If a director fails to use a reasonable amount of supervision over corporate officers and
employees, then the director can be held liable for negligence.
a. True
b. False
In most situations involving sales, rights and liabilities are determined by who has the
title to the goods.
a. True
b. False
Criminal law focuses on duties that exist between persons.
a. True
b. False
Kay and Leo enter into a contract that falls within the provisions of the UETA. Under
the UETA, “an electronic sound, symbol, or process attached to or logically associated
with a record and executed or adopted by a person with the intent to sign the record is
a. an e-document.
b. an e-signature.
c. an e-transaction.
d. a record.
To commit an intentional tort, one person must intend to harm a certain person.
a. True
b. False
When a corporation is dissolved voluntarily, the corporation must file articles of
dissolution with the state.
a. True
b. False
OntheWeb Company is an Internet service provider. OntheWebs customer Phoebe
commits copyright infringement. OntheWeb is not liable for Phoebes activity
a. unless OntheWeb is aware of Phoebes violation.
b. unless OntheWeb is not aware of Phoebes violation.
c. unless OntheWeb shuts down Phoebe after learning of the violation.
d. under any circumstances.
A writ of execution is a writ that puts in force a court decree or judgment.
a. True
b. False
Jay files a bankruptcy petition under Chapter 7. Among his debts are un-paid taxes,
fines owed to the government, student loans owed to Mega University, and support
owed to his ex-wife Kris. Most likely to be dis-charged are
a. the back taxes if they accrued within the previous three years.
b. the fines if they have been outstanding less than eight years.
c. the student loans if their payment would impose undue hardship.
d. the support debts.
When a U.S. firm wishes to increase its involvement in an international market, it
normally establishes an agency relationship with a foreign firm.
a. True
b. False
Ike pushes Joan, who falls and breaks her arm. Ike is liable for the injury
a. if Ike intended to push Joan.
b. only if Ike did not intend to break Joans arm.
c. only if Ike had a bad motive for pushing Joan.
d. only if Ike intended to break Joans arm.
Doyle and Emily are officers of Freshé Bottled Water Corporation. As cor-porate
officers, their compensation is determined by Freshés
a. directors.
b. incorporators.
c. other officers.
d. shareholders.
Browse-wrap terms are arguably not enforceable.
a. True
b. False
Mackenzie, an agent for Lindsay, signs an agreement with Kirk on Lindsays behalf but
ne-glects to tell her that the agreement requires the payment of a certain tax. The
government prosecutes Lindsay for failing to pay the tax. She is
a. liable, because notice to Mackenzie is notice to Lindsay.
b. liable, because notice to Kirk is notice to Lindsay.
c. not liable, because Mackenzie did not tell Lindsay about the tax.
d. not liable, because Kirk did not tell Lindsay about the tax.
The duty of good faith is imposed on the parties involved in commercial contracts by
the Uniform Commercial Code.
a. True
b. False
Ivan signs Jebs name, without his authorization, to the back of a check.This is
a. no crime.
b. forgery.
c. larceny.
d. robbery.
If a contract does not require that performance be rendered directly to a third party, the
third party is an intended beneficiary.
a. True
b. False
Ali offers to sell Ben a new car for $10,000. Ben accepts the offer and sells his old car
so that he will have money for the new one. Alis offer is probably
a. revocable because the terms of the offer were not definite.
b. irrevocable because Ben sold his old car because of justifiable reliance on Alis offer
to sell him a new car.
c. revocable because any offer is revocable.
d. irrevocable because Alis offer represents an opinion contract.
A breach of contract entitles the nonbreaching party to sue for monetary damages.
a. True
b. False
Julie works as an employee for Organic Produce Express, Inc. (OPI). Rowan, who is
unemployed, collects unemployment compensa-tion. This compensation is provided by
a tax on
a. Julie and other employees.
b. Julie, OPI, and other employees and employers.
c. OPI and other employers.
d. not Julie, OPI, or other employees or employers.
Hailey, a lawyer on the staff of International Group, always considers the consequences
of an action rather than the nature of the action itself when making ethical decisions in a
business context. Hailey is applying
a. the utilitarian theory of ethics in business contexts.
b. religious beliefs in business contexts.
c. Kantian ethics in business contexts.
d. the principle of rights theory of ethics in business contexts.
Orin creates a living trust to pass his assets, including stock in Petro Oil Company and
other business investments, to his heirs. One advantage of this arrangement is that
a. income taxes do not have to be paid on trust earnings.
b. the assets are sheltered from the payment of estate taxes.
c. the assets can be transferred without going through probate.
d. the trust does not come into existence until the grantors death .
An action in strict product liability requires that the product not be in a defective
condition when the defendant sells it.
a. True
b. False
William steals a valuable collection of baseball cards from Phillip. William then sells
the cards to Darrel, who does not know that the cards are stolen. Phillip discovers that
Darrel has the cards. Which of the following best describes the rights and liabilities of
the parties involved?
a. Darrel has the right to keep the cards if he compensates Phillip monetarily.
b. Phillip has the right to reclaim the cards from Darrel, but is liable to Darrel for
damages.
c. Phillip has the right to reclaim the cards from Darrel and William is liable to Darrel
for damages.
d. Darrel has the right to keep the cards without compensating William.
A voidable contract is a valid contract that can be avoided at the option of at least one
of the parties to it.
a. True
b. False
At a meeting of employees, Fuel Injection Design & Manufacturing, Inc.s managers
announce the creation of a new company-wide code of ethical conduct and the initiation
of an ad campaign to publicize the new code. They also say that any employees who do
not adhere to the code will be discharged. The effectiveness of this code will be
determined by
a. the commitment of company leadership to enforcing the code.
b. the extent to which the employees comply with the code.
c. a marketing campaign posted online to tout the firms ethical tone.
d. managementdirecting employees to “do as we say, not as we do.
A penalty provision specifies a certain amount to be paid in the event of a default or
breach of contract.
a. True
b. False
Federal courts are superior to state courts.
a. True
b. False
Employers cannot monitor employees electronic communications made in the ordinary
course of business.
a. True
b. False
Copyright protection is automaticregistration is not required.
a. True
b. False
When a statute protects a certain class of people, a member of that class cannot enforce
an illegal contract.
a. True
b. False