Mehdi Operates a Sole Proprietorship,but He Is in Poor Health

question 164

Multiple Choice

Mehdi operates a sole proprietorship,but he is in poor health and may be unable to continue running the business.If Mehdi becomes incapacitated,his business:

• A)automatically continues under new management as a sole proprietorship.
• B)automatically converts into a public corporation with stock sold to interested investors.
• C)becomes the property of the most senior employee who wishes to continue operating the firm.
• D)ceases to exist unless sold or taken over by Mehdi's heirs.

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Definitions:

Flood

An overflow of water that submerges land that is usually dry, often caused by heavy rain or melting snow.

Insurance

A financial agreement where a company provides compensation for specified losses, damage, illness, or death in exchange for premium payments.

Wealth

Refers to the abundance of valuable financial assets or physical possessions which can be converted into a form that can be used for transactions.

Expected Utility Function

A mathematical representation of a decision-maker's preferences concerning uncertain outcomes, factoring in the utility of each outcome and its probability.