Final answer:
To change the top management of the Darkroom Windowshade Company, the shareholders would require over 50,000 shares in favor, hence involving more than just Investors 1 and 2, who collectively have 38,000 shares. They would need to collaborate with at least Investor 3 to achieve a majority vote. Shareholders have limited liability and can raise money for the company by selling stock.
Step-by-step explanation:
To change the top management of the Darkroom Windowshade Company, a simple majority vote is commonly required. This means more than half of the shares need to be in favor of the change. The share distribution is as follows: Investor 1 with 20,000 shares, Investor 2 with 18,000 shares, Investor 3 with 15,000 shares, Investor 4 with 10,000 shares, Investor 5 with 7,000 shares, and Investors 6 through 11 with 5,000 shares each. Therefore, the minimum number of investors needed to change the company's top management would be those holding collectively more than 50,000 shares.
If Investors 1 and 2 agree to vote together, they will have 38,000 shares, which is less than a simple majority. Thus, they cannot be certain of always getting their way in company decisions. They would need to persuade at least one more investor (Investor 3 being the most advantageous option) to vote with them to reach a majority.
Advantages of shareholders investing in a corporation include limited liability to the amount they have invested and the ease of raising or borrowing capital for business purposes, such as expansion or financing growth through the sale of stock.