Final answer:
Shares of ownership in a company are referred to as 'stock,' and individuals who buy stock become shareholders. No one person usually owns a majority of the shares in large corporations, with shareholders each owning only a small part of the company.
Step-by-step explanation:
The general term referring to shares of ownership in a company is stock. When a person buys stock in a company, they become part of the owners, known as shareholders. Stock represents a claim on the company's assets and earnings; as you acquire more stock, your ownership stake in the company becomes greater.
For instance, if someone owns 100% of a company's stock, they own the entire company. However, this is uncommon in large corporations such as IBM, AT&T, Ford, General Electric, Microsoft, Merck, and Exxon, which have millions of shares. In these companies, stock is divided into shares to allow multiple individuals to own a portion of the company.
No single individual usually owns a majority of shares in these large firms. Shareholders, including those who may hold thousands of shares, typically own only a fractional part of the company. The dispersion of shares among many shareholders helps in distributing the ownership and reducing the risk for individual investors.
By purchasing shares, an investor becomes eligible to receive dividends and has the right to vote on certain corporate matters. The distribution of shares and the composition of shareholders can have significant implications on how companies are managed and directed.