CPCU
552 Exam Questions With Correct Answers
/ / / / / /
Which /one /of /the /following /is /a /major /responsibility /of /corporate /directors?
a) /to /perpetuate /a /competent /board /through /regular /elections
b) /to /manage /investments /and /disbursements /of /the /corporation's /assets
c) /to /create /the /proper /annual /& /interim /reports /for /shareholders
d) /to /establish /the /procedures /& /operational /goals /for /each /department /- /verified /answer(s)-
✔✔a
Corporate /directors /are /considered /to /have /met /their /duty /of /care /if /they:
a)
/Discharge
/their
/responsibilities
/according /to /the /same /standards /that /an /employee /of /the /organization /would /use
b)
/Act
/in
/good
/faith /and /in /a /manner /they /reasonably /believe /to /be /in /the /best /interests /of /the /corporation
c) /Conduct /themselves /in /a /manner /that /guarantee's /the /enterprise's /profitability /
d) /Make /informed /decisions /based /upon /their /special /business /skills /- /verified /answer(s)-
✔✔b
Directors' /and /Officers' /fiduciary /duties /include /the /duty /of: /
,a) /Trustworthiness
b) /Reliability
c) /Obedience
d) /Credibility /- /verified /answer(s)-✔✔c
A /lawsuit /brought /by /one /or /more /shareholders /in /the /name /of /the /corporation /is /a:
a) /Derivative /lawsuit
b) /Class /action /lawsuit
c) /Fiduciary /lawsuit
d) /Retaliation /lawsuit /- /verified /answer(s)-✔✔a
A /corporation's /directors /are:
a) /Elected /by /the /corporation's /officers
b) /Appointed /by /the /corporation's /officers
c) /Elected /by /the /corporation's /shareholders
d) /Appointed /by /the /corporation's /management /- /verified /answer(s)-✔✔c
A /typical /securities /class /action /complaint /contains /an /allegation /such /as:
a)
/Directors
/and
/officers /have /failed /to /fulfill /legal /duties /owed /to /employees /under /the /Employee /Retirement
/Income /Security /Act /of /1974 /(ERISA)
,b) /Directors /and /officers /have /violated /state /environmental /statutes
c)
/Insiders
/have
/profitably
/sold
/their
/personal /holdings /in /the /company's /shares /while /the /share /price /was /artificially /inflated
d) /Directors /and /officers /have /used /the /corporate /jet /for /personal /use /- /verified /answer(s)-
✔✔c
A /corporation /owned /by /its /shareholders /is /controlled /by /its:
a) /Management
b) /Board /of /Advisors
c) /Proxies
d) /Board /of /Directors /- /verified /answer(s)-✔✔d
Directors
/and
/officers
/of /
a
/corporation
/owe
/special
/duties
/to
/the
/stockholders
/of
/that
/corporation.
, /Those
/duties
/include:
/the
/duty
/of
/care;
/the
/duty
/of
/loyalty;
/the
/duty
/of /disclosure; /and /the /duty /of /obedience. /What /is /the /term /used /to /describe /these /duties?
a) /Legal
b) /Moral
c) /Fiduciary
d) /Ethical /- /verified /answer(s)-✔✔c
Although /
a
/corporation's
/directors
/and
/officers
/must
/exercise
/care
/when
/making
/decisions
/about
/the
/running
552 Exam Questions With Correct Answers
/ / / / / /
Which /one /of /the /following /is /a /major /responsibility /of /corporate /directors?
a) /to /perpetuate /a /competent /board /through /regular /elections
b) /to /manage /investments /and /disbursements /of /the /corporation's /assets
c) /to /create /the /proper /annual /& /interim /reports /for /shareholders
d) /to /establish /the /procedures /& /operational /goals /for /each /department /- /verified /answer(s)-
✔✔a
Corporate /directors /are /considered /to /have /met /their /duty /of /care /if /they:
a)
/Discharge
/their
/responsibilities
/according /to /the /same /standards /that /an /employee /of /the /organization /would /use
b)
/Act
/in
/good
/faith /and /in /a /manner /they /reasonably /believe /to /be /in /the /best /interests /of /the /corporation
c) /Conduct /themselves /in /a /manner /that /guarantee's /the /enterprise's /profitability /
d) /Make /informed /decisions /based /upon /their /special /business /skills /- /verified /answer(s)-
✔✔b
Directors' /and /Officers' /fiduciary /duties /include /the /duty /of: /
,a) /Trustworthiness
b) /Reliability
c) /Obedience
d) /Credibility /- /verified /answer(s)-✔✔c
A /lawsuit /brought /by /one /or /more /shareholders /in /the /name /of /the /corporation /is /a:
a) /Derivative /lawsuit
b) /Class /action /lawsuit
c) /Fiduciary /lawsuit
d) /Retaliation /lawsuit /- /verified /answer(s)-✔✔a
A /corporation's /directors /are:
a) /Elected /by /the /corporation's /officers
b) /Appointed /by /the /corporation's /officers
c) /Elected /by /the /corporation's /shareholders
d) /Appointed /by /the /corporation's /management /- /verified /answer(s)-✔✔c
A /typical /securities /class /action /complaint /contains /an /allegation /such /as:
a)
/Directors
/and
/officers /have /failed /to /fulfill /legal /duties /owed /to /employees /under /the /Employee /Retirement
/Income /Security /Act /of /1974 /(ERISA)
,b) /Directors /and /officers /have /violated /state /environmental /statutes
c)
/Insiders
/have
/profitably
/sold
/their
/personal /holdings /in /the /company's /shares /while /the /share /price /was /artificially /inflated
d) /Directors /and /officers /have /used /the /corporate /jet /for /personal /use /- /verified /answer(s)-
✔✔c
A /corporation /owned /by /its /shareholders /is /controlled /by /its:
a) /Management
b) /Board /of /Advisors
c) /Proxies
d) /Board /of /Directors /- /verified /answer(s)-✔✔d
Directors
/and
/officers
/of /
a
/corporation
/owe
/special
/duties
/to
/the
/stockholders
/of
/that
/corporation.
, /Those
/duties
/include:
/the
/duty
/of
/care;
/the
/duty
/of
/loyalty;
/the
/duty
/of /disclosure; /and /the /duty /of /obedience. /What /is /the /term /used /to /describe /these /duties?
a) /Legal
b) /Moral
c) /Fiduciary
d) /Ethical /- /verified /answer(s)-✔✔c
Although /
a
/corporation's
/directors
/and
/officers
/must
/exercise
/care
/when
/making
/decisions
/about
/the
/running
