A Disadvantage of a Limited Liability Company Is That It

question 12

Multiple Choice

A disadvantage of a limited liability company is that it ________.

• A) requires earnings to be taxed at the corporate rate
• B) must dissolve when an owner leaves the company
• C) requires the division of profits in a fixed proportion
• D) has more restrictive ownership rules than S corporations
• E) is required to hold annual meetings

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Definitions:

Do Nothing

A decision or strategy to not take action or intervene in a situation.

Social Comparison Theory

The concept that people gauge their own value and societal status by comparing themselves to others.

Present Performance

The current level of achievement or effectiveness in a particular activity or field, often assessed to identify areas for improvement.

Our Behavior

Refers to the range of actions and mannerisms exhibited by individuals, groups, or systems in response to external or internal stimuli.