A hacker is someone who uses one computer to break into another.
a. True
b. False
Echo takes her car to Fix-It, Inc., which repairs the car and bills Echo for $500. Echo
writes out a check drawn on Capital Bank, but later, believing that Fix-It did not repair
the car properly, issues a stop-payment order.
Refer to Fact Pattern 18-1. Capital Bank pays the check. Capital
a. can sue Echo for a wrongful stop-payment order.
b. can sue Echo for a wrongful stop-payment order.
c. can sue no one because it paid a check that was not properly payable.
d. is liable for Echos loss due to the wrongful payment.
Banks may notassign their loan contracts to other firms.
a. True
b. False
A copyright owner must place a © or an ® on the work to have the work protected from
copyright infringement.
a. True
b. False
Civil law
a. defines, describes, regulates, and creates legal etiquette.
b. spells out the rights and duties that exist between persons and between persons and
their governments.
c. establishes the methods of enforcing the rights established by criminal law.
d. has to do with the wrongs committed against society for which society demands
redress.
Rocco gives Sequoia a smartphone as a gift. Sequoia develops a new game app for the
phone. She obtains intellectual property protection, and forms Titan Games, LLC, to
make and market the game. Sequoias ac-quisition of the game is by
a. gift.
b. accession.
c. confusion.
d. production.
Valley Furniture Store sells household consumer goods on credit for which Valley files
a financing statement to perfect a security interest in the goods. With the filing of
subsequent continuation statements, the ef-fectiveness of the statement can be
continued
a. indefinitely.
b. for no longer than five years.
c. for no more than six months.
d. up to five years and six months.
A limited liability company (LLC) formed in one state but doing business in another
state is referred to in the second state as a foreign LLC.
a. True
b. False
CallTalk Corporation, a smartphone and phone-time seller, chooses to use and register
“calltalk as its second-level domain. Later, CallTalks less successful competitor,
CellTalk Company, chooses to use and register “caltalk (an intentional misspelling of
“calltalk) as its second-level domain. Still later, Call&Talk, Inc., uses the domain name
“callltalk (also a deliberate misspelling of “calltalk) without CallTalks authorization, to
sell pornographic phone conversations.
Refer to Fact Pattern 6-2. CallTalk wants to sue Call&Talk for its unauthorized use of
the domain name “callltalk. Before bringing the suit, CallTalk has to ask the court for a
subpoena to discover
a. the true identity of the owner of the unauthorized site.
b. the amount of the profits of the unauthorized site.
c. the estimated costs of the court proceedings and discovery.
d. all of the registered variations of the name “calltalk.
A close corporation can operate as an S corporation.
a. True
b. False
The effectiveness of a companys code of ethics is determined by the commitment of the
company leadership to enforcing the code.
a. True
b. False
A trustee has the power to avoid a sale of the debtors property.
a. True
b. False
Falsifying public records is forgery.
a. True
b. False
Homers Remodeling, LLC, is a limited liability company. Among the mem-bers, a
dispute arises that their operating agreement does not cover. No statute applies. The
dispute is governed by the principles of
a. corporate law.
b. partnership law.
c. sole proprietorship law.
d. none of the choices.
Generally, a foreign government cannot sue under U.S. anti-trust laws in U.S. courts.
a. True
b. False
In a contract for a sale of goods, the usual measure of compensatory dam-ages is the
difference between the contract price and the market price.
a. True
b. False
Clear Creek Corporation enters into a contract with Brightside Management Associates
to manage and maintain Clear Creeks apartment complex. Their contract provides that
neither party can recover damages for a non-fraudulent or unintentional breach. This is
a. a limitation-of-liability clause.
b. an exculpatory clause.
c. a liquidated damages clause.
d. a quasi contract.
Ralph signs an instrument promising to pay a total of $10,000 to Martha in $1,000
monthly installments with the final payment being made on August 1. Ralph
unexpectedly inherits $10,000 from his aunt on May Ralph may
a. not complete his $10,000 payment before August 1.
b. complete his $10,000 payment before August 1.
c. increase his monthly payments by five percent, but not more.
d. increase his monthly payments by ten percent, but not more.
The states and the federal government provide for registration of trademarks.
a. True
b. False
Coast-to-Coast Distribution, Inc., is a direct-mail distribution company. Like most
corporations, Coast-to-Coasts employees include its
a. board of directors.
b. incorporators.
c. officers.
d. shareholders.
A corporation is an artificial being.
a. True
b. False
Laredo advertises a reward for the return of his lost dog. Mikayla, who does not know
of the reward, finds and returns the dog. Mikayla cannot recover the re-ward, because
she
a. did not confer a benefit on Laredo by returning the dog.
b. did not know of the reward when she found and returned the dog.
c. does not need the money.
d. returned the dog.
If a customers debit card is lost or stolen, the customer will not be liable for any
unauthorized use of the card.
a. True
b. False
A Chapter 11 reorganization plan must provide for payment of tax claims over a
five-year period.
a. True
b. False
Pete, an accountant, convinces his client Kasey to invest her savings in a nonexistent
social-networking Web site. When Kasey learns the truth, she can
a. seek to void the contract on the ground of undue influence.
b. recover damages based on a claim of mistake of value.
c. rescind the contract to invest in the Web site.
d. seek to void the contract on the ground of unconscionability.
Good Tire Company and Hiway Auto Service enter into a contract for a sale of tires.
Good Tire is a merchant who deals in goods of the kind sold. Under the UCC, an
implied warranty of merchantability arises
a. automatically in sales contracts.
b. only if the buyer asks for it.
c. only if the seller does not expressly disclaim it.
d. only in conjunction with lease contracts, not sales contracts.
For most purposes, the law recognizes a partnership as an independent entity.
a. True
b. False
A bailee must exercise reasonable care in preserving the bailed property.
a. True
b. False
Shanes Auto Parts orders twenty tires from Tough Tires, Inc. The truck delivering the
tires to Shanes is in an accident and ten of the tires are damaged. Shanes Auto Parts
a. cannot reject the entire shipment.
b. must still pay for all twenty tires at the original contract price.
c. may inspect the tires and accept the shipment with a reduction in price.
d. must reject the entire shipment.
A principal has the right to control an agents conduct in matters entrusted to the agent.
a. True
b. False
A check is not a substitute for cash.
a. True
b. False
A sharing of both profits and losses is the only requirement of a partnership.
a. True
b. False
No federal court has held that digitally sampling a copyrighted sound recording of any
length constitutes copyright infringement.
a. True
b. False