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Question 7 (1 point) Assuming a business is incorporated, what is the effect of a guarantee from a key investor versus other forms of security
Question 7 (1 point) Assuming a business is incorporated, what is the effect of a guarantee from a key investor versus other forms of security directly related to the business? It provides possible access to the personal wealth of all the investors rather than just the business assets. 0 It provides possible access to the key investor's personal wealth rather than just the business assets. 0 It ensures the key investor won't leave the employment of the business. 0 It helps spread the risk. Question 8 (1 point) A quite wealthy but not not especially business saavy small town elderly couple (they had inherited wealth from the family business that others managed and since they didn't care for material things lived a very simple life) were asked by a grandchild to provide a personal guarantee for a new business venture. Assuming they initially did so but fairly quickly grew concerned based on the behaviour of their grandchild (who proceeded to buy an expensive automobile while supposedly 'bootstrapping' a start up) what might they argue (even if it may not be effective)? The grandchild's apparent self-interest behaviour constitutes bad faith on his part and discharges them from the guarantee. 0 They might resort to an exculpatory clause contained in the guarantee. 0 That while admittedly well-off they were still not knowledgeable about business and did not appreciate the nature and consequences of the guarantee. As a guarantor they did not receive direct personal benefit from the underlying loan so they should be free to revoke the guarantee
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