Ethan is seventeen years old. Under the Fair Labor Standards Act, Ethan cannot work
a. during school hours.
b. in a hazardous occupation.
c. more than eighteen hours per week.
d. without a special permit.
Gladstone regularly sends unsolicited commercial e-mail to hundreds of millions of
recipients. This e-mail is prohibited or regulated in
a. most states.
b. only a few states.
c. no state.
d. California only.
Premier Clothing, Inc., a U.S. firm, obtains a judgment in a U.S. court against Quang
Tri, Ltd., a Vietnamese business. Whether the courts judgment will be enforced by a
court in Vietnam depends on the Vietnamese courts application of
a. the act of state doctrine.
b. the doctrine of sovereign immunity.
c. the principle of comity.
d. the World Trade Organization.
Ross e-mails Super Snowboard Companys marketing campaign to Winter Sports
Corporation, Supers competitor, without its permission. This is
a. copyright infringement.
b. patent infringement.
c. trademark infringement.
d. a theft of trade secrets.
In Restful Motels suit against Sleepy Hotels, Inc., the jury returns a verdict in Restfuls
favor. Sleepy files a motion stating that even if the evidence is viewed in the light most
favorable to Restful, a reasonable jury should not have found in its favor. This is a
motion for
a. a judgment in accordance with the verdict.
b. a judgment on the pleadings.
c. a new trial.
d. judgment n.o.v.
The government of Iran violates an international law. Persuasive tactics to remedy the
situation fail. The only recourse of other nations is to
a. approve the European Unions enforcement of the law.
b. ask the International Court of Justice to enforce sanctions.
c. seek enforcement of the law through the United Nations.
d. take coercive actionsever relations, impose boycotts, go to war.
Joy induces Kelly to enter into a contract for the purchase of a condominium about
which Joy knowingly misrepresents a number of material features. When Kelly
discovers the truth, Kelly can
a. enforce the contract and seek damages.
b. enforce the contract but not seek damages.
c. neither enforce the contract nor seek damages.
d. seek damages but not enforce the contract.
Rikki and Sid enter into a sales contract. With respect to the specific contractual
provisions set out in the UCC, Rikki and Sid may
a. agree to different terms only to a reasonable extent.
b. agree to different terms unless they “get caught.
c. agree to whatever terms they wish.
d. not agree to different terms.
Alan, the president of Bayside Investments, Inc., and Colin, Baysides accountant, are
charged with a crime, after the police search Baysides offices. Under the exclusionary
rule
a. certain Bayside records are excluded from subpoena.
b. certain parties to a criminal action may be excluded from a trial.
c. illegally obtained evidence must be excluded from a trial.
d. persons who have biases that would prevent them from fairly deciding the case may
be excluded from the jury.
Fact Pattern 8-3
Dex and Carmen are in an auto accident. Dex offers Carmen $2,000 if she promises not
to pursue her potential legal claim against Dex. Carmen agrees. Later, Carmen
discovers that it will cost $1,500 to repair her car and $4,000 to cover the medical
expenses for a latent injury.
Refer to Fact Pattern 8-3. In Carmens suit against Dex to recover her repair and medical
expenses, Carmen will most likely recover
a. half the amount to pay the costs over what Dex already paid Carmen.
b. nothing.
c. the estimated amount to pay those costs and any other liability.
d. the exact amount to pay those costs and no more.
In making business decisions, Glenda, personnel manager for HVAC Maintenance, Inc.,
applies his belief that all persons have fundamental rights. This is
a. a religious rule.
b. the categorical imperative.
c. the principle of rights.
d. utilitarianism.
Saf-T Storage, Inc. (SSI), offers to sell a warehouse to Richfield Investments. Richfield
says that it will pay SSI $100 to hold the offer open for three business days. This
a. creates an illegal contract by adding a clause to SSIs offer.
b. makes the offer irrevocable for three days if SSI accepts.
c. negates SSIs offer by changing the price term.
d. voids SSIs offer by extending the time term.
Niki owns O.K. Oil Corporation. Niki uses O.K.s funds to pay her personal expenses,
creates Pure Fuel Corporation to engage in the same business as O.K., transfers O.K.s
assets to Pure Fuel, and petitions O.K. into bankruptcy. This most likely warrants
a. a bonus to Niki for financial maneuvers.
b. a discharge for O.K. in bankruptcy.
c. a piercing of O.K.s corporate veil.
d. a review of Pure Fuels articles of incorporation.
GR8 Products, Inc., warrants its goods to be free of defects. If Heck issues an
instrument to obtain goods from GR8 that prove defective, Heck can avoid paying on
the instrument
a. only if it is a check.
b. only if it is a note.
c. whether it is a check or a note.
d. under no circumstances.
Fact Pattern 8-2
Brad defends against a breach-of-contract suit by College Credit Corporation by
claiming that their deala student loan accruing interest at a certain rate and payable
beginning on a certain datewas unfair because the consideration for their contract was
inadequate.
Refer to Fact Pattern 8-2. A court is most likely to evaluate the adequacy of considera-
tion if
a. a thing exchanged has no intangible value to one of the parties.
b. something exchanged is not of direct economic or financial value.
c. the items exchanged were of unequal value.
d. there is a gross disparity in the value of the consideration exchanged.
Business Rental Corporation (BRC) and Cartage Trucking Company enter into a
contract for a lease of ten hydraulic lifts. Under the perfect tender rule, BRC must ship
or tender goods to the lessee that
a. approximately conform to all of the details of the contract.
b. entirely conform to the contract except in one or two details.
c. exactly conform to the contract in every detail.
d. substantially conform to the contract in most details.
Fact Pattern 7-1
Minka uses her computer to secretly install software on hundreds of personal computers
without their owners knowledge.
Refer to Fact Pattern 7-1. Minkas secretly installed software allows her to forward
transmissions from her unauthorized network to even more systems. This network is
a. a hacker.
b. a bot.
c. a botnet.
d. a worm.
Loni delivers her Mazda to be repaired at Niles Body Shop. Loni agrees to pay cash.
Nile performs, but Loni does not pay. Nile tells Loni that he will keep the car until she
pays. This is
a. a judicial lien.
b. a mechanics lien.
c. an artisans lien.
d. a violation of most states laws.
Fact Pattern 18-2
Lita replaces Manny in his job at Neighborly Business Corporation (NBC).
Refer to Fact Pattern 18-2. Manny believes that he has been discriminated against on
the basis of his age. For the Age Discrimination in Employment Act of 1967 to apply
a. all parties must be forty years of age or younger.
b. Lita must be forty years of age or older.
c. Manny must be forty years of age or older.
d. NBC must have been in existence for at least forty years.
On the back of a check payable to Nero, he writes “Pay to Odell, without recourse and
signs it. This
a. does not effect the checks negotiability or any partys liability.
b. relieves Nero of liability on the check.
c. relieves Odell of liability on the check.
d. renders the check nonnegotiable.
Kay and Leo copy and exchange MP3 music files over the Internet without anyones
permission. With respect to songs owned by Natural Recording Company, this is
a. copyright infringement.
b. fair use.
c. licensing.
d. protected expression.
Lara induces Moe to enter into a contract for the sale of an apartment about which Lara
fraudulently misrepresents a number of material facts. Lara tells Moe that her
commission is 6 percent, but their signed, written contract states “12 percent. The
Statute of Frauds governs
a. contracts that are induced by fraud.
b. contracts that must be in writing to be enforceable.
c. the admissibility in court of oral evidence.
d. the merging of oral and written statements into one contract.
Open Country, Inc., makes grills, camp ovens, and other outdoor cooking appliances.
Under the Restatement (Third) of Torts: Products Liability, Open Country could be
liable for a warning defect if there is a foreseeable risk of harm posed by one of its
products and
a. the omission of a warning renders the product not reasonably safe.
b. there is a reasonable alternative design.
c. there is a lack of care in making of the product.
d. none of the choices.
Pricey Auto Corporation gives notice to Quint that Pricey is terminating their franchise
arrangement. Winding up the business requires
a. a new franchise agreement.
b. nothing more than closing immediately.
c. Quints death, disability, or insolvency.
d. returning Priceys property.
To raise capital to form Plasticity Corporation with Quinn, Rona sells bonds and stock
in other companies, and plans to register an initial public offering under the Securities
Act of 1933. SEC Rule l0b-5 covers
a. most forms of securities.
b. only bonds.
c. only securities registered under the Securities Act of 1933.
d. only stock.
Chip is a director of Diners Restaurants, Inc. Chip would breach his duty of loyalty if
he
a. becomes a director of Fluffy Mattresses, Inc., a noncompeting firm.
b. buys a controlling interest in Picnic Parlors Corporation, a competing firm.
c. votes for Diners to buy a controlling interest in Eateries, Inc., which causes Diners to
suffer a loss.
d. votes against Diners purchase of a controlling interest in Eateries, Inc., which causes
Diners to suffer a loss.
On behalf of Premier Shipbuilding Corporation (PSC), Rita orders 1,000 cases of
1/4-inch nuts from Steel Parts Companys 10,000-case lot. Steel Parts separates 1,000
cases from the lot. Title and risk of loss
a. remain with Steel Parts until PSC acknowledges tender of delivery.
b. remain with Steel Parts until PSC accepts 1,000 cases.
c. shift to PSC after it accepts the nuts and inspects them for defects.
d. shift to PSC when Steel Parts separates the cases.
Horizon Corporation makes cell phones. Inez files a product liability suit against
Horizon, alleging a design defect. Under the Restatement (Third) of Torts: Products
Liability, in deciding whether to hold Horizon liable, the court may consider
a. neither the effect of an alternative design on the products costs and life nor the range
of consumer choice among products.
b. only the effect of an alternative design.
c. only the range of products.
d. the effect of an alternative design and the range of products.
Dunn and Etta are limited partners in Fancee Fashion Stores, a limited partnership. In
terms of the firms books, Dunn and Etta are entitled to
a. access in proportion to their participation in management of the firm.
b. access to the parts that directly relate to their capital contributions.
c. no access.
d. total access.
Fact Pattern 3-1
Java Cafes, Inc., and Kaffe Import Corporation dispute a term in their contract.
Refer to Fact Pattern 3-1. Resolving the dispute between Java and Kaffe by having a
neutral third party render a binding decision is one of the advantages of
a. arbitration.
b. conciliation.
c. intervention.
d. mediation.
Lon enters into a contract to mine limestone in Micas quarry, sell it, and share the
profits on its sale with Mica. If the duties under this contract are discharged like those
under most contracts, the duties will be
a. assigned.
b. breached.
c. performed.
d. rescinded.
If a contract for a sale of goods does not include a quantity term, it is a requirements
contract.
Reformation allows a court to rewrite a contract to reflect the parties true intentions.
Federal statutes provide the basis for issuing regulations to control water pollution.
Java Bean Company imports coffee beans and sells them under two-year contracts to
Mellow Roast, Inc., and other coffeemakers. The contracts require that during the
two-year term a coffeemaker not buy beans from Java Beans competitors. The contracts
do not limit the coffeemakers purchase of tea or other beverage ingredients from other
suppliers, however. In the second year of the contract, Mellow Roast protests that this
arrangement violates antitrust law. Is Mellow Roast correct? If not, why not? If so,
under which antitrust statute, or statutes, could these contracts be held illegal?
Any conspiracy that has a substantial effect on U.S. commerce is within the reach of the
U.S. antitrust laws.
A novation revokes and discharges a prior contract.
If a nonconforming installment substantially impairs the value of a whole contract, the
buyer can treat the entire contract as having been breached.
A check is a special type of certificate of deposit.
A limited liability partnership can be formed in virtually any state.
Under the UCC, a contract for a sale of goods that includes open terms is void.
Unlike a “natural person, a corporation cannot be compelled to give self-incriminating
testimony.
Express authority is authority declared in clear, direct, definite terms.
Once the government begins to clean up a waste disposal site, only the party who
generated the waste must contribute to the cost.
A corporation whose shares are held by relatively few persons is a partnership.
Forcing someone to enter into a contract through fear created by threats is undue
influence.
Digital pirates may be prosecuted under state, but not federal, law.
A contract involving property of any kind must be in writing to be enforceable.
Promoters, not incorporators, must execute the articles of incorporation.
A lawsuit involving a federal question can originate in a federal court.
It may be a crime to take anothers property, but it is not a crime to receive stolen goods.