Final answer:
The main difference between private and public limited companies is in their ownership. Private companies are owned by a group of people who run them, while public companies have their shares sold to the public, leading to diverse ownership by shareholders.
Step-by-step explanation:
One key difference between private and public limited companies lies in their ownership structure. A private company is typically owned by the people who run it daily. It may be a sole proprietorship run by an individual or a partnership run by a group. However, when a firm decides to sell its stock to the public, allowing financial investors to buy and sell it, it becomes a public company. The public company's ownership resides with its shareholders, who elect a board of directors to hire the top management responsible for day-to-day operations. Therefore, the key distinction revolves around the availability or offering of the company's stock to public investors or keeping it private.
Learn more about Private and Public Companies