A Corporation Has Which of the Following Set of Characteristics

question 217

Multiple Choice

A corporation has which of the following set of characteristics?

• A) Shared control, tax advantages, increased skills and resources
• B) Simple to set up and maintains control with founder
• C) Easier to transfer ownership and raise funds, no personal liability
• D) Harder to raise funds and gives owner control

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Definitions:

Financial Leverage

The use of borrowed money (debt) to amplify the potential return of an investment or project.

Debt/Equity Ratio

The indicator that compares the role of debt and equity in financing company assets.

Financial Leverage

The use of borrowed money to increase the potential return of an investment, which also increases the risk of loss.