1.

Select the example in which a corporation is making use of a safe harbor provision.

• A corporation that hosts user-uploaded videos online reports a copyright infringement to federal authorities and removes the copyrighted video from its website in order to reduce liability.

• A corporation that operates a chain of restaurants establishes an ethics hotline so that employees can report legal or company policy violations to the corporate office to reduce liability.

• A corporation that manufactures commercial exercise equipment establishes a thorough inspection process to ensure compliance with safety standards to reduce liability.

• A software corporation promotes a whistleblower who exposed patent violations within the company.

2.

Which of the following is a consideration when choosing a form of business organization?

• The location of the business

• The tax burden that a business owner is willing to accept

• The short-term goals of the business founders

• The earnings generated by the business in prior years