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When Ford runs a commercial stating that Fords are better than Chevrolets and that
"you'll be happier if you buy a Ford," Ford is committing trade libel.
The sales of securities in the secondary market does not raise capital for the business
whose stock is sold.
Reasonableness of an offer requires that the offeror have an objective intent to contract
when making the offer.
Private international law primarily addresses relationships between countries, business
entities, and international organizations.
Under the Truth in Lending Act, creditors have a week to notify consumers of their
right to cancel the transaction.
The Equal Employment Opportunity Commission enjoys rulemaking as well as
enforcement powers.
A minor's contract for actual necessities does not require that the minor be mentally
competent for the contract to be valid.
Public corporation disclosures and filings are made available to the general public.
Leasing of personal property is based on state law modeled after provisions of the
Uniform Commercial Code.
Both commercial speech and corporate political speech are subject to intermediate
scrutiny.
The Sherman Act prohibits only contracts, combinations, and conspiracies in restraint
of trade.
Unless very extreme circumstances are shown, the tenant's right to habitability will be
more strictly enforced in residential leases than in commercial leases.
Just as in common law, the UCC recognizes the concept of anticipatory repudiation,
allowing a breach to be declared prior to performance being due.
Religious teachings and ethics are separate and distinct and rarely if ever overlap.
Jan has been fired by her employer for poor job performance. Jan is still entitled to
apply for and receive employer-provided health care under provisions of the
Consolidated Omnibus Budget Reconciliation Act.
As of today, the Enron bankruptcy remains the largest corporate bankruptcy in
America's history.
Every state in the United States recognizes the existence of LLCs.
Agencies are frequently charged by Congress to study potential solutions to a problem
and then exercise legislative function by creating legally enforceable rules.
Once an entry becomes part of a credit report, it is permanently a part of the report.
In an agency relationship, one party agrees to act as an agent for another party.
In order to file a lawsuit to enforce an environmental regulation, an individual must be
authorized to do so by the statute.
One of the principal's duties is to keep an accounting during the agency relationship.
States may never regulate commerce that crosses state borders as this is an exclusive
federal power.
Brad is drunk and driving his car 20 miles over the speed limit. He hits Angelina, who
is crossing the street against a red light. Angelina has over $95,000 in medical bills and
has significant pain and suffering. If Angelina sues in a state that still follows the theory
of contributory negligence, she will get nothing.
An easement is a nonpossessory interest in land.
When the seller promises that a product is good for a particular activity, the seller is
implying the warranty of merchantability.
When you place your garbage or trash at the curb, you have waived any expectations of
privacy and the police may go through the garbage or trash without a warrant.
The court cannot force creditors to agree to a reorganization plan even if it is fair,
equitable, and feasible.
Employers are not required to offer their employees health care benefits.
Whether an agency is classified as disclosed, undisclosed, or partially disclosed, the
principal has the duty to fully perform the contract obligations.
Kathy is the president of a corporation. She has just made the news by being discovered
with a male prostitute while at a conference. Mike, a shareholder, may successfully
present a proposal at the next shareholder meeting calling for a shareholder vote to have
her removed from office.
Government officials do not negotiate with principally responsible parties to figure out
their contribution toward cleaning up polluted sites.
An individual filing for Chapter 7 may always keep his or her car.
Tom's company has a code of ethics and a separate code of conduct. If he would like to
find out about the company's expectations or requirements regarding community
service, he would reference the code of ethics.
After an offer is made, the offeror may revoke that offer at any time, even if the offeree
has not been given a reasonable period of time to decide whether or not to accept.
Rich has been arrested for a series of 21 home burglaries that spanned over nine
months. The news regarding the crime spree was on television, on radio, and in the
newspapers on a regular basis. His lawyer doesn't believe that Rich can get a fair trial
locally, so he will ask for:
A. a change in personal jurisdiction.
B. a change in subject matter jurisdiction.
C. a change in venue.
D. a change using a long-arm statute.
AIG received a government bailout to save the company because:
A. had the company gone bankrupt, too many employees would have become
unemployed without sufficient unemployment insurance to aid them.
B. had the company gone bankrupt, the effect on New York City, where it was situated,
would have been a catastrophe, so the bailout was actually in part to keep New York
City solvent.
C. had the company gone bankrupt, money already owed to the U.S. government prior
to the collapse would never have been recovered, so the bailout was necessary to keep
AIG in operation until it was solvent enough to repay the government.
D. had the company gone bankrupt, the U.S. financial infrastructure would have been
severely or even irreparably damaged.
What is the standard that an individual must meet in order to file for Chapter 7
bankruptcy?
A. means test
B. threshold level of debt
C. length of time of debt
D. attempts to repay under Chapter 13
Christian and Jimmy both design and manufacture popular shoes. They believe that one
of the department stores that carries both of their designs is undercutting the other
department stores' prices. After discussion, Christian and Jimmy decide that they should
not sell their shoes to the department store again. What type of restraint is this?
A. meeting of the minds
B. price-fixing
C. boycott
D. market allocation
Martha and Bill have applied for teaching positions in your school's accounting
department. Martha is a recent graduate with her PhD in accounting and one published
paper. She has no teaching experience except for classes taught as a teaching assistant
during her PhD program. Bill also has a PhD in accounting and has been teaching for
five years at a major university. He has eight published papers. Both are hired as tenure
track assistant professors and assigned two 101 courses and one 102 course. When
Martha later discovers that Bill's salary is $10,000 higher than hers, she is furious and
files suit under the Equal Pay Act. Will she be successful?
A. She is being paid less to do the exact same job that her male counterpart is doing, so
she does have a valid cause of action.
B. Bill's five years of seniority allows the university to pay him more without liability.
C. Martha does not have a valid cause of action because she is not a minority eligible
for EPA protections.
D. Martha does not have a valid cause of action because Bill is being paid a different
salary based on factors other than sex.
An easement written in a deed is called an:
A. easement by necessity.
B. easement by grant.
C. easement by implication.
D. easement by prescription.
The merchant's privilege with regard to shoplifters requires each of the following
except:
A. the shopkeeper must have reasonable cause to stop the customer.
B. the shopkeeper may detain the customer only for a reasonable time.
C. the shopkeeper must make a reasonable investigation if possible.
D. the shopkeeper must have an eyewitness or video evidence of the theft.
Hillary is a nerdy bookworm couch potato who rarely goes out of her home except to
go to her job as a deskbound CPA. She wears a sweater almost every day, including
during the summer, and is always complaining about being cold. Edmund, a co-worker,
tells Hillary that he will give her $1 million if she climbs Mt. Everest. Edmund doesn't
believe that she'd even give the offer a second thought. Hillary, without saying anything
to anyone, starts an intensive training program to whip herself into shape, and six
months later, during her vacation, she climbs Mt. Everest. Upon returning to work, she
presents Edmund a picture of herself on the summit of Mt. Everest and demands her $1
million. Edmund tells her that they never had a contract so he owes her nothing, and
Hillary claims that the money is owed based on promissory estoppel.
A. Promissory estoppel applies only if Edmund is very rich, because $1 million is a lot
of money.
B. Promissory estoppel applies whether Edmund is rich or not.
C. Promissory estoppel does not apply because Edmond had no reason to believe that
Hillary would rely on his promise.
D. Promissory estoppel does not apply because Hillary must announce that she accepts
his offer for it to create an obligation to pay.
Mike lends money as a business loan to Kathy, who is capitalizing her start-up sole
proprietorship named Kathy's Things. If Mike must sue for repayment, he would sue:
A. Kathy.
B. Kathy's Things.
C. Kathy and Kathy's Things.
D. no one, since the loan makes him a partner.
Fred's Flooring (FF) contracted with Harry homeowner to install wood flooring
throughout Harry's home. Harry was to purchase the flooring, and the contract was
solely for installation. Payment was to be 20 percent at the time that the work
commenced and 80 percent once the flooring was installed. Harry purchased the
flooring materials and paid the 20 percent, so FF began work. When FF's work was
halfway completed, Harry realized that he didn't have the money to pay FF on
completion, so he bolted the doors and refused access. If FF wants to rescind the
contract and be paid for work completed, FF would sue for:
A. compensatory damages.
B. consequential damages.
C. restitution.
D. liquidated damages.
What is the problem with the Madrid Protocol?
A. There are no specifics that require fundamental enforcement.
B. Few countries have signed the agreement.
C. The European Union chose to create its own agreement instead of following the
Madrid Protocol's terms.
D. The terms of the protocol are very limited in their application.
Sam and Dave are going to open a sporting goods store. They sign a written limited
partnership agreement naming Dave as a limited partner and Sam as the general partner.
Sam files a certificate of limited partnership with the state. Sam contributes $100,000
toward the start-up, while Dave contributes $200,000. They agree to split profits evenly
because Sam will be working in the store and operating the day-to-day business. About
a month after they open, the business is not doing well, so Dave starts becoming more
involved. Soon he is requiring that Sam approve all purchases with him, and Dave is
actively directing Jack, the sole other employee. One day, Geoff, a customer, is injured
when a bowling ball falls off a shelf and shatters his foot. Geoff sues and is awarded a
judgment of $1 million.
A. As this was a limited partnership, Sam is liable for $800,000 and Dave is liable for
$200,000.
B. Sam and Dave are each liable for up to $500,000.
C. Under the circumstances, Sam and Dave are both jointly and severally liable for the
full $1 million.
D. Whoever negligently secured the bowling ball on the shelf is liable for the $1
million liability.
The Freedom of Information Act:
A. requires that all documents become public.
B. has no meaningful enforcement procedures.
C. opens certain agency records to the public.
D. publicly announces agency meetings ahead of time.
In Edgewater Motels Inc., v. A. J. Gatzke and Walgreen Company, Gatzke, an employee
agent of Walgreen, while filling out expense reports under the scope of his employment,
accidentally started a fire due to careless smoking, severely damaging the Edgewater
Motel. With regard to the smoking the court determined that:
A. defendant Walgreen has no liability because smoking had nothing to do with
Gatzke's duties, so the fire was caused by an act outside the scope of his employment.
B. defendant Walgreen is liable only if it knew that Gatzke smoked and did not order
him to stop or if it condoned or authorized smoking.
C. Edgewater wins because the smoking occurred as Gatzke was performing his job
and the slight deviation for his personal comfort was reasonable and was not a severe
departure from his duties.
D. Edgewater wins because Walgreen authorized Gatzke to rent the room and is
therefore liable for any intentional or unintentional acts of its employee agent that result
in harm to others.
In Falcon et al. v. Starbucks Corporation, after Starbucks reclassified the assistant store
managers (ASMs) from exempt to nonexempt for FLSA purposes, changing their job
duties but not their labor budgets and discouraging overtime, the court found that:
A. reclassifying an employee after the employee has begun work violates the FLSA.
B. maintaining a policy of discouraging overtime is unlawful and could, along with
other factors, lead to a consistent pattern of FLSA violations.
C. maintaining a policy of discouraging overtime, while not unlawful, could, along
with other factors, lead to a consistent pattern of FLSA violations.
D. reclassifying the ASMs from exempt to nonexempt was an improper reclassification
and the ASMs should indeed be exempt and not qualified for overtime compensation.
Which of the following is not a requirement for the undue-hardship standard?
A. The debtor cannot maintain a minimal standard of living for herself and her
dependents.
B. The debtor has no marketable skills that would allow him to be employed.
C. This state of affairs is likely to persist for a significant portion of the repayment
period.
D. The debtor has made good faith efforts to repay the loan.
The Toxic Substance Control Act (TSCA):
A. gives the FDA broad jurisdiction in controlling risks from manufacturing,
processing, use, and disposal of chemical compounds.
B. gives the state legislatures broad jurisdiction in controlling risks from
manufacturing, processing, use, and disposal of chemical compounds.
C. gives the EPA broad jurisdiction in controlling risks from manufacturing,
processing, use, and disposal of chemical compounds.
D. gives the EPA limited jurisdiction in controlling risks from manufacturing,
processing, use, and disposal of chemical compounds.
Formation of an LLC requires the filing of:
A. a statement of qualification.
B. a certificate of formation.
C. a record of business creation.
D. articles of organization.
Which of the following is not true regarding firm offers?
A. A firm offer automatically occurs when an offer or promise is made by one
merchant to another.
B. Firm offers do not require consideration for the offer to remain open.
C. Firm offers occur only between merchants.
D. Firm offers must be in writing.
An LLC offers principals the same liability coverage as that of:
A. principals in corporations with taxation at the business entity level.
B. principals in corporations with pass-through taxation.
C. general partners in a partnership with taxation at the business entity level.
D. limited partners in a partnership with pass-through taxation.
Felonies generally are punishable by:
A. three months or more of incarceration.
B. six months or more of incarceration.
C. nine months or more of incarceration.
D. twelve months or more of incarceration.
In Estate of Weingeroff v. Pilatus Aircraft, the plaintiff's representative brought a
diversity action against Pilatus, a Swiss company that manufactured the plane that
crashed, killing Weingeroff. The court decided:
A. that because Pilatus was a Swiss company, it was immune from civil lawsuits.
B. in favor of Pilatus because the more than $1 million that it spent in Pennsylvania
was too insignificant to create minimum contacts and no specific marketing was done
targeted to Pennsylvania.
C. in favor of Weingeroff because spending over $1 million in Pennsylvania satisfied
the minimum-contacts requirement to create jurisdiction.
D. in favor of Weingeroff because Pilatus conducted a nationwide marketing campaign
and specifically manufactured planes to meet FAA compliance, thus constituting
purposeful availment.
An offer may be terminated in all but which of the following ways?
A. acceptance
B. revocation
C. rejection
D. counteroffer
When a party files a writ of certiorari to the U.S. Supreme Court, how many justices
must vote to hear the case for it to be accepted for review?
A. four
B. five
C. six
D. The vote must be unanimous.
Riparian rights have to do with:
A. water rights.
B. airspace rights.
C. subsurface mineral rights.
D. leasehold rights.
Absent specific agreements between the parties, the reasonableness requirement of the
UCC governing delivery of goods requires each of the following except:
A. the goods must be delivered in one shipment.
B. the goods must be delivered at a reasonable hour.
C. the goods must be delivered on a weekday.
D. the goods must be delivered in a reasonable manner.
The amount and methods of capitalizing an LLC are often controlled by the:
A. articles of organization.
B. certificate of organization.
C. statement of qualification.
D. operating agreement.
Rule 16 of the 34 Act defines an insider as an officer, director, or shareholder who owns
________ or more of the company's total stock.
A. 5 percent
B. 10 percent
C. 15 percent
D. 20 percent
The Resource Conservation and Recovery Act (RCRA) regulates:
A. the environmental impact of coal mining and logging.
B. active and future facilities that produce solid waste and hazardous materials.
C. community recycling programs across the country.
D. none of these choices.
The FDA is proposing new rules for over-the-counter pain medication. The agency
expects to hear from various pharmaceutical groups in favor of the regulation and from
several medical associations on the public health consequences of the proposed change.
This is an example of what rulemaking phase?
A. publication of the rule
B. revision
C. public comment
D. study and research
Mackey Corp. is incorporated in Delaware but has no office or personnel in the state. Its
main office is in Arizona. Mackey would have a physical presence in Delaware if:
A. it maintains a P.O. box to receive mail, which is then forwarded to the main office in
Arizona.
B. it advertises its products in Delaware newspapers.
C. its sales personnel drive through Delaware to go to offices in Maryland.
D. it sells products to Delaware residents using the USPS for delivery.
Joe and Arthur each own a chain of restaurants. In order to ensure successful
restaurants, Joe and Arthur enter into an agreement that Joe will open his new locations
in Kansas City but not St. Louis and Arthur vice versa. This is an example of:
A. price-fixing.
B. market allocation.
C. tying agreements.
D. boycotts.
Bill is a technician at a university chemistry lab and is in charge of safety inspections
and prevention of injury due to faulty equipment. One morning, as a result of his
inspection, Bill discovers a gas burner with a broken valve. Bill gets distracted and fails
to put an "OUT OF ORDER/DO NOT USE" sign on the faulty burner. When the
morning class arrives, Halle uses the faulty burner and is burned when it catches fire.
Bill's negligence is based on:
A. nonfeasance.
B. misfeasance.
C. negligence per se.
D. res ipsa loquitur.
Burns offers Realtor a commission of 10 percent of the sales price if Realtor can find a
buyer for the Burns Building for $500,000. Realtor spends funds to research and obtain
potential-buyer contact information and locates Walters, who is willing to accept the
$500,000 offer to sell from Burns. Before any transaction takes place, Burns revokes his
offer to Realtor and refuses to sell the property to Walters. Burns's revocation is:
A. valid.
B. not effective.
C. enforceable.
D. effective.
A limited partnership requires:
A. at least two general partners.
B. at least two limited partners.
C. a written limited partnership agreement.
D. at least one general and one limited partner.
Contracts that involve goods and services are known as ________ contracts.
Every time you hit the delete button on your new computer you get a small electric
shock. Your friends with the same computer are suffering the same problem. These
computers have a ________ defect.
Explain how the UCC "battle of the forms" is resolved in nonmerchant and in merchant
transactions.
The court's authority over disputes between the parties is called ________ jurisdiction.
In a minority of the states, the articles of incorporation are called the ________.
Name and define three forms of illegal work stoppages that may be conducted by
employees.
Measures of judicial action intended to compensate an injured party in a civil lawsuit
are called _______.
State security laws are generally referred to as ________ laws.
You are taking a course with an adjunct professor who is teaching under a one-course
contract. With six weeks to go in the course, she is offered a tenure track position at
another school that requires her to start within a week. When she approaches the
administration, what options are available, if any, regarding the adjunct contract and her
desire to leave early?
Stella has asked her employer for leave pursuant to the Family and Medical Leave Act.
What must she evidence to be eligible for leave?
What is meant by the term capital call? Under what circumstances might a capital call
occur, and how does it affect partners?
When a copyright owner can prove that she or he has legal ownership of the work and
that the infringer copied the work without permission, this is called ______
infringement.
Once a federal judge is confirmed and sworn in, he or she may be removed only by
death, retirement, or _______.
________ are those who start up an LLC initially.
The ________ of the International Court of Justice is the main document constituting
and regulating the International Court of Justice.
In Georgia Malone & Company Inc., v. Ralph Rieder et al., Malone was a real estate
firm that accused a former potential buyer of selling confidential information Malone
had gathered about the sale property. The former buyer sold the information to a
competing real estate firm. How did the court rule in the case, and what must a plaintiff
show to recover under this equitable theory?
The idea that nations defer to and give effect to laws and court decisions is referred to
as ______.
If an employee in a unionized company believes that the employer is violating the
collective bargaining agreement, he or she may file a ________ and the union will
arbitrate the matter on behalf of the employee.
