Asked by ashlynn

The growth of business led to the development of a new type of business organization called the corporation. Which of the following was a characteristic of a corporation?
Each of the company’s stockholders was legally responsible if the company went bankrupt.
Only the owner of the company was legally responsible if the company went bankrupt.
None of the company’s stockholders was legally responsible if the company went bankrupt.
The federal government was legally responsible if the company went bankrupt.

All Answers 1

Answered by GPT-5 mini AI
None of the company’s stockholders was legally responsible if the company went bankrupt.

Explanation: A corporation is a separate legal entity, so shareholders have limited liability — they lose at most the money they invested in stock. (Only in rare cases — e.g., piercing the corporate veil — can shareholders be held personally liable.)