The bank where the payee or holder has an account is called the ________.
A) payer
B) depository
C) promissory
D) intermediary
If a contract specifies “F.A.S. The Oceanking, New Orleans,” the seller bears the risk of
loss until it hands over the goods to the carrier.
Which of the following pairs of terms describes the same concept or situation?
A) implied-in-law contract and implied-in-fact contract
B) implied-in-law contract and quasi-contract
C) implied-in-fact contract and quasi-contract
D) formal contract and implied-in-law contract
Which of the following is true of an LLC formation?
A) Doctors and lawyers cannot operate practices as LLCs.
B) An LLC has to be organized in every state that it operates.
C) “Inc.” and “Ltd.” can both be used to denote an LLC.
D) An LLC can conduct business only in the state where it is organized.
Which of the following elements must be established to create an implied-in-fact
contract?
A) The plaintiff provided the property or services gratuitously.
B) The plaintiff made the defendant sign the contract and then changed its terms, calling
the new terms “previously implied.”
C) The defendant was given an opportunity to reject the property or services provided
by the plaintiff but failed to do so.
D) The defendant accepted the property or services offered by the plaintiff as a fee for
an illegal activity.
James hires Franco for a painting job. Their contract explicitly states that Franco’s
employment can be terminated if he is employed by another party during the contract
period. Two weeks into the job, James finds out that Franco is also working for a
painting agency two blocks away and terminates his employment. This is an instance of
________ terminating the contract.
A) condition precedent
B) condition subsequent
C) concurrent condition
D) implied condition
If the lessee repudiates the contract while the goods are in the process of being
transported to the lessor, the lessor has the ________.
A) right to stop delivery of goods in transit
B) right to replevy goods
C) right to obtain specific performance
D) right to cure
The ________ is a federal law that gives the FDA broad powers to license new
medicines in the United States.
A) Drug Amendment of the FDCA
B) Food Labeling and Education Act
C) Health Care Reform Act
D) Patient Protection and Affordable Health Care Act
The ________ prohibits health insurance companies from terminating health insurance
coverage when a person gets sick.
A) Health Care Reform Act
B) Drug Amendment of the FDC Act
C) Medical Device Amendment Act
D) Food, Drug, and Cosmetic Act
Rio-Werner Corporation owns Rio’s Sandwiches, a fast-food restaurant in New Jersey.
It wants to operate in five cities on the west coast by means of franchisees which make
and sell all menu items from Rio’s Sandwiches. Which of the following would best suit
the Rio-Werner Corporation’s franchise plan?
A) processing plant
B) area
C) distributorship
D) chain-style
Which of the following statements is true of limited liability partnerships (LLP)?
A) All the partners lose only their capital contribution in the LLP if the LLP fails.
B) The limited partners are personally liable for the debts and obligations of the LLP.
C) A limited partner whose negligent or intentional conduct causes injury cannot be
held personally liable for his or her conduct.
D) If an LLP fails, the LLP’s remaining assets are sold to help the largest stakeholder
recover his or her investments in the LLP.
________ is a point along a chain of events caused by a negligent party after which this
party is no longer legally responsible for the consequences of his or her actions.
A) Causation in fact
B) Actual cause
C) Direct cause
D) Proximate cause
The trial court usually issues a ________ that sets forth the reasons for a judgment.
A) remittitur
B) written memorandum
C) delegation doctrine
D) rebuttal
A ________ indorsement disclaims or limits liability on an indorsement.
A) blank
B) restrictive
C) special
D) qualified
John, Nathan, and Julio form JNJ, LLC with equal capital investment each. On his way
to a business meeting with clients of JNJ, Nathan accidentally injures Melissa in a car
accident. Which of the following is true in this scenario?
A) Melissa can claim damages from JNJ, LLC as she was injured in the ordinary course
of business.
B) Melissa can only claim damages from Nathan and not from JNJ, LLC.
C) Melissa can choose to claim damages from any one of the three.
D) John, Nathan, and Julio have equal personal liability to Melissa’s injuries.
Which of the following statements is true of the Fair Credit Billing Act?
A) It prohibits creditors from taking actions that adversely affect the consumers’ credit
standing until the investigation is completed.
B) It gives consumers the right to obtain one free credit report once every 12 months
from the 3 nationwide credit reporting agencies.
C) It is a federal statute that protects consumer-debtors from abusive, deceptive, and
unfair practices used by debt collectors.
D) It is a federal statute that requires disclosure of credit terms on credit card and
charge card solicitations and applications.
A(n) ________ is a detailed and comprehensive written contract that sets forth the
express terms of a contract between two parties transferring the rights to an intellectual
property.
A) digital signature
B) electronic agent
C) licensing agreement
D) electronic signature
The action of a will being witnessed by two or three objective and competent people is
known as ________.
A) attestation
B) abatement
C) escheating
D) ademption
If employees no longer want to be represented by a union, a(n) ________ election is
held.
A) employer-contested
B) consent
C) decertification
D) management-contested
Which of the following best defines the duty of care a member of a member-managed
LLC must adhere to?
A) the duty of not engaging in a known violation of law
B) the duty of not usurping an opportunity of the LLC
C) the duty of not competing with the LLC’s business
D) the duty of not engaging in undisclosed self-dealing
________ is a tort related to defective products in which the defendant has breached a
duty of due care and caused harm to the plaintiff.
A) Defamation
B) Negligence
C) Embezzlement
D) Assault
Which of the following best describes an entrepreneur?
A) a person who forms and operates a business
B) a person who invests in an existing business
C) a person who lends capital to a new business
D) a person who operates a state owned enterprise
A private plaintiff has ________ years from the date on which an antitrust injury
occurred to bring a private civil treble-damages action because only damages incurred
during this period are recoverable.
A) three
B) two
C) five
D) four
The ________ is the right of a lessor to resell or release goods in a good faith and
commercially reasonable manner.
A) right to dispose of goods
B) right to withhold delivery
C) right to cure
D) right to replevy
Armex, a large nuclear power plant, has been in the news for a radioactive leak caused
by a probable structural defect. This has endangered the lives of the employees at the
plant as well as those of people staying in nearby areas. This safety violation is likely to
be taken up by the ________ for corrective action, which could include closure of the
plant.
A) Federal Nuclear Agency
B) U.S. Army Corps of Engineers
C) Nuclear Waste Policy Commission
D) Nuclear Regulatory Commission
Which of the following statements is true of accountants’ liability to clients in fraud
cases?
A) Actual fraud occurs when an accountant acts with “reckless disregard” for the truth
or consequences of his or her actions.
B) If an auditor does not verify information from third parties, constructive fraud is said
to have been committed by the auditor.
C) Punitive damages may be awarded in cases of actual fraud.
D) The client can only recover nominal damages in cases of constructive fraud.
A(n) ________ is a signature and other directions written by or on behalf of the holder
somewhere on an instrument.
A) recommendation
B) assignment
C) indorsement
D) reference
William buys a house for $500,000 from Keith Geller through a realtor. He makes a
down payment of $200,000. He borrows the rest from Smith and Sons, a lending firm,
and places his new house as collateral for the loan. Who is the creditor in this case?
A) William
B) Keith Geller
C) Smith and Sons
D) the realtor
________ of the UCC establishes rules for the creation of, transfer of, enforcement of,
and liability on negotiable instruments.
A) Article 5
B) Article 3
C) Article 2
D) Article 2A
At what stage of the criminal procedure is the accused asked to enter a plea?
A) when the accused is being booked
B) when the accused is taken to an arraignment
C) when the accused is being arrested
D) while an indictment or information statement is being issued
Lori just purchased a brand new lawnmower for $500. When she got home and tried to
use it, it would not work. She became angry and shouted, “I’d sell this thing for $50.”
Her neighbor heard her and said, “I’ll take it,” and offered Lori the $50 in cash. Which
of the following best describes this situation?
A) This is an enforceable bilateral contract.
B) This is an express contract.
C) This situation does not result in the creation of a contract.
D) Contract formation in this case depends on whether the neighbor subjectively
thought Lori was serious.