A Covenant That Is Attached to All Houses in a Neighborhood

question 159

Multiple Choice

A covenant that is attached to all houses in a neighborhood built in the 1950s states that the houses may not be sold to "members of any minority race." This covenant is:

• A) enforceable since it was voluntarily agreed to by the buyers and sellers
• B) not favored by public policy and so will expire when the houses are torn down
• C) in violation of public policy and so not enforceable
• D) in violation of public policy and, under federal law, requires home owners to pay $1,000 a year fines until removed
• E) none of the other choices

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Definitions:

Financial Statement

A formal record of the financial activities and position of a business, person, or other entity, typically comprising the balance sheet, income statement, and cash flow statement.

Trend Indication

An analysis or estimate aimed at predicting the future direction of something, often based on past and present data.

Partial Balance Sheet

A financial statement that shows a portion of a company’s assets, liabilities, and equity at a specific point in time, rather than the complete picture.

Current Assets

Assets that are expected to be converted into cash within one year or within the operating cycle of the business, whichever is longer.