Which of the following statements about wills is correct?
a. A will must be written on one piece of paper.
b. Another writing may be incorporated by reference in a will.
c. The testator must sign his or her full name.
d. The testator cannot have any “help” in signing a will.
Rule 10b-5:
a. applies only to seller misconduct.
b. is an SEC antifraud rule.
c. applies only to securities listed on an exchange, not those sold over the counter.
d. Both (b) and (c).
e. All of the above.
Discuss the validity and effect of each of the following:
a. Two manufacturers of the same product decide to allocate territories, with one taking
the southern States.
b. A labor union encourages its members and all consumers to boycott a product
manufactured by a company that refuses to honor a union contract.
c. Carrin’s Department Store sells its products for 10% under the suggested retail price.
One manufacturer tells the store it will not supply wholesale goods to it unless it
charges at least the suggested retail price.
An involuntary bankruptcy petition, even if contested by the debtor, may still result in
an “order for relief” if:
a. the debtor generally is not paying his admitted debts as they come due.
b. the debtor failed to pay three or more debtors whose total debts equal $10,000.
c. a custodian assignee was appointed within 120 days before the filing of the petition.
d. Both (a) and (c).
Which of the following remedies are available under the Sherman Act?
a. Injunctive
b. Damages of four times the amount of actual loss sustained
c. Consequential damages
d. All of the above
Laura is in possession of a check which contains the following indorsement, “Sam
Smith, without recourse, for collection only.” The indorsement would be classified as:
a. blank, qualified, and restrictive.
b. blank, unqualified, and unrestrictive.
c. special, unqualified, and restrictive.
d. special, qualified, and unrestrictive.
Albert found a stone in his yard and took it to Bob, a jeweler, for evaluation. Although
Bob knew what the stone was, he told Albert that he wasn’t sure as to the nature of the
stone, but that he thought it was a topaz. Bob then offered to buy the stone for $25 and
Albert agreed. Later Albert found out the stone was an uncut diamond worth about
$700. The sale:
a. was a valid contract that should be enforced by the law.
b. can be voided based upon fraud in the execution.
c. can be voided based upon fraud in the inducement.
d. can be voided based upon mistake as to the identity of the subject matter.
Which of the following is NOT true about Social Security?
a. Disability insurance is one program within the system.
b. Employees pay for Social Security when they file their federal income tax returns.
c. Contributions made by the employer are tax deductible.
d. None of the above.
The Equal Employment Opportunity Commission is empowered to:
a. file legal actions in its own name but not to intervene in actions filed by third parties.
b. attempt to resolve alleged violations through informal means prior to bringing suit.
c. investigate all charges of discrimination.
d. Both (a) and (b).
e. Both (b) and (c).
Which of the following remedies is NOT available for patent infringement?
a. Attorney fees in some but not all cases
b. An accounting for profits
c. Treble damages when appropriate
d. Injunctive relief
A(n) ____ signs an instrument to lend his credit to an instrument, and his liability is
determined by the capacity in which he signs.
a. indorser
b. accommodation party
c. authorized agent
d. maker
According to the Code, identification takes place:
a. upon the making of a contract if it is for future goods.
b. when the seller ships, marks, or otherwise designates the goods as those to which the
contract refers if the contract is for goods that are already existing and identified.
c. when the crops are planted or start growing if the contract is for crops to be grown
within twelve months.
d. when the young animals are born if the contract is for offspring of animals to be born
within twelve months.
Which of the following is true regarding unconscionability under the Code?
a. It is defined in Article 2 as “monstrously extortionately harsh, showing no regard for
conscience.”
b. The Code denies or limits enforcement of an unconscionable contract for the sale of
goods.
c. Unconscionability may be substantive, but it cannot be procedural.
d. All of the above.
Alexander Schwing indorses his check with his own name and the words “for deposit
only.” What type of indorsement is this?
a. A blank indorsement
b. A special indorsement
c. An unrestrictive indorsement
d. A blank, restrictive indorsement
Kimberly contributed $50,000 as a limited partner in a limited partnership. Upon
dissolution of the partnership, the priorities in distributing the assets are to:
a. creditors of the partnership, partners and ex-partners in satisfaction of liabilities for
unpaid distributions, partners for return of contributions, and to partners for their
partnership interests in the proportions in which they share in distributions.
b. creditors of the partnership, partners for return of contributions, partners and
ex-partners in satisfaction of liabilities for unpaid distributions, and partners for their
partnership interests in equal shares.
c. creditors of the partnership, partners for their partnership interests, partners for return
of contributions to the partnership, and ex-partners for liability for unpaid distributions.
d. partners for return of contributions, outside creditors of the partnership, partners for
their partnership interests, and partners and ex-partners for unpaid distributions.
Under Rule 505, the issuer must:
a. not advertise.
b. restrict the offering to thirty-five persons.
c. limit the offering to $1 million.
d. sell only to “accredited investors.”
A will entirely in the handwriting of the testator is called a ____ will.
a. nuncupative
b. holographic
c. conditional
d. codicil
Which of the following is characteristic of a bailment?
a. There is a separation of ownership and possession
b. A bailment must be a contract
c. It must last for an indefinite time
d. All of the above
e. Both (a) and (b)
The warranty of title for the sale of goods found in Article 2 of the Code:
a. may be excluded with the phrase “as is.”
b. is labeled as an implied warranty.
c. may not be excluded or modified by the seller.
d. will apply regardless of whether it is provided for in the contract unless the parties
have specifically excluded it or it is excluded by certain circumstances.
e. Both (b) and (c).
Assume that 12,000 shares are represented at a shareholder meeting and a quorum
exists. How many votes are normally necessary to carry a motion?
a. 4,001
b. 8,001
c. 6,001
d. 10,000
Lynne is the intended beneficiary of a third-party contract. Her rights have vested. In an
action by Lynne to enforce the promise, the promisor may assert the defense of:
a. rescission.
b. contractual modification.
c. fraud.
d. All of the above.
Bill lends Harvey $500 and the loan is secured by Harvey’s furniture. If Bill files a
financing statement on January 30, 2010, how long will he keep his security interest?
a. Until July 30, 2015
b. Until January 30, 2013
c. Until July 30, 2015, unless a continuation statement is filed
d. Until January 30, 2020, if a continuation statement is filed
Assuming there are no provisions in the corporation’s articles of incorporation or
bylaws regarding quorum requirements, if there are 13 total directors of General Gonzo
Corporation and the minimum number of directors are present to transact business, how
many votes normally would be necessary for those present to act as a board?
a. 7
b. 4
c. 6
d. 11
A general partnership that, by making the statutorily required filing, limits the liability
of its partners for some or all of the partnership’s obligations is a:
a. limited liability partnership.
b. limited liability company.
c. limited liability limited partnership.
d. limited partnership.
Maxine offered to sell her video camera to Tom for $200 and also stated to Tom, “I will
give you two weeks to accept my offer.” One week later Tom learned that Maxine had
sold the video camera to Cindy. Maxine:
a. has revoked her offer to Tom.
b. must sell Tom a video camera for $200 because she made a firm offer to him.
c. must get the camera back from Cindy if Tom accepts within two weeks.
d. Both (b) and (c) are appropriate alternatives in this case.
In order for a full warranty to be given for a consumer product, the manufacturer must
provide that:
a. the product will be repaired for free.
b. the warranty lasts for at least 10 days.
c. the consumer can opt for refund rather than repair.
d. consequential damage cannot be excluded.
Which of the following is/are excluded from UCC Article 4A coverage?
a. Credit transactions
b. A transfer of credit that moves from an originator to a beneficiary through the
banking system
c. A funds transfer that is, even partially, governed by the EFTA
d. Both (a) and (c)
e. Both (b) and (c)
Which of the following is correct with respect to the reasonable person standard?
a. It makes allowance for mental deficiency.
b. It makes allowance for physical disability.
c. It applies an individualized test to children that takes into consideration the child’s
age, background, and experience.
d. Two of the above, (b) and (c).
e. All of the above
A perfected security interest has priority over:
a. an unperfected security interest.
b. a lien creditor who acquires a lien after perfection.
c. a previously filed security interest.
d. Both (a) and (b) are correct.
Which of the following duties would not be delegable?
a. John has a contractual duty to pay Isaac $50.
b. Karl has a contractual duty to deliver 50 bushels of corn to Michael by October 1.
c. Jeffrey has a duty to mow Georgia’s lawn at least once a week.
d. Arthur has a duty to teach an accounting class at a community college during the fall
semester.
Another term for personal property is:
a. patent.
b. chattel.
c. realty.
d. fixtures.
If X Co. agrees with S Co. that X will not sell beer in Wisconsin if S will not sell beer
in Colorado, under the Sherman Act, this is:
a. no violation.
b. a per se illegal horizontal price fixing agreement.
c. a per se illegal horizontal market allocation.
d. a per se illegal horizontal tying agreement.
A contract which does not satisfy the writing requirement of the Article 2 statute of
frauds, but which is otherwise valid, is enforceable in which of the following situations?
a. Where the goods have been delivered and accepted
b. Where payment has been accepted
c. Where the goods have been specially manufactured and are not suitable for resale in
the ordinary course of business
d. All of the above are situations where the contract would be enforceable.
Consumer electronic funds transfers are covered by Article 4A of the UCC, and
nonconsumer electronic transfers are covered by the federal Electronic Fund Transfer
Act.
RULPA requires a lesser duty of care by a general partner to a general partnership than
that owed by a general partner to a limited partnership.
In relation to damages, the test of foreseeability is subjective.
Workers’ Compensation Acts have been adopted by all states in an effort to provide
speedier and more certain relief to injured workers than was available through
litigation.
Creditors of any trust beneficiary can attach the fund or the income to pay the
beneficiary’s individual debts.
A stock split results in a larger proportion of corporate ownership by the shareholder.
Smith’s of Dallas placed a $10,000 order for dresses, F.O.B. Dallas from Magnifique
Manufacturing Co. in New York, for their October 1 Fall Showing. The dresses were to
be shipped at a cost of $300 to the seller. In New York, Magnifique dresses were the
rage, but the boom had not yet reached Dallas. By September 15, Smith’s realized that
the shop could not afford all of these dresses and called Magnifique to cancel the
contract. On September 15, the market price for the dresses in New York was $9,000
and in Dallas, $5,000. On October 1, the market price had risen to $9,500 in New York
and to $7,000 in Dallas. What may Magnifique do? What are the alternatives for
damages from Smith’s?
The Restatement provides that a promise following the rendering of emergency services
is binding even if not supported by consideration if necessary to prevent injustice.
A tender offer is a general invitation to all the shareholders of a target company to
tender their shares for sale at a specified price.
A group of investors bring a class action lawsuit against the H & R Accounting Firm
under SEC Rule 10b-5 of the 1934 Securities Act. Richard, an accountant with the firm,
had prepared financial reports filed with the SEC for the Paymark Company. The
reports contained false information of a material fact, and this led to financial loss to the
investors who relied on the reports. What is the likely result of the suit?
The Clean Air Act requires the use of reformulated automotive fuels to reduce ozone
pollution.
According to the UCC, if the buyer of defective goods recovers incidental damages, he
will be unable to recover compensatory damages.
If no specific agreement exists, the partners bear losses in the same proportion in which
they share profits.
Tort law gives persons relief from civil wrongs or injuries to their person, property, and
economic interests.
The doctrine of unconscionability deals only with whether the actual terms of the
contract are grossly unfair or oppressive.
Consideration is required in order to have a valid assignment.
If a seller occupies a fiduciary relationship with the buyer and fails to make full
disclosure to the buyer, then the latter will be able to avoid the transaction.