B2B, Inc., an inventory management firm, is a corporation. Cody is one of B2Bs
ownersa shareholder. If Codys dies, B2B
a. automatically terminates.
b. continues in business.
c. dissolves unless the other owners agree to continue.
d. distributes Codys shares to the other shareholders.
Dian, a clerk at an Entertainment Unlimited store, takes a video game player from the
store without permission. Dian is liable for
a. appropriation.
b. conversion.
c. disparagement of property.
d. wrongful interference with a business relationship.
Echo enters into an agreement with Deep Pan Pies, Inc., to operate a franchise in Centre
City. Later, Deep grants franchises to others within the city. Echo files a suit to close
them. If the court rules in Echos favor it will most likely be on the ground that
a. Deep violated the antitrust laws.
b. Deep violated the implied covenant of good faith and fair dealing.
c. Echo paid a franchise fee.
d. Echo was the first Deep franchisee in Centre City.
The U.S. Mine Safety Administration conducts searches of certain businesses. This
agency and other administrative agencies can conduct warrantless searches in
a. all industries.
b. highly regulated industries.
c. no industries.
d. newly regulated industries only.
Tonya and many other consumers complain to the Federal Trade Commission (FTC)
that a Whoopie Wonders Company ad is deceptive. The FTCs first step is to
a. draft a formal complaint.
b. investigate.
c. issue a cease-and-desist order.
d. require counteradvertising.
Kelly is injured when she slips and falls on Lees sidewalk. To determine whether Lee
owed a duty of care to Kelly, Lee is subject to the standard of
a. a realistic person.
b. a reasonable person.
c. a recognizable person.
d. a reliable person.
Crosby believes that he and Dakota agreed he would act as her personal sports trainer
for seven workout sessions. In a later dispute, the existence of any contract can be
judged by
a. the parties statements at the time of their alleged contract.
b. what the defendant claims was the parties intent.
c. what the plaintiff claims was the parties intent.
d. what the parties agree they intended.
Trevors business is The Spicy Chocolatier Café chain. “The Spicy Chocolatier Café is
a. a certification mark.
b. a collective mark.
c. a service mark.
d. a trade name.
Leon files a suit against Moira, a medical doctor, alleging negligence. As a physician,
Moira is held to the standard of
a. a blameless individual.
b a faultless ordinary person.
c. a reliable professional.
d. a reasonable physician.
Fact Pattern 31-1A
24-Hour Credit Corporation issues high-cost and high-fee mortgage products to people,
including Benny, who could not easily obtain credit under other loan programs.
Refer to Fact Pattern 31-1A. Under federal law, if 24-Hour Credit fails to provide
certain material disclosures with respect to the loan, Bennys right to rescind the loan
a. expires at midnight on the day the loan is finalized.
b. is immediately revoked.
c. is extended for up to three years.
d. is tolled for the duration of the loan payments.
Delta Music Company and eDistribution & Marketing Corporation form a joint stock
company. A joint stock company can be formed for, at the most,
a. an implied duration of not more than six months.
b. a perpetual existence.
c. a single activity or transaction.
d. a stated duration of not more than one year.
Brick Products, Inc., files a suit against City Trucking Service for breach of contract,
based on what Brick claims was Citys offer. For a court to determine if a contract has
been breached, under the common law, the offer must include terms that are
a. exactly precise.
b. reasonably definite.
c. unequivocally approximate.
d. vague or uncertain.
Garland publishes a book titled Half Pipe, Full Throttle, which includes a chapter from
Ians copyrighted book Snowboarder. Garlands use of the chapter is actionable provided
a. consumers are confused.
b. Garlands use is intentional.
c. Garlands use reproduces Ians chapter exactly.
d. Garland does not have Ians permission.
When Flash Flush Company is incorporated in Georgia, the state agency with which the
business name is filed approves it as a trade name. This filing will protect the name
a. only within Georgia.
b. throughout the United States.
c. in every United Nations member country.
d. wherever the name might be used.
Fact Pattern 18-B1
Bella Homes enters into a contract to buy 132 acres from Watershed Holdings to
subdivide and sell in fifth-acre lots for Pristine Acres, a residential development.
Refer to Fact Pattern 18-1. If Watershed breaches the contract, Bellas remedy would
most likely be
a. a certain ratio of the amount that Watershed has in liquidated funds.
b. a percentage of Watersheds unrealized profit.
c. the difference between the lands contract and market prices.
d. specific performance.
Ewa is a current employee of Financial Accounting, Inc. Gomer, a former Financial
employee who is currently unemployed, collects unemployment compensation. This is
provided by a tax on
a. Ewa and Gomer only.
b. Ewa, Financial, and Gomer.
c. Financial only.
d. none of these parties.
The U.S. Fish and Wildlife Service uses notice-and-comment rulemaking. This involves
a period during which
a. judges, legislators, and the president are asked about a proposed rule.
b. potential violators of a proposed rule are notified and publicized.
c. the administrators “notice a problem and “comment on it.
d. the public is asked to comment on a proposed rule.
Carol agrees with Dede and other performers to sign contracts with promoters and
others on the performers behalf. Carol is
a. an agent.
b. an employee.
c. an employer.
d. a principal.
Krystal is a federal judge. Krystals judicial decisions are part of case law. This law
includes interpretations of primary sources of law. These sources include
a. administrative regulations.
b. articles in law reviews and other legal journals.
c. compilations summarizing court decisions on particular topics.
d. legal encyclopedias.
The payment of Floridas debt to Guillermo is guaranteed by Floridas personal property.
Guillermo is
a. a lienor.
b. a secured party.
c. a mortgagee.
d. a usurer.
Chuckie, president of DrinkUp Fresh Beverages, Inc., does not apply utilitarianism to
business ethical issues. One problem with utilitarianism is that it
a. gives business profits priority over production costs.
b. ignores the practical costs of a given set of circumstances.
c. requires complex cost-benefit analyses of simple situations.
d. tends to justify human costs that many find unacceptable.
In a brief filed in Genes suit against Hoyt in a federal court, Ilsa, Genes attorney, cites,
Jon v. Klint, an unpublished opinion. According to a ruling of the United States
Supreme Court, the judge in Genes suit
a. may consider the unpublished opinion persuasive.
b. must apply the unpublished opinion as binding.
c. must ignore the unpublished opinion.
d. must issue a judgment in Hoyts favor.
Dunn and Etta are limited partners in Fancee Fashion Stores, a limited partnership. In
terms of the firms books, Dunn and Etta are entitled to
a. access in proportion to their participation in management of the firm.
b. access to the parts that directly relate to their capital contributions.
c. no access.
d. total access.
Rita orders 1,000 cases of 1/4-inch nuts from Steel Parts Companys 10,000-case lot.
Steel Parts separates 1,000 cases from the lot. Title and risk of loss
a. remain with Steel Parts until Rita acknowledges tender of delivery.
b. remain with Steel Parts until Rita accepts 1,000 cases.
c. shift to Rita after she accepts the nuts and inspects them for defects.
d. shift to Rita when Steel Parts separates the cases.
Fact Pattern 46-1B
Rock Mining Company operates a gravel pit next to Sids residence. Sid files a suit
against Rock, alleging that the pit is a nuisance and unreasonably interferes with Sids
enjoyment of his property.
Refer to Fact Pattern 46-1B. The court is most likely to award Sid damages
a. if letting the pollution continue is equally as harmful as stopping it.
b. if letting the pollution continue is less harmful than stopping it.
c. if letting the pollution continue is more harmful than stopping it.
d. under no circumstances.
Triple-D Cinemas promises to pay Shakir $1,000 to repair and clean its marquee. The
act of doing this work is
a. not consideration because its performance is a preexisting duty.
b. not consideration because its exchange is not a bargain.
c. consideration.
d. not consideration because its value is legally insufficient.
Fabulous Auto Sales, Inc., employs GR8 Collection Company as a collection agent.
While repossessing a car from Hadji, one of Fabulouss customers, GR8 causes an
accident in which Hadji is injured. Hadji can recover from
a. Fabulous only.
b. Fabulous or GR8.
c. GR8 only.
d. Hadjis insurance company only.
Pressing Music, Inc., offers to buy from Digital Media Corporation (DMC) one million
blank CDs of a certain quality. Without notifying Pressing, DMC timely ships CDs of a
different quality. With respect to the offer and a possible contract, this shipment is
a. an acceptance and a breach.
b. an acceptance and an accommodation.
c. an acceptance and complete performance.
d. a rejection and a counteroffer.
Merchandise Presentation Company enters into a contract with Newt to perform certain
services for a certain price. Newt is later dissatisfied with what he claims is a low level
of service for a high price. Whether this deal is unconscionable is subject to
a. the interpretation of a court.
b. the opinion of the buyer.
c. the position of the seller.
d. the precise definition in UCC 2302.
Velma borrows $110,000 from Watershed Bank to buy a home. If she fails to make
payments on the mortgage, the bank has the right to repossess and auction off the
property securing the loan. This is
a. a short sale.
b. forbearance.
c. foreclosure.
d. the equitable right of redemption.
Chuck works for Deepwater Drilling Corporation. While operating a Deepwater drill,
Chuck suffers an injury. Under state workers compensation laws, Chuck will be
compensated only if
a. he does not have health insurance.
b. he is completely disabled.
c. his injury was accidental.
d. his injury was intentional.
A tenancy by the entirety is created by a conveyance of all of a parcel of real property
to a single tenant.
The Constitution expressly excludes state regulation of commerce.
Personal defenses are used to avoid payment to an ordinary holder of a negotiable
instrument, but not to an HDC or a holder through an HDC.
Special damages are awarded for damage caused by special circumstances beyond a
contract.
In many states, a hotel is not liable for the loss of any cash or property that guests bring
into their rooms if the hotel is not negligent.
According to utilitarianism, it does not matter how many people suffer a negative effect
from an act.
A buyer in the ordinary course of business has priority unless a previously perfected
security interest exists as to the goods.
The extreme risk of an activity is a primary basis for imposing strict liability.
State laws may not regulate a business s disposal of toxic wastes.
An incorrect statement as to the age of the insured provides an insurance company with
an excuse to avoid payment on the insureds death.
If a debtor does not pay a mechanics lien, the debtors property can be sold to satisfy the
debt.
All collateral promises must be in writing to be enforceable.
Agency by operation of law may not occur in emergency situations.
A “living will is a will drafted and executed during a decedents life.
Employment laws apply only to the employer-employee relationship.
If a price quotation contains a mistake in the adding of a number of figures, the contract
may not be enforceable.