Question

In: Economics

Which of the following is not an advantage of incorporation? Select one: a. There may be...

  1. Which of the following is not an advantage of incorporation?

Select one:

a. There may be tax advantages

b. Shareholders can veto decisions of directors.

c. Shareholders owe no duty to the corporation.

d. Shares are easily transferred.

e. Shareholders are not liable for debts of the corporation.

  1. Which of the following is false with respect to methods of carrying on a business?

Select one:

a. A ‘society’ must be for a non-profit purpose.

b. Unlimited liability means that an investor can lose not only what he/she has invested but also their personal assets.

c. A partnership is a legal entity separate and apart from the partners who make it up.

d. Sole proprietors have unlimited liability.

e. A corporation is a separate legal entity independent and apart from the shareholders that make it up.

  1. If you allow Mr. Gnowsky to act as your agent, which of the following is not true with regard to the duties which he owes to you?

Select one:

a. Mr. Gnowsky must use reasonable care, skill, and diligence in his service to you.

b. His failure to obey you and to act within the authority given him would allow you to sue him for breach of contract

c. Generally, an agent may not delegate his authority without the authorization of his principal.

d. Even when Mr. Gnowsky is acting as your agent, he need not put your interest above his own.

e. Mr. Gnowsky must tell you everything relevant to his task that a reasonable person would consider might affect your decision making.

  1. The process by which a third party imposes a solution to a dispute on the employer and union is called:

Select one:

a. Binding arbitration

b. Mediation

c. Job action

d. Certification

e. Conciliation

  1. Federal and provincial human rights legislation relate to such issues as:

Select one:

a. Disabled workers

b. Affirmative action

c. Harassment

d. Pay equity

e. All of the above

  1. To which of the following would the Sale of Goods Act not apply?

Select one:

a. A contract for the sale of a ranch.

b. A contract for future goods when title will pass in the future

c. A contract for the purchase of a car.

d. A meal in a restaurant.

e. A contract for the sale of tangible personal property

  1. Which of the following statements regarding novation is false?

Select one:

a. Novation requires the creditor to accept the new contract in full satisfaction and substitution for the old contract.

b. Novation requires the creditor to accept the new debtor as principal debtor, not merely as a guarantor.

c. Novation requires the inclusion of a force majeure clause in order to be enforceable.

d. Novation requires that the new debtor assume complete liability.

e. Novation refers to the creation of a new contract through the substitution of a third party for one of the original parties to a contract, with everyone's consent.

  1. Tong hired Hocaloski to design an ad for her business. Hocaloski assigned the work to Peppar, her employee. After the ad was run, it was noticed that Peppar made a serious error; he gave the wrong address and phone number of the business. Based on these facts, which of the following is true?

Select one:

a. Tong can sue either Hocaloski or Peppar, her employee, for breach of contract, but not both of them.

b. Tong can sue both Hocaloski and Peppar for breach of contract, since they are both connected with the job.

c. If Hocaloski did not pay Peppar, Peppar could sue Tong for his pay because Peppar did do work for Tong.

d. Only Peppar is liable since he made the mistake.

e. For breach of contract, Tong could successfully sue only Hocaloski.

Solutions

Expert Solution

1 Option C

Shareholders owe no duty to the corporation.

Majority or controlling shareholders may take on fiduciary duties toward other shareholders if they assume control of the corporation through the board. Controlling shareholders owe a duty of loyalty to the minority shareholders of a corporation when they make decisions or take action on behalf of the corporation.

2.Option E.

A corporation is a separate legal entity independent and apart from the shareholders that make it up.

A corporation is a legal entity that is separate and distinct from its owners. Corporations enjoy most of the rights and responsibilities that individuals possess: they can enter contracts, loan and borrow money, sue and be sued, hire employees, own assets, and pay taxes.

3.Option D

Even when Mr. Gnowsky is acting as your agent, he need not put your interest above his own.

When an agent is appointed to facilitate or negotiate a transaction on behalf of the principal, the agent owes a duty to the principal to act in the principal's best interests within the authority of the agent.In a principal-agent relationship, the agent acts on behalf of the principal and should not have a conflict of interest in carrying out the act.

4. Option A Binding Arbitration

Binding arbitration means that the disputing parties must adhere to the arbitrator's decision and usually cannot appeal the decision to a court.


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