Which type of corporation is characterized by shares being publicly traded?

• A. Private corporation
• B. Public corporation
• C. Closely held corporation
• D. Crown corporation

Answer: (B)

The answer is appropriate because a public corporation is specifically defined by its ability to have shares that are traded on public stock exchanges. This means that these shares can be bought and sold by the general public, leading to a broad ownership base and increased access to capital. Public corporations are subject to stringent regulatory standards and disclosure requirements to ensure transparency for investors.

In contrast, a private corporation does not offer its shares to the general public; its ownership is typically restricted to a small number of individuals or entities. A closely held corporation is a subset of private corporations where shares are owned by a small group, often involving family or close business associates. A crown corporation, on the other hand, is owned by the government and serves to fulfill government objectives rather than operating primarily for profit in the public trading sense.