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Briefly explain the following term: Artificial person - Business Studies

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Briefly explain the following term: Artificial person

Answer in Brief
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Solution

By the term artificial person, we mean that a company is created as a separate legal entity under the law and is a juristic person. However, unlike human beings, a company, as an artificial person, cannot breathe or talk, cannot sign its documents and cannot negotiate with its customers. In contrast, like human beings, a company does have its own life that is truly independent of the life of its members. Hence, because of these dissimilarities and similarities, a company is regarded as an artificial person.

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Chapter 2: Forms of Business Organisation - Short Answer Questions [Page 56]

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NCERT Business Studies [English] Class 11
Chapter 2 Forms of Business Organisation
Short Answer Questions | Q 6.4 | Page 56

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