Paper 2 · November 2019 · private limited company
A private limited company is a business enterprise in which
Atwo or more partners share the profits and the losses equally.
Bshares are transferred privately and members have limited liability.
Cshares are traded freely on the stock exchange by any investor.
Dthe owner trades alone and carries unlimited liability for the debts.
Explanation
A private limited company is incorporated, so it is a legal person separate from its members and their liability stops at the value of their shares, but the transfer of those shares is restricted rather than open to the public. That keeps control in known hands while limiting how much capital can be raised.
Derived from ZIMSEC Business Enterprise Skills Paper 2, Nov 2019, Q1