Public Limited Companies Quiz
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Questions and Answers

What is the main advantage of a PLC in terms of raising capital?

  • Easier to raise capital by issuing more shares (correct)
  • Minimal paperwork and administrative work
  • Banks are more willing to lend money without collateral
  • Limited liability for shareholders

Who are the primary shareholders in a PLC?

  • Government entities
  • Financial institutions (correct)
  • Individuals
  • Public businesses

What is the main disadvantage of a PLC in terms of administrative work?

  • Minimal paperwork and administrative work
  • No need to prepare annual accounts
  • Expensive and involves a lot of paperwork (correct)
  • No need to provide information to shareholders

What is the role of the chief executive in a PLC?

<p>Responsible for carrying out the PLC policy and daily management (D)</p> Signup and view all the answers

What does the term 'divorce of ownership and control' refer to in a PLC?

<p>Separation between the owners and the managers controlling daily operations (B)</p> Signup and view all the answers

What is the primary reason for a limited company to consider becoming a public limited company (PLC)?

<p>To obtain further investment from a wider pool of potential shareholders (C)</p> Signup and view all the answers

What is the minimum share capital required for a company to become a public limited company (PLC)?

<p>£50,000 (C)</p> Signup and view all the answers

What is the purpose of issuing a prospectus for a public limited company (PLC)?

<p>Inviting potential investors to purchase shares before flotation (B)</p> Signup and view all the answers

What are some of the expenses involved in a company's transition to a public limited company (PLC)?

<p>Insurance against unsold shares and advertising costs (D)</p> Signup and view all the answers

What is the key difference between a private limited company and a public limited company (PLC)?

<p>A public limited company can offer shares to the general public, while a private limited company cannot (D)</p> Signup and view all the answers

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