A company whose shares cannot be bought by the general public is typically a?

A company whose shares cannot be bought by the general public is typically a?

• A. Private Limited Company
• B. Public Limited Company
• C. Cooperative
• D. Sole trader

Answer: (A)

Private limited companies keep ownership among a small group of shareholders, and shares cannot be bought by the general public because their transfer is restricted and typically requires consent from existing shareholders. This makes control more tightly held and not open to broad public investment. In contrast, a public limited company is designed to sell shares to anyone in the market and can be listed on a stock exchange, so its shares are widely available. A sole trader has no shares at all, and a cooperative usually operates with member-owned shares that aren’t traded on the public market in the same way as a PLC. So the description most accurately describes a private limited company.

Private limited companies keep ownership among a small group of shareholders, and shares cannot be bought by the general public because their transfer is restricted and typically requires consent from existing shareholders. This makes control more tightly held and not open to broad public investment. In contrast, a public limited company is designed to sell shares to anyone in the market and can be listed on a stock exchange, so its shares are widely available. A sole trader has no shares at all, and a cooperative usually operates with member-owned shares that aren’t traded on the public market in the same way as a PLC. So the description most accurately describes a private limited company.