The Interstate Commerce Commission (ICC) is empowered to enforce the FTC Act, as
well as other federal consumer protection statutes.
A warranty deed will protect a grantee regarding a mortgage from one hundred years
ago.
Under modern law, no state will permit younger persons to be married, even if they
have the consent of their parents.
The primary purpose of federal and state securities statutes that regulate the issuance
and trading of securities is to promote full disclosure to investors and to prevent fraud.
In a contract for the sale of goods, if the seller does not have a place of business and the
contract does not mention delivery in any way, delivery is to be made at the seller’s
residence.
According to the Sarbanes-Oxley Act, if a public company is required to restate its
financial statements because of material non-compliance with financial reporting
requirements, the CEO and CFO must reimburse the company for any bonuses,
incentive pay, or securities trading profits made because of the noncompliance.
The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 was the
most extensive financial reform law enacted by the United States Congress since the
Great Depression of the 1930s.
A collective membership mark is owned by an organization, such as an association,
whose members use it to identify themselves with a level of quality or accuracy or other
characteristics set by the organization.
The community property method of co-ownership is based on the notion that a husband
and wife should share equally in the “fruits” of the marital partnership.
General partners are personally liable for the debts and obligations of the partnership.
A person’s ownership right in real property is called intellectual property.
An “area” franchise licenses the franchisee to make and sell its products to the public
from a retail outlet serving an exclusive geographical territory.
A used car salesperson’s saying “This is the best car available in town” creates an
express warranty.
If the three (3.) largest automobile manufacturers agreed among themselves what prices
to charge automobile dealers for this year’s models, this would be seller’s illegal per se
price fixing.
According to the United States Supreme Court, in order for a work (e.g., a movie) to be
obscene, the work, taken as a whole, must lack serious literary, artistic, political, or
scientific value.
The monetary amount of federal exemptions is adjusted every five years to reflect
changes in the Consumer Price Index.
Kate is HIV positive, but shows no obvious symptoms of her disease. In spite of her
disease, Kate is still physically strong, and able to perform all of her job functions.
Under the Americans with Disabilities Act, Kate is nevertheless considered disabled
because she is regarded as having an impairment.
Negligence that results in a material misstatement will subject a party to liability under
Rule 10b-5 of the Securities Exchange Act of
The Drug Amendment to the Food, Drug, and Cosmetic Act, enacted in 1962, gives the
Food and Drug Administration broad powers to license new drugs in the United States.
Judges have always accepted and recognized the value and legality of arbitration
agreements.
Under Section 7 of the Clayton Act, mergers can be prevented only if the companies
proposing to merge are currently competitors.
There is some variation in contract law from state to state.
A website is composed of electronic documents known as webpages.
A contract remains executory as long as any party to the contract has not fully
performed.
Contracts are voluntarily entered into by parties.
For the contributory negligence defense to apply in a product liability action, the
defendant must prove that (1) the plaintiff knew and appreciated the risk and (2) the
plaintiff voluntarily assumed the risk.
John owns two cars. He says to Faye, “I’ll sell you either one of my cars for $8,000.”
This would be a valid offer.
In today’s urbanized society, acquiring ownership in personal property by capture has
become increasingly important.
To bring an action under Title VII, a private complainant must first file a complaint with
the Equal Employment Opportunity Commission within one year of the alleged
discrimination.
A landlord may sell leased property to a new owner, but the new owner takes the
property subject to the existing lease.
The Consumer Product Safety Commission (CPSC) is empowered to conduct research
on the safety of consumer products.
The members of the board of directors are appointed by upper-level corporate
management.
A plaintiff can generally recover for negligent infliction of emotional distress for any
unintentional conduct of the defendant that causes the plaintiff to suffer emotional
distress.
What is the legal consequence of a trademark becoming a generic term?
A) No one can use the term in a name for that type of product.
B) Every seller must use the term to describe that type of product.
C) The fair use doctrine would not apply.
D) The holder of the trademark for the term that has become generic cannot prevent
others from using the generic term.
E) There is no legal consequence.
Both the directors and shareholders of Big X Corporation are tired of the business, and
want to end it. How should they proceed?
A) The board of directors should recommend dissolution, the shareholders should vote
on the issue of dissolution, and assuming there is a majority vote by the shareholders
favoring dissolution, articles of dissolution must be filed with the secretary of state in
the state of incorporation.
B) All that is necessary is a shareholder vote in favor of dissolution.
C) All that is necessary is that the board of directors vote in favor of dissolution.
D) If both the board of directors and the shareholders vote in favor of dissolution, all
business dealings must cease, notice must be placed in newspapers of general
circulation, and signs must be posted at all places of business.
E) The board of directors should vote, and articles of dissolution must be filed with the
secretary of state in the state of incorporation, but there is no requirement that
shareholders vote on the issue of dissolution.
A principal gives an agent express authority to “do what it takes to get my car running
right.” The authority that the agent has to enter into contracts for the purchase of auto
parts is:
A) apparent authority
B) authority by estoppel.
C) inherent authority.
D) express authority.
E) implied authority.
The Clean Water Act is administered by the:
A) Food and Drug Administration.
B) Environmental Protection Agency.
C) Federal Trade Commission.
D) United States Department of Justice.
E) United States Department of Homeland Security.
One of the provisions of the American Inventors Protection Act of 1999 is that:
A) the power to regulate invention promoters was transferred to the Department of
Justice.
B) the legal life of a patent was extended to 20 years.
C) the Patent and Trademark Office must make a decision on a patent application within
three years after its filing.
D) inventors are able to file a provisional application granting provisional rights
pending the filing of a final application within six months.
E) the legal life of a patent was extended to 15 years.
The doctrine that places a duty on a non-breaching party to take reasonable steps to
reduce damages is called:
A) liquidation.
B) mitigation.
C) garnishment.
D) avoidance.
E) reciprocal duties.
The finder of lost property acquires:
A) no rights in the property.
B) rights that are good against everyone but the true owner.
C) rights that are good against everyone, including the true owner.
D) rights to use the property until it must be turned over to the state.
E) a life estate in the found property.
The Ultramares doctrine, as created by Justice Cardozo in Ultramares Corporation v.
Touche, states that:
A) a third party may hold an accountant liable for negligence, but only if they have a
direct contractual relationship with the accountant and/or the accounting firm.
B) a third party may hold an accountant liable for negligence when the accountant
prepares a client audit he or she knows is specifically intended for use by the third
party.
C) a third party may hold an accountant liable for negligence when the accountant
prepares an audit for his or her client, regardless of whether the accountant knows the
audit is specifically intended for use by the third party.
D) a third party may hold an accountant liable for negligence, but only if the
engagement agreement with the client contains a general release stating that the client
may use the audit for whatever purposes the client wishes.
E) contractual relationships and knowledge of use or intended use are irrelevant issues,
because an accountant and/or accounting firm, as professionals, will be liable for any
damages caused by their negligence, whether foreseeable or not.
A “gift causa mortis” differs from an “inter vivos” gift, in that a gift causa mortis:
A) has different requirements regarding consideration.
B) requires witnesses to be effective.
C) can only be made to family members.
D) sometimes is automatically revoked.
E) may not be revoked by the donor.
A will that is oral is what kind of will?
A) nuncupative
B) invalid
C) holographic
D) reciprocal
E) self-proving
In fighting a hostile takeover, which of the following will usually occur in connection
with a standstill agreement?
A) a reverse tender offer
B) a “greenmail” payment
C) the sale of a “crown jewel”
D) the adoption of a “poison pill”
E) a “white knight” merger
A member’s distributional interest in a limited liability company is ________ property
and may be transferred in whole or in part.
A) real
B) actual
C) intellectual
D) bailment
E) personal
The ________ Trademark Act provides for the registration of trademarks and service
marks with the United States Patent and Trademark Office (USPTO) in ________.
A) Lloyd; New York, New York
B) Lanham; New York, New York
C) Lloyd; Washington, D.C.
D) Lanham; Washington, D.C.
E) Landrum; Chicago, Illinois
Which of the following is true about what can be copyrighted?
A) Paintings can be copyrighted, but not photographs.
B) Books and newspapers can by copyrighted, but not sermons.
C) Guidebooks can be copyrighted, but not maps.
D) Books, plays and ideas can all be copyrighted.
E) Photographs, maps and cartoons can all be copyrighted.
What is a tender offer?
A) an offer made directly to the shareholders of a target corporation for those
shareholders’ shares
B) an offer made directly to the board of directors of the corporation to be acquired
C) an offer made by the use of proxies granted by the shareholders of the corporation to
be acquired
D) an offer to acquire another corporation that has been approved by the Securities and
Exchange Commission prior to the making of the offer
E) an offer made directly to the shareholders of a target corporation for merger
Which of the following best describes the overall system of pollution regulation in the
United States?
A) It is exclusively based on federal law.
B) It is exclusively based on state law, with minimal federal oversight.
C) It is exclusively based on state law, but with considerable federal oversight.
D) It is primarily based on federal law, but includes considerable state law as well.
E) It consists of a series of uniform state laws.
Which of the following is most consistent with the Natural Law School of
jurisprudence?
A) Law is based on moral and an ethical principle of what is right, and it is the job of
men and women, through study, to discover what these principles are.
B) The law is a reflection of society, thus the law must change naturally as society
changes over time.
C) The laws of man are secondary to the laws of nature, and thus the laws of nature take
precedence whenever the laws of man are in conflict with the laws of nature.
D) By applying the rules of logic to specific cases, the logical, or natural, result will be
obtained.
E) Laws must first and foremost respect, preserve and promote the preservation of the
environment and life in all its forms.
Negotiable instruments may have:
A) one or two parties.
B) two parties only.
C) two or three parties.
D) three parties only.
E) one, two or three parties.
For which of the following is protection extended by filing an application to renew?
A) patents
B) patents and trademarks.
C) trademarks
D) copyrights and trademarks
E) copyrights, trademarks and patents
The power of the federal government to make treaties with Native American Nations
regarding land and land use is derived from the:
A) Commerce Clause.
B) Privileges and Immunities Clause.
C) Equal Protection Clause.
D) First Amendment.
E) Supremacy Clause.
A transaction in which two corporations combine, such that afterwards only one of
them still exists and owns all the assets previously owned by either corporation, is
called a:
A) merger.
B) consolidation.
C) purchase of assets.
D) share exchange.
E) buyout.
In 1978, singer songwriter Warren Zevon wrote and recorded the classic song,
“Lawyers, Guns and Money.” In 2007, he died. When does his song go into the public
domain?
A) in 1978, when he publicly released it and recorded it
B) in 2007, when he died
C) in 2048
D) in 2078
E) in 2082
What is a guaranty arrangement?
A) an agreement under which the guarantor’s property can be used to satisfy a debt on
which the guarantor defaults
B) an agreement that collateral can be sold without giving notice to the debtor
C) the filing of a security agreement so that others will be aware of it
D) a pledge by a debtor that a loan will be paid in accordance with its terms
E) a promise to pay the debt of another if that other party defaults, and the creditor has
attempted unsuccessfully to collect the debt from the debtor
Unionized employees of Serve-Me Company vote to strike. They decide, however, that
instead of actually leaving the premises, they will simply do no work. Which of the
following is true?
A) Remaining at work, but performing no work, is a valid and legal form of a strike.
B) Remaining at work, but performing no work, is an illegal wildcat strike.
C) Remaining at work, but performing no work, is an illegal sit-down strike.
D) Remaining at work, but performing no work, is an illegal partial strike.
E) Remaining at work, but performing no work, is a valid and legal form of a strike, but
only if the employer has threatened to hire replacement workers.
Which of the following is not required under the Nutrition Labeling and Education Act?
A) Sellers of most food must provide information on fat content and fiber.
B) The terms “light,” “natural,” and similar terms must be used only in accordance with
specific definitions.
C) Maximum fat and saturated fat levels are established for certain foods
D) Calories derived from fat must be disclosed.
E) The amount of dietary fiber must be disclosed.
There are ________ United States District Courts.
A) Seventy-eight (78.)
B) Eighty-one (81.)
C) Ninety-one (91.)
D) Ninety-four (94.)
E) Ninety-eight (98.)
A minor, unable to live at home, contracts to rent an apartment for one year at $800 per
month. After living there for three months, he disaffirms the contract. The reasonable
value of that apartment was only $700 per month. Assuming no rent has been paid, the
minor must pay:
A) nothing, because the contract has been disaffirmed.
B) $2,400, which is the contract rate for three months.
C) $2,100, which is the reasonable value for three months.
D) $9,600, which is the contract rate for the one-year lease term.
E) $8,400, which is the reasonable rate for the one-year lease term.
Lou writes a check to Bud but leaves out some essential components that are required
on the check. This check would be described as:
A) valid.
B) void.
C) voidable.
D) unenforceable.
E) a quasi-contract.
The following are commonly used terms to describe banks in the collection system
except:
A) the collecting bank.
B) the depository bank.
C) the intermediary bank.
D) the maker bank.
E) the payer bank.
Which of the following individuals would not be considered an officer regarding Rule
16 enforcement?
A) an executive officer who participates in policy-making functions
B) an executive officer who does not participate in policy-making functions
C) a chief executive officer
D) a vice president in charge of business units
E) a chief financial officer