Which of the following business units can issue shares?

Analyze the question: The question asks which business unit has the legal power to issue shares, that is, to raise capital by selling ownership units to the public or to investors.

Explain the concept: Shares are units of ownership in a company. Only companies that are incorporated as joint-stock companies can issue them. In Nigeria, under the Companies and Allied Matters Act (CAMA), there are two types:

• Private limited company (Ltd): It can issue shares, but only to a limited group of people such as founders, family and friends. It cannot offer them to the general public.
• Public limited company (Plc): It can issue shares to the general public, and these are often listed on the Nigerian Exchange (NGX).

Solution (option by option):

• A. Partnership: Capital comes from the partners' contributions. Ownership is defined by the partnership agreement, not by shares. It cannot issue shares.
• B. Public limited liability company: Capital is raised by selling shares to the public through an IPO or a share offer. It can issue shares.
• C. Sole proprietorship: One person owns and funds the business. There is no share structure, so it cannot issue shares.
• D. Central bank: The CBN is a government-owned regulatory institution. It does not raise capital by selling shares to the public.

Answer: The correct option is B. Public limited liability company.

Exam tip: Link "shares" with "company," and link "public" with "open to everyone." If a question asks about shares, rule out sole proprietorships and partnerships straight away. They raise money from the owners' own funds, from loans, or from partners.