61. In states that have adopted the Revised Model Business Corporation Act, the secretary of state may commence proceedings to administratively dissolve a corporation under all but which of the following circumstances?

a. the corporation adopts more than one business purpose.

b. the corporation does not pay franchise taxes within sixty (60) days after they are due. c. the corporation does not file its annual report within sixty (60) days after it is due.

d. the corporation is without a registered agent or registered office for sixty (60) days or more.

62. Failure to mitigate damages limits recovery to:

a. damages that would have been sustained had the plaintiff mitigated the damages where it was possible to do so.

b. nominal damages and punitive damages.

c. damages for consequential loss.

d. exemplary damages.

63. Repeated breaches and waivers are generally interpreted to indicate:

a. poor business practices.

b. illegal behavior.

c. ignorance of the law.

d. modification of contract.

64. All the following are characteristics of a general partnership except: ______.

a. separate entity.

b. voluntary and consensual.

c. partner contributions.

d. co-owners for profit.

65. Which form of business entity was created primarily to shield professionals from malpractice liability generated by other owners in the firm?

a. the limited partnership

b. the limited liability partnership

c. the limited liability company

d. the general partnership

66. In which of the following scenarios is the agent exposed to the greatest risk of liability?

a. disclosed principal and authorized contract

b. undisclosed principal and authorized contract

c. partially disclosed principal and authorized contract

d. authorized receipt of money from third person remitted to disclosed principal

67. The party that breaks a contract may be required to pay damages to the other party to compensate for:

a. losses that could have been avoided by hiring someone else to perform the contract.

b. emotional disturbance caused by the breach of contract.

c. a heart attack induced by the emotional disturbance caused by the breach of contract.

d. damages resulting necessarily and directly from the breach of contract.

68. The Revised Model Business Corporation Act: ______.

a. has eliminated the certificate of incorporation.

b. has made the process of incorporation more difficult.

c. states that corporate existence begins when the secretary of state issues a certificate of incorporation.

d. has eliminated the need for articles of incorporation.

69. When two corporations merge: ______.

a. their separate existences cease, and a new corporation is formed.

b. one of the corporations absorbs the other.

c. each corporation's stockholders keep their original shares of stock

d. a new charter is needed.

70. To protect themselves against liability, franchisors often require individual franchisees to: ______.

a. take out fraud insurance.

b. register with the attorney general.

c. publicly disclose their own separate business identities.

d. disavow any connection with the franchisor.

71. All of the following result in the automatic dissolution of the partnership by law, except: ______.

a. the expulsion of a partner.

b. the bankruptcy of the partnership or of one of the partners.

c. the death of a partner.

d. an event that make the partnership's business illegal.

72. Partnership property may consist of:

a. real property only.

b. personal property only.

c. any and all property acquired by the partnership.

d. all property contributed by the partners or acquired for the firm or with its funds.

73. The most common method of creating an agency is by: ______.

a. express authorization.

b. conduct.

c. operation of law.

d. ratification.

74. Which of the following is a correct statement concerning the incorporation process?

a. Each application for incorporation is reviewed by the appropriate state legislature.

b. The incorporation process is essentially a matter of filing the correct papers and fees with the designated government official.

c. Most applications for incorporation are rejected.

d. Incorporator(s) are never required to give public notice of the intent to form a corporation.

75. _________ of a corporation may occur when management is deadlocked and the deadlock cannot be broken by the shareholders.

a. Bankruptcy

b. Consolidation

c. Reinstatement

d. Judicial dissolution

76. Damages in excess of actual loss are called:

a. punitive damages.

b. compensatory damages.

c. restitution.

d. nominal damages.

77. An agent is under a duty to obey: ______.

a. all instruction given by the third party.

b. all lawful instructions given by the principal.

c. all instructions given by the principal.

d. none of these, since "obedience" is not an obligation of the agent.

78. The principal forms of business organization are: ______.

a. sole proprietorships, joint ventures, and corporations.

b. unincorporated associations, partnerships, and corporations.

c. unincorporated associations, limited partnerships, and corporations.

d. sole proprietorships, partnerships, and corporations.

79. An agent who commits a crime is:

a. always liable.

b. only liable if acting in self-interest.

c. only liable if the act is done to advance the interest of the principal.

d. never liable when acting in the role of an agent.

80. The limited liability company form was first made possible as the result of

a. The enactment by the United States Congress of a law recognizing limited liability companies.

b. The enactment by 45 State legislature of the Uniform Limited Liability Company Act.

c. The enactment by the legislature of the State of Wyoming a law recognizing limited liability companies.

d. The issuance of a ruling by the Internal Revenue Service that it would recognize the limited liability company form of ownership.