Which of the Following Could Explain Why a Business Might

question 35

Multiple Choice

Which of the following could explain why a business might choose to operate as a corporation rather than as a sole proprietorship or a partnership?

• A) Corporations generally find it relatively difficult to raise large amounts of capital.
• B) Less of a corporation's income is generally subjected to taxes than would be true if the firm were a partnership.
• C) Corporate shareholders escape liability for the firm's debts, but this factor may be offset by the tax disadvantages of the corporate form of organization.
• D) Corporate investors are exposed to unlimited liability.
• E) Corporations generally face relatively few regulations.

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Definitions:

Gap

The difference or discrepancy between two points, figures, or elements, often used to identify missing pieces or disparities.

Median

The median is the middle value of a sorted list of numbers, dividing the dataset into two equal halves, where half the numbers are lower and half are higher than the median.

Skewed

Describes a distribution of data that is not symmetrical, leaning towards one side, either to the left or right, often indicating a deviation from the norm.

Midterm Test Scores

The grades or marks that students receive on examinations conducted halfway through an academic term.