Several States' Constitutions Place Stricter Limits Than the MBCA on Permissible

question 13

Multiple Choice

Several states' constitutions place stricter limits than the MBCA on permissible considerations for issuance of common shares by corporations.Which of the following considerations is permissible under the MBCA but not permissible by such state constitutions?

• A)A promoter's preincorporation services worth $25,000,which services were performed prior to incorporation.
• B)A gratuitous promise to contribute $35,000 in cash to the corporation.
• C)Bonds of another corporation,which bonds are worth $15,000.
• D)The president's actual performance of services for the corporation,which services are worth $50,000.

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Definitions:

Illusory Correlation

Cognitive exaggeration of the degree of co-occurrence of two stimuli or events, or the perception of a co-occurrence where none exists.

External Attribution

The process of attributing the cause of one's own or another's behavior to factors outside the individual, such as the situation or environment.

Just World

The belief that the world is fundamentally fair and that justice prevails, leading individuals to rationalize injustices or victimization.

Actor-Observer Effect

A cognitive bias in which people tend to attribute their own actions to external circumstances but the actions of others to inherent traits.