Why Is It Possible for a Corporation to Enter into Contracts

question 24

Multiple Choice

Why is it possible for a corporation to enter into contracts, acquire assets, incur obligations, and enjoy protection against the seizure of its property?

• A)The number of owners, and hence the spread of risk among these owners, is not limited.
• B)The state in which the corporation is incorporated provides safeguards against any wrongdoing by the corporation.
• C)Its owners are liable for any obligations it enters into.
• D)It is a legally defined, artificial entity that is separate from its owners.

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Definitions:

Display Rules

Cultural norms that dictate the appropriate expressions of emotions in various social situations.

Expressions

Visible manifestations of internal emotions, thoughts, or feelings, often communicated through facial movements, gestures, or speech.

Intimacy-Equilibrium Theory

A theory that suggests relationships are maintained through a balance of personal intimacy and physical proximity.

Social Distance

A measure of perceived or actual emotional, cognitive, or physical space between individuals or groups, impacting relationships and interactions.