Reference no: EM132481112

Question 1: Which of the following statements is most correct?

Option 1: Due to limited liability, unlimited lives, and ease of ownership transfer, the vast majority of U.S. businesses (in terms of number of businesses) are organized as corporations

Option 2: Most businesses (by number) are organized as proprietorships or partnerships because it is easier to set up and operate in one of these forms rather than as a corporation. However, if the business gets very large, it becomes advantageous to convert to a corporation, primarily because corporations have important tax advantages over proprietorship and partnerships

Option 3: Due to legal considerations related to ownership transfers and limited liability, most business (measured by dollar sales) is conducted by corporations

Option 4: Corporate stockholders are exposed to unlimited liability