Christy and Sylvester trade movies by downloading each others movie files. If the
copyrighted material has a retail value greater than $1,000, Christy and Sylvester are
subject to criminal penalties under the No Electronic Theft Act, even if they had no
profit motive in reproducing the movies.
a. True
b. False
Both the Justice Department and the Federal Trade Commission (FTC) have authority
to enforce the antitrust laws.
a. True
b. False
Agnes plans to file for bankruptcy under Chapter 7. One month prior to filing, Agnes
gives Joe’s Filling Station $700 to apply to her gas bill. Joe has been so kind to let her
charge the gas she needed for her car over the past year. The bankruptcy trustee
appointed to the case:
a. can cancel the payment to Joe as a fraudulent transfer.
b. cannot cancel the payment to Joe because it is payment for an existing debt.
c. cannot cancel the payment to Joe because he is not an insider.
d. can cancel the payment to Joe as a voidable preference.
Sea Rovers, Inc. contracted to sell 1,000 pounds of shrimp to the Seafood Shack with
delivery on June 1. On May 1 Sea Rovers advised the Seafood Shack that it would not
be able to deliver the shrimp. The Seafood Shack:
a. can sue Sea Rovers immediately for breach of contract.
b. must wait until June 1 to see if Sea Rovers will perform before suing for breach of
contract.
c. cannot sue Sea Rovers because Sea Rovers gave adequate notice.
d. must wait until actual damages are determined before it can sue.
Public officials and public figures receive less protection from defamation than ordinary
people.
a. True
b. False
The Uniform Commercial Code provides that, under certain circumstances, a merchant
may be liable on a written contract, even though that merchant has NOT signed it.
a. True
b. False
A company’s trade secret lasts for:
a. 20 years after the application is filed.
b. 70 years after the death of the creator.
c. 10 years, but it can be renewed for an unlimited number of terms as long as it is used.
d. as long as it is kept confidential.
When a business is concerned about selling to minors because of their right to disaffirm
contracts, the business might protect itself by:
a. getting the minor to sign an agreement not to disaffirm.
b. requiring an adult co-signer.
c. requiring a court-appointed guardian to be named.
d. using a layaway system until the minor turns 18.
If a salesperson says, “This is a great car and its really fun to drive,” but the car turns
out to be a lemon, the salesperson has committed fraud.
a. True
b. False
What is the name of the treaty that allows American patents to be recognized and
enforced in member countries?
a. The Paris Convention for the Protection of Industrial Property.
b. The International Treaty of Trademarks and Patents.
c. The World Agreement of London.
d. The Berne Convention.
When Dudley files his Chapter 7 petition, he lists the following debts:
a. $25,000 in back child support and alimony.
b. $15,000 for liabilities incurred after drinking and driving.
c. $10,000 for past-due student loans.
d. $5,000 for past-due rent to his landlord.
e. $550 for a past-due phone bill.
How will each of these debts be treated by the bankruptcy court.
Corporations have a distinct advantage over other forms of business organization in the
area of taxation.
a. True
b. False
Ron, a minor, goes to the hospital for treatment of the flu. On the new-patient form Ron
signs, he agrees to pay for any care or treatment he receives. When billed for the
treatment:
a. Ron must pay for the value of the benefit he received, because medical care is a
necessary.
b. Ron must pay for the benefit he received because the contract is fully executory.
c. Ron must pay for the benefit he received because he ratified the contract.
d. Ron does not have to pay for the benefit he received.
When an appeal is filed with the U.S. Supreme Court, the Supreme Court:
a. must hear the case if the validity of a federal statute is in question.
b. must hear the case if two or more U.S. courts of appeals have decided the legal issue
differently.
c. may decide whether or not it will hear the case.
d. must hear all cases.
The Milicic v. Basketball Marketing Company, Inc. case illustrated the proper use of a
preliminary injunction.
a. True
b. False
Tender means to physically deliver the goods to the buyer.
a. True
b. False
Don runs a construction company. He hires people to work on his projects and tells
them they are all “independent contractors.” Legally, they are not independent
contractors since Don tells the workers when to come to work, how long to work, what
days to work, what they are to do each day, and so forth. At the end of each week, Don
pays his workers in cash rather than with a check. Also, he does not withhold any state,
federal or local withholding tax (since he claims the workers are independent
contractors). Which statement is correct?
a. Don has committed both unethical and illegal conduct.
b. Don has committed unethical conduct, but it is legal.
c. Don has committed ethical conduct but it is illegal.
d. Don has committed both ethical and legal conduct.
Tina wishes to learn what records the IRS has about her. Under the Freedom of
Information Act (FOIA),
a. Tina can only obtain copies of declassified information.
b. Tina is entitled to all information the IRS has about her.
c. Tina can only obtain information about the IRS, not records concerning herself.
d. Tina cannot obtain any information since the IRS is exempt from the FOIA.
Which of the following types of concurrent ownership does not provide for rights of
survivorship?
a. Joint tenancy.
b. Tenancy in common.
c. Tenancy by the entirety.
d. All of the above provide for rights of survivorship.
James and his band played a very familiar song. However, they made up different
words for the song that were intended to be funny. James’s version of the popular song
with different words is known as:
a. a “knock off.”
b. a parody.
c. a “mockarama.”
d. a “link.”
The Employee Retirement Income Security Act (ERISA) requires employers to
establish pension plans for employees.
a. True
b. False
After answering a summons and complaint, Mike received a set of written questions
from the plaintiff’s attorney. He was directed to respond to the questions in writing
under oath. This discovery technique is called:
a. a request for admission.
b. a request for the production of documents.
c. a deposition.
d. interrogatories.
Pablo, a resident of New Mexico, while driving through Arizona was struck by a SUV
driven by Dick, a resident of California. Dick was speeding when the accident
happened and Pablo suffered severe injuries that ruined a potential acting career. Pablo’s
damages are estimated at $200,000. Discuss the court system(s) in which Pablo may
bring a lawsuit.
On April 10, Amy agreed to buy a riding lawn mower from Mowers Plus, signing a
promissory note and security agreement giving Mowers Plus a security interest in the
mower. On April 15, Amy took delivery of the mower. On May 1, Mowers Plus filed a
financing statement. Which of the following is correct?
a. Despite the agreement, Mowers Plus could not create a security interest in the mower
since it is a consumer good.
b. Mowers Plus has attachment of a security interest in Amy’s mower.
c. Mowers Plus completed the attachment of a security interest in the mower when it
filed the financing statement on May 1.
d. The security interest has not attached, but attachment is unimportant to enforceability
of a security interest.
The tort of exploitation prohibits someone from peeping through your window or
wiretapping your telephone.
a. True
b. False
Ron is the business agent for Kansas Sunshine, a rock band. He is also the agent for
another popular Midwestern rock group, City Sand. Ron negotiates a deal with a
Kansas City promoter to have City Sand play after a professional football game. The
promoter was willing to pay $250,000 for both groups to play after the game; however,
Ron talked her into booking just City Sand for $175,000. Given his contract with City
Sand, Ron made more money under this arrangement. Has Ron violated his fiduciary
duty to Kansas Sunshine?
a. Yes. It appears that Ron put his own interests ahead of his principal’s interests.
b. Yes. Ron cannot, under any circumstances, act as an agent for both groups.
c. Both a and b are correct.
d. Neither a nor b is correct since it is very common for rock band agents to represent
several groups at the same time.
The criminal penalties under RICO include all EXCEPT:
a. imprisonment.
b. capital punishment.
c. confiscation of property acquired through the criminal activity.
d. fines.
The FTC can impose a fine for each violation of a voluntary compliance affidavit, a
consent order, an FTC rule, or a cease and desist order, even one issued against
someone else.
a. True
b. False
Hensley and Boyer have been negotiating for several months over issues related to the
purchase and sale of some real estate. They draft a letter of intent which:
a. protects both parties by ensuring the other side is serious and creates a binding
agreement on the issues on which the parties have agreed thus far.
b. may or may not be an offer, depending on the exact language and whether the
document indicates that the parties have reached an agreement.
c. has no legal effect, but provides a record for the parties as to where the negotiations
stand.
d. courts will consider to be a valid offer which the other party must accept if offered in
good faith.
Which of the following is an example of incidental damages you might be awarded if
you are wrongfully terminated from your job?
a. The costs of psychological counseling.
b. The costs of mailing resumes to prospective employers.
c. The costs of a new wardrobe for future interviews.
d. The costs of cosmetic surgery.
If Rudy offers Oscar $200 for his laptop valued at $600 and Oscar agrees, a court will
probably:
a. set aside the agreement as being unfair.
b. set aside the agreement because the consideration is inadequate.
c. not set aside the agreement based on the adequacy of the consideration.
d. not set aside the agreement because of the UCC.
Morality plays no part of gambling contract legality.
a. True
b. False
The most accurate statement about the Robinson-Patman Act is:
a. It has rarely been enforced in recent years.
b. The U.S. government has stepped up its enforcement during the last decade.
c. It has been declared unconstitutional.
d. It was repealed by Congress in 1998.
Which of the following started out as a trademark name?
a. Zipper.
b. Linoleum.
c. Nylon.
d. All the above.
Which of the following statements is TRUE regarding immigration under Title VII?
a. An interviewer cannot ask an applicant if he or she is authorized to work in the
United States.
b. Once hired, a person must show three forms of evidence proving he or she is
authorized to work in the United States.
c. It is illegal for employers to discriminate against non-citizens because “national
origin” is a protected category.
d. Once hired, employers must turn I-9 records over to the immigration office.