MegaCorp is incorporated under Delaware law. It is registered to do business in New
York. Legally, in New York MegaCorp is known as what kind of corporation?
a. Domestic
b. Foreign
c. Secondary
d. Cumulative
Generally, a joint venture is a partnership created for one limited purpose.
a. True
b. False
A buyer obtains an insurable interest when the goods are identified to the contract.
a. True
b. False
Predatory pricing occurs when a company lowers its prices below cost to drive
competitorsout of business.
a. True
b. False
Jacques informed his tenants that the railing on their balcony was unstable and he was
in the process of repairing it. In the meantime, one of the tenants stepped out onto the
balcony and fell through the railing. The tenant sued Jacques. Under common law, is
the landlord liable?
a. The landlord is liable because there was an understanding that the premises would be
kept in a safe condition.
b. The landlord is not liable because he informed the tenant of the safety issue.
c. The landlord is liable because he did not complete the repair in a timely manner.
d. The landlord is not liable because there was no expectation of safety.
Kelley went ice skating on a neighbors pond, but she fell through a thin area into icy
waters. Kelley did not have permission to be on the property, and the neighbor did not
even know that she was there. Is the neighbor liable for Kelleys injuries?
a. Yes. The neighbor should have posted “thin ice notices.
b. No. Kelley was a trespasser and the neighbor can only be held liable for intentionally
injuring her or for gross misconduct.
c. It may depend on Kelleys age.
d. Yes, the neighbor is strictly liable.
A partnership is liable for both the negligent and intentional acts of a partner if the acts
were committed within the ordinary course of the partnership’s business.
a. True
b. False
MegaCorp is incorporated in the state of Delaware and is registered only in Delaware.
Jolene purchased a MegaCorp product from a company’s sales representative following
a presentation in Michigan. Jolene was seriously injured by the product in Michigan.
Under the Model Act, if Jolene sues in Michigan, can MegaCorp defend the suit there?
a. MegaCorp may only defend against a lawsuit in Michigan if it first registers by
paying back fees, taxes, and penalties.
b. Yes, MegaCorp can bring or defend against a lawsuit in any state regardless of
whether the corporation is registered to business in that state.
c. Yes, MegaCorp can defend against a lawsuit in Michigan regardless of whether
MegaCorp is registered to do business in that state.
d. No. Jolene must sue and MegaCorp may defend a lawsuit only in Delaware.
A drawee has primarily liability on a draft.
a. True
b. False
Wizardry Corporation’s purpose clause in its charter states, “To operate a home-cleaning
service business.” After a few years of successful operation, Wizardry is offered the
challenge of landscaping a neighboring business. If Wizardry accepts the offer, it would
be violating its charter under
a. the de jure doctrine.
b. the de facto doctrine.
c. the ultra vires doctrine.
d. an estoppel theory.
Shirley is an actress under contract with Twentieth Century. Shirley agreed to perform
the lead role in a musical to be filmed in Hollywood by Twentieth Century. At the last
minute, Twentieth Century decided to scrap the musical and assigned its rights in
Shirley to MGM. MGM was planning to film a western in Australia requiring Shirley to
spend six months filming in Australia. Can Shirley successfully prevent this
assignment?
After Jan’s boyfriend broke up with her, she posted unflattering pictures of him on her
Facebook page and wrote about how he was a terrible boyfriend, calling him a liar and
a cheater. Jan’s actions are protected by the First Amendment to the Constitution.
a. True
b. False
Punitive damages are intended to punish the defendant for conduct that is extreme and
outrageous.
a. True
b. False
Lucky loses in a high-stakes poker game to Fat Chance. To pay his debt, Lucky writes a
check to Fat Chance, who negotiates the check to Convenient, who then tries to cash the
check at Lucky’s bank. Lucky has already stopped payment on the check, so the check
is not honored by her bank. Convenient then tries to collect the check by suing Lucky.
High-stakes poker games are illegal in this state. Which statement is correct?
a. If Convenient can demonstrate that he is a holder in due course, he will prevail.
b. If Convenient can demonstrate that he was a buyer in the ordinary course of business,
he will prevail.
c. If Convenient can demonstrate that he gave value without notice, he will prevail.
d. Convenient will not prevail.
What law prohibits mergers that are anti-competitive?
a. Sherman Act
b. Clayton Act
c. Robinson-Patman Act
d. Radmon Act
An example of the type of relationship required to find undue influence would be
a. a salesperson-purchaser relationship.
b. a bartender-customer relationship.
c. a doctor-patient relationship.
d. a neighbor-neighbor relationship.
The cost-benefit trade-off is particularly complex in environmental issues because those
who pay the cost often are not the ones who receive the benefit.
a. True
b. False
What level of owner’s liability does a trespassing adult have?
a. lowest level
b. mid level
c. higher level
d. highest level
Statements of fact about the past and present are called
a. provisions and terms.
b. promises and covenants.
c. representations and warranties.
d. damages and remedies.
In a condemnation, a court order specifies what compensation is just for the property
owner and awards title to the government.
a. True
b. False
The legal right to sue for a breach of contract is subject to a statute of limitations.
a. True
b. False
Which of the following is a characteristic of a restricted security?
a. It is purchased in a private offering.
b. It cannot be sold at any time.
c. It is subject to reporting requirements.
d. After six months, it is classified as a control security.
Any ambiguity in a contract is interpreted against the party who drafted the contract.
a. True
b. False
Under the UCC statute of frauds, the writing for a sale of goods must
a. state the quantity.
b. state the price.
c. be signed by both parties.
d. be notarized.
When a principal is partially disclosed
a. the agent and principal will be jointly and severally liable on the contract.
b. the agent and principal will be only jointly liable on the contract.
c. only the principal can be liable.
d. only the agent is liable.
Researchers who study happiness find that good health, companionship, and enjoyable
leisure activities all contribute more to happiness than money does.
a. True
b. False
The Civil Rights Act of 1866 offers plaintiffs the possibility of higher compensatory
and punitive damage awards than plaintiffs who file under the Civil Rights Act of 1964.
a. True
b. False
In a negligence case, the plaintiff must establish
a. duty, strict liability, causation, and injury.
b. mens rea, breach, foreseeable harm, and injury.
c. duty, actus reus, foreseeable harm, and causation.
d. duty of due care, breach, causation, foreseeable harm, and damages.
The Supreme Court has held that parody of copyrighted material is a violation of
copyright law.
a. True
b. False
All bailments have to be by agreement between the bailor and bailee.
a. True
b. False
What is a whistleblower?
a. An employee who thwarts an attempt by fellow employees to form a union
b. An employee who crosses the picket line to return to work
c. An employee who discloses illegal behavior on the part of his or her employer
d. An employee who secretly gives information to his or her employer about union
activity