Frank Asked Matt to Join Him in a Business Venture

question 219

Multiple Choice

Frank asked Matt to join him in a business venture.Matt has heard that partnership could result in some harsh consequences.Which of the following statements he has heard about the liability of partners is false?

• A) A partner is an agent for the firm and the other partner, and thus Matt would be liable for a contract made by Frank on behalf of the partnership if the partnership funds could not cover it.
• B) Matt could be liable for losses suffered by a client whose funds were misappropriated by Frank even if he (Matt) were not aware of the misappropriation and had no part in it.
• C) A partner is liable to the full extent of his personal fortune if an employee of the firm was negligent in the course of his duties and there were insufficient partnership funds to cover the resulting loss.
• D) A partner is not liable for any partnership debt that was incurred after he left as long as he gave notice in writing to his partner that he was retiring from the partnership.
• E) A partner has unlimited liability for any loss suffered by the partnership because of a negligent act by one of the partners if the partnership funds are insufficient to cover the loss.

Knowledge of bond ratings and the criteria for investment grade bonds.

Comprehend liquidity preference theory and its implications for the term structure of interest rates.

Analyze how changes in yield to maturity affect bond prices.

Identify the hierarchy of bond claims in the event of bankruptcy.

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Definitions:

Organic Substances

Organic substances refer to chemical compounds that contain carbon-hydrogen bonds, typically associated with living organisms.

Chemical Substances

Materials with definite chemical compositions, which can be elements or compounds, involved in chemical processes.

Tactile Stimulation

Physical contact or touch that can produce responses or stimuli, playing an essential role in human development and emotional connections.

Olfactory Cilia

Hair-like structures located in the nasal cavity that serve as receptor sites for smell, playing a crucial role in the sense of smell.