MULTIPLE CHOICE

9. What is the most important factor that contributes to a minority shareholders ability to commence a derivative action?

a.	The action must arise from discrimination against minority shareholders.
b.	The action must be a pursuit of proper and adequate disclosure of material information.
c.	The action must arise as a direct result of a fundamental change to the corporation.
d.	The action must be in the corporations cause as a result of some injury to it.

10. What is the source of the laws that specifically govern the relationship between partners and third parties?

a.	the Law of Partnership
b.	the Law of Agency
c.	the Partnership Act
d.	the Agency Act

11. What is the most likely reason, from a financial liability perspective, for a corporation to be viewed as the most risk-aversive form of business entity?

a.	It forms a distinct legal entity, the corporation is liable for its own obligations.
b.	Any entity that deals with a corporation may demand personal guarantees.
c.	It shields directors from negligent acts of management.
d.	It provides limited liability to the corporations directors.

12. In what manner are a sole proprietorship and a partnership similar?

a.	There is no legislated regulation affecting either.
b.	Both require special steps to create.
c.	Neither is a separate legal entity with capacity to contract.
d.	Both require regulation of their profit motives.