To be actionable as fraud, the misrepresentation must be the sole factor in inducing the
innocent party to enter into the contract.
Accountants cannot be held criminally liable for material irregularities in financial
statements prepared for registration statements.
Unless otherwise expressly stated, an auction is considered an auction without reserve.
The inaccessibility exception is a rule that permits employees and union officials to
engage in union solicitation on company property if the employees are beyond the reach
of reasonable union efforts to communicate with them.
The NEPA and EPA regulations require that an environmental impact statement (EIS)
be prepared by the state government.
According to the FLSA, children under the age of 14 are forbidden from working,
including as newspaper deliverers.
John watches his brother being killed in a road accident. The perpetrator was driving
under the influence of alcohol. John can recover damages for negligent infliction of
emotional distress for the mental trauma he suffered from watching his brother die.
The International Court of Justice (ICJ) is composed of 15 judges who serve nine-year
terms.
According to Rawls’s social justice theory, a person who is in his or her “veil of
ignorance” is best fit to select the fairest possible ethical principles.
An S corporation must pay federal income tax at the corporate level.
Title I of the ADA covers employers with three or more employees.
Continuous reporting to investors and the SEC is a requirement imposed by the
Securities Act of 1933.
In common law, burglary is defined as “breaking and entering a dwelling at night” with
the intent to commit a misdemeanor.
The jurisdiction of the EEOC is restricted to investigating charges of discrimination
based on gender.
An electronic agent allows for the contracting for the sale and lease of goods over the
Internet, using websites to order or lease goods.
The Oil Pollution Act authorizes the U.S. government to clean up oil spills and spills of
other hazardous substances in ocean waters within 12 miles of the shore.
In a partially disclosed agency, the contracting third party transacts directly with the
principal and does not know the identity of the agent.
The duty of loyalty requires directors and officers to subordinate their personal interests
to those of the corporation and its shareholders.
The nonissuer exemption permits local businesses to raise capital from local investors
to be used in the local economy without the need to register with the SEC.
If an employer intentionally injures a worker, the worker cannot collect workers’
compensation benefits.
The determination of whether a corporate director or officer has met his or her duty of
care is measured in hindsight.
Principals do not control the means by which independent contractors achieve results.
The filling or dredging of navigable waters and qualified wetlands is prohibited unless a
permit has been obtained from the Army Corps of Engineers.
A third party can bring a tort action against an accountant for constructive fraud.
The Sarbanes-Oxley Act of 2002 makes it lawful for a registered public accounting firm
to simultaneously provide audit and nonaudit investment banking services to a public
company.
Actual physical contact is not necessary for a tort to be considered an assault.
Unless otherwise agreed, the principal owes a duty to cooperate with and assist the
agent in the performance of the agent’s duties and the accomplishment of the agency.
A rejection of an offer is not effective until it is actually received by the offeror.
Equitable orders and remedies of the Court of Chancery took precedence over the legal
decisions and remedies of the law courts.
An S corporation can have nonresident aliens as shareholders.
The .biz extension is used for large-business and corporate websites.
In U.S. courts of appeals, the parties file legal briefs with the court and are given a short
oral hearing.
A limited partnership cannot have general partners.
Direct physical contact, such as intentionally hitting someone with a fist, is considered
battery.
Most public accounting firms operate as limited liability partnerships (LLPs).
Section 10(b) of the Securities Exchange Act prohibits the use of manipulative and
deceptive devices in contravention of the rules and regulations prescribed by the SEC.
An exclusive license grants the licensee exclusive rights to use information rights for a
specified duration.
Profits and losses from an LLC do not have to be distributed in the same proportion.
A petitioner must file a petition for certiorari, asking the Supreme Court to hear the
case.
Consideration is defined as something of legal value given in exchange for termination
of an offer.
A detailed set of rules adopted by the board of directors after a corporation is
incorporated that contains provisions for managing the business and the affairs of the
corporation are referred to as ________.
A) ultra vires rules
B) articles of incorporation
C) bylaws
D) corporation codes
A party who owes a duty of performance under a contract is called the ________.
A) obligor
B) assignor
C) assignee
D) obligee
Ashley owns a piece of vacant real estate through which a small river runs. Ashley hires
Warren, a licensed real estate broker, to list the property for sale and help sell the
property. While inquiring in the neighborhood, Ashley’s neighbor Lenny tells Warren
that a chemical plant upstream has polluted his property and that Warren should have
environmental engineers test the soil on Ashley’s property as well. Warren does not tell
Ashley about Lenny’s suggestion. Warren manages to find a buyer for Ashley’s property
in Martha. It is later discovered that the property Martha bought from Ashley is also
polluted. What important agent’s duty has Warren failed to perform?
A) duty to indemnify
B) duty to account
C) duty to reimburse
D) duty to notify
A small business can file a ________ with the Securities and Exchange Commission
(SEC) if it plans on raising $1 million or less in any 12-month period from a public
offering of securities.
A) Form U-7
B) registration statement
C) Form S-1
D) certificate of interest
While Harry was intoxicated, he sold his car to Ben for substantially less than its fair
market value. This contract is considered ________.
A) valid
B) voidable
C) void
D) unenforceable
Intellectual property falls into a category of property known as a(n) ________.
A) tangible property
B) moveable property
C) real property
D) intangible property
The tort of defamation of character requires a plaintiff to prove that the defendant
________.
A) publicized a private fact about the plaintiff
B) insulted people closely related to the plaintiff, such as family or friends
C) published an untrue statement of fact about the plaintiff to a third party
D) made one or more financial deals with the plaintiff under a false identity
Lease creditors that violate the ________ Act are subject to the civil and criminal
penalties provided in the Truth-in-Lending Act (TILA).
Kidney dialysis machines are scrutinized for attainment of quality standards under the
Drug Amendment to the FDCA.
The ________ recognizes electronic contracts as meeting the writing requirement of the
Statute of Frauds for most contracts.
A) Uniform Contracts Code
B) Uniform Computer Information Transactions Act
C) E-SIGN Act
D) Communications Decency Act
Reversibility is a principle of Kantian ethics according to which ________.
A) a person must be allowed to reverse his moral judgment to better suit his needs
B) a person must treat all moral circumstances as one
C) a person must be allowed to selectively choose moral judgments based on the
circumstances
D) a person must abide by the rule he or she uses to judge the morality of someone
else’s conduct
A ________ is any trade name, symbol, word, logo, design, or device used to identify
and distinguish goods of a manufacturer or seller or services of a provider from those of
other manufacturers, sellers, or providers.
A) trade secret
B) patent
C) trademark
D) copyright
Which of the following is true of the Clean Air Act?
A) It is the only major state law regulating air pollution in the United States.
B) It fails to include the air pollution caused by fuel and fuel additives in its purview.
C) It is only concerned with stationary sources of air pollution.
D) It requires air pollution controls to be installed on motor vehicles.
A female is hired by an employer as an employee. During a 36-month period, the
employer engages in pay act violations and underpays the female employee each pay
period. According to the Lilly Ledbetter Fair Pay Act of 2009, how long does the
female employee have to file her claim?
A) within three years from her initial date of hire
B) within 90 days from the initial paycheck violation
C) within 180 days from the last paycheck violation
D) within one year from the last paycheck violation
Which of the following is a perceived disadvantage of Rawls’s social justice theory?
A) It allows those in advantageous positions to suppress people in least advantageous
positions in a society.
B) It does not consider the fact that people would not want to maximize benefits to the
least advantaged persons in a society.
C) It only allows people in advantageous positions in a society to form rules on
morality.
D) It postulates that there are no universal ethical rules to guide a person’s conduct.
A(n) ________ is a type of plea where the defendant pays a penalty without admission
of guilt.
A) nolo contendere
B) arraignment
C) indictment
D) plea bargain
Which of the following is a compulsory subject during collective bargaining?
A) health benefits
B) closed shop recognition
C) corporate reorganization
D) workplace location
The ________ is a registration exemption that permits local businesses to raise capital
from local investors to be used in the local economy without the need to register with
the Securities and Exchange Commission (SEC).
A) intrastate offering exemption
B) Regulation A offering
C) private placement exemption
D) nonissuer exemption
An agreement between two or more nations that is formally signed by an authorized
representative of each nation and ratified by each nation is defined as a(n) ________.
A) statute
B) charter
C) treaty
D) arraignment
Which of the following is true of discharge by agreement?
A) A partially executed contract cannot be rescinded.
B) Mutual rescission requires parties to enter into a second agreement that expressly
terminates the first one.
C) A party is allowed to rescind a contract without the consent of the other party.
D) Unilateral rescission is not regarded as a breach of contract.
What happens to the ownership of a copyrighted work after the copyright period
expires?
A) A non-copyright holder can use the work, but he or she must first purchase the rights
to the work.
B) The work enters the public domain and can be used for free.
C) The copyright can be renewed for a fee by the original creator of the work.
D) The government takes over ownership of the work and provides public access for a
fee.
________ is said to have occurred if a certificate of limited partnership was not
properly filed.
A) Defective formation
B) Illegitimate partnership
C) Void partnership
D) Voidable association
________ is a restraint of trade in which competitors agree that each will serve only a
designated portion of the market.
A) Resale market price maintenance
B) Profit sharing
C) Market sharing
D) Gain sharing
What is a quiet title action?
A) a lawsuit to determine the rightful owner of disputed real property and his or her
rights
B) a lawsuit to enforce the right of survivorship against the holder of title to real
property
C) a lawsuit asking for the judicial conversion of a joint tenancy to a tenancy in
common
D) a lawsuit to obtain reimbursement for losses caused by undiscovered defects in title
A(n) ________ is a written law enacted by the legislative branch of the federal and state
governments that establishes certain courses of conduct to which covered parties must
adhere.
A) charter
B) treaty
C) executive order
D) statute
An LLC that was organized in Alabama and is operating in Texas with no operations
outside the United States is considered a ________ in Texas.
A) foreign limited liability company
B) limited liability partnership
C) domestic limited liability company
D) general partnership
The UCC rule that says that a merchant who offers to buy, sell, or lease goods and gives
a written and signed assurance on a separate form that the offer will be held open
cannot revoke the offer for the time stated or, if no time is stated, for a reasonable time
is referred to as the ________.
A) gap-filling rule
B) firm offer rule
C) mirror-image rule
D) open term rule
By allowing the U.S. citizens to practice any religion of their choice, what essential
function of the law does the U.S. Constitution serve?
A) facilitating orderly change
B) maintaining the status quo
C) maximizing individual freedom
D) facilitating planning
Jill wins a lawsuit against Terry in Wyoming state court. The court passes a judgment
requiring Terry to pay $20,000 to Jill. Soon after the case is settled, Terry moves to
Colorado, where she owns a house, and refuses to pay Jill the money. Which of the
following is the best course of action for Jill?
A) File a lawsuit against Terry in a Colorado state court to enforce the Wyoming court
judgment.
B) File another case against Terry in the Wyoming state court to collect the money
against Terry’s property.
C) File a case against Terry in Wyoming to force Terry to sell her house in Colorado to
pay the money.
D) File a case in the Colorado federal court as this qualifies as a federal question case.
The lawfulness of all government classifications that do not involve suspect or
protected classes is examined using a(n) ________ test.
A) strict scrutiny
B) intermediate basis
C) due process
D) rational basis
________ hears appeals from trial courts.
A) The highest state court
B) A court of record
C) An inferior trial court
D) An intermediate appellate court
A(n) ________ is a less serious crime, is not inherently evil but nevertheless prohibited
by society, and is punishable by fines or imprisonment for one year or less.
A) misdemeanor
B) indictable offence
C) felony
D) violation
The Labor Management Relations Act of 1947 is also known as the ________ Act.
A) Landrum-Griffin
B) Gompers-Lewis
C) Taft-Hartley
D) Wagner
In terms of the infancy doctrine, which of the following is true?
A) A minor must honor a contract he or she entered into with an adult if the minor had
sufficient mental capacity when the contract was formed.
B) A minor can disaffirm a contract he or she entered into with an adult.
C) A minor cannot enter into a legal contract with another minor.
D) A minor cannot elect to enforce a contract he or she has entered into with an adult.
The ________ provides that federal law takes precedence over state or local law.
According to the doctrine of stare decisis, past court decisions become ________ for
deciding future cases.
A(n) ________ is a party who is unintentionally benefited by other people’s contracts.
A panel of persons who are elected by shareholders that make policy decisions
concerning the operation of a corporation is known as the ________.
Differentiate between the Historical School of jurisprudence and the Sociological
School of jurisprudence.
The right to picket is implied from the ________ Act.
In a criminal case, the government is represented by the ________.
The legislative and ________ branches of federal and state governments are
empowered to establish administrative agencies.
________ are vertical trade restraints that involve the seller’s refusal to sell a product,
the tying item, to a customer unless the customer purchases a second product.
A car salesperson is employed to sell the principal’s car, and the principal tells the agent
that the car was repaired after it was involved in a major accident. If the agent
intentionally tells the buyer that the car was never involved in an accident, the agent has
committed the tort of ________.
________ are damages that will be paid upon a breach of contract that are established in
advance.
Under a(n) ________ deed, the seller is not liable for defects in title that existed before
the seller obtained the property or for encumbrances that were present when the seller
obtained the property.
A(n) ________ letter is issued by the EEOC if it chooses not to bring an action against
an employer that authorizes a complainant to sue the employer for employment
discrimination.
________ is the federal statute that prohibits job discrimination based on the race,
color, religion, sex, or national origin of the job applicant.