Which of the Following Can Be a Disadvantage of Establishing

question 6

Multiple Choice

Which of the following can be a disadvantage of establishing a corporation?

• A)A corporate owner's personal assets are not protected.
• B)A corporation can be sued.
• C)A corporation must report business income in a separate tax return.
• D)A corporation can limit profits for tax purposes.

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Definitions:

Maximization

The choice of the decision alternative with the greatest expected value.

Satisficing

Establishing an adequate level of acceptability for a solution to a problem and then screening solutions until one that exceeds this level is found.

Bounded Rationality

A concept suggesting that when individuals make decisions, their rationality is limited by the information they have, the cognitive limitations of their minds, and the finite amount of time they have to make a decision.

Perceptual Defence

The psychological mechanism by which individuals unconsciously filter out or modify distressing information to protect themselves.