Which of the Following Is an Advantage of a Closely

question 32

Multiple Choice

Which of the following is an advantage of a closely held or private corporation?

• A) the ability to sell preferred shares on the stock exchange
• B) refund of the GST paid on the first $500 000 of annual business income
• C) the ability to raise funds by soliciting private investors
• D) reduced tax rate on the first $500 000 of business income earned in each fiscal year

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Definitions:

Foreclosure Proceeding

A legal process by which a lender seeks to recover the balance of a loan from a borrower who has stopped making payments by forcing the sale of the asset used as the collateral for the loan.

Redeem

To recover possession of something by paying a specified amount, or to fulfill a promise or obligation.

Default

Failure to fulfill an obligation, especially failure to meet a financial commitment or appear in a court of law.

Prepayment Penalty Clause

A provision in a contract that imposes a penalty on a borrower for paying off a loan before its maturity date.