Question

GloboTron is a large company that produces home entertainment technology. GloboTron has stock that anyone can buy, sell, or trade, but since it is a large company, its stockholders are far removed from its management. However, it must disclose its financial information to the public under specific laws that regulate the trade of stocks and other securities. What type of business is this?

a. Public corporation
b. private corporation
c. general partnership
d. limited partnership
e. domestic corporation

Answer 1

GloboTron is a public corporation, identifiable by its publicly traded stocks and its obligation to disclose financial information as required by securities regulations.

Step-by-step explanation:

GloboTron is categorized as a public corporation. This is due to the fact that its stock can be bought, sold, or traded by the general public and it is required to disclose its financial information as per the laws regulating securities.

In general, a corporation is a business entity that is owned by its shareholders who have limited liability for the company's debts. These owners share in the corporation's profits and losses. Corporations can be private or public, depending largely on whether their stocks are publicly traded.

Publicly traded stocks allow for a broad base of shareholders and create the need for corporate transparency as per regulatory requirements. Public corporations also have a board of directors elected by shareholders to oversee the company's direction and management.

To finance their operations or new ventures, public corporations like GloboTron may raise capital by selling stock or issuing bonds. The shareholders of public corporations have the ability to vote for the board of directors, and the number of shares they own proportionally reflects the number of votes they can cast.