Which of the following is a disadvantage of a public limited company?

• A. Dividends are shared with many shareholders.
• B. Ownership remains with a single founder.
• C. It never has to publish annual accounts.
• D. It cannot be affected by market conditions.

Answer: (A)

In a public limited company, ownership is spread among many shareholders. That means any profits that are paid out as dividends go to a large number of owners rather than to a single founder, which can be a disadvantage because it reduces the amount of profits that stay with the company and can increase pressure to pay regular or higher dividends to please the many investors. The other statements don’t fit: ownership in a PLC is not held by just one founder, PLCs are required to publish annual accounts, and they are indeed affected by market conditions.