Which type of corporation typically has the smallest number of shareholders?

The correct answer is the closely held (or close) corporation, which typically has the smallest number of shareholders. A closely held corporation is characterized by a limited number of shareholders, often consisting of a small group of family members or friends. This structure allows for more control and privacy, as the shares are not available for public trading and are usually held tightly amongst a few individuals.

In contrast, a professional corporation is created by specific professionals, such as doctors or lawyers, but can still have a relatively larger number of shareholders depending on the practice. A public corporation, on the other hand, has numerous shareholders and is traded publicly on stock exchanges, often numbering in the thousands. Not-for-profit corporations, while they can have any number of members, do not operate for profit and may also have numerous stakeholders, particularly if they are larger organizations. Therefore, the closely held corporation is uniquely defined by its small number of shareholders.