Michelle gives out a business card with an e-mail address on it. According to the
comments that accompany the UETA, it may be reasonable to infer that Michelle has
consented to
a. transact business electronically.
b. submit to the jurisdiction of any selected forum.
c. accept and respond to any correspondence sent to that address.
d. nothing.
Iowa enacts a law that restricts certain kinds of advertising to protect consumers from
being misled. This law would likely be held by a court to be
a. an unconstitutional restriction of speech.
b. constitutional under the First Amendment.
c. justified by the need to protect individual rights.
d. necessary to protect state interests.
Howie enters into a contract with Ida over the Internet to buy soybeans as a hedge
against falling prices in corn. Neither party prints out a hard copy. Under the Electronic
Signatures in Global and National Commerce Act (E-SIGN Act), this contract can
a. be “denied legal effect” if it falls under the UCC’s Statute of Frauds.
b. be “denied legal effect” unless a hard copy is printed.
c. be “denied legal effect” until it is executed.
d. not be “denied legal effect” because it is only in electronic form.
Jim organized, and owns and operates, Jim’s Landscaping Service in the simplest form
of business organization. This is
a. none of the choices.
b. a limited liability company.
c. a partnership.
d. a sole proprietorship.
Esteban and Florian want to form a limited liability company (LLC) to manage their
business, Gordian Nuts. LLC statutes have been adopted in
a. all states.
b. no states.
c. less than one-fifth of the states.
d. only Wyoming and Florida.
Joy and Kris enter into a contract for Kris to lay sod in Joy’s yard for which she agrees
to pay Kris. When Kris’s schedule conflicts, she contacts Leza, to whom Kris “assigns
all rights under the contract.” Kris is
a. absolved of any liability under the contract.
b. in breach of the contract with Joy.
c. liable to Joy if Leza does not perform.
d. liable to Leza for inducing a prohibited contract.
Fess, research manager for Greenergy Products, Inc., applies utilitarian ethics to
determine that an action is morally correct when it produces the greatest good for
a. Fess.
b. Greenergy.
c. the fewest people.
d. the most people.
Bubbly Cola features Sparkly Cola’s trademark without its owner’s permission.
Bubbly’s use of the mark is actionable provided
a. consumers are confused.
b. Bubbly’s use is intentional.
c. Bubbly and Sparkly are not otherwise competitors.
d. Sparkly’s mark is registered.
Kris contracts to work exclusively for Little Manufacturing Company during May for
$5,000. On April 30, Little cancels the contract. Kris finds another job during May but
earns only $3,000. Kris files a suit against Little. As compensatory damages, Kris can
recover
a. $3,000.
b. $2,000.
c. $1,000.
d. $0.
Safe-T Guard Services enters into a contract to secure Taylor’s Business Park from
vandalism and theft between 6 p.m. and 6 a.m. nightly for six months. At the end of the
term, if there has been no vandalism or theft in the Park, Safe-T’s performance will have
been
a. absolute.
b. complete.
c. conditional.
d. substantial.
Mona and Nero want to discharge their contract by executing and performing a new
agreement. They can best accomplish this by
a. accord and satisfaction.
b. novation.
c. reinvention.
d. specific performance.
Eppie hires Franz to do some remodeling work in her office.
The relationship between Eppie and Franz is
a. client and independent contractor.
b. employer and employee.
c. master and servant.
d. principal and agent.
Home Products Store buys furniture from Relax Furniture, Inc. The parties agree that
the furniture will be shipped “F.O.B. Relax’s warehouse” to Home Products via Swifty
Shipping Corporation. The furniture is lost in transit. The loss is suffered by
a. Home Products and Relax Furniture, but not Swifty Shipping.
b. Home Products, Relax Furniture, and Swifty Shipping.
c. Home Products only.
d. Relax Furniture only.
Driving his sport utility vehicle negligently, Bart crashes into a streetlight. The
streetlight falls, smashing through the roof of a house, killing Chris. But for Bart’s
negligence, Chris would not have died. Regarding the death, the crash is the
a. cause in fact.
b intervening cause.
c. proximate cause.
d. superseding cause.
Bayou Boats, Inc., and Eventide Fishing Tours enter into a contract for a sale of seven
swamp boats. Eventide pays for the goods, but Bayou does not deliver. Eventide can
use replevin as a remedy if
a. Bayou is lawfully withholding the goods.
b. Eventide cannot effectively cure the defect.
c. Eventide is unable to cover for the goods.
d. the goods have not been identified to the contract.
The legislature of the state of Mississippi enacts a new statute that sets standards for the
liability of businesses selling defective products. This statute applies
a. only in Mississippi.
b. only in Mississippi and its border states.
c. in all states.
d. in all states but only to matters not covered by other states’ laws.
Like the bylaws of other corporations, the bylaws of Farmland Equipment, Inc.,
a. establish the operating name of the corporation.
b. establish the value and classes of corporate stock.
c. were adopted at its first organizational meeting.
d. were submitted for approval to the public official in charge.
Cecilia’s Day Spa, LLC, is a member-managed limited liability company. If the law in
Cecilia’s state is like the law in most states, unless the members have agreed otherwise,
voting rights are apportioned according to
a. capital contributions.
b. participation in management.
c. the number of members.
d. transactions with the firm.
Reba is a director of Quantum Mechanix Corporation. Reba’s rights, as a director, do
not include a right to
a. indemnification.
b. inspection.
c. participation.
d. self-dealing.
Boutique Corporation would like to change its corporate status to avoid income taxes at
the corporate level. To qualify, the shareholders must not be
a. corporations.
b. estates.
c. individuals.
d. partnerships.
Lara induces Moe to enter into a contract for the sale of an apartment about which Lara
fraudulently misrepresents a number of material facts. Lara tells Moe that her
commission is 6 percent, but their signed, written contract states “12 percent.” The
Statute of Frauds governs
a. contracts that are induced by fraud.
b. contracts that must be in writing to be enforceable.
c. the admissibility in court of oral evidence.
d. the merging of oral and written statements into one contract.
Clear Day Company, which is based in Delaware, agrees to sell fifty windows,
currently stored in Florida, to Great Vu, Inc., which is based in Hawaii. Absent an
agreement to the contrary, the place of delivery is in
a. California.
b. Delaware.
c. Florida.
d. Hawaii.
Parker, a salesperson for Quality Textiles, Inc., shows Rosa, a fabric buyer for Style
Clothing Company, samples of cloth, stating that any shipment will match the samples.
This statement is
a. an express warranty.
b. an implied warranty.
c. a warranty of title.
d. puffery.
Jon agrees to sell his K9 Sports Equipment store to Lacy. As part of the sale, Jon
promises never to open a similar, competing store anywhere. Jon’s promise is most
likely
a. invalid because it is part of a sale of an ongoing business.
b. invalid because of the unreasonable terms of area and time.
c. valid because it is part of a sale of an ongoing business.
d. valid because Jon and Lacy apparently have the capacity to contract.
Rite Contractors, Inc., agrees to build a motel for Sleep Inn Corporation. The project
proceeds according to plan, but before it is done, Sleep tells Rite to quit. Rite may
recover
a. the contract price less costs of materials and labor.
b. the contract price.
c. the costs needed to complete construction.
d. profits plus the costs incurred up to the time of the breach.
Green Grocers, Inc., enters into a contract with Hiway Transport Company for the
delivery of a shipment of fresh produce. In a later dispute between these parties over the
delivery, the doctrine of quasi contract cannot be used because
a. both of the parties involved are businesses.
b. at least one of the parties had greater bargaining power.
c. the subject of the contract was a service.
d. there is an actual contract covering the subject in dispute.
Metro Daily and New City Newsstand enter into a contract under which Metro agrees
to deliver a certain quantity of newspapers to New City each day. The contract does not
include a price term. In a suit between the parties over the price, a court will
a. determine a reasonable price.
b. impose the lowest market price.
c. refuse to enforce the agreement.
d. return the parties to the positions they held before the contract.
The U.S. Congress enacts a new federal statute that imposes liability on businesses
emitting significant amounts of a certain pollutant into the environment. This statute
applies
a. only to matters not covered by state law.
b. only to those states that adopt the statute.
c. to all of the states.
d. to none of the states.
Mona is an agent for Nationwide Restaurant Corporation (NRC). In acting as an agent,
Mona follows all of NRC’s clearly stated instructions. This responsibility arises under
a. no agent’s duty.
b. the agent’s duty of loyalty.
c. the agent’s duty of notification.
d. the agent’s duty of obedience.
Noah and Orin do business as Pest Control Partners. In most states, for the purposes of
suing and being sued, Pest Control Partners would be treated as
a. an aggregate of the individual partners.
b. a natural person.
c. an entity.
d. a non-existent party.
Whirlwind Financial Corporation sends its executives to a resort in Mexicoat taxpayers’
expenseto consider using the firm’s cash to buy back its stock and thereby prop up the
value. Many of its competitors are doing the same thing. One of the best ways to learn
about the ethical responsibilities inherent in operating a business is to look at
a. the mistakes made by other companies.
b. the benefits of pursuing profit despite the appearance of impropriety.
c. the prevalence of a practice among other corporations.
d. who is footing the bill for a particular action.
Omar sends Nell an e-mail ad touting software that will cloak its user in “the anonymity
of the Internet.” Nell pays Omar for the software, which is never delivered to her. This
is online
a. auction fraud.
b. puffery.
c. retail fraud.
d. frustration but not fraud.
Elin, an agent for First Credit Corporation (FC), enters into an unauthorized contract
with Great Expectations, Inc. (GE), purportedly on FC’s behalf. This contract will be
enforceable if it is ratified by
a. any third party.
b. Elin.
c. FC.
d. GE.
Brad defends against a breach-of-contract suit by College Credit Corporation by
claiming that their deala student loan accruing interest at a certain rate and payable
beginning on a certain datewas unfair because the consideration for their contract was
inadequate.
A court is most likely to evaluate the adequacy of consideration if
a. a thing exchanged has no intangible value to one of the parties.
b. something exchanged is not of direct economic or financial value.
c. the items exchanged were of unequal value.
d. there is a gross disparity in the value of the consideration exchanged.
Eppie hires Franz to do some remodeling work in her office.
While working, Franz drops a tool on Gibby, Eppie’s customer, causing an injury. Eppie
is
a. liable to Gibby because he was injured on Eppie’s property.
b. liable to Gibby unless Franz’s act is intentional.
c. not liable because Franz is an independent contractor.
d. not liable to Gibby because Franz is Eppie’s employee.
Setting realistic workplace goals can reduce the probability that employees will act
unethically.
Theatrical Supplies Company contracts to sell to Unique Costumes, Inc., seven hundred
plastic masks at $1 each to be delivered by October 1. Theatrical knows that Unique
will use the masks to make Halloween costumes. Unique usually makes $7,000 profit
from the costumes’ sale. Theatrical fails to deliver on October 1. Unique attempts to buy
substitute masks, but must pay $1.20 for each and take delivery on October 15, cutting
Unique’s sales in half. Unique sues Theatrical. What is the measure of recovery?
Congress can regulate all commerce in the United States.
An agency coupled with an interest is an agency created for the agent’s benefit.
To reason by analogy is syllogistic reasoning because it employs a syllogism.
A publicly held corporation is a private corporation.
Jurisdiction can be a key issue in a case involving a cyber crime.
In State X, persons must be at least eighteen years old before they can purchase
alcoholic beverages. The state also has passed a law requiring that persons who prepare
and serve liquor in the form of drinks in commercial establishments be licensed. The
only requirement for obtaining a yearly license is that the person be at least eighteen
years old. Moffitt, aged thirty-five, is hired as a bartender for Lone Star Restaurant.
Bekins, an alumnus of State X University, brings twenty of his friends to the restaurant
to celebrate State X U’s football victory. Bekins orders four rounds of drinks, and the
bar bill exceeds $200. When Bekins learns that Moffitt has failed to renew his
bartender’s license, Bekins refuses to pay, claiming the contract is unenforceable. Is
Bekins correct? Explain.
State and federal governments provide for the registration of trademarks.
On May 1, Faith, a real estate agent, and Grace, a commercial property owner, sign an
agreement to find a buyer for Grace’s office building. Under the terms, if a buyer makes
a serious offer within sixty days, Grace must pay Faith’s commission. Faith puts signs
on the building, ads in real estate pamphlets and a local newspaper, and features the
property in a “walking” tour on the Internet. On June 1, Grace tells Faith that she is
canceling their arrangement. Ten days later, Grace closes a sale on the building without
Faith’s participation. Faith files a suit against Grace for the amount of her commission.
In whose favor is the court most likely to rule and why?
Independent contractors have no control over the details of their work performance.
If goods fail to conform to a contract in any way, the buyer or lessee must reject them.
In an express contract, the terms are fully stated in words.
An offer that a statute makes illegal automatically terminates the offer.
The United States Supreme Court has original jurisdiction in rare instances.
The primary document needed to incorporate a business is the articles of incorporation.
Pence. Queenie, and Randall want to form Sales-to-Infinity, LLC (limited liability
company). What should they provide in their operating agreement? If they fail to
include some important operating details, what determines these details?