30 Questions
What is the main reason Jenny's victory in selling the advertising deal with AutoMax was not considered a victory by her supervisor?
DotBomb's CEO did not approve contracts exceeding six months.
Why did DotBomb provide Dave with a written notice of termination?
He had not made any sales recently.
What method do DotBomb's salespeople use to contact potential advertisers?
Making cold calls.
Why does DotBomb sell advertising space on its website in addition to retail products?
To generate additional revenue.
In which scenario would DotBomb's CEO need to approve an advertising deal?
Deals that exceed six months.
How does DotBomb's sales team usually follow up after making cold calls to potential advertisers?
By sending marketing materials like business cards and company letterhead correspondence.
What type of business relationship exists between Hank and Biff?
A formal partnership
If Big Billy wants to collect $5000 from either Hank or Biff for Hank's Unyun® debt, who should he be able to collect from?
$5000 from Hank
With a court order to collect on Hank's $5000 Unyun® debt against his interest in the hot sauce business, what would Big Billy be entitled to?
One half of the excess assets over liabilities upon dissolution, up to $5000
In the context of Hank and Biff's business relationship, why is it important to establish the existence of a partnership?
To clarify the rights and obligations of both parties
If Hank and Biff's partnership agreement was not in writing, what type of business relationship could be assumed?
A joint venture
What legal concept is highlighted by Hank's Unyun® debt being classified as personal rather than business-related?
Statute of Frauds
Why could (B) potentially succeed?
Ratification creates an agency relationship.
Why is (C) a potential success?
Paul's statement to Bob constitutes ratification.
Why will (A) fail?
Ratification retroactively authorizes acts.
What was the initial reaction of Barb when Alex told her about the zine?
She expressed interest and offered help.
How do Alex and Barb earn revenue from their zine?
Through sales of advertising.
What are Alex and Barb's long-term plans for the zine?
To make it their sole employment eventually.
Does the election of LLP status increase management rights?
False
Is an LLC more similar to a corporation or a limited partnership?
Neither
Does the adoption of LLP status exempt partners from contributing to satisfy partnership obligations?
False
Are partners responsible for their own torts in an LLP?
True
Can partners sign capital call agreements in an LLP?
Depends on the LLP agreement
In what aspect are member-managed LLCs and closely held corporations similar?
Management structure
Why was the contract enforceable against Dena, even though she made them on behalf of an undisclosed principal?
Dena had actual authority.
If Dena disclosed that she represented Wacky World before executing contracts with Mary and Robert, what would make the contracts enforceable?
Wacky World must have ratified them.
Why could Mary and Robert have reasonably believed that Dena had authority to enter into contracts despite her lack of actual authority?
Custom in the market allowed Dena to proceed this way.
Why did Dena lack actual authority to buy land for more than $100,000?
Dena did not have the necessary permission.
What would have made the contracts unenforceable if custom or other evidence did not suggest that Dena had the authority to enter them?
Dena's lack of authority.
If John is the owner and manager of an apartment building, what implications might this have on agency relationships based on the given text?
John's potential liability for undisclosed agent actions.
Test your knowledge on ratification, agency relationships, and compensation entitlement. Learn about when ratification can create an agency relationship and the implications of ratification on compensation.
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