In a partnership agreement, an exit clause is included only if partners fear a potential failure.



Write T if the given statement is True and F if False. More than one answers for a statement will make the answer incorrect.   

  1. In a partnership agreement, an exit clause is included only if partners fear a potential failure.
  2. An exit strategy is to plan on how to optimize the exit situation.
  3. Through an exit plan, partners may minimize their losses and optimize the difficult situation. 
  4. Exit strategies are planned for only the following reasons: problems in style of management, failure to meet strategic objectives, fulfillment of partnership objectives, financial issues and breach of agreement by a partner.
  5. Some partners may want to exit the partnership even when the business is doing well.
  6. Acquisition may also be called the purest form of partnership.
  7. Selling ownership to employees could be one of the exit strategies for owners to exit the business.
  8. Exit in case of bankruptcy will have legal authorities intervene to settle issues.
  9. Succession is referred to as extent of success a partnership is experiencing. 
  10. Offering shares to the general public is not considered an exit as existing owners may still own part of ownership. 
  11. In merger, one of the partner companies ceases to exist after the merger is completed.
  12. Liquidation is when some of the assets of the partnership are offered for sale. 
  13. Once the conditions of an exit clause are agreed and signed upon, they become binding on partners.
  14. Termination of a contract by an "aggrieved" partner may be caused because of the other partner may be “underperforming” or over-performing. 
  15. An explicit Exit clause could also be referred to as an "implied" or indirect ground of termination of partnership contract.
  16. Arbitration as an Alternative Dispute Resolution Method cannot be challenged in a court of law. 
  17. A decision through Mediation is not legally binding. 
  18. It is best for both partners to have conditions in the exit clause implemented when the business is still running.
  19. Some objectives of International business operations are meeting quality standards, forecasting demand and supply, assess the production cost and arrange financial resources. 
  20. A Joint Venture is considered the real form of partnership.
  21. The most cost-effective way of conducting conferences with international partners is to hold these conferences at prospective partner's own office. 
  22. A partner development-strategy is successful when it trains and mentors the staff for future operations. 
  23. Almost all organizations in North America train their future employees/partners.
  24. The only motivator for employees is financial rewards. 
  25. The cheapest of the conflict-resolution methods is a resolution within the organization. 
  26. One of the main objectives of negotiating a partnership-agreement is to develop trust between potential partners. 
  27. The only objective of finding the right partner is to assess the organizational "readiness".
  28. Some companies may also look for a potential business partner on social networking sites. 
  29. When a company is dealing with a limited number of clients, an agent is a more appropriate option as compared to a distributor. 
  30. A Licensing-agreement is always for a term. 
  31. Licensing, Franchising and Joint-Ventures are some types of Foreign Direct Investment.
  32. A Greenfield project is bought and run within the country of business. 
  33. In a franchising agreement, the franchisee pays a fee to sell the product in a designated area. 
  34. Mostly, the franchise owner advertises the product whereas the franchisee pays for advertising.
  35. The upfront fee and commission that a franchisee pays is also called as Royalty.
  36. An agent could legally sue and be sued upon for their Principal whereas a distributor cannot. 

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