Florida Broker Practice Exam

Who are the owners of a corporation typically referred to as?

1. Directors

2. Stockholders

3. Managers

4. Associates

The correct answer is: Stockholders

The owners of a corporation are typically referred to as stockholders. This term designates individuals or entities that hold shares in the corporation, which represent their ownership interest. Each stockholder has a claim to a portion of the corporation's assets and earnings, proportional to the number of shares they own. Stockholders play a vital role in a corporation as they have the right to vote on major corporate decisions, including the election of the board of directors, mergers, and other significant changes. They are distinct from directors, who are members of the board responsible for making strategic decisions and governance, and managers, who run the day-to-day operations of the company. Associates might refer to employees or partners in other business structures but do not denote ownership in a corporate context. Thus, referring to the owners as stockholders accurately captures their role within a corporation.