Diana and Earl Incorporate Their Computer Technical Support Business as Fast

question 14

Essay

Diana and Earl incorporate their computer technical support business as Fast Aid,Inc.Diana contracts with Gina to respond to Fast Aid's cus?tomer service calls on a commission basis.What are the advantages and disadvantages to Fast Aid of classifying Gina as an independent contrac?tor rather than as an employee? Earl obtains a loan from First National Bank and signs a promissory note for repayment of the amount without indicating that he is doing so on behalf of Fast Aid.Fast Aid does not make enough profit its first year to make payments on the loan.Charging default,the bank files a suit against Earl for the unpaid amount.Earl re?sponds that he was acting on behalf of Fast Aid.Will the bank succeed against Earl? Why or why not?

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Definitions:

Bongos

A pair of small, drum-like musical instruments connected in the center by a bridge, typically played with the hands.

Frisbees

Flat, circular flying discs often used for games and sports.

Comparative Advantage

The ability of a country or firm to produce a particular good or service at a lower opportunity cost than others, leading to more efficient trade possibilities.

Absolute Advantage

Absolute advantage refers to the ability of an individual, firm, or country to produce more of a good or service than competitors using the same amount of resources.