In which of the following situations would medical payments be paid under an unendorsed PAP?
A) injuries incurred while riding a motorcycle
B) injuries incurred while an auto is being used without the presumption that permission would have been granted to use the auto
C) injuries incurred in an auto while it is used in a share-the-expense car pool
D) injuries incurred during the course of employment if workers compensation benefits are available
Question 2
In which of the following cases will the agency problem between shareholders and managers be the
greatest?
A) The Johnson family owns 50 of the common stock of the company. The other 50 is owned
by 5 mutual funds.
B) 100 of the common stock is owned by the founder of the company who decided to retire and
hired a manager to run his business for him.
C) The common stock of the company is owned by many diverse shareholders, with no
shareholder owning more than 1 of the outstanding stock.
D) All top managers in the company own significant amounts of stock and stock options.
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