Which of the Following Statements About a Private Company Is

question 19

Multiple Choice

Which of the following statements about a private company is correct?

• A) It is permitted to raise funds from the public.
• B) The company name must include 'Proprietary' or 'Pty'.
• C) There is no restriction for the maximum number of shareholders.
• D) The company's shareholders can only be family members.

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Definitions:

Risk Aversion

The preference to avoid uncertainty and potential financial loss.

Holding-period Return

The total return received from holding an asset or portfolio of assets over a period of time, considering both income and capital gains.

Risk Aversion

The behavior exhibited by investors who prefer lower risk investments, often at the expense of sacrificing some potential returns.

Expected Return

The anticipated average return on an investment, factoring in the probabilities of each potential outcome.