To recover under a property insurance policy, an insurable interest must exist:
A. When the policy is purchased: Yes; At the time of loss: Yes
B. When the policy is purchased: Yes; At the time of loss: No
C. When the policy is purchased: No; At the time of loss: Yes
D. When the policy is purchased: No; At the time of loss: No
Xavier deeds to Peter, a trustee, his property in the form of security for the loan, which
is lent by Smith, the beneficiary of the trust. The nature of this transaction renders it as
a deed of trust. Under these circumstances, if Xavier defaults to pay the loan, which of
the following is the appropriate way in which Smith can recover his loan?
A. By asking Xavier to enter into an action and sale contract
B. By exercising the right of exoneration
C. By exercising right of reimbursement
D. By notifying Peter to sell the property
Carlos has written a novel. He wants to protect his intellectual property with a
copyright. What must he do first?
A. He must apply to the U.S. Copyright Office for a copyright.
B. He must produce a certificate that he is the original author.
C. He must put the novel in some tangible form, like a hard copy or a compact disc.
D. He must certify that his story is original and novel.
A(n) _____ is a formal charge signed by the prosecutor outlining the facts supporting
the charges against the defendant.
A. booking
B. indictment
C. information
D. arraignment
Which of the following is also known as the “dormant” Commerce Clause?
A. Power of Congress to regulate interstate commerce.
B. Power of Congress to regulate instrumentalities of interstate commerce.
C. Limits on the states’ ability to burden interstate commerce.
D. Limits on Congress to burden states with taxes.
Which of the following items of a debtor’s property are exempt from sale in a
bankruptcy proceeding under the federal set of exemptions?
A. Life insurance contracts valued at $10,000.
B. Real or personal property valued at $50,000.
C. Jewelry whose value exceeds $10,000.
D. Individual retirement account exceeding $1 million.
A trading partnership:
A. borrows money to avoid cash flow problems.
B. engages in providing services.
C. has no substantial inventory.
D. buys but does not sell merchandise.
What is the term for when a principal may be forced to be liable for an agent’s actions
to a third party based on a detrimental change in position of the third party and a
reasonable belief that the agent was truly acting with the authority from the principal?
A. Estoppel
B. Undisclosed
C. Ratification
D. Incorporation
The Uniform Transfers to Minors Act:
A. permits the donor to deliver the property to a custodian who acts for the benefit of
the minor under the Act.
B. prohibits an adult from making a gift to a minor unless the minor is the child of the
donor.
C. provides a method for making gifts to minors, who are defined by the Act as children
under the age of 16.
D. provides a complicated and abstract method of transferring money to minors.
Which of the following can issue both National Pollution Discharge Elimination
System (NPDES) permits and industrial discharge permits?
A. The states
B. The federal government
C. Sewage treatment plants
D. The EPA
Does the Federal Arbitration Act (FAA) override a state law vesting initial decision
making authority to a court or administrative agency?
Which of the following characterizes procedural due process?
A. The procedures are clearly laid in the Constitution.
B. It entitles one to a fair hearing before action is taken.
C. It challenges rules that set standards of behavior for organized social life.
D. It does not require adequate notice to be given before action.
The process by which a principal binds himself to an unauthorized act done by an
agent, or by a person purporting to act as an agent, is called ______.
A. indemnification
B. notification
C. liability
D. ratification
Questions of proximate cause assume the existence of _____.
A. intervening cause
B. strict liability
C. actual cause
D. comparative fault
When a person whose duty is conditional leads the other party to rely on his
noninsistence on the condition, the condition will be excused because of a(n) _____.
A. waiver
B. estoppel
C. recission
D. liability
A _____ occurs when a tenant remains in possession of the property (holds over) after a
lease has expired.
A. periodic tenancy
B. tenancy at sufferance
C. tenancy at will
D. month-to-month tenancy
Maple Interiors, located in Boston, contracted to sell and ship sofas to Peach Furniture,
located in Atlanta. The contract stated that the goods were to be shipped “F.O.B.
Boston, via XYZ railroad.” Maple delivered the sofas to XYZ railroad. They were
shipped from Boston but never seen again. Both Peach and Maple had assumed that the
other party had the risk of loss, so neither had obtained insurance. Who must bear this
loss?
A. Peach must bear the loss because the risk passed to it after the sofas were placed on
the loading dock at Maple’s warehouse.
B. Peach must bear the loss because the risk passed to it after the sofas were delivered
to XYZ railroad.
C. Maple must bear the loss because the goods were never tendered to Peach.
D. Maple must bear the loss because in any sale by a merchant, risk does not pass until
the actual delivery of the goods to the buyer.
Under the mailbox rule, the acceptance of an offer is effective at the time the
acceptance is dispatched unless:
A. both the offeror and offeree are merchants.
B. the offer proposes a sale of real estate.
C. the acceptance is not in the authorized mode of communication.
D. the acceptance is lost or never reaches the offeror.
Agreements under which corporations avoid formal criminal charges and trials in return
for their agreement to pay monetary penalties and submit to outside monitoring of their
activities are called:
A. non-prosecution agreements.
B. plea agreements.
C. deferred guaranty agreements.
D. deferred prosecution agreements.
Why must real estate sales contracts be evidenced in writing and signed by the party to
be charged in order to be enforceable?
A. Contracts of such property are covered under the statute of frauds.
B. Such property would otherwise not be entitled to mortgage.
C. Such property would otherwise not be entitled to insurance.
D. Such property would otherwise be liable to eminent domain.
Under the _____, no writing is required where the guarantor makes a collateral promise
for the main purpose of obtaining some personal economic advantage.
A. parol evidence rule
B. leading object rule
C. collateral contract rule
D. part performance rule
A promoter owes a fiduciary duty to the corporation and to its prospective investors.
This implies that:
A. a promoter is an agent of the prospective corporation.
B. prospective investors in the business can control actions of a promoter.
C. a promoter may engage in intrinsically fair transactions with the corporation.
D. a promoter is an agent of the prospective investors in the business.
Which of the following would result in the termination of agency by act of the parties?
A. The principal suffers a permanent loss of capacity.
B. A specified result has been accomplished.
C. The agent declares personal bankruptcy.
D. The agent loses capacity or dies.
Acme Corp. has captured 90 percent of the national market for commodity “X.” Acme
is most likely to be liable for monopolization under Section 2 of the Sherman Act, if
“X” is:
A. felt-tip pens.
B. cellophane.
C. men’s socks.
D. yellow notepads.
A gift inter vivos is a gift:
A. made in contemplation of death.
B. between two living persons.
C. between a deceased person and a living one.
D. made in consideration for money.
The Employee Polygraph Protection Act is enforced by the _____.
A. Labor Department
B. state
C. EEOC
D. NLRB
A share split within the same class of shares generally:
A. increases the net value of the shares following the split.
B. decreases the net value of the shares following the split.
C. has no effect on the net value of the shares following the split.
D. reduces the capital surplus and increases the number of shares authorized.
Strict liability was first promulgated in the Restatement (Second) of Torts in section
402A.
Social Security is mainly financed by _____.
A. FICA
B. ERISA
C. FLSA
D. FMLA
Which of the following characterizes discovery?
A. It begins before the pleadings are completed.
B. Information may be subject to discovery only if it is ultimately be admissible at trial
under the legal rules of evidence.
C. It is an efficient and time-saving remedy for litigants.
D. Interrogatories are a commonly utilized form of discovery.
The corporate form of business has facilitated the rapid growth of development by
allowing businesses to attain economies of scale compared to other forms of businesses
by:
A. giving businesses a greater capacity to raise capital.
B. imposing unlimited management responsibilities on the owners.
C. maximizing the owners’ liabilities.
D. granting the persons who control a corporation limited flexibility in operating it.