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CPCU 552 quiz questions and answers graded A+ 20254/2025
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CPCU 552 quiz questions and answers graded A+ 20254/2025
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CPCU 552 quizWhich one of the following is a chief obligation of company administrators?
A) to perpetuate a ready board thru normal elections
b) to control investments and disbursements of the business enterprise's assets
c) to create the right annual & period in-between reports for shareholders
d) to establish the methods & operational goals for each department - ANSa
Corporate directors are taken into consideration to have met their responsibility of care in the
event that they:
a) Discharge their duties in step with the equal requirements that an employee of the employer
might use
b) Act in precise religion and in a manner they reasonably accept as true with to be inside the
great pastimes of the corporation
c) Conduct themselves in a manner that guarantee's the corporation's profitability
d) Make informed selections based totally upon their unique business capabilities - ANSb
Directors' and Officers' fiduciary obligations encompass the responsibility of:
a) Trustworthiness
b) Reliability
c) Obedience
d) Credibility - ANSc
A lawsuit added by means of one or extra shareholders in the call of the organization is a:
a) Derivative lawsuit
b) Class movement lawsuit
c) Fiduciary lawsuit
d) Retaliation lawsuit - ANSa
A company's administrators are:
a) Elected by way of the business enterprise's officials
b) Appointed via the enterprise's officials
c) Elected by way of the corporation's shareholders
d) Appointed via the organization's control - ANSc
A normal securities magnificence movement grievance carries an allegation which include:
,a) Directors and officers have failed to satisfy prison obligations owed to employees below the
Employee Retirement Income Security Act of 1974 (ERISA)
b) Directors and officials have violated state environmental statutes
c) Insiders have profitably offered their private holdings in the enterprise's shares while the
proportion fee turned into artificially inflated
d) Directors and officers have used the company jet for non-public use - ANSc
A corporation owned by its shareholders is controlled with the aid of its:
a) Management
b) Board of Advisors
c) Proxies
d) Board of Directors - ANSd
Directors and officials of a enterprise owe unique obligations to the stockholders of that
organization. Those duties include: the obligation of care; the duty of loyalty; the duty of
disclosure; and the duty of obedience. What is the time period used to explain these
obligations?
A) Legal
b) Moral
c) Fiduciary
d) Ethical - ANSc
Although a organization's directors and officers ought to exercising care while making decisions
approximately the walking of the organization, courts have held that they cannot be held
responsible for honest errors. This latitude allowed with the aid of courts to officials and directors
is called the:
a) Business judgment rule
b) Nonjudgmental rule
c) Due diligence rule
d) Honest mistake rule - ANSa
Directors and officers are taken into consideration to have met their obligation of care in the
event that they have met 2 standards. Which one of the following is such a standards?
A) Maintaining and imposing the corporate charter & bylaws.
B) Approve critical economic topics & company reports
c) Act in a way believed to be in the company's great pursuits
d) Be involved in organising the dreams & guidelines of the organization - ANSc
Which one of the following is a fiduciary obligation of directors and officers?
,A) Duty of information
b) Duty of care
c) Duty of adherence
d) Duty of consent - ANSb
The director of a agency has been named in a match brought by means of a stockholder of the
employer alleging a failure to correct faulty statements made inside its prospectus. What is the
class of the fit made:
a) Non-spinoff suit
b) Civil match
c) Derivative healthy
d) Class action - ANSa
Which one of the following is a distinguishing function of a derivative in shape?
A) Damages recovered, besides for the costs of bringing the suit, cross directly to the
enterprise.
B) It is delivered by way of one or extra individuals representing the interests of a whole group
of people.
C) Persons outside of the organization might also provoke such court cases.
D) Such complaints are made inside the name of character clients or employees. - ANSa
A not unusual defense used to defend directors and officers against claims that allege a breach
in the obligation of care is the:
a) Ultra vires rule
b) Securities & Exchange Act of 1934
c) CLass-Action Fairness Act of 2005
d) Business judgment rule - ANSd
A shareholder can also convey a by-product in shape in opposition to a director or officer for
having possession in a competing commercial enterprise. This is a breach in their:
a) Loyalty
b) Obedience
c) Disclosure
d) Care - ANSa
Jean is a director on the board of an garb promotion employer. Towards the organization, Jean
owes a responsibility of:
a) Undivided time
, b) Profitability
c) Divided loyalty
d) Undivided loyalty - ANSd
Under common law and the Securities & Exchange Act of 1934, no director or officer can sue
which one of the following kinds of information to buy or sell business enterprise stock?
A) Outsider data
b) Public facts
c) Insider data
d) Quantitative information - ANSc
Directors (& from time to time officials) owe a responsibility of loyalty to the:
a) Federal Securities and Exchange Commission
b) Employees that help the organization they serve
c) Customers of the corporation they serve
d) Stockholders who go with them - ANSd
Although a business enterprise may not want to settle any by-product fits out of courtroom, why
beneath commonplace law may such settlements no longer benefit the employer?
A) the corporation might be considered to be the perpetrator
b) No determination of wrongdoing is made
c) The results are not binding on all members
d) The outcomes are sealed and, for this reason, hidden from the stockholders - ANSb
The director of a company has been named in a fit added by using a stockholder of the
company alleging a failure to accurate faulty statements within its prospectus.
The stockholder filed in shape in his own call. Which one of the following is the most probable
category of the fit?
A) Non-derivative healthy
b) Civil in shape
c) Derivative fit
d) Class action - ANSa
Tom, Bill, and Adam are the 3 largest shareholders in ABC Corporation. Recently, the price of
ABC's stock has dropped severely. Tom, Bill, and Adam decide to carry a match in their own
names against the administrators.
In that match, Tom, Bill, and Adam allege that the directors didn't review the company's
monetary statements and that additionally they failed to properly monitor the employer's affairs.
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