Which of the Following Statements Is Most Accurate in Regarding

question 45

Multiple Choice

Which of the following statements is most accurate in regarding corporations?

• A) Due to limited liability, unlimited lives, and ease of ownership transfer, the vast majority of businesses are organized as corporations.
• B) Due to legal considerations related to ownership transfers and limited liability, most business is conducted by corporations in spite of large corporations' often less favourable tax treatment.
• C) Large corporations are taxed more favourably than sole proprietorships.
• D) Corporate stockholders are exposed to unlimited liability.

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Definitions:

Managerial Efficiency

The effectiveness with which managers utilize resources and operate businesses to achieve desired outcomes and profitability.

Security Registration

The legal process through which securities are registered with relevant authorities before being offered to the public or placed on the market.

Best Efforts Basis

A best efforts basis is an agreement where an underwriter commits to sell as much of a new securities offering as possible, but not to buy any unsold securities.

Public Offering Price

The price at which new issues of stocks or bonds are offered to the public by an issuer for the first time.