7.Which of the following characteristics is most important factor contributing to the growth of the corporate form of business organization:
a. There is no distinction between the officers of the company and the owners of the company because they are one and the same.
b. Limited legal liability.
c. Profits are generally taxed only once.
d. Relatively simple legal structure
e. None of the above.
Answer: b. Limited legal liability.
a) is incorrect. Large corporations have hundreds of thousands of shareholders and it will be impossible to have the "owners" manage the business directly. Thus ...
Answer to a multiple choice question on corporate form of business organization.