A corporate officer is expected to be informed on corporate matters.
In most states, a release requires a signed writing.
A check is a special type of certificate of deposit.
Common carriers are held to a standard of care based on strict liability in protecting
bailed property in their possession.
A court’s direction to a party to do or to refrain from doing a particular act is a
rescission.
Business ethics applies only to the owners, operators, and employees of corporations.
To be enforceable, a writing evidencing an oral contract that would otherwise be
unenforceable must be signed by the party who seeks to enforce it.
SEC Rule 10b-5 applies in relatively few cases involving the trading of securities.
Under no view does a corporation owe an ethical duty to a group other than its
shareholders.
An employer can refuse to bargain collectively with an elected employee representative.
Title is one concept that the UCC has substituted for the common law concept of risk of
loss.
An individual’s right to privacy includes the exclusive use of his or her identity.
A party’s oral agreement to pay another’s debt is never enforceable.
Misrepresentation of a material fact can occur through words alone.
A limited liability company can be taxed as a partnership.
Consequential damages are foreseeable damages that arise from a party’s breach of a
contract.
The UETA applies to an e-transaction unless the parties “opt out.”
If a homeowner defaults, the lender has the right to foreclose on the mortgaged
property.
A person whose name is forged on an instrument is liable to pay only a holder in due
course the value of the forged instrument.
If a contract requires performance to the personal satisfaction of a party, the party must
in all cases be personally satisfied.
In early neutral case evaluation, a third party’s evaluation of each party’s strengths and
weaknesses forms the basis for negotiating a settlement.
A business organization and its actions cannot be based on trust.
A court will not pierce the corporate veil of a corporation that is merely too “thinly”
capitalized.
A third party’s right to control the details of performance of a contract indicates that the
third party is an intended beneficiary.
A business firm may have to comply with the laws of any jurisdiction in which it
actively targets customers.
When the corporate privilege is abused for personal benefit, the courts will require the
owners to assume personal liability.
An employer can be liable for an employee’s sexual harassment of a member of the
same gender.
A copy must be exactly the same as the original to infringe a copyright.
For action to be taken during a shareholders’ meeting, a quorum must be present.
To execute a valid will, a testator must remember the “natural objects of his or her
bounty.”
As a joke, Jem takes Kyla’s business law textbook and hides it so that Kyla cannot find
it during the week before the exam. Jem may have committed
A.appropriation.
B.conversion.
C.intentional infliction of emotional distress.
D.trespass to personal property.
Rikki and Sid enter into a sales contract. With respect to the specific contractual
provisions set out in the UCC, Rikki and Sid may
A.agree to different terms only to a reasonable extent.
B.agree to different terms unless they “get caught.”
C.agree to whatever terms they wish.
D.not agree to different terms.
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.
Quik Fix-It, Inc., offers Pam a job as a plumber. No time for acceptance is specified in
the offer. The offer will terminate
A.after a reasonable period of time.
B.after a typical work week (five business days).
C.after a usual month (thirty calendar days).
D.never.
Vehicle Leasing Agency (VLA) and Wander Trucking Company enter into a contract
for a lease of eight cargo vans. VLA delivers eight vans, but they are not cargo-sized.
Wander
A.cannot reject the entire shipment.
B.can reject the entire shipment.
C.must accept the entire shipment.
D.must reject the entire shipment.
Dani asks her cousin Cedric to sacrifice his career, move his home and family, and
provide services, at a lower salary than usual, to Dani’s new Commercial Shipping
Company. Dani tells Cedric that he will jointly own and run the firm. Cedric agrees.
Later, after the firm gains the benefit of Cedric’s services, Dani forces Cedric out.
According to the majority in the Braddock case, these facts sufficiently allege the
elements of a claim for
A.damages based on quasi contract.
B.recovery in fraud.
C.relief from a unilateral mistake.
D.none of the choices.
Kip writes a check for $1,000 drawn on Local Bank and presents it to Mira. Mira
presents the check for payment to Local Bank, which dishonors it. The party most likely
liable to Mira is
A.Kip in a civil suit.
B.Kip in a criminal prosecution.
C.Local Bank in an administrative proceeding.
D.neither Kip nor Local Bank.
Chita owns the land on which Downwind Farm is situated, plus the farmhouse, barn,
and other structures permanently attached to the land. Chita’s brother Elvin owns
everything else on the farm-implements, seed, and so on. The real property is owned by
A.Chita and Elvin.
B.Chita only.
C.Downwind Farm.
D.Elvin only.
Genuine Seed Company and Hillside Farmers Cooperative enter into a contract for a
sale of hybrid seeds. Under the perfect tender rule, Genuine Seed must ship or tender
seeds to Hillside that
A.approximately conform to all of the details of the contract.
B.entirely conform to the contract except in one or two details.
C.exactly conform to the contract in every detail.
D.substantially conform to the contract in most details.
Baked Goods Company agrees to supply Comida Caf with all the corn chips that it
requires for a year. A sudden demand for ethanol results in a shortage of corn, and the
price rises sharply. Baked Goods asks Comida to pay a higher price for the chips. This
request is
A.invalid as an attempt at extortion or the so-called holdup game.
B.invalid under the preexisting duty rule.
C.valid as a risk ordinarily assumed in business.
D.valid due to the unforeseen difficulty of the sudden price increase.
In Ben v. City Car Dealership, a state supreme court held that a minor could cancel a
contract for the sale of a car. Now a trial court in the same state is deciding Daphne v.
Even Steven Auto Deals, Inc., a case with similar facts. Under the doctrine of stare
decisis, the trial court is likely to
A.allow the minor in the Daphne case to cancel the contract.
B.disregard the Ben case.
C.order the minor in the Daphne case to cancel the contract.
D.require the minor in the Daphne case to fulfill the contract.
Louis-larger and stronger than Mica-threatens to hit Mica before hitting and injuring
him. Mica files a suit against Louis for assault and battery. Mica will most likely
recover for
A.assault and battery.
B.assault but not battery.
C.battery but not assault.
D.neither assault nor battery.
Lacy is an accountant who prepares her clients’ tax returns. Muff is not an accountant,
but he also prepares tax returns for clients. Under the Internal Revenue Code, liability
for preparing a false return may be imposed on
A.Lacy and Muff.
B.Lacy only.
C.Muff only.
D.neither Lacy nor Muff.
Seafood Canning Corporation keeps a file of I-9 verifications forms. To inspect this file,
the appropriate government officer must obtain
A.a subpoena and a warrant.
B.a subpoena or a warrant, but not both.
C.not a subpoena, a warrant, or the employer’s consent.
D.the employer’s consent.
Kady, an agent for Lebron, enters into a contract on Lebron’s behalf with Madge that
must be in writing to be enforceable under the Statute of Frauds. Kady’s authority to
enter into this contract is not in writing. Under the equal dignity rule, this contract is
A.enforceable.
B.void.
C.voidable at Lebron’s option.
D.voidable at Madge’s option.
Gelato Ice, Inc., is incorporated in the state of New Jersey and is doing business in the
state of New York. In New York, Gelato is properly referred to as
A.a domestic corporation.
B.a foreign corporation.
C.an alien corporation.
D.a de jure corporation.
Cross-Country Trucking Company contracts with Baldwin to transport crated goods to a
certain destination for $5,000. Cross-Country delivers the crates, but Baldwin does not
pay. Cross-Country learns that the crates contained stolen goods. Cross-Country can
A.do nothing with respect to the contract.
B.recover $5,000 from Baldwin.
C.recover the goods but not the $5,000 from Baldwin.
D.recover the goods or the $5,000 from Baldwin.
Dizzy is not Edwina’s agent but enters into a contract with Frida on Edwina’s behalf.
Edwina later contacts Frida to approve the contract. This is
A.an agency by agreement.
B.an agency by estoppel.
C.an agency by ratification.
D.not the creation of an agency relationship.
Reed borrows $150,000 from Suburban Credit Union to buy a home, which secures the
loan. Three years later, Reed stops making payments on the loan. After Suburban Credit
repossesses and auctions off the property to Tyler, equity remains. This amount most
likely belongs to
A.Reed.
B.Suburban Credit Union.
C.Tyler.
D.the county in which the property is located.
Celfone Corporation is required to file a registration statement with the Securities and
Exchange Commission. This statement must contain
A.a copy of prospectuses to be provided to investors.
B.a description of securities being offered for sale.
C.a record of pre-registration sales in securities.
D.a sample of advertising to be used to attract investments in Celfone.
New Apps Company develops “Browser Lite,” software to speed the display of graphics
on Web sites. Browser Lite has the most copyright protection under
A.the Berne Convention.
B.the Paris Convention
C.the TRIPS Agreement.
D.the Madrid Protocol.
Loni and Myra enter into a contract for a sale of clarinets and other wind instruments.
Loni delivers, but Myra does not pay. Loni can normally recover as damages the
difference between
A.any loss avoided and any profit gained.
B.the actual price and the hoped-for price.
C.the contract price and the market price.
D.the current prices in the parties’ locations.
Flynn, an accountant, helps Grange Supply Company prepare and file a false federal
corporate income tax return. Under the Internal Revenue Code, this is
A.a felony punishable by a fine and imprisonment.
B.a felony punishable only by a fine.
C.a misdemeanor punishable only by a fine.
D.a civil violation subject to a liability suit but not a crime.
Brandy forges Caleb’s signature on a check “payable to the order of Brandy” drawn on
Caleb’s account in Downtown Bank. Caleb’s forged signature is
A.effective if an innocent third party accepts the check.
B.effective to the degree that it matches Caleb’s genuine signature.
C.effective to the extent that Downtown Bank debits Caleb’s account.
D.not effective.
Grain from Harvest Farms is wrongfully commingled with grain from Idyllic Fields,
which obtains possession of all of the grain. This is
A.a bailment.
B.accession.
C.confusion.
D.production.
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.
Kit loses her suit against Lou in a Minnesota state trial court. Kit appeals to the state
court of appeals and loses again. Kit would appeal next to
A.a U.S. district court.
B.the Minnesota Supreme Court.
C.the United States Supreme Court.
D.the U.S. Court of Appeals for the Eighth Circuit.
Screen Perfect, Inc., and TV Stores enter into a contract for a sale of high-definition
television sets. Screen Perfect ships goods that do not exactly conform to the contract in
some details. TV Stores
A.cannot reject the entire shipment.
B.can reject the entire shipment.
C.must accept the entire shipment.
D.must reject the entire shipment.
Ozzy is an officer of Prudent Financial Corporation. Ozzy serves in a representative
capacity for Prudent Financial’s owners. With respect to binding Prudent Financial to
contracts, Ozzy is
A.an agent and has the authority.
B.an agent but does not have the authority.
C.not an agent and does not have the authority.
D.not an agent but does have the authority.
The payment of Brian’s debt to Chuck is guaranteed by Brian’s personal property. This
is
A.a reorganization.
B.a secured transaction.
C.a suretyship agreement.
D.a violation of most state laws.
Delite Candy Company hires Elton to sell Delite’s products in a certain area. Delite
agrees to pay Elton a salary, plus commission, for a trial period. They also agree that
Elton can sell using any methods and during any hours that seem appropriate. The key
factor in whether Elton is Delite’s employee is
A.the amount of Elton’s salary.
B.the control Delite has over the details of the work.
C.the length of the trial period.
D.the title that designates Elton’s position.
Olive Grove Enterprises, Inc., completes its registration process and issues a
free-writing prospectus. This tells prospective investors
A.about investing freely.
B.how to write their own prospectus.
C.that they can “freely write their own ticket” to buy Olive’s securities.
D.that they may obtain the prospectus at the SEC’s Web site.
Louis, a certified public accountant and an investor, and Maria, an insurance
salesperson and a realtor, may create an agency relationship for
A.a business purpose only.
B.a legal purpose only.
C.any purpose.
D.no purpose.