A corporation is a form of business that is owned by a group of people.  The state gives it power to act as if it were a single person by means of charter.  In a sence, a corpation is a make-believe person which has been made possible by state law.  Ownership is divided into parts called shares.  When people buy a share of stock, they are part owners of the frim and are known a shareholders.  They elect the board members, who develop the plans to guide the firm and then appoint officers to carry out the plans.  The officers are the mamgers of the mamgers of the frim

                      

The two main types of stock are common and preferred. Poeple who own common stock share in the profits by means of dividends. The dividend rate may vary from year to year. They also share in the management of the firm by the right to vote. Dividends usually must be paid on preferred stock before they are paid on common stock. A dividend is often a set rate based on the face value of the stock. In most cases, people who own preferred stock do not have the right to vote.