Asked by Mayesha Tanjeen on Jul 17, 2024
Verified
Which of the following is most likely to obtain large amounts of resources by issuing stock?
A) partnership
B) corporation
C) proprietorship
D) government entity
Issuing Stock
The process by which a company sells new shares to investors to raise capital, often through a public offering.
Corporation
A legal entity separate from its owners, with rights to own property, incur liabilities, and sell shares.
Partnership
A lawful business arrangement involving two or more people who divide both management responsibilities and earnings.
- Comprehend the attributes, creation, and economic mechanisms of corporations.
Verified Answer
UW
Urvashi WaliaJul 18, 2024
Final Answer :
B
Explanation :
Corporations are able to obtain large amounts of resources by issuing stock because they can sell ownership interests to a large number of investors. This can result in a significant infusion of cash into the corporation, which can then be used for various purposes such as expansion, research and development, or debt repayment. Proprietorships and partnerships are not able to issue stock, and government entities generally rely on taxes and other sources of revenue rather than stock offerings to fund their operations.
Learning Objectives
- Comprehend the attributes, creation, and economic mechanisms of corporations.