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Business Studies

Methods of Floatation

An associatio...

Question

An association of individuals for profit, having its capital divided into a large number of shares is a _______.

A

joint stock company

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B

co-operative organisation

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C

non-profit organisation

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D

none of the above

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Solution

The correct option is A joint stock company
The joint stock company collects huge capital from public by dividing its capital in a small unit called shares and inviting subscription from general public on these shares. Holding these shares ensures dividend to the shareholders and provides them voting powers in the decision making process of the business.

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