A negotiable promissory note was issued by Gold. It was properly issued in all ways.
Nevertheless, the payee managed to alter the note and raise the amount from $500 to
$5,000. A holder in due course presented the note for payment to Gold who discovered
the alteration. In this case:
a. Gold is liable for $500 only.
b. Gold is liable for the full $5,000.
c. Gold has no liability on the altered note.
d. Gold is liable for $2,500.
Which of the following is not a third-partybeneficiary contract?
a. a contract in which A hires B to give A’s niece piano lessons
b. a contract to repair sewers in front of Macy’s Department Store
c. a life insurance contract with a named beneficiary
d. a contract between X and Y for Y to install a new door on Z’s home
All of the following statements refer to an element of fraud except:
a. the defendant desired to obtain a financial benefit.
b. the defendant made a false statement.
c. the defendant knew that the statement was false or was recklessly indifferent
regarding its truth.
d. the defendant intended for the other party to rely on the false statement.
The _____ rule(s) on the admissibility of evidence.
a. Judge
b. Jury
c. Attorneys
d. court clerk
Computer crimes include:
a. theft of hardware.
b. theft of software.
c. intentional damage to information stored on a computer.
d. all of the above.
Which of the following is true about judicial review of agency action?
a. Judges tend to substitute their own judgment for that of the agency.
b. Courts will reverse agency decisions merely because the court would have made a
different decision based on the same facts.
c. Courts will reverse a decision if they disagree with the legal interpretation.
d. All of the above
In the absence of a fixed duration provision, a joint venture will ordinarily terminate:
a. upon completion of the project.
b. at the will of any participant.
c. as specified in the joint venture agreement.
d. any of the above.
A person who did not necessarily commit the crime can still be held criminally
responsible for acts committed by others __________.
a. only for non-business crimes
b. only for business crimes
c. both a. and b.
d. neither a. nor b.
Article 3 of the UCC establishes a __________-year statute of limitations for most
actions involving negotiable instruments.
a. one
b. two
c. three
d. four
The warranty of merchantability guarantees that the:
a. party in question is a merchant.
b. product is fit for the ordinary purposes for which it is sold.
c. product will remain fit for its normal use for the applicable statute of limitations
period.
d. product can be resold by the buyer if the buyer does not want to keep it.
A prospectus sets forth:
a. the key information contained in the registration statement.
b. information on stocks approved by the SEC.
c. information that the SEC has not reviewed.
d. none of the above.
Which is NOT a correct statement concerning a liquidated damages clause?
a. If the clause is enforced, the injured party can collect no more than the amount
specified.
b. If the clause is enforced, the injured party has a choice between compensatory
damages or liquidated damages.
c. It must be possible to determine actual damages.
d. The amount of liquidated damages are established by the parties to the contract.
Probate is the act by which:
a. the court declares an instrument is a valid will.
b. a qualified person may contest the will.
c. the witnesses sign an attestation clause.
d. publication of the will takes place.
After a proper demand has been made, for assurance of performance to be adequate, it
must:
a. include consideration.
b. allow for the additional examination of the goods.
c. be sufficient to assure a reasonable person that the contract will be performed.
d. be written.
With regard to priority of claims in the payment of unsecured debts, which of the
following has priority over alimony and child support obligations?
a. costs and expenses of the administration of the bankruptcy case.
b. claims arising in the ordinary course of the debtor’s business after commencement of
the case
c. claims for wages, salaries or commissions earned within 180 days before the filing of
the petition
d. none of the above
If an offer requires that acceptance be communicated by a specific date and the
acceptance is properly dispatched by the offeree on the final date,
a. no contract is formed, since the offeror will undoubtedly receive the dispatched
acceptance after the deadline for acceptance.
b. a contract is formed, but the contract is voidable at the election of the offeror.
c. the acceptance is timely and a contract is formed, even though the offeror actually
receives the acceptance well after the specified date has passed.
d. the acceptance is timely and a contract is formed, but only if the offeror actually
receives the acceptance by the deadline specified for acceptance.
To analyze a copyright infringement claim in the context of computer programs, courts
will primarily examine:
a. the total number of program steps that are substantially similar.
b. the number of significant program steps that are substantially similar.
c. whether the programs appear substantially similar in ordinary language.
d. whether the programs appear substantially similar in machine language.
When a partnership is dissolved by the act of a partner, notice:
a. is not required.
b. must be given to the other partners only.
c. must be given to third persons only.
d. must be given to both other partners and third persons.
The Endangered Species Act gives which of the following cabinet-level officers the
authority to protect various species?
a. the Secretary of the Interior only
b. the Secretary of Commerce only
c. both the Secretary of the Interior and the Secretary of Commerce
d. none of the above
A __________ agent is authorized by the principal to do all acts that can be delegated
lawfully to a representative.
a. special
b. general
c. secret
d. universal
Initially, ratification is a question of:
a. intention.
b. consideration.
c. form.
d. implication.
The legal definition of a guest of a hotel requires that the person:
a. live at least five miles from the hotel.
b. is a guest of a registered occupant of the hotel.
c. is a transient.
d. stay at the hotel for at least 24 hours.
If a breach of the peace might occur:
a. self-help repossession is the only option available to obtain the collateral.
b. the creditor must use court action to obtain the collateral.
c. the creditor is barred from repossessing the collateral.
d. the collateral reverts to the debtor.
Uniform State Laws are used as a basis for laws by which of the following entities?
a. Congress
b. international trade associations
c. state legislatures
d. local governmental entities
Trespass applies to:
a. personal property only.
b. land only.
c. both personal property and land.
d. only government-owned property.
Private lotteries, which generally are held to be illegal, involve three elements:
a. prize, chance, and consideration.
b. return, skill, and wager.
c. prize, skill, and consideration.
d. attractive return, minimal involvement, and skill.
__________ courts impose liability on the accountant to a total stranger who gets
possession of the accountant’s work and then sustains a loss because of a false statement
in the work.
a. No
b. A minority of
c. A majority of
d. All
If an involuntary bankruptcy petition is dismissed other than by consent of all
petitioning creditors and the debtor, the court may award which of the following to the
debtor?
a. Costs
b. Reasonable attorney fees
c. Damages
d. All of the above
It is the duty of an agent to act with the care that:
a. the principal would exercise under the circumstances.
b. a reasonable principal would exercise under the circumstances.
c. a reasonable juror would exercise under the circumstances.
d. a reasonable person would exercise under the circumstances.
A shopkeeper may lose the shopkeeper’s privilege if:
a. the customer is kept an unreasonable amount of time.
b. the shopkeeper acted with reasonable suspicion.
c. the shopkeeper acted with necessary force.
d. all of the above.
Three types of patents available under U.S. law are:
a. utility, product, design.
b. design, packaging, invention.
c. design, plant, utility.
d. utility, regulatory, common law.
A limited liability company:
a. is the same type of business entity as a “Subchapter S” corporation.
b. has no restriction on the number of owners.
c. is taxed in a manner similar to that of a corporation.
d. has unlimited life regardless of what happens with any individual member.
Three defenses are commonly raised to the extraterritorial application of U.S. antitrust
laws. They are:
a. act”of-state, sovereign compliance, and sovereign immunity doctrines.
b. jurisdictional rule of reason, effects doctrine, and comity.
c. foreign legislation, sovereign compliance, and comity.
d. foreign antitrust laws, sovereign immunity doctrine, and International Monetary Fund
applications.
In performing agency duties, the agent must exercise the care that a reasonably prudent
person would exercise under the same circumstances.
Shares can exist for only as long as the shareholder is alive.
The normal remedy for breach of contract where the plaintiff has suffered a loss is
compensatory damages.
The Administrative Procedure Act is a federal law that establishes the operating rules
for administrative agencies.
A will is very informal and may be created in any reasonable manner.
Plaintiffs are typically awarded punitive damages in negligence cases.
Franchise agreements frequently contain an arbitration provision under which a neutral
party is to make a final and binding determination whether there has been a breach of
the contract sufficient to justify cancellation of the franchise.
The Securities Act of 1933 requires a seller to provide a prospectus to each potential
purchaser of an original issue of securities.
The Fifth and Fourteenth Amendments prohibit the national and state governments from
depriving any person of property without due process of law.
Under the majority view, a contract that does not satisfy the statute of frauds is not
enforceable.
The maker is the person who writes out and creates a promissory note.
Companies whose securities are listed on a national securities exchange and unlisted
companies with assets in excess of $10 million and 500 or more shareholders are
exempt from the reporting requirements of the Securities Exchange Act of 1934.
There is often a conflict between the goal of making money for shareholders and the
goal of solving social problems through business.
Employment testing and educational requirements must be “job-related”; that is,
employers must prove that employment testing and educational requirements bear a
relationship to job performance.
An oral contract to sell custom-made goods to a buyer is binding if the goods are not
suitable for sale to anyone else in the ordinary course of the seller’s business, and the
seller has made a substantial beginning in manufacturing or procuring the goods.
When a third person makes payment to an authorized agent, such payment is deemed
made to the principal at the time the agent remits the payment to the principal.