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Limited companies and multinationals - Coggle Diagram
Limited companies and multinationals
Limited companies features
Limited Liability-
The owner can only lose money he invested in the buisness. Cant be forced to use own money to pay debt.
Shareholders elect directors-
To run the company. This person is called the chairman and he runs the company as the shareholders wished. If company performs bad the chairman can be voted out.
Limited companies
are incorprated. They have a seperate legal identity from the owner.
Private Limited Company
Advantages
Shareholders have limited company
More capital can be raised
Control cant be lost to outside
Buisness continues if owner dies
Has more status than for example sole trader
Disadvantages
Financial information has to be made public
Costs money and time to set up
Profits shared between more members
Takes time to transfer shares to owner
Cannot raise more huge amounts of money
Public Limited Companies
Advantages
Large amounts of money can be raised
Shareholders have limited liability
May be able to dominate market
Shares can be bought and solved very easily
May have very high profile
Disadvantages
Set up costs can be very expensive
Outsiders can take control by buying shares
More financial information has to be made public
Managers may take control rather than owners
May be more remote from customers
Multinational companies-
Buisnesses with production services in more than two companys
Powerful advertising-
they can invest huge amounts of money into impressive advertising
Highly advanced-
They can afford to be up to date with technology as they are more capable with the amounts of money
Huge assets-
well resourced and can take on more large-scale contracts and projects