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Why is it a nontax advantage for corporations to be able to trade their stock on the

stock market?

1 Answer

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Final answer:

Corporations can access financial capital for expansion by trading their stock on the stock market, without the need to repay the money. This allows them to increase their visibility, attract investors, and potentially grow the company. The sale of stocks also allows ordinary individuals to benefit from the profits of corporations.

Step-by-step explanation:

The ability for corporations to trade their stock on the stock market provides a non-tax advantage because it allows them to access large amounts of financial capital for expansion without worrying about repaying this money. When a corporation issues stock, it increases its visibility in the financial markets, attracting potential investors. If the corporation is successful, it can choose to pay dividends to shareholders or reinvest profits to further grow the company. Additionally, the sale of stocks allows ordinary individuals to share in the profits of corporate America.

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