What is a Limited Company?

Explain briefly what is a Limited Company.
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Limited company is a legal entity, separate from its owners (called shareholders). The basic difference between a partnership and a limited company is the concept of limited liability. • If a partnership business runs into losses and is unable to pay its liabilities, its partners will have to pay the liabilities from their own wealth. • Whereas, in case of limited company, the shareholders don’t lose anything more than the amount of capital they have contributed in the company. i.e., their personal wealth is not at stake and their liability is limited to the amount of share capital they have contributed. The concept of limited company is to mobilize the resources of a large number of people for a project, which they would not be able to afford independently and then, get it managed by experts. Source:
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Limited company is a authorized thing, separate from their owners having a special legal responsibility.
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