Question

Discuss two benefits and two drawbacks of the corporation as a form of business organization?

Answer 1

Two benefits of corporation as a form of business-

A. Being a corporation will be providing the business with a higher access to the capital and growth strategies and the market as well

B. Being a corporation will also be helpful in increasing the liquidity in the company and having a higher transparency in the operation by optimum disclosure.

Two disadvantages of Corporation form of business-

A. There are too many disclosures and there is lack of privacy being a corporate form of organisation.

B. There is also a separation of the ownership and the management and it will be leading to agency conflicts.