David Wants to Go into Business as Explosive Bursts to Make

question 11

Multiple Choice

David wants to go into business as Explosive Bursts to make and market fireworks. When deciding which form of business organization would be most appropriate, David would normally take into account all of the following except

• A)the liability of the owners.
• B)the forms of competitors' business organizations.
• C)tax considerations.
• D)the need for capital.Fact Pattern 20-1 Ray is a shareholder of Small Biz Company (SBC).When the directors fail to undertake an action to redress a wrong suffered by SBC, Ray files a suit on the firm's behalf.

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Definitions:

Contracts of Adhesion

Contracts of adhesion refer to standard-form agreements prepared by one party, leaving the other party little or no ability to negotiate more favorable terms.

Public Policy

Principles and standards considered by the government to be beneficial for the community and used to guide legislative or regulatory actions.

Trade Secrets

Information, including formulas, practices, processes, designs, instruments, patterns, or compilations of information that is not generally known or reasonably ascertainable, by which a business can obtain an economic advantage over competitors or customers.

Illegal Agreement

A contract or agreement that is void because it involves actions that are against the law.