Which of the Following Statements Is TRUE with Respect to "Reversions

question 36

Multiple Choice

Which of the following statements is TRUE with respect to "reversions" and "remainders," as those terms were discussed in the text?

• A)The doctrine of waste imposes an obligation on a person who has either a reversion or a remainder.
• B)A remainder is used only if one life estate is followed by another life estate.
• C)If a life estate is followed by a reversion,the right to sue for waste belongs to the person who created the life estate.
• D)Reversions and remainders are far more common in a business context than in a family context.
• E)A reversionary interest exists only if a person has paid to buy back a piece of land that he or she previously sold.

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Definitions:

Adverse Selection

A situation where sellers have information that buyers do not, or vice versa, often resulting in a market failure.

Market Signals

Indicators or signs derived from market behavior that provide information or data regarding the demand or supply conditions, influencing decisions.

Adverse Selection

A situation in which one party in a transaction has more or better information compared to another, leading to an imbalance and potentially poor decision-making, often discussed in insurance markets.

Asymmetric Information

A situation in which one party in a transaction has more or superior information compared to another, often leading to an unfair advantage.