Which of the Following Explains the Historical Reasons for the Creation

question 8

Multiple Choice

Which of the following explains the historical reasons for the creation of equity?

• A) There was no system of common law available throughout the country.
• B) It took too long to petition the monarch for his justice.
• C) The rules of equity arose to remedy defects in the common law.
• D) Equity was a faster alternative the common law courts.

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Definitions:

Corporate Form

A legal structure for businesses recognized as separate entities from their owners, providing limited liability protection and enabling easier access to capital.

Cost Efficient

Achieving a specific goal or output with minimum expense or least waste.

Economic Profit

The discrepancy between sum revenue and sum expenses, taking into account both acknowledged and assumed costs.

Principal-Agent Problem

A dilemma in relationships when one party (the agent) is expected to act in the best interest of another (the principal), but has the potential to act in their own self-interest instead.