What type of company is defined as one that only sells shares to invited individuals?

The correct answer is that a company which only sells shares to invited individuals is classified as a private company. This type of company is characterized by having restricted ownership; shares are not available to the general public and are typically sold to a select group of investors. This can include family, friends, or a small group of private investors, which allows the private company to maintain a significant level of control over its activities and decision-making processes.

Private companies are not required to disclose their financials to the public, which sets them apart from public companies, where shares are sold on public stock exchanges and information is readily available to all investors. Similarly, unlisted companies are often private, but the term may also refer to companies that do not meet the requirements to be listed on stock exchanges, regardless of their share-selling practices. Listed companies, on the other hand, are publicly traded entities with shares available for purchase by anyone on the stock market.