Which of the Following Could Explain Why a Business Might

Multiple Choice

Which of the following could explain why a business might choose to operate as a corporation rather than as a sole proprietorship or a partnership?

A) Corporations generally face fewer regulations.
B) Less of a corporation's income is generally subject to federal taxes.
C) Corporate shareholders are exposed to unlimited liability, but this factor is offset by the tax advantages of incorporation.
D) Corporate investors are exposed to unlimited liability.
E) Corporations generally find it easier to raise large amounts of capital.