Gateway sold a big-screen TV and entertainment center to Iris for $2000 on credit. Iris
signed a promissory note and gave Gateway a security interest in the TV and
entertainment center. Gateway filed a financing statement in the appropriate public
office. When Iris defaulted on her monthly payments owing a balance of $1780,
Gateway’s attorney made arrangements to have the TV and entertainment center
repossessed. The attorney then placed classified ads in the local newspaper to sell the
goods. The attorney’s fees are $300, the repo company charged $150, and the
advertising costs are $50.
(A) If Iris chooses to redeem the property, how much must she pay to Gateway to
recover the property?
(B) If Iris does not redeem and the TV and entertainment center are sold for $1750, how
will the money be disbursed?
The two principal actions prohibited by the Foreign Corrupt Practices Act include
making bribes and making grease payments.
a. True
b. False
Marshall wants to work as a security guard. However the employer hires Wanda
instead. The primary reason the employer chose Wanda is her gender. What is the best
defense against Marshalls sex discrimination suit?
a. Wanda will supervise girls.
b. Wanda is prettier than Marshall is handsome.
c. Wanda is stronger than Marshall..
d. Wanda studied as a nun.
John Akers, former chairman of IBM, argues that ethics are not important to economic
competitiveness.
a. True
b. False
Most, but not all, contract rights are assignable.
a. True
b. False
The Identity Theft and Assumption Deterrence Act of 1998 does all but which of the
following:
a. prohibits the use of false identification to commit fraud.
b. limits liability on a stolen credit card to $50.
c. permits a victim to seek restitution in court.
d. It does all of the above.
A contract involving the sale of goods from a Texas seller to a French wholesaler must
always use the United Nations Convention on Contracts for the International Sale of
Goods (CISG).
a. True
b. False
Sweet Plantation, Inc. made a written contract with Candy, Inc. whereby Sweet
Plantation agreed to supply all of Candy’s sugar requirements for the next year at $.25
per pound. A dispute arose as to how much sugar Sweet is to supply. The parol evidence
rule will bar Sweet’s introduction of evidence concerning the intent of the requirements
of Candy.
a. True
b. False
In a breach of warranty case, the buyer must:
a. notify the seller of defects within a reasonable time.
b. bring any lawsuit no later than three years after the defect was discovered.
c. extend the statute of limitations in writing rather than orally if they choose to allow a
longer time for bringing suit.
d. notify the seller of defects within six months of their discovery or they cannot bring a
lawsuit.
When courts consider economic duress, they consider all the following factors
EXCEPT:
a. relative bargaining power.
b. financial distress.
c. legitimate business actions.
d. relative size of the contract.
Veritas, Inc. is planning its annual shareholder meeting on June 15. The company:
a. need not send notices of the meeting to shareholders since it is the regularly
scheduled, annual meeting, which Veritas always holds on the third Thursday of June.
b. must send notices to everyone who owns stock as of January 1.
c. must send notices to everyone who owns stock on the “record date, which can be no
more than 70 days before the meeting.
d. is not required to have an annual shareholders meeting if the company is listed only
on the NYSE.
Verne has possession of a draft that has been validly negotiated to him. His payment
process necessarily includes:
a. presentment of the draft, dishonor, and notice of dishonor.
b. exhibiting the instrument, showing reasonable identification, and surrendering the
draft if it is paid in full.
c. exhibiting the draft, providing a thumbprint signature, and giving a receipt.
d. suspending the underlying debt, applying the shelter rule, and making a demand for
payment.
Landlord-tenant relationships are governed by a mixture of property law, contract law,
and negligence law.
a. True
b. False
Norm and Frank have a legal contract that is silent with regard to an assignment of the
contract. In order for Norm to assign all or part of his rights under a contract, Frank
must grant such permission to Norm.
a. True
b. False
ABC Siding, Inc. manufactures aluminum siding. ABC enters into a contract to deliver
siding to Slippery Siding, Ltd., a retailer of aluminum siding. The written agreement
insists that all modifications to the agreement be in writing and signed by both parties.
This prohibition against oral modifications is:
a. valid regardless of whether the clause is signed separately.
b. invalid unless the clause is signed separately by Slippery Siding, Ltd.
c. invalid unless the clause is signed separately by ABC Siding, Inc.
d. invalid unless new consideration is supplied by the parties when the modification
agreement is made.
Ethics is the study of:
a. sovereign immunity.
b. how people should act.
c. respondeat superior.
d. victimization.
Nunnskys Retail sent out newspaper inserts advertising wool suits for $50. In fact, the
store had only two, out-of-style suits for sale at this price. Their other wool suits started
at $175. This constitutes bad faith in its advertising, so consumers may have protection
through state statutes.
a. True
b. False
Angie, a minor, wants to avoid a contract she made with Cumberland Cycles. She may
disaffirm the contract by:
a. notifying Cumberland orally that she will not honor the agreement.
b. filing a lawsuit to have a court formally cancel the contract.
c. just refusing to perform her obligations under the contract.
d. All of the answers are correct.
A corporation is not allowed to issue dividends to shareholders unless it is solvent.
a. True
b. False
Ikerd was entering the United States from a trip abroad when the Customs Service
confiscated some goods she had purchased and brought back with her. The
determination of whether the government is attempting to take property and what type
of hearing the Customs Service must offer Ikerd, is an analysis of:
a. substantive due process.
b. procedural due process.
c. the Takings Clause.
d. eminent domain.
Prime Products, Inc. was going to be able to ship the comforter Margaret ordered within
three weeks instead of the seven days it had originally promised. Prime must cancel
Margarets order and notify her that it can deliver within three weeks if she wants to
reorder.
a. True
b. False
TECO Coal Corporation is interested in the inspections that the U.S. Bureau of Mines
has conducted over the past year. To secure this information, TECO should:
a. issue a subpoena duces tecum.
b. make a Freedom of Information Act request.
c. make a de novo request.
d. assert the substantial evidence rule.
Under the federal legislation known as OSHA:
a. employers must keep records of all workplace injuries.
b. employers must keep records of positive results of workplace drug tests.
c. employees must keep their work area free from recognized hazards.
d. employers may monitor workers e-mail messages if the monitoring is done in the
ordinary course of business and the employer provides the e-mail system.
If a foreign company “dumps” goods on the United States market:
a. the goods will be considered illegal goods and not be allowed to be sold in the United
States.
b. the United States will issue trade sanctions against the country that allowed the
dumping.
c. a “dumping duty” will be imposed on the dumped goods if the Commerce
Department determines the goods are being sold at less than fair value and that this
harms an American industry.
d. All the above are correct.
Abbott provided evidence of fraudulent financial reporting about his employer, a
publicly traded company, to federal securities investigators. Abbott receives
whistleblower protection under:
a. the U.S. Constitution.
b. The Sarbanes-Oxley Act.
c. The Civil Service Reform Act.
d. None of the above.
Which of the following is a primary goal of bankruptcy:
a. to preserve as much of the debtor’s property as possible.
b. to divide the debtor’s assets fairly between the debtor and the creditors.
c. to divide the debtor’s assets fairly among the creditors.
d. All of the above.
A civil case generally proceeds as follows:
a. answer, complaint, discovery, trial, verdict.
b. complaint, answer, trial, discovery, verdict.
c. complaint, answer, discovery, trial, verdict.
d. discovery, complaint, answer, trial, verdict.
The states have a severely restricted power to enact laws that affect interstate
commerce. This concept is called:
a. federalism.
b. the undue burden concept.
c. constitutional hierarchy.
d. the dormant aspect of the Commerce Clause.
The U.S. Supreme Court was asked to decide whether same-sex sexual harassment is a
violation of Title VII of the Civil Rights Act. This law forbids discrimination in
employment on the basis of sex. In interpreting statutes, the court may use which of the
following?
a. The plain meaning rule.
b. Legislative history.
c. Public policy.
d. All of these.
Which of the following would not be personally liable for the debts of the business?
a. A sole proprietor.
b. A partner in a general partnership.
c. A general partner in a limited liability limited partnership.
d. A general partner in a limited partnership.
What is a major difference between a United States lawsuit versus a French lawsuit?
a. In a French civil lawsuit, there is usually no right to a jury trial.
b. The French legal system does not engage in extensive discovery procedures
commonly used in the United States.
c. In a French lawsuit, the rules of evidence are more flexible.
d. All of the above are correct.