Which of the Following Is True with Regard to the Characteristics

question 10

Multiple Choice

Which of the following is true with regard to the characteristics of corporations?

• A) The corporation is a separate legal person, but neither can sue nor be sued.
• B) Shareholders, are liable for the debts and other obligations of the corporation.
• C) Directors are responsible for the shareholders of the corporation.
• D) A shareholder's liability is limited to the amount he or she paid for the shares.
• E) The shareholders would be vicariously liable for any damage caused by a employee of the corporation carrying out his or her duties.

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Definitions:

Marginal Cost

The added total cost resulting from the manufacture of one more unit.

Producer Surplus

The difference between what producers are willing to accept for a good versus what they actually receive, often represented as the area above the supply curve and below the equilibrium price.

Output Tax

A tax imposed based on the quantity of goods or services produced.

Marginal Cost Curve

A graphical representation that shows how the cost of producing one additional unit varies as production increases.