Final Answer:
A(n) close corporation is a corporation where the outstanding shares of stock and managerial control are held by fewer than 50 shareholders.;
The correct option is 2.
Step-by-step explanation:
A close corporation is a type of corporation where the outstanding shares of stock and managerial control are held by fewer than 50 shareholders. This makes option 2 the correct answer to the given question.
In a close corporation, the number of shareholders is limited, fostering a close-knit and often familial business environment. The specific number of shareholders can vary by jurisdiction, but the key characteristic is the restriction on the total number of shareholders. This differs from an S corporation, which is a specific tax designation, and an alien corporation, which is a corporation formed in a foreign country. A shell corporation, on the other hand, is typically an inactive company with no significant assets or ongoing business activities.
Understanding the distinctions between these types of corporations is essential for individuals involved in corporate law, business management, and entrepreneurship. It ensures that businesses can select the appropriate legal structure that aligns with their goals and the number of individuals involved in the ownership and management of the company. In the case of a close corporation, the limit of 50 shareholders is a defining characteristic, emphasizing the close relationship and limited ownership structure of such entities.
The correct option is 2.