Under the Corporate Form of Business Organization

question 10

Multiple Choice

Under the corporate form of business organization

• A)a shareholder is personally liable for the debts of the corporation.
• B)a shareholder's acts can bind the corporation even though he/she has not been appointed as an agent of the corporation.
• C)the corporation's life is continuous.
• D)shareholders wishing to sell their shares must get the approval of other shareholders.

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Definitions:

Put Option

An option contract giving the holder the right, but not the obligation, to sell a specified amount of an underlying asset at a set price within a specified time.

Time to Expiration

The duration remaining until the expiration date of a derivative contract, such as an option or futures contract, which represents the time period within which the contract can be executed.

Intrinsic Value

The actual, fundamental worth of an asset or investment, determined through financial analysis independent of current market value.

Time Value

The concept that money available now is worth more than an identical sum in the future due to its potential earning capacity.