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:

Efferent Arteriole

A blood vessel that carries blood away from the glomerulus of the kidney after filtration has occurred.

Glomerulus

A network of capillaries located at the beginning of a nephron in the kidney, involved in the filtration of blood.

Renal Artery

A blood vessel that supplies the kidneys with oxygenated blood from the heart.

Nephron

The basic structural and functional unit of the kidney responsible for filtering and purifying blood to produce urine.