If a principal and an agent enter into an express agency contract, the principal cannot
employ any agent other than the agent who entered into the contract.
The traditional view of social responsibility of business emphasized maximizing profits
for employees rather than shareholders.
Section 7 of the NLRA is a federal law that gives employers the right to terminate union
practices detrimental to the organization.
A principal is liable for an agent’s tortious conduct during a substantial frolic and
detour.
The United Nations (UN) does not allow permanent membership of the Security
Council to any member nation.
An agent is not liable to the principal for any injuries resulting from a breach of the
duty to notify.
The shareholders are responsible for determining how much will be paid in dividends.
States lack the power to enact antitrust statutes autonomously.
The Howey test is used to determine if an arrangement is an investment contract.
Criminal fraud is the crime of obtaining title to property through deception or trickery.
A nolo contendere plea can be used as evidence of liability against the accused at a
subsequent civil trial.
A surviving spouse in a tenancy by the entirety has the right of survivorship.
If an employer refuses to promote all persons of the Asian race, the company has
engaged in disparate-impact discrimination.
The ECPA provides that stored electronic communications may be accessed by the
party or entity providing the electronic communication service.
Individual unions are not allowed to join AFL-CIO; the members need to be individual
employees.
A corporation can be incorporated in several states.
Native American tribes and tax-exempt private clubs are expressly excluded from Title
VII of the Civil Rights Act of 1964.
An apparent agency is also known as an agency by estoppel.
Malicious prosecution is a tort that permits a person to recover for emotional distress
caused by the defendant’s negligent conduct.
By permitting pre-issuance and post-grant challenges within the U.S. Patent and
Trademark Office (PTO), the law attempts to have disputes resolved within the PTO
before reaching the litigation stage.
A terminated life estate property reverts to the grantor or the grantor’s estate or other
designated person.
Federal judges of the U.S. district courts are appointed for 14-year terms.
The term ISP refers to users who disguise computer viruses as executable programs and
send them across the Internet.
A general warranty deed contains the greatest number of warranties and provides the
highest level of protection to a grantee.
If an employer refuses to promote a qualified female to a management position because
of her gender, this would be in violation of Title VII of the Civil Rights Act of 1964.
A group of employees that a union is seeking to represent in known as an appropriate
bargaining unit.
Buildings constructed on land are considered personal property.
Under the Resource Conservation and Recovery Act, the EPA is authorized to regulate
underground storage facilities.
Regions that do not meet air quality standards are designated as air quality control
regions.
Corporations can seek protection under the Fifth Amendment privilege against
self-incrimination.
According to Kantian ethics, one would be obligated to abide by a contract even if that
contract turns out to be detrimental to the obligated party.
To be valid, a security agreement must set forth the creditor’s rights upon the debtor’s
default.
In a criminal lawsuit, guilt has to be proven beyond a reasonable doubt.
The process of liquidating a partnership’s assets and distributing the proceeds to satisfy
claims against the partnership is known as winding up.
According to the failing company doctrine, two or more smaller companies are allowed
to merge to compete with a larger company even if they are highly profitable as smaller
companies.
Restraints that are not characterized as per se violations are not further examined using
the rule of reason.
General partners have unlimited personal liability for the debts and obligations of the
partnership.
The FDA cannot recall any cosmetics that contain unsubstantiated claims of preserving
youth or increasing virility from the market.
Which of the following is true of a general power of attorney?
A) It can be based on a conversation between the principal and agent.
B) It must appoint a licensed attorney to act as the attorney-in-fact.
C) It is one of the most informal types of express agency agreements.
D) It allows the agent to sign legal documents on the principal’s behalf.
Which of the following forms of tenancy involves the possession of property without
right?
A) tenancy at sufferance
B) tenancy for life
C) tenancy for years
D) tenancy at will
________ are courts that hear matters of a specialized or limited nature.
A) General-jurisdiction trial courts
B) Inferior trial courts
C) Intermediate appellate courts
D) Chancery courts
To which Fifth Amendment provision in the U.S. Constitution do the Miranda rights
refer?
A) parole eligibility
B) privilege against self-incrimination
C) inordinate seizures
D) double jeopardy
A limited partnership has two types of partners, ________.
A) general partners and sole proprietors
B) general partners and limited partners
C) ordinary partners and liable partners
D) special partners and sole proprietors
According to the U.S. Department of Labor, children under the age of 14 can only be
employed as ________.
A) dishwashers
B) newspaper deliverers
C) waiters or waitresses
D) retail store clerks
Which of the following is true of the Islamic law of Shari’a?
A) The Shari’a disallows making a reasonable profit from the sale of goods and
services.
B) All Islamic countries strictly follow the complete Shari’a to govern all aspects of
life.
C) The Shari’a encourages riba through the strict payment and collection of interest on
loans within stipulated periods of time.
D) The Shari’a is primarily used in the areas of marriage, divorce, and inheritance and,
to a limited degree, criminal law.
What is the function of the judicial branch of the federal government?
A) It has the power to interpret and determine the validity of the law.
B) It has the power to enact the law.
C) It has the power to enforce the law.
D) It has the power to act as a liaison between the legislative and executive branches.
Frank Carpenter, who runs a charity organization, has been faking his father’s signature
on his father’s personal checks and writing them in favor of the charity as donations. He
gets hold of the checks from his father’s personal assistant, Rhonda Mason, who is also
Frank’s friend and the charity’s trustee. After faking the signature, Frank gives the
checks to Rhonda to deposit in the bank. But unbeknownst to Frank, Rhonda routes
some of the check money into her own savings account. Frank’s father, Dawson,
realizes that money is being withdrawn from his account without his consent. He
suspects his estranged son, Frank, and in order to find out if Frank is involved, Dawson
secretly offers money to the financial accountant of the charity to divulge the charity
organization’s financial dealings. The accountant accepts the money and gives access to
the account books. After scrutinizing the financial records, Dawson realizes that Frank
has been swindling him of his money, and the charity itself was being swindled by
somebody from within. With this information, Dawson proceeds to file a suit against his
son. In the above scenario, of which illegal activity are Rhonda and Frank guilty when
it came to using Dawson’s money for the charity?
A) bribery
B) criminal conspiracy
C) extortion
D) forgery
________ is a tort doctrine that makes manufacturers, distributors, wholesalers,
retailers, and others in the chain of distribution of a defective product liable for the
damages caused by the defect, irrespective of fault.
A) Absolute liability
B) Contingent liability
C) Superior responsibility
D) Strict liability
Which of the following best describes the tort of battery?
A) unauthorized and harmful or offensive physical contact with another person that
causes injury
B) an action that arouses reasonable apprehension of imminent harm
C) oral or written defamation of another person’s character
D) intentional confinement or restraint of another person without that person’s consent
If an auditor makes a disclaimer of opinion, this means that the auditor ________.
A) generally agrees that the company’s financial records accurately represent the
company’s financial position, but notes a few departures from GAAPs
B) disagrees that the company’s financial records accurately represent the company’s
financial position
C) cannot draw a conclusion about the accuracy of the company’s financial records,
generally due to a lack of sufficient information about the records
D) agrees that the company’s financial records accurately represent the company’s
financial position
Which of the following businesses or activities enjoy a statutory exemption from
antitrust laws?
A) airlines
B) professional baseball
C) agricultural cooperatives
D) all professional sports and games
Which of the following is true of the Nutrition Labeling and Education Act (NLEA)?
A) The NLEA is a state law and its implementation is not federally regulated.
B) The NLEA applies to packaged foods and other foods regulated by the Food and
Drug Administration.
C) The NLEA mandates compulsory labeling for all kinds of raw and processed food
with any exceptions.
D) The NLEA specifically eliminates the practice of providing point-of-purchase
nutrition information by sellers.
Which of the following statements is true about the strict liability doctrine?
A) Privity of contract between the injured party and defendant is mandatory.
B) Injured bystanders cannot recover damages under the strict liability doctrine.
C) Parties in the chain of distribution are strictly liable only to the customer who buys
the product.
D) Injured bystanders are entitled to the same protection as the product’s consumer.
Which of the following is true of an S corporation?
A) It can have no more than 100 shareholders.
B) Only a foreign corporation can become an S corporation.
C) It is taxed at the corporate level.
D) It must be a member of an affiliated group of corporations.
Which of the following rules provides that an accountant is liable only for negligence to
third parties who are members of a limited class of intended users of the client’s
financial statements?
A) Section 552 of the Restatement (Second) of Torts
B) the foreseeability standard
C) the Ultramares doctrine
D) the due diligence defense
Which of the following is a definition of a foreign corporation?
A) a corporation with incorporations in multiple states
B) a corporation in the state in which it was incorporated
C) a corporation in states other than the one in which it was incorporated
D) a corporation in the United States which has been incorporated in another country
In the U.S. Supreme Court, if all the justices voting agree as to the outcome and
reasoning used to decide a case, it is a ________ decision.
A) tie
B) plurality
C) majority
D) unanimous
A contract between a corporation and a holder that contains the terms of a debt security
is known as a(n) ________.
A) option contract
B) right of first refusal
C) indenture
D) shareholder voting agreement
The EPA can prohibit the construction of a new industrial plant that causes pollution in
a state that is a nonattainment area.
Which of the following is true about the duty of care?
A) Breach of the duty of care is not actionable unless the plaintiff suffers personal
injury or injury to his or her property.
B) The reasonable person standard is used to determine the amount of damages that a
defendant owes a plaintiff.
C) A firefighter who refuses to put out a fire when his safety is not at stake does not
breach his duty of care.
D) The damages recoverable for breach of the duty of care are independent of the effect
of the injury on the plaintiff’s life or profession.
Which of the following is true of the federal minimum wage?
A) An employer may not reduce the minimum wage by an amount equal to the
reasonable cost of food provided to employees.
B) Managerial employees are not subject to minimum wage requirements.
C) Apprentices cannot be paid less than the minimum wage.
D) Employees who earn tips, such as waiters and waitresses, are not entitled to the
minimum wage.
Secondary boycott picketing is lawful only if it is directed at ________.
A) the primary employer’s product
B) the neutral employer
C) customers who purchase the product
D) employees not part of the union
After the defendant’s attorney has finished calling witnesses, the plaintiff’s attorney can
call witnesses and put forth evidence to disprove the defendant’s case. This is called a
________.
A) rebuttal
B) rejoinder
C) closing argument
D) deliberation
The ________ is a duty owed by a member of an LLC to not act adversely to the
interests of the LLC.
A) duty of discharge
B) duty of restitution
C) duty of loyalty
D) duty of resolution
Which of the following is true of a tenancy by the entirety?
A) It can only be formed by and between corporations.
B) It does not include the right of survivorship.
C) It cannot be created by express words alone.
D) It cannot be transferred by one of the tenants without the consent of the other.
A ________ is a product formula, pattern, design, compilation of data, customer list, or
other covert business information.
A) copyright
B) trade secret
C) trademark
D) patent
The ________ is a federal statute primarily designed to prevent fraud in the trading of
securities after they are issued.
A) Securities Act of 1933
B) Securities Exchange Act of 1934
C) Sarbanes-Oxley Act of 2002
D) Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010
The ________ established by Congress have limited jurisdiction.
A) state supreme courts
B) state appeals courts
C) special federal courts
D) courts of records
Which of the following circumstances leads to the termination of an agency by
impossibility of performance?
A) the loss of a required qualification
B) the bankruptcy of the principal
C) the insanity of either the principal or the agent
D) the outbreak of a war between the principal’s country and the agent’s country
Horace, Keith, and John own Rendezvous, a luxury dining restaurant, as joint tenants.
After the death of Horace, Keith and John became the owners of Horace’s interest in the
property automatically. This feature of concurrent ownership is called ________.
A) a quiet title action
B) adverse possession
C) a nonconforming use
D) the right of survivorship
The ________ is a federal statute passed in 1990 that requires food manufacturers and
processors to provide nutrition information on many foods and prohibits them from
making scientifically unsubstantiated health claims.
A) Food, Drug, and Cosmetic Act
B) Health Care and Education Reconciliation Act
C) Nutrition Labeling and Education Act
D) Patient Protection and Affordable Care Act
On the dissolution and the commencement of the winding up of a limited partnership,
a(n) ________ must be filed by the limited partnership with the secretary of state of the
state in which the limited partnership is organized.
A) termination statement
B) renunciation statement
C) certificate of cancellation
D) annulment
An offeror can ________ an offer by withdrawing the offer prior to its acceptance.
OSHA standards establish safety requirements for safety guards on saws. This is an
example of a(n) ________ standard.
A seller or lessor has ________ if he obtained the goods through fraud, if his check for
the payment of the goods or lease is dishonored, or if he impersonated another person.
The ________ Act gives the president of the United States the right to seek an
injunction (for up to 80 days) against a strike that would create a national emergency.
________ deeds are most often used when property is transferred between relatives by
gift or otherwise.
The ________ system was established to provide limited retirement and death benefits
to covered employees and their dependents.
The ________ is the legislative branch of the U.S. government and has the power to
enact the law.
The ________ School of jurisprudence emphasizes shaping laws on the basis of
morality and ethics.
________ are defined as areas that are inundated or saturated by surface water or
groundwater that support vegetation typically adapted for life in saturated soil
conditions.
Give an account of how the digital age has affected lawmaking in the United States.
John L. Lewis formed the ________ in 1935, which permitted semiskilled and unskilled
workers to be its members.
Give an account of state environmental protection laws.
In the United States, the ________ is the federal administrative agency that is primarily
responsible for regulating meat, poultry, and other food products.
Each state has ________ senators in the U.S. Senate.