M100 CH 2 questions and answers with
solutions
Each of the following legal sources specify management authority and responsibilities for
community associations EXCEPT
A. survey data
B. state statutes
C. community association governing documents
D. court decisions - ANSWER A. survey data
True or False. The basic authority in a community association lies with the developer - ANSWER
False
The board of directors in a community association has a ____ to act in the best interests and for
the benefit of the community as a whole.
A. bond
B. fiduciary duty
C. ballot
D. quorum - ANSWER B. fiduciary duty
True or False. The "business judgment rule" means that if a board has exercised reasonable
business judgment in making a decision, the court will generally not consider the board
negligent in its fiduciary duty - ANSWER True
Which of the following community association committees typically are assigned responsibilities
related to elections, nominations, and architectural standards?
A. standing committees
solutions
Each of the following legal sources specify management authority and responsibilities for
community associations EXCEPT
A. survey data
B. state statutes
C. community association governing documents
D. court decisions - ANSWER A. survey data
True or False. The basic authority in a community association lies with the developer - ANSWER
False
The board of directors in a community association has a ____ to act in the best interests and for
the benefit of the community as a whole.
A. bond
B. fiduciary duty
C. ballot
D. quorum - ANSWER B. fiduciary duty
True or False. The "business judgment rule" means that if a board has exercised reasonable
business judgment in making a decision, the court will generally not consider the board
negligent in its fiduciary duty - ANSWER True
Which of the following community association committees typically are assigned responsibilities
related to elections, nominations, and architectural standards?
A. standing committees
