Which Form of Business Entity Was Created Primarily to Shield

question 51

Multiple Choice

Which form of business entity was created primarily to shield innocent owners,particularly those in professions,from malpractice liability generated from other owners in the firm?

• A) the limited partnership
• B) the limited liability partnership
• C) the limited liability company
• D) none of the above

Understand the concept and calculation of the Profitability Index for investment projects.

Understand the impact of salvage value, working capital, and income taxes on the evaluation of investment projects.

Understand the method for computing the simple rate of return and its significance in investment decisions.

Distinguish between different investment evaluation methods, namely the Profitability Index, Internal Rate of Return (IRR), and Net Present Value (NPV), and their applicability in ranking investment projects.

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Definitions:

Politicization

The process by which an issue or matter becomes a subject of political debate or action.

Independent Central Banks

Central banking institutions that operate without direct political influence to maintain price stability and economic confidence.

Socializing Losses

A scenario where financial losses are distributed across society, typically through government intervention, rather than being borne solely by the entity that incurred them.

Government Loan Guarantees

Programs where the government promises to repay a loan in case the borrower defaults, typically used to encourage lending to certain sectors or projects.