1994 WAEC Economics Theory Compare and contrast the private limited company with the public limited company.

WAEC 1994

Compare and contrast the private limited company with the public limited company.

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Explanation

Similarities between private limited Company and the public limited company are:
(i) Both have legal status.
(ii) They have limited liabilities.
(iii) There is continuity of existence.
(iv) There is large capital outlay.
(v) Powers are exercised through memorandum and Article of Association
(vi) Both companies may be voluntarily or compulsorily liquidated.
(v) Directors control the company.

Differences between Private limited company and Public limited company are:

Public Limited Company	Private Limited Company
1. Shares are easily transferable. 2. Shares are quoted in the stock exchange. 3. It has a minimum of seven people. 4. It has no maximum number of people. 5. It is owned by the members of the public. 6. There is no privacy as the account must be published.	-Shares are not easily transferable, except with the consent of other members. -Its shares are not quoted. -It has a minimum of two people. -It has maximum number of owners of 50. -It is owned by family members and family friends. -It enjoys some level of privacy.