Which of the Following Is Not an Advantage of Incorporation

question 82

Multiple Choice

Which of the following is not an advantage of incorporation?

• A) Shareholders are not liable for debts of the corporation.
• B) There may be tax advantages.
• C) Shareholders can veto decisions of directors.
• D) Shares are easily transferred.
• E) Shareholders owe no duty to the corporation.

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Definitions:

Referent Power

A form of influence based on the leader's appeal and charisma that inspires loyalty and admiration from followers.

Compliance

The act of following and adhering to rules, regulations, or requests established by authorities or organizations.

Coercive

Employing force or intimidation to obtain compliance or control over others.

Instrumental Compliance

Following rules or guidelines not out of agreement or belief but as a means to achieve a certain goal or reward.