A proposal by a sales representative that is subject to approval by the home office is not
an offer.
a. True
b. False
Answer:
Which of the following is true?
a. Cannot be bound on contracts made by an agent if the principal’s identity is not
disclosed to the third party.
b. Cannot through ratification be bound on contracts made by an agent.
c. Can be bound on contracts made by an agent even if the principal’s identity is not
disclosed to the third party.
d. Cannot through ratification be bound on contracts made by an agent, but a principal
can be bound on contracts made by an agent even if the principal’s identity is not
disclosed to the third party.
Answer:
Which of the following is a technique by which a new party is substituted for one of the
old parties, and a new contract is written (with the consent of all old and new parties) to
effect the desired change?
a. Novation
b. Substitution
c. Formal change
d. Verified change
Answer:
Agency is perhaps the most pervasive legal relationship in the business world.
a. True
b. False
Answer:
In a series of laws, known collectively as the __________ laws, Congress has
authorized the President to raise U.S. tariffs on specified products and to provide other
forms of import protection to U.S. businesses.
a. export-relief
b. domestic-relief
c. import-relief
d. international-relief
Answer:
After a patent expires, the invention is dedicated to the public.
a. True
b. False
Answer:
State environmental laws may not be more stringent than federal laws.
a. True
b. False
Answer:
According to Kant’s theory of universalizability, the ethical worth of an act is
determined by whether a person:
a. would want such a rule applied to minority members of society.
b. would want everyone to perform in this manner.
c. could get away with such an action.
d. could live with the results of such an action.
Answer:
The United States v. Jones case discussed in the text, involved a question of a GPS
tracking device placed on car that was tracked for over a month. The U.S. Supreme
Court held that installing the device was:
a. a search incident to a lawful arrest, and did not require a search warrant.
b. analogous to a traffic stop in plain view, and therefore did not require a traffic stop.
c. “negligible” trespass on private property, which did not require a search warrant.
d. a trespass on private property, which required a search warrant.
Answer:
In a joint venture, the authority of one member to bind the partnership is more limited
than in a general partnership.
a. True
b. False
Answer:
Since 1990 until today, the compensation gap between the average worker and a CEO
listed in Standard and Poors Index has narrowed.
a. True
b. False
Answer:
Fact Pattern 9-1
Frank belongs to the same country club as his former physician, Dr. Bozo. Frank
recently started dating Dr. Bozo’s former wife, Alice, and decided to find a new
physician. Frank found out that Dr. Bozo has been telling their mutual friends at the
club about Frank’s high blood pressure and problems with anxiety. Frank is very angry,
confronts Dr. Bozo on the golf course, and tells him that he is going to sue him under a
federal law protecting medical information. Dr. Bozo laughs and says in front of a
number of Frank’s golfing buddies, “I’m not surprised that you’re going nuts and that
you have high blood pressurehanging out with Alice has done that to many a man.”
Refer to Fact Pattern 9-1. What right of action, if any, would Frank have against Dr.
Bozo?
a. He has no cause of action against Dr. Bozo because the law does not protect this type
of invasion of privacy so long as Dr. Bozo was being truthful regarding his health
condition.
b. He could sue Dr. Bozo under a federal statute enacted to protect privacy rights.
c. He could not sue Dr. Bozo directly under any federal statute enacted to protect
privacy rights, but he could likely prevail in a common law action for the public
disclosure of private facts.
d. He could not sue Dr. Bozo under federal law for invasion of privacy nor could he sue
under a common law cause of action, but only because he was no longer Dr. Bozo’s
patient.
Answer:
A formal administrative adjudication does not include the right to:
a. a jury trial.
b. an attorney.
c. present your evidence.
d. participate in the proceeding.
Answer:
CASE 1 Eaton v. Federal National Mortgage Association (2012) dealt with the
underlying promissory note, the assignments to a third party, andthe true
mortgagee-in-fact. After reviewing the relevant common and statutory laws, the court
concluded that the true __________ means the party __________.
a. mortgagee, securing the note on the real property
b. mortgagor, transferring legal title of the real property to the lender
c. mortgagee, transferring legal title of the real property to the lender
d. mortgagee, holding the underlying mortgage note
Answer:
A car loan is an example of a closed-end credit transaction.
a. True
b. False
Answer:
A(n) __________ places the license terms on the outside of a box containing software.
a. click-wrap license
b. browse-wrap agreement
c. shrink-wrap license
d. computer-license agreement
Answer:
The ____ approach to business and society introduced in the text is a descriptive
framework that integrates legal and societal considerations with mainstream theories of
competitive advantage and social responsibility.
a. Integrative
b. Systems
c. Proactive
d. Economic
Answer:
Allison, a dress designer, believes that she has a great deal with a company in Ireland,
called Fashion, which has agreed to purchase a number of her dresses. The manager of
Fashion, however, insists on delivery of the dresses before payment will be provided.
Which of the following would be a good idea for Allison?
a. Allison should insist on a documentary letter of credit provided by an issuing bank
promising payment upon proof of delivery of the dresses.
b. Allison should insist on a letter of credit issued by the buyer promising payment upon
delivery of the dresses.
c. Allison should personally deliver the dresses so that she can demand payment while
there.
d. Allison should turn down the deal because it is too risky.
Answer:
The __________ Amendment provides that no state shall “deprive any person of life,
liberty, or property, without due process of law.”
a. Seventh
b. Tenth
c. Eleventh
d. Fourteenth
Answer:
The Local Government Antitrust Act expressly exempts municipalities from antitrust
monetary damages, while expressly limiting equitable remedies such as injunctions.
a. True
b. False
Answer:
Courts enforce liquidated damages as a form of a penalty.
a. True
b. False
Answer:
Fact Pattern 16-1
Patty owns and operates a gym. Her main competitor is Jason who runs another gym
three streets from her. They cater to the same clientele. Patty and Jason keep trying to
undercut each other in order to attract customers. One evening Patty sees Jason in the
local coffee shop and sits down to talk with him. They discuss how difficult it is to do
upgrades and make money with the prices they are charging. Patty winked at Jason and
said “You know, charging $80 per month would enable a good profit margin.” The next
day Patty started charging $80 per month as did Jason. Customers started complaining
particularly after another coffee drinker and gym customer at a table sitting at a table
near Patty and Jason made it known that they had seemed very cozy. Patty and Jason
deny any agreement to set the same price for gym membership. They avow that the
decision was made by each of them independently.
Refer to Fact Pattern 16-1. Frank, a first year law student and gym member, is
suspicious; but he does not know what violation to claim. Which of the following is the
correct term for an illegal agreement by providers of the same good or service to charge
a set fee?
a. Horizontal price fixing
b. Vertical price fixing
c. Substantial price fixing
d. Predatory price fixing
Answer:
The __________ makes it a crime for any U.S. firm or any firm controlled by a U.S.
firm to make payments to an official of a foreign government in an attempt to influence
the actions of the official.
a. Illegal Bribery Prohibition
b. Foreign Corrupt Practices Act
c. Extraterritorial Reach Prohibition
d. Foreign Bribery Act
Answer:
English common law created a type of co-ownership of real property between husband
and wife called joint tenancy.
a. True
b. False
Answer:
The National Labor Relations Act prohibits employers from discriminating against any
employee to encourage or discourage membership in any labor organization.
a. True
b. False
Answer:
The __________ test is applied to determine whether or not speech is protected by the
First Amendment to the U.S. Constitution.
a. incitement of violence
b. Brandenburg
c. espionage and sedition
d. clear and present danger
Answer:
The WARN act requires employers to give employees at least 120 days advance notice
of a plant closure affecting at least 50 employees.
a. True
b. False
Answer:
__________ is the division of a city into districts and the application of specific
land-use regulations in each district.
a. Zoning
b. Nonconforming use
c. Subdivision process
d. Constitutional taking
Answer:
In a(n) __________ listing, the broker will receive any sales proceeds in excess of the
net listing amount specified by the seller.
a. exclusive
b. open
c. net listing
d. broker
Answer:
Fact Pattern 16-2
Number One Oil Company sells gas to various gas stations. Number One requires that
the gas stations agree that they will not sell gas above a certain maximum price set by
Number One. Some of the gas stations are unhappy with the arrangement because they
wish to sell gas at any price they choose. Unfortunately for them, other oil companies in
the region also impose maximum price restrictions. The station owners begin
investigating whether any antitrust violation could be involved.
Refer to Fact Pattern 16-2. Which of the following best describes the situation by which
Number One Oil Company and other companies impose maximum price restrictions?
a. Horizontal price-fixing
b. Vertical price-fixing
c. Adverse price-fixing
d. There is no antitrust term for the practice.
Answer:
The Supreme Court has consistently ruled that Congressional intent disfavors
arbitration agreements.
a. True
b. False
Answer:
The person that conveys real property by deed is called the grantee.
a. True
b. False
Answer:
Proxies give the proxy holder the right to vote the shares owned by the person who
signs the proxy card.
a. True
b. False
Answer:
Which of the following is true regarding the effect of death and incapacity on an offer?
a. Death or incapacitation of either party terminates an offer.
b. Death of either party terminates an offer, and incapacity on the part of the offeror
terminates an offer, but incapacity on the part of an offeree does not terminate an offer.
c. Death of either party terminates an offer, and incapacity on the part of an offeree
terminates an offer, but incapacity on the part of the offeror does not terminate an offer.
d. Neither death nor incapacity on either the part of the offeror or offeree terminates an
offer.
Answer: