Which type of company can sell shares in the stock exchange and has limited liability?

Prepare for the WJEC GCSE Business Studies Test with interactive quizzes and detailed explanations. Enhance your knowledge on key business concepts and boost your exam confidence.

Multiple Choice

Which type of company can sell shares in the stock exchange and has limited liability?

Explanation:
The key idea is owning a business that can raise capital from the public by selling shares and that protects owners with limited liability. A public limited company is set up to issue shares to the public, which can be bought and sold on a stock exchange. This structure also provides limited liability, meaning shareholders’ financial risk is limited to the amount they invested, not their personal assets. Other forms may have limited liability, but they don’t typically offer shares to the public or be listed on the stock exchange. So, the type described is the public limited company.

The key idea is owning a business that can raise capital from the public by selling shares and that protects owners with limited liability. A public limited company is set up to issue shares to the public, which can be bought and sold on a stock exchange. This structure also provides limited liability, meaning shareholders’ financial risk is limited to the amount they invested, not their personal assets. Other forms may have limited liability, but they don’t typically offer shares to the public or be listed on the stock exchange. So, the type described is the public limited company.

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