Final answer:
A corporation is a legal entity used for doing business, which offers limited liability to its shareholders and raises funds through issuing stock or bonds. Shareholders own the corporation proportionally to the stock they hold, and it is taxed both at the entity level and on shareholder profits.
Step-by-step explanation:
The blank in the student's question should be filled with the word corporation. A corporation is a legal entity that is established under statute, often used for conducting business. The benefit of incorporating is that it allows individual investors, or shareholders, to limit their liability to the amount they have invested in the enterprise. A corporation can raise funds for operation or investment by selling stock or issuing bonds. Ownership in a corporation is determined by the stock issued to investors, which represents a share of the company's ownership. It is important to note that corporations are taxed at the entity level and also on the profits that shareholders receive. These characteristics make the corporation a popular choice for businesses of various sizes, from small enterprises to large multinational firms.