Which of the following is an attribute that is not characteristic of a private corporation?

The correct answer highlights a key feature that differentiates private corporations from other business entities. Private corporations have a distinct legal status known as "corporate personality," which means they exist as separate legal entities from their owners or shareholders. This separation provides a layer of protection for the owners, limiting their liability and allowing the corporation to enter contracts, sue, or be sued independently of its shareholders.

In contrast, the statement that a private corporation has "no personality separate from its owners" is incorrect for two primary reasons. First, it contradicts the basic principle of corporate law that recognizes corporations as separate legal entities. Second, this separation centralizes the attributes of limited liability for shareholders, meaning they are not personally liable for the corporation's debts beyond their investment.

While a private corporation does require a limited number of incorporators and limitations on the transfer of ownership interests, the possession of a distinct corporate identity remains a central characteristic that enables its operation and legal standing. Thus, understanding that private corporations do indeed have a separate legal identity is crucial when distinguishing them from other business structures such as partnerships, which do not have separate legal personalities.