In the Case of a Zero Interest Below-Market Loan by a Corporation

question 89

Essay

In the case of a zero interest below-market loan by a corporation to a shareholder-employee, what difference does it make to the corporation and the shareholder whether the loan is characterized as a corporation's loan to its shareholder or a corporation's loan to its employee?

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Definitions:

Constructs

Abstract concepts developed in the mind to understand and interpret the world around us.

Intellectual Hypothesis

A tentative explanation or theory that seeks to interpret or solve cognitive, philosophical, or theoretical issues.

Personality

An individual's characteristic pattern of thinking, feeling, and behaving that distinguishes one person from another.

Choice Corollary

A principle in George Kelly's personal construct psychology that suggests individuals choose for themselves the construction process that they anticipate will best help them anticipate future events.