Why Is It Possible for a Corporation to Enter into Contracts

question 81

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) Its owners are liable for any obligations it enters into.
• C) The state in which a corporation is incorporated provides safeguards against any wrongdoing by the corporation.
• D) It is a legally defined, artificial entity that is separate from its owners.

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Definitions:

Memo Format

A concise and formal way of communication typically used within an organization to inform or instruct employees.

Progress Reports

A document or update that provides information about the development, performance, or status of a project or activity over a period.

Sole Purpose

The primary or only reason for something's existence or a particular action or situation.

Purpose Statement

A declaration that outlines the goals, aims, or intentions behind a project, research, or document.