What is defined as an association of individuals united for a common purpose and allowed to change its members without dissolution?

The correct answer is the corporation. A corporation is a legal entity that is distinct from its owners and can conduct business, enter into contracts, sue and be sued, and own assets. One of the defining characteristics of a corporation is its ability to change members – meaning shareholders – without affecting its existence. This continuity is fundamental as it allows the corporation to persist even if ownership changes over time, providing stability and security.

In a corporation, the shareholders are not personally liable for the debts and obligations of the business, which further underscores its distinct legal status. This separation between the corporation and its owners is crucial because it promotes ease of ownership transfer and attracts investment, as individuals can buy and sell shares without dismantling the corporate structure.

Other entities such as partnerships, limited liability companies, and cooperatives have different structures and rules regarding ownership, liability, and continuity, often involving more direct ties between the individuals involved and the entity itself. For instance, partnerships typically dissolve upon the departure of one partner, while cooperatives are member-driven organizations that may not have the same continuity characteristic as corporations.