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A contract cannot be rescinded if there has been a mutual mistake.
In a recognizance, a party agrees to pay a specified sum of money if another party does
not pay it.
An appropriate bargaining unit must consist of employees from a single company.
A partially disclosed agency can be created by mistake.
Executives who are compensated on a salary basis and engage in management are
exempt from overtime pay.
When the states ratified the Constitution, they delegated certain powerscalled
enumerated powersto the federal government.
A patent can only be claimed for a limited amount of time.
If a consumer product is found to be imminently hazardous, the Consumer Product
Safety Commission (CPSC) has the power to require the manufacturer to recall the
product.
An agent given a power of attorney is known as an attorney-in-fact.
A distributorship franchisee is called a subfranchisor.
A franchisor deals with the franchisee as an independent contractor.
The U.S. Food and Drug Administration promotes the principle of caveat emptor in
sales transactions involving food and drugs.
The stakeholder interest theory compels a corporation to consider the effects of its
actions specifically on shareholders.
Any contract entered into by a person who has been adjudged insane is void.
Powers not given to the federal government by the U.S. Constitution are reserved to the
states.
No federal or state government approval is required for creating a sole proprietorship.
The firm offer rule allows the offeror to revoke an offer at any point of time prior to the
acceptance.
A principal is not liable for the intentional torts of agents and employees that are
committed outside the principal's scope of business.
Price fixing is a rule of reason violation of Section 1 of the Sherman Act.
Natural monopolies are found to violate Section 2 of the Sherman Act.
Utility patents for inventions are valid for 20 years.
The trademark symbols TM and SM can be used with marks that have not been
registered.
Once declared, a cash or property dividend cannot be revoked.
The FSIA strictly states that a foreign country is not immune to lawsuits in U.S. courts
under any circumstance.
In a rejoinder, the defendant's attorney can call additional witnesses and introduce other
evidence to counter the plaintiff's rebuttal.
If an agent competes with the principal without the principal's permission, the principal
may recover profits made by the agent.
Agency law is a mixture of contract law and tort law.
An exculpatory clause can relieve a party of liability for ordinary negligence.
The bankruptcy of the principal is not a valid reason to terminate an agency.
The Marine Protection, Research, and Sanctuaries Act strictly prohibits, without
exception, the dumping of wastes and other foreign materials into ocean waters; as a
result, dumping permits are not available.
The Chief Justice of the Supreme Court is elected by the associate justices of the U.S.
Supreme Court.
Ordinances are not codified into code books.
If there is no agreement about the amount of compensation, the law implies a promise
that a principal will pay the agent the customary fee paid in the industry.
If at least 25 percent of the employees in a bargaining unit sign consent cards indicating
that they are interested in joining or forming a union, the National Labor Relations
Board can be petitioned to investigate and to set an election date.
An employer-employee relationship occurs when an employer gives an employee the
authority to act and enter into contracts on his or her behalf.
EDGAR is the world's largest electronic securities exchange.
Gary Govetty is a famous movie star. A tabloid published an interview with his
ex-girlfriend in which she falsely claimed that Gary was completely bald and had been
wearing a wig for several years. Gary can sue his ex-girlfriend for ________.
A) slander
B) invasion of the right to privacy
C) tort of appropriation
D) negligent infliction of emotional distress
Overtime pay is paid for each hour worked in excess of ________ hours in a week.
A) 35
B) 40
C) 45
D) 50
One student actor wins a part in a play over another student actor. To get back at the
winning student, the rejected student files a lawsuit against the winning student alleging
intentional infliction of emotional distress, defamation, and negligence. The jury returns
a verdict exonerating the defendant. The defendant is now entitled to sue the plaintiff
for ________.
A) the tort of outrage
B) malicious prosecution
C) intentional misrepresentation
D) misappropriation of the right to publicity
________ refer to the formal documents that must be filed at the secretary of state's
office of the state of organization of an LLC to form the LLC.
A) Operating agreements
B) Certificates of interest
C) Articles of organization
D) Articles of amendment
In a(n) ________ franchise, the franchisor authorizes the franchisee to negotiate and
sell franchises on behalf of the franchisor.
A) chain-style
B) area
C) distributorship
D) processing plant
A ________ grants the owner all the incidents of a fee simple absolute except that
ownership may be taken away if a specified condition occurs or does not occur.
A) future interest
B) servient estate
C) fee simple defeasible
D) life estate
A member of a minority race applies for a promotion to a position advertised as
available at his company. The minority applicant, who is qualified for the position, is
rejected by the company which hires a nonminority applicant for the position. The
minority applicant can sue under ________.
A) Title I of the ADA
B) Title II of the GINA
C) Title VII of the Civil Rights Act
D) the Lilly Ledbetter Fair Pay Act
Which of the following would violate the Double Jeopardy Clause?
A) The government reopens a case after new incriminating evidence is found against an
acquitted person.
B) A person is tried for a case similar to a case from which he was acquitted earlier.
C) A case reaches a hung jury in court and the government reopens the case with a new
jury.
D) The criminal act violates more than one jurisdiction and each jurisdiction tries the
accused in turn.
Justin and Michael form a limited partnership and start a car dealership. Justin is the
general partner and Michael is the limited partner. Seven months after the
commencement of the business, Pedro makes an investment and wishes to become a
general partner. A week later, Michael's mother wishes to join the partnership as a
limited partner. Which of the following is true in this scenario?
A) Pedro cannot be admitted as a general partner to the partnership after the business
has commenced.
B) Pedro cannot be admitted as a general partner to the partnership as a limited
partnership can only have one general partner.
C) Michael's mother cannot be admitted as a limited partner to the partnership as a
limited partnership can only have one limited partner.
D) Both Pedro and Michael's mother can choose to be admitted as either general or
limited partners to the partnership.
From which of the following theories of morality is Rawls's social justice theory
fundamentally derived?
A) the utilitarianism theory
B) the ethical fundamentalism theory
C) the social contract theory
D) the moral relativism theory
Which of the following is true of a registration statement?
A) A registration statement must be accompanied by financial statements certified by
certified public accountants.
B) Once submitted, a registration statement cannot be amended.
C) The SEC judges the merits of the securities based on the registration statement.
D) A registration statement need not reveal how a company plans on using the proceeds
from the offering.
Roland and Kelly were involved in a car accident in which Kelly was badly injured and
had to be hospitalized. After the accident was investigated, it was determined that
Roland's negligence was the cause of the accident. He was charged with reckless
driving, a crime. In criminal proceedings, what course of action should Roland take to
prevent Kelly from using evidence of his guilt against him in a subsequent civil trial
seeking recovery for her injuries and hospital bills?
A) plead not guilty and go to trial
B) enter into a plea of nolo contendere
C) plead guilty and serve the punishment established by the government
D) enter into a plea bargain with the government, admitting guilt but receiving less
punishment in return for the plea
Which of the following is true of a license?
A) A license grants the licensee complete control over intellectual property.
B) An exclusive license is granted to only one licensee for a specific period.
C) A licensee has complete control over the information he or she is allowed to access.
D) A licensee has the right to use information rights beyond the licensor's control that
are necessary to exercise the expressly described rights.
Which of the following would be considered an example of shaping moral standards, as
seen as a function of the law?
A) laws granting freedom of speech and religion
B) laws discouraging drug and alcohol abuse
C) laws providing for the right to peaceful protest
D) laws preventing the overthrow of a government
The Association of Southeast Asian Nations (ASEAN) was created as a treaty among
the oil-producing countries of Asia.
Law is described as ________.
A) a body of rules of action or conduct prescribed by controlling authority and having
binding legal force
B) a study of fundamental problems, such as those connected with existence like
knowledge and language
C) a legal system that builds and organizes knowledge in the form of testable
explanations and predictions
D) a group of legal hypotheses employed to explain a legal phenomenon
In which of the following ways does the FDA regulate cosmetics?
A) by adding warnings for potential carcinogens
B) by regulating the sale of cosmetics through exclusive FDA approved stores
C) by placing a complete ban on animal testing in the cosmetic industry
D) by autonomously undertaking criminal proceedings against nonconforming cosmetic
companies
________ is a situation in which one party threatens to do a wrongful act unless the
other party enters into a contract.
A) Scienter
B) Duress
C) Battery
D) Assault
A due diligence defense cannot be asserted by an accountant against the civil liabilities
of Section 11(a) of the Securities Act of 1933.
Jerome wears a t-shirt that bears a picture of the current U.S. president. Under this
picture, there are words which imply that the President is doing a bad job of running the
country. In accordance with the Freedom of Speech Clause, which of the following is an
accurate statement?
A) Criticizing the current president is fully protected speech and Jerome cannot be
prosecuted.
B) Jerome could be arrested as his t-shirt violates the Freedom of Speech doctrine.
C) Jerome wearing the t-shirt is an example of limited protected speech.
D) Wearing the t-shirt makes Jerome liable for prosecution on the basis of defamation.
Which of the following is true of the ECPA?
A) Businesses are allowed to send spam e-mails, as long as they do not lie.
B) ISPs are not liable for the content transmitted over their networks by e-mail users
and websites.
C) An e-signature is as effective as a pen-inscribed signature.
D) It is a crime to intercept an electronic communication at the point of transmission.
If an employee is injured in an automobile accident while she is driving to an
off-premises restaurant during her personal lunch hour, the injury is ________.
A) covered by workers' compensation insurance
B) not covered by workers' compensation
C) covered by the employer's self-insurance fund
D) not covered by the employee's medical insurance
At the food processing company where Mika works, his primary job responsibility is to
review the quality of preservatives that are used in the food products being made. A
new and highly recommended preservative that has the potential to preserve food
longer without refrigeration was approved by Mika. However, Mika failed to identify
that the substance used to make the particular preservative was banned. If the food
product is released with this new preservative, which of the following provisions of the
Nutrition Labeling and Education Act (NLEA) would help consumers identify the
banned preservative prior to consumption?
A) condemnation of unfit food products
B) disclosure of information on food labels
C) inspection of the storage facilities
D) initiation of legal proceedings against violators
Martha is walking along a street with her son when he is hit by a passing car just as he
steps off the pavement. He dies in his mother's arms, leaving her traumatized. The court
hearing the case rules that Martha's son was not responsible for the accident. Martha
can sue the person who killed her son to recover damages for ________.
A) the tort of outrage
B) breach of the duty of care
C) negligent infliction of emotional distress
D) transfer of intent
________ is an interest in real property that lasts for a specified person's lifetime.
A) Life estate
B) Fee simple absolute
C) Servient estate
D) Fee simple defeasible
A ________ is a preferred stockholder's right to be paid a stated dollar amount if a
corporation is dissolved and its assets redistributed.
A) noncumulative preference
B) cumulative dividend preference
C) dividend preference
D) liquidation preference
The lawfulness of government classifications based on a protected class other than a
suspect class or a fundamental right, such as a classification based on gender, is
examined using a(n) ________ test.
A) strict scrutiny
B) intermediate scrutiny
C) rational basis
D) cogent basis
Which of the following is true of misrepresentation?
A) An intentional misrepresentation by an agent is not considered fraud or deceit.
B) The principal is not liable for an agent's intentional misrepresentation.
C) A third party cannot recover damages from the principal due to an agent's intentional
misrepresentation.
D) The principal is liable for an agent's innocent misrepresentation.
A(n) ________ provides that certain job preferences will be given to members of
minority racial and ethnic groups, females, and other protected-class applicants when
making employment decisions.
A) retaliation
B) affirmative defense
C) affirmative action plan
D) reasonable accommodation plan
While downloading a license to a software program, Harriet reads the "Terms of
Agreement" document which states that the company is not liable for any unforeseen
damages that arise from the software. Harriet clicks "Accept" and continues to install
the program. The document is an example of a(n) ________.
A) digital signature
B) digital identification
C) licensing agreement
D) implicit contract
Kimlon Informatics is owed $5,000 from a client for its services. The recovery period is
100 days, but Kimlon needs the money immediately. It sells the right of collecting
money from its client to Quikcollect, a collection agency. Here, Kimlon Informatics is
the ________.
A) obligor
B) obligee
C) subassignee
D) assignee
A ________ is a transfer of the right to the possession and use of named goods for a set
term in return for certain consideration.
A) trade
B) gift
C) lease
D) sale
The ________ was a labor union formed in 1886 that only allowed craft workers such
as silversmiths and artisans to be its members.
A) Congress of Industrial Organizations (CIO)
B) American Federation of Labor (AFL)
C) National Labor Relations Board (NLRB)
D) International Labor Organization (ILO)
A(n) ________ is a warranty created when a seller or lessor makes an affirmation that
the goods he or she is selling or leasing meet certain standards of quality, description,
performance, or condition.
Explain in brief the composition of a bankruptcy estate.
The issuance of securities by an issuer to the public is known as a(n) ________.
A(n) ________ contract is a contract entered into by way of an exchange of promises
between the parties.
Chapter 11 of the Bankruptcy Code deals with the ________ form of bankruptcy.
________ is defined as the taking of personal property from another person by the use
of fear or force.
The ________ Act forbids the use of oppressive child labor and makes it unlawful to
ship goods produced by businesses that use oppressive child labor.
Authorized shares that have not been sold by the corporation are known as ________.
The ________ provides that Internet service providers are not liable for the content
transmitted over their networks by e-mail users and websites.
Explain Section 552 of the Restatement (Second) of Torts.
The ________ Act of 1986, which is administered by the USCIS, requires employers to
verify whether prospective employees are either U.S. citizens or otherwise authorized to
work in the country.
The ________ Act prohibits public companies from making personal loans to their
directors or executive officers.
The ________ is the federal administrative agency responsible for enforcing most
federal antidiscrimination laws.
While claiming under ________ liability, a plaintiff must name the partnership and all
of the partners as defendants in a lawsuit.
The ________ applies to lessors who engage in leasing or arranging leases for
consumer goods in the ordinary course of their business.
A contract or lease that has not been fully performed is termed as a(n) ________
contract.
Explain the formation of a general partnership.
The two elements that are required to be found guilty of an intent crime are ________
and ________.
In a criminal case, the government is represented by the ________.
