The separation between ownership and control:
A)characterizes the nonprofit firms.
B)is present in both nonprofit firms and large corporations, but for a different reason.
C)characterizes large corporations.
D)was invented to confuse MBA students.

Question

Quizplus · Accepted Answer

The separation between ownership and control is present in both nonprofit firms and large corporations, but for a different reason. In nonprofit firms, the separation is due to the fact that the owners (the donors) do not have any control over the firm's operations. In large corporations, the separation is due to the fact that the shareholders (the owners) are too numerous to have any meaningful control over the firm's operations.

The Separation Between Ownership and Control