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5. Ahmed has a small grocery business. He decides to incorporate, and creates Ahmed's Groceries Ltd., and runs the business through the corporation. The business

5. Ahmed has a small grocery business. He decides to incorporate, and creates Ahmed's Groceries Ltd., and runs the business through the corporation. The business needs a loan, so Ahmed goes to Big Bank to ask for a loan on behalf of Ahmed's Groceries Ltd. Big Bank agrees to lend Ahmed's Groceries Ltd. $50,000. Ahmed agrees to the loan on behalf of the borrower, Ahmed's Groceries Ltd. After about a year, business is slow, and Ahmed's Groceries Ltd. is unable to pay its debts, including the money owed to Big Bank. Ahmed's Groceries Ltd. runs completely out of money, and goes bankrupt. Ahmed's Groceries Ltd. has no money available to pay Big Bank. Ahmed, however, is quite rich, and could afford to pay the $50,000 back to Big Bank.

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