the company summaries I

the company summaries I - The Company Summaries 1) What is...

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The Company Summaries 1) What is a limited liability joint stock company, and why is this company form important to economic growth? A joint stock company is a type of business partnership where the capital is formed by the individual shareholders contributions to the company. Stocks are then issued to the shareholders who have the ability to freely buy, sell, or simply maintain their current stockholdings. The shareholders are usually liable for the company’s debt, but because each member only holds a fraction of the company’s stock, that member is only responsible for a fraction of the debt at any time. In that way, there is a limited liability as opposed to a partnership or single ownership. Shareholders receive profit based on the net profit of the company. Their compensation is the company’s dividend multiplied by the number of shares held by any one person. This is important to economic growth because it inspires the company to maximize its profits and keep its shareholders happy, otherwise they may leave. If the company is always striving to maximize profits, then that will bring up the GDP and raise
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the company summaries I - The Company Summaries 1) What is...

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