A Private Company is

A Private Company is

• A. A business that invites 2-50 private shareholders to buy shares
• B. A business owned by one person
• C. A business that offers shares to the public
• D. A business owned by government

Answer: (A)

In business structures, a private company is defined by who can own its shares and how those shares are offered. A private company has a small group of private shareholders and does not offer its shares to the general public. This keeps ownership among a limited number of people and maintains tighter control over who can buy into the business. The option that describes inviting a small number of private shareholders to buy shares fits this idea perfectly: it implies a private ownership model with shares exchanged privately rather than sold on the open market. The other descriptions point to different structures: sole ownership describes a sole trader; offering shares to the public describes a public company; and being owned by the government describes a government-owned entity.

In business structures, a private company is defined by who can own its shares and how those shares are offered. A private company has a small group of private shareholders and does not offer its shares to the general public. This keeps ownership among a limited number of people and maintains tighter control over who can buy into the business.

The option that describes inviting a small number of private shareholders to buy shares fits this idea perfectly: it implies a private ownership model with shares exchanged privately rather than sold on the open market. The other descriptions point to different structures: sole ownership describes a sole trader; offering shares to the public describes a public company; and being owned by the government describes a government-owned entity.