A Joint Stock Company can raise huge capital.

Question

Justify the following statement :

A Joint Stock Company can raise huge capital.

Answer 1

1. A Joint Stock Company is an incorporated association. 

2. It has a legal status independent of its members. 

3. A Joint Stock Company has large membership. There is no maximum limit. 

4. Shares are available in the open market. 

5. Large number of investors are interested in buying shares. 

6. Shares are freely transferable and members have limited liability. 

7. Thus, a Joint Stock Company can raise huge capital. 

8. Capital can also be raised by company from financial institutions.