What is a corporation?

A corporation is defined as a separate legal entity that is distinct from its owners, which is why the choice stating it as a separate entity from its owners is correct. This characteristic allows the corporation to own assets, incur liabilities, enter into contracts, and sue or be sued independently of the individual shareholders who own it.

This structure provides several advantages, including limited liability for its shareholders, meaning that their personal assets are generally protected from the corporation's debts and legal obligations. This separation between the owners and the entity is a fundamental principle of corporate law and is crucial in distinguishing corporations from other business forms such as sole proprietorships or partnerships, where owners typically bear personal liability.

In contrast, the other options describe business structures that do not possess the same level of separation between owners and the business. For example, a business owned by one individual would be classified as a sole proprietorship, where the owner and the business are legally the same entity. Similarly, a partnership involves multiple owners but does not provide the same legal separation and limited liability associated with a corporation. Lastly, referring to a business structure as unregulated does not accurately depict the nature of corporations, as they are subject to various regulations and laws governing their operation.