Which of the following is an advantage of a private limited company?

• A. Shareholders have limited liability.
• B. Capital cannot be raised by selling shares.
• C. They must disclose more information publicly.
• D. Ownership is lost to outsiders.

Answer: (A)

Limited liability is the key advantage here. A private limited company is a separate legal entity, so shareholders are only exposed to the amount they’ve invested in shares. Their personal assets aren’t at risk if the company runs into troubles, which makes this structure appealing for owners who want protection from business debts.

The other statements don’t fit as advantages. Private limited firms can raise capital by issuing shares to a limited group of investors, even if they can’t access public markets as a public company can. They don’t have to disclose more information publicly—indeed, they typically publish less information than public companies. And ownership isn’t automatically lost to outsiders; shares stay with current or new private investors, not automatically transferred to external parties.