Question

Shane owns shares of Vegan Pizza Inc., a food and beverages company. The company's financial situation takes a turn for the worse and ends up in severe debt. Despite owning shares of Vegan Pizza, Shane is not responsible for bringing more money into the company to get it out of its debt. Which characteristic of public stock companies does this scenario best exemplify?

Answer 1

Limited liability for shareholders

Step-by-step explanation:

Limited liability implies that owners or shareholders are legally responsible for the company's debts only to the extent of the amount of capital the shareholders invested.