ACCA Applied Knowledge · Business and Technology · The purpose and types of business organisation
Which of the following is a typical feature of a private sector company limited by shares, as opposed to a public sector body?
A private sector company limited by shares is owned by investors who provide capital and expect a financial return through dividends or share price growth. Political control, tax funding and free service provision are characteristics of public sector bodies rather than private companies.
- AIts owners provide capital and expect a financial returnCorrect
- BIt is controlled directly by elected politicians
- CIt is funded mainly through taxation
- DIts main objective is to provide free services to citizens
Explanation
Private sector companies are owned by private investors who supply capital and expect returns through dividends and share value growth. Political control, tax funding and free provision to citizens are features of public sector bodies.
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