Norm,Cliff and Sam Form a Limited Liability Company

question 8

Multiple Choice

Norm,Cliff and Sam form a limited liability company.Norm contributes $20,000,Cliff $30,000 and Sam $50,000.The operating agreement does not state how profits and losses are to be apportioned.The company makes a $60,000 profit during the year.Under the ULLCA,how will profits be divided?

• A) Norm will receive $12,000,Cliff $18,000,and Sam $30,000.
• B) Norm will receive $20,000,Cliff $20,000,and Sam $20,000.
• C) Norm will receive $18,000,Cliff $12,000,and Sam $30,000.
• D) Norm will receive $15,000,Cliff $15,000,and Sam $30,000.

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Definitions:

Short-run Phillips Curve

A graphical representation that shows the inverse relationship between the rate of inflation and the rate of unemployment in an economy over a short period.

Farthest from Origin

In geometric terms, the point on a graph that is at the greatest distance from the origin, often used metaphorically to describe extreme or outlier conditions.

Phillips Curve Analysis

An economic concept that analyzes the inverse relationship between rates of unemployment and corresponding rates of inflation.

Natural Rate

The natural rate often refers to the natural rate of unemployment, which is the level of unemployment consistent with sustainable economic growth, without accelerating inflation.