Question 1

In 2012, the highest paid CEO was paid slightly more than $96 million in compensation.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following shareholders would qualify for access to the corporate books and records?

Accepted Answer

A)  a shareholder who owns 5 percent of any class of stock 
B)  a shareholder who owns 5 percent of all the outstanding stock of a corporation 
C)  a shareholder who has owned stock for six months 
D)  All of the above shareholders qualify. 
A)  a shareholder who owns 5 percent of any class of stock 
B)  a shareholder who owns 5 percent of all the outstanding stock of a corporation 
C)  a shareholder who has owned stock for six months 
D)  All of the above shareholders qualify.

Question 3

Discuss investors' concerns regarding CEO compensation.

Accepted Answer

The main concerns are the following: inc

Question 4

It is fraud to form a corporation to avoid personal liability.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following is a requirement under Sarbanes-Oxley?

Accepted Answer

A)  The majority of the board of directors must be independent. 
B)  No inside officers can serve on the board of directors. 
C)  Lawyers must blow the whistle on their corporate clients engaged in fraud. 
D)  all of the above 
A)  The majority of the board of directors must be independent. 
B)  No inside officers can serve on the board of directors. 
C)  Lawyers must blow the whistle on their corporate clients engaged in fraud. 
D)  all of the above

Question 6

The corporate veil liability theory has been applied in situations that involve environmental clean-up issues.

Accepted Answer

A) True 
 B)False

Question 7

The sole proprietor's personal assets are subject to business creditor attachment.

Accepted Answer

A) True 
 B)False

Question 8

An inadequately capitalized corporation can have its corporate veil pierced.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following cannot be used to pierce the corporate veil?

Accepted Answer

A)  inadequate capitalization 
B)  alter ego theory 
C)  formation of the corporation to avoid personal liability 
D)  All of the above theories can be used. 
A)  inadequate capitalization 
B)  alter ego theory 
C)  formation of the corporation to avoid personal liability 
D)  All of the above theories can be used.

Question 10

The CEO of Citigroup announced a $8 billion write-down for the company because of bad loans. This announcement followed a previous announcement of a $5 billion write-down three quarters earlier. The board asked him to step down.

Accepted Answer

A)  The board does not have the authority to remove a CEO. 
B)  The shareholders must approve the removal of a CEO. 
C)  The CEO is elected by the shareholders. 
D)  none of the above 
A)  The board does not have the authority to remove a CEO. 
B)  The shareholders must approve the removal of a CEO. 
C)  The CEO is elected by the shareholders. 
D)  none of the above

Question 11

Partners are not liable for each others' torts committed in the scope of business.

Accepted Answer

A) True 
 B)False

Question 12

A limited liability company can be created informally.

Accepted Answer

A) True 
 B)False

Question 13

A limited liability partnership (LLP):

Accepted Answer

A)  is a statutory creature. 
B)  is the same as a limited partnership. 
C)  is the same as a LLC. 
D)  all of the above 
A)  is a statutory creature. 
B)  is the same as a limited partnership. 
C)  is the same as a LLC. 
D)  all of the above

Question 14

Explain when a shareholder has a right to see the books and records of a corporation.

Accepted Answer

A shareholder has the right to see the b

Question 15

Hank Greenberg was the head of:

Accepted Answer

A)  the SEC. 
B)  Citigroup. 
C)  AIG. 
D)  BP. 
A)  the SEC. 
B)  Citigroup. 
C)  AIG. 
D)  BP.

Question 16

Limited partners:

Accepted Answer

A)  can use their name in the partnership name. 
B)  can contribute management services to the partnership. 
C)  cannot advise the general partner. 
D)  none of the above 
A)  can use their name in the partnership name. 
B)  can contribute management services to the partnership. 
C)  cannot advise the general partner. 
D)  none of the above

Question 17

Sharing of profits is prima facie evidence that a partnership exists.

Accepted Answer

A) True 
 B)False

Question 18

Piercing the corporate veil has been used for purposes of imposing CERCLA liability.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following is not required for the articles of incorporation?

Accepted Answer

A)  names of incorporators 
B)  capital stock structure 
C)  names of board members 
D)  All of the above are required. 
A)  names of incorporators 
B)  capital stock structure 
C)  names of board members 
D)  All of the above are required.

Question 20

Dissolution of a partnership is termination of a partnership.

Accepted Answer

A) True 
 B)False

Exam 18: Governance and Structure: Forms of Doing Business

In 2012, the highest paid CEO was paid slightly more than $96 million in compensation.

Which of the following shareholders would qualify for access to the corporate books and records?

Discuss investors' concerns regarding CEO compensation.

It is fraud to form a corporation to avoid personal liability.

Which of the following is a requirement under Sarbanes-Oxley?

The corporate veil liability theory has been applied in situations that involve environmental clean-up issues.

The sole proprietor's personal assets are subject to business creditor attachment.

An inadequately capitalized corporation can have its corporate veil pierced.

Which of the following cannot be used to pierce the corporate veil?

The CEO of Citigroup announced a $8 billion write-down for the company because of bad loans. This announcement followed a previous announcement of a $5 billion write-down three quarters earlier. The board asked him to step down.

Partners are not liable for each others' torts committed in the scope of business.

A limited liability company can be created informally.

A limited liability partnership (LLP):

Explain when a shareholder has a right to see the books and records of a corporation.

Hank Greenberg was the head of:

Limited partners:

Sharing of profits is prima facie evidence that a partnership exists.

Piercing the corporate veil has been used for purposes of imposing CERCLA liability.

Which of the following is not required for the articles of incorporation?

Dissolution of a partnership is termination of a partnership.

Introduction to Law

Business Ethics and Social Responsibility

The Judicial System

Managing Disputes: Alternative Dispute Resolution and Litigation Strategies

Business and the Constitution

Administrative Law

International Law

Business Crime

Business Torts

Cyberlaw, Social Media, and Privacy

Environmental Regulation and Sustainability

Contracts and Sales: Introduction and Formation

Contracts: Performance, Remedies, and Rights

Sales: Product Advertising and Liability

Products: Business Intellectual Property

Business Competition: Antitrust

Management of Employee Conduct: Agency

Governance and Regulation: Securities Law

Management: Employee Welfare

Management: Employment Discrimination

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