Question

The liability of members in a company is:

• A. Limited
• B. Unlimited
• C. Stable
• D. Fluctuating

Hint:

Company = separate legal entity; hence, shareholders’ liability is limited to unpaid value of shares.

Answer 1

The Correct Option is A

Step 1: Liability concept.
One of the key features of a company form of business is “limited liability of shareholders”.
Step 2: Extent of liability.
Shareholders’ liability is limited only to the amount unpaid on their shares. They are not personally liable for company’s debts.
Step 3: Conclude.
Thus, liability of members in a company is limited.
Final Answer: \[ \boxed{\text{Limited}} \]