Question

The ability of a corporation to obtain capital is A) about the same as a partnership B) enhanced because of limited liability and ease of share transferability C) restricted because of the limited life of the corporation D) less than a partnership

Answer 1

Answer:

Option B) Enhanced because of limited liability and ease of share transferability.

Explanation:

• Limited liability means fewer risks and anyone willing to invest in the business will prefer to invest money on a business that has fewer risks.

• Share transferability is the process of transferring one's share and that should also be easily done.

• That is why the ability of a corporation to obtain capital is enhanced by these two factors to a large extent.