Question

In a corporation, the members of the board of directors are elected by the

A)

employees.

B)

creditors.

C)

chief executive officer.

D)

stockholders.

Answer 1

In a corporation, the members of the board of directors are elected by the stockholders.

Step-by-step explanation:

The members of the board of directors in a corporation are elected by the stockholders.

When a firm becomes a public company and sells its stock to financial investors, the shareholders become the owners of the company. Shareholders then have the right to vote for the board of directors, who are responsible for making important decisions and overseeing the company. The more shares of stock a shareholder owns, the more voting power they have in electing the board of directors.

For example, let's say a corporation has 100,000 shares of stock, and a shareholder owns 1,000 shares. In this case, the shareholder has 1% ownership of the company and is entitled to 1% of the voting power in electing the board of directors.