Napolean Wanted to Borrow Money from the Bank of Winnipeg

question 4

Multiple Choice

Napolean wanted to borrow money from the Bank of Winnipeg.The bank was not,however,fully convinced that Napolean would be able to repay the debt.It therefore wanted some assurance from Napolean's mother,Josephine,that she would repay the loan if necessary.Which of the following statements is most likely to be TRUE?

• A)If it was not evidenced in writing,Josephine's promise will certainly be enforceable if it was a guarantee,but it may not be enforceable if it was an indemnity.
• B)If Josephine's promise must be evidenced in writing in order to be enforceable,the bank may be able to satisfy that requirement by combining several documents even if those documents do not refer to each other.
• C)If Josephine's promise is not evidenced in writing,and if such writing is required by statute,then neither Josephine nor Napolean needs to repay the loan.
• D)If Josephine's promise must be evidenced in writing in order to be enforceable,then the contract will be unenforceable unless both Josephine and the bank sign the relevant document.
• E)If Josephine's promise is properly classified as an indemnity,then the bank cannot demand payment from her unless Napolean has first refused to pay.

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Definitions:

Normal Distribution

A bell-shaped frequency distribution that is symmetrical about the mean, describing how many data points, given continuous variables, distribute in nature.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, indicating how much the values in a data set deviate from the mean.

Mean High Temperature

Mean high temperature is the average of the highest temperatures over a specific time period for a particular place.

Book Value

The net value of an asset according to its balance sheet account balance, calculated as the original cost minus accumulated depreciation.