Pure Oil Company enters into a contract with QuikBilt, Inc., to construct an oil pipeline
to withstand specific conditions. If QuikBilt fails to meet this standard, which is
construed as a breach of contract and a breach of a duty of care, Pure might be awarded
punitive damages to
a. establish, as a matter of principle, that QuikBilt acted wrongfully.
b. provide Pure with funds for a foreseeable loss beyond the contract.
c. provide Pure with funds for its loss of the bargain.
d. punish QuikBilt and deter others from similar acts.
Mary waits outside Julias house and hits Julia with a baseball bat as Julia leaves the
house. When Julia sues Mary for battery, Mary will be considered
a. a victim.
b. a tortfeasor.
c. a plaintiff.
d. a reasonable person.
Generally, stock offerings that are made in a limited manner during any twelve-month
period are ex-empt from the registration requirement.
a. True
b. False
A bank is not responsible for determining whether a signature on a customers check is
genuine.
a. True
b. False
The Uniform Commercial Code has been adopted, at least in part, in
a. all states.
b. forty-five states.
c. thirty-five states.
d. no state.
Billy opens a bicycle shop that sells an innovative new kind of bicycle. He decides to
call the bicycles “Bicycles. Billy extensively markets his product, has a high sales
volume and becomes well known for selling Bicycles. The term Bicycle
a. is automatically protected against trademark infringement.
b. receives no protection against trademark infringement.
c. can be registered as a trademark to obtain protection against trademark infringement.
d. can be registered as a certification mark.
Emily checks her luggage at Flyaway Airliness ticket counter before boarding her flight
to Houston, Texas. Subject to a bailment is
a. Emily.
b. Emilys luggage.
c. Emilys ticketed seat on the flight
d. none of the choices.
Hollister and Gladys do business as partners in Frothy Confections. For federal income
tax purposes, Frothy Confections would be treated as
a. a pass-through entity.
b. a natural person.
c. a tax-paying entity.
d. a partnership by estoppel.
A person who buys a copyrighted work cannot sell it to someone else.
a. True
b. False
Quinn enters into a series of agreements with Reba involving a sale of a Suite Dreams
Motel, including the land, building, furnishings, shares of stock in Suite Dreams
Company, and a contract with Trudy to create an ad campaign. Reba suspects that
Quinn may be misrepresenting the facts. The UCC Statute of Frauds governs
a. the sale of any of the property evidenced by a writing.
b. the entire deal, including the marketers services.
c. the sale of the furnishings priced at $500 or more.
d. the sale of the land and the building.
Harm must be foreseeable to be considered the proximate cause of an injury in
negligence.
a. True
b. False
Mary admires Julias collection of scarves. Julia says “I might sell you a few someday, if
I get tired of them. Julias statement is
a. an effective offer.
b. not an effective offer because it has not been communicated to Mary.
c. not an effective offer because the Julia does not show a serious intent to be bound.
d. an acceptance.
Perfection refers to the quality of the collateral that secures a creditors interest in a
debtors debt.
a. True
b. False
Goldtone Corporation makes cell phones. Haji files a product liabil-ity suit against
Goldtone, alleging a design defect. In deciding whether to hold Goldtone liable, the
court may consider an alternative designs
a. popularity among industrial designers.
b. attractiveness to consumers.
c. aesthetics.
d. effect on the product.
Genetic Seed Company hires Howie to work on Genetics shipping dock, accepting
deliveries and dealing with other companies drivers. With respect to Genetic, Howie is
most likely
a. an agent.
b. an independent contractor.
c. a principal.
d. awork for hire.
Securities that are exempt from the registration requirement can generally be sold and
resold without being registered
a. True
b. False
Julie orally agrees to assume Carlyles debt to FunGames, Inc. Julie gets a substantial
personal benefit from the agreementCarlyle agrees to work for Julies landscaping
service for six months. Julies oral assumption of the debt is enforceable by
a. Julie or Carlyle only.
b. FunGames only.
c. any of the parties.
d. no one.
Filtration Products, Inc., files a suit against Emmett, its former accountant, al-leging
constructive fraud. Emmett may be held liable
a. if Filtration cannot prove actual fraud.
b. if Emmett was grossly negligent in the performance of his duties.
c. only if Emmett acted with fraudulent intent.
d. only if Emmett impersonated someone else who could be liable for fraud.
Genovese Contracting, Inc., agrees to build a warehouse for Hawthorne Distributors.
Genovese runs into the types of difficulties that contrac-tors ordinarily confront, and
Hawthorne agrees to pay extra compensation to over-come them. Regarding the
agreement to pay more, a court would likely
a. enforce it.
b. rescind it.
c. order the parties to renegotiate it.
d. not enforce it.
A generic term is not protected under trademark law unless it acquires a secondary
meaning.
a. True
b. False
Kristal is a member of Laboratory CSI Services, LLC, a limited liability company.
Kristal can participate in the firms management
a. only to the extent that she assumes liability for the firms debts.
b. only to the extent of her investment in the firm.
c. to any extent.
d. to no extent.
Sweetwater Café defaults on debts to Town & Country Bank and Uno Loan Company.
Town & Country perfected its security interest before Uno. Town & Country takes
possession of the collateral in which it has a security interest. On a sale of the
collat-eral, the proceeds will be applied first to
a. Sweetwaters previous payments on the debts.
b. Sweetwaters unpaid payments on the debts.
c. the balance of Sweetwaters debt to Town & Country.
d. the balance of Sweetwaters debt to Uno.
Mythic Games Company employs two hundred workers full-time. If Mythic Games
plans to have a mass layoff, it must provide its employees with at least
a. thirty days of notice.
b. sixty days of notice.
c. ninety days of notice.
d. one year of notice.
In contracts involving a sale of unborn animals to be born within twelve months,
identification takes place when the animals are born.
a. True
b. False
There is one set of procedural rules for federal courts and one set for state courts.
a. True
b. False
The last security interest to be perfected is the first in priority over any other perfected
security interests.
a. True
b. False
A fixed-rate mortgage has a rate of interest that changes periodically.
a. True
b. False
StartUp Investors, LLC, is a limited liability company without a written operating
agreement. Among the mem-bers, a dispute arises concerning the division of profits.
Under most LLC statutes, the profits will be
a. distributed according to the members proportionate shares of ownership in the firm.
b. divided equally among the members.
c. forfeited to the state.
d. reinvested in the business until the dispute is resolved.
Federal law prohibits the Federal Trade Commission from cooperating and sharing
information with foreign agencies in investigating and prosecuting those involved in
spamming.
a. True
b. False
An accountant who prepares a financial state-ment in good faith may avoid liability
under Section 18 of the Securities Ex-change Act of
a. True
b. False
Carol is married to Andy. Carol buys food for their childrens lunches and charges the
cost to Andys account. This is
a. an agency by operation of law.
b. an agency by estoppel.
c. anagency by ratification.
d. not the creation of an agency relationship.
Under the Foreign Sovereign Immunities Act, a foreign state can be a political
subdivision of a foreign state.
a. True
b. False
An instrument “payable to bearer is transferable but not negotiable.
a. True
b. False