A contract in which both parties exchange promises is a:
a. voidable contract.
b. bilateral contract.
c. unilateral contract.
d. quasi contract.
Stan has agreed to sell a warehouse to Ed for $150,000. The contract says that Stan will
convey to Ed whatever interest he has in the property, but does not state that he has any
interest. Ed is to receive a(n) ____ deed.
a. insurable
b. quitclaim
c. general warranty
d. special warranty
Rule 10b-5 applies to:
a. any purchase or sale of any security.
b. only the purchase or sale of securities registered under the 1934 Act.
c. only publicly traded securities.
d. only securities that are involved in a secondary distribution.
If Sean, a shareholder, dissents to a corporate merger, his appraisal remedies will be:
a. fair value of his shares as of the day the corporation agrees to purchase the shares.
b. fair value of the shares as of the time immediately before the action to which he
objects is taken.
c. average purchase price for the shares during the preceding 30 days.
d. None of the above.
Which of the following can be the basis for an accountant’s liability under state law?
a. Contract law and negligence, but not criminal law
b. Tort law, contract law, and criminal law
c. Negligence, criminal law, and strict liability
d. Intentional torts and negligence, but not contract law
An officer who breaches the fiduciary duty to the corporation will be:
a. discharged.
b. required to return to the corporation profits obtained through breach of a fiduciary
duty.
c. required to forfeit the right to compensation during the period of the breach.
d. Both (a) and (b).
e. Both (b) and (c).
Which of the following is ordinarily held liable for their intentional torts?
a. A person who has not reached the age of majority
b. An incompetent
c. An employer, for the acts of employees in the course of employment
d. All of the above.
Federal trademark protection:
a. lasts for fourteen years after registration.
b. can be renewed for only a limited number of times.
c. can be abandoned by non-use.
d. All of the above.
a. Distinguish between a rejection of goods and a revocation of acceptance of goods.
b. What is the effect of a rejection? What is the effect of a revocation of acceptance?
c. Does the buyer have any obligations to the seller once she has rejected the goods?
Anna has a contract to perform accounting services for Interior Corporation. She
breaches her contract in a nonmaterial way. Which of the following is correct with
respect to Anna’s liability?
a. Anna is not entitled to any compensation for her services.
b. Anna may have liability to third party intended beneficiaries.
c. Anna is entitled to the contractually agreed upon fee less any damages or loss her
breach has caused her clients.
d. Two of the above, (a) and (b) are correct.
e. Two of the above, (b) and (c) are correct.
Arthur fired a gun in the middle of the desert. He intended to fire the gun, but had no
reason to believe anyone else was in the area. If the bullet hits Tom, who happened to
be riding his ATV across the desert:
a. Arthur has committed the tort of assault.
b. Arthur has committed the tort of battery.
c. it is unlikely that Arthur has the necessary intent to commit a tort.
d. Arthur has committed the tort of intentional infliction of emotional distress.
The statute which contains the rules applicable to investment securities transfers is:
a. the Securities and Exchange Commission Act.
b. Article 2 of the UCC.
c. Article 8 of the UCC.
d. the Model Business Corporation Act.
Which of the following is not an element of a tort?
a. A breach of duty
b. Proximate cause
c. Hostile mens rea
d. Injury or damage to the owner of a legally protected interest
What contractual defenses are available to those parties involved in surety
relationships?
a. The nonexistence of the principal debtor’s obligation
b. Discharge of the principal debtor’s obligation
c. Modification of the principal debtor’s contract
d. Variation of the surety’s risk
e. All of the above
In general, what are the elements of a crime? Discuss the following concepts of
criminal law and how and why the general elements of criminal action are altered,
extended, or eliminated. In addition, give examples corresponding to each concept of
the type of conduct that could be a criminal act.
a. Objective fault
b. Vicarious liability
c. Corporate liability
When both parties misunderstand the same set of facts relating to a basic assumption on
which a contract is made, it is termed:
a. rescissionary mistake.
b. unilateral mistake.
c. mistake of law.
d. mutual mistake.
Bill wants to buy a new car. He goes to the bank to get a loan for the purchase, and
signs an agreement to pay $00 per month in premiums on a term life insurance policy
which names the bank as the recipient of the policy proceeds in the event of his death
before the loan is repaid. The bank is a(n):
a. incidental beneficiary.
b. creditor beneficiary.
c. donee beneficiary.
d. assignee.
Which of the following would NOT be a merchant under Article 2 of the UCC?
a. The owner of a hardware store which sells paint
b. A car mechanic who fixes used cars and sells them in his spare time
c. A person who inherits three speedboats and wants to sell them to buy a car
d. Both (b) and (c).
Which of the following is correct with regard to the capacity of an agent?
a. The incapacity of the agent disqualifies him from making a contract that is binding on
his principal.
b. Business associations do not have the capacity to act as agents.
c. If an incompetent person who is not under guardianship appoints an agent, contracts
made by that agent are voidable.
d. Electronic agents, although not persons, are considered agents.
Joanne rents a single-family house and lot for one year starting September If the house
burns down, the common law requires:
a. payment of rent up to the time of the destruction.
b. payment to be suspended until the house is repaired.
c. termination of the lease.
d. payment to continue for the entire year.
If Sam leases property to Susan without specifying the duration, Sam has created a(n):
a. base fee.
b. condominium.
c. estate (tenancy) at will.
d. estate at sufferance.
Registration calls for disclosure of which of the following?
a. A description of the registrant’s properties and business.
b. A description of the significant provisions of the security to be offered for sale and its
relationship to the registrant’s other capital securities.
c. Information about the management of the registrant.
d. Financial statements certified by independent public accountants.
e. All of the above.
The Family and Medical Leave Act:
a. applies to private employers with 50 or more employees.
b. applies to governmental employers.
c. allows up to twelve weeks per year of leave for childbirth, adoption, or serious health
conditions of a spouse, child, or parent.
d. states that the leave may be paid, unpaid, or a combination of both.
e. All of the above.
All of the following are “real defenses” except a:
a. note made by a minor.
b. check written while a gun is held to the drawer’s head.
c. note given in exchange for worthless securities.
d. check fraudulently changed from $100 to $400.
Inventory includes:
a. goods held for sale or lease.
b. farm products.
c. equipment.
d. intangible products.
A party to a contract may be able to avoid the contract if:
a. there is a mutual mistake, and the party undertook to bear the risk by conscious
allocation.
b. there is a unilateral mistake, and the party undertook to bear the risk by conscious
ignorance.
c. there was a mistake and the mistaken party was at fault in not discovering the
problem before making the contract.
d. None of the above.
e. Only (a) and (b).
Which of the following is correct with respect to a grand jury?
a. The grand jury decides guilt or innocence of the defendant.
b. The grand jury always hears testimony from the defendant.
c. The grand jury can issue an indictment if it finds sufficient evidence to justify a trial
on the charges alleged.
d. None of the above.
Time paper that states it is due on July 1, a Sunday, is overdue on:
a. July 1.
b. July 2.
c. July 3.
d. It depends on when the instrument is presented for payment.
Which of the following is/are required for a valid tender under the Code? The seller
must:
a. put and hold conforming goods at the buyer’s disposition.
b. give notice to the buyer that the goods are available.
c. give notice at a reasonable time and keep the goods available for a reasonable period
of time.
d. All of the above are required.
Which of the following are prohibited under Title VII of the 1964 Civil Rights Act?
a. Seniority systems
b. Affirmative action programs
c. Disparate impact
d. All of the above
Time paper is payable at a definite time.
The “value” requirement of a holder in due course is the same as “consideration” for a
contract.
Check 21 permits banks to remove an original paper check from the check collection
process and send instead a substitute check.
Donald has a $10,000 judgment against him for a debt owed to a creditor. If Donald
files for bankruptcy and receives a discharge from the bankruptcy court, he will no
longer be obligated to pay the judgment.
The statute of frauds does not prevent the performance of oral contracts if the parties
are willing to perform.
According to the Restatement, whether an agency relationship has been created is
determined by using a subjective test.
Under the CISG, if the seller fails to perform any of his obligations under the contract
or the CISG, the buyer may require the seller to perform or may fix an additional
reasonable period of time for the seller to perform.
Pat told her friends that her car got 35 miles to the gallon in the city when in reality it
only got 20 miles per gallon. When Pat decides to sell the car and one of her friends
decides to buy it, Pat is under no duty to tell the correct figure unless asked.
The Robinson-Patman Act adds to the Clayton Act merger provisions.
A check indorsed “Pay to Manuel or bearer” may be negotiated by transfer of
possession alone.
There is no necessity to distinguish language which constitutes an offer from that which
merely solicits or invites offers.
Bart buys a car from a friend “as is.” The friend tells him, “In my opinion, this car is in
excellent mechanical condition.” The friend has made an express warranty.
The U.S. Consumer Product Safety Commission’s estimate that the cost of deaths,
injury, and property damage from consumer product incidents is about $800 million
each year led Congress to pass three major federal product liability statutes between
2006 and 2010.
Jones, an agent of Rossi, is authorized to sell Rossi’s ownership of wheat on the
commodities market on Monday. On Monday, however, the market opens with the
lowest prices for wheat in two decades. Jones must go ahead and sell Rossi’s wheat on
Monday.
Gerdsome, Inc. uses a trademark that is substantially the same as a mark of Balsmore
Co. As a result, Balsmore’s business falls off. Balsmore may recover damages from
Gerdsome without proving Gerdsome intended to cause confusion by the use of that
mark.
Like domestic law, international law can be easily enforced, because international
courts have compulsory jurisdiction.