In which type of company can shares be sold by invitation only?

The correct answer is private limited company, as this type of business structure allows company shares to be sold privately and typically only to invited individuals or institutions.

In a private limited company, the share ownership is restricted, meaning that the company cannot offer its shares to the general public. This restriction is important because it enables the company to maintain a level of control over who becomes a shareholder, providing an added layer of privacy and security. The company can choose to invite specific individuals to invest, which often includes family members, friends, or business associates of the existing shareholders.

This contrasts with a public limited company, where shares can be sold to the general public through stock exchanges, increasing accessibility but also dilution of control. In a general partnership, ownership is shared among partners and cannot be sold as shares. Similarly, a sole trader operates individually and does not have shares to sell in any form, as the business is not legally separate from its owner. Thus, private limited companies uniquely provide the option for shares to be sold exclusively by invitation.