A(n) _____ occurs when the landlord or the tenant transfers all of her remaining rights
under the lease to another person.
A. tenancy
B. lease
C. sublease
D. assignment
You wish to download free software from the Internet. The download procedure
includes a page titled “download now” that asks you to “please review” the licensing
agreement that is available to you on another web page. The “download now” page has
a button that initiates the download process. You click that button without going to the
licensing agreement page and find that it contains an arbitration provision. Are you
bound by this provision?
A. Yes, because the “please review” statement in the “download now” page informed
you of the licensing agreement.
B. Yes, because when you clicked the button to initiate the download process you
agreed to the provisions in the licensing agreement.
C. No, because you did not perform an action that indicated your assent to the licensing
agreement.
D. No, because laws relating to Internet privacy consider silence to be an acceptance of
the offer.
Profit maximization results in ethical conduct because:
A. it emphasizes the right to redistribute wealth in order to help the poor and
disadvantaged.
B. it requires society’s members to act within the constraints of the law.
C. it protects fundamental rights, unless some greater right takes precedence.
D. it focuses on the decision or action itself, irrespective of what results it produces.
One of the elements necessary to hold a CPA liable to a client for conducting an audit
negligently is that the CPA:
A. acted with scienter or guilty knowledge.
B. was a fiduciary of the client.
C. failed to exercise reasonable care.
D. executed a fraudulent engagement letter.
Workers’ compensation systems have failed to eliminate which of the following
employer defenses?
A. Injuries resulting from employee horseplay
B. Implied assumption of risk by the employee
C. Injuries resulting from the negligence of the employee
D. Injuries resulting from the negligence of a coemployee
Which of the following would have an argument to being exempted from using
materials that were copyrighted?
A. A business owner attempting to make money off the materials
B. A news organization transmitting information to the public
C. A consumer attempting to avoid paying for the materials
D. An author who copies the materials to make money without permission
_____ occur(s) when partners accept an act of a partner who had no actual or apparent
authority to do the act when it was done.
A. Arbitration
B. Defamation
C. Indemnification
D. Ratification
Sometimes, if an agent incurs tort liability the principal is required to _____.
A. ratify the agency
B. dismiss the agency
C. transfer the agent
D. indemnify the agent
Checks and other drafts collected through the banking system usually have all of the
following EXCEPT:
A. bank.
B. payee.
C. drawer.
D. employee.
For an employee to recover under a workers compensation system what percentage of
negligence must the employer be found guilty of?
A. There is no requirement for a finding of employer negligence
B. Employer must be 51% negligent for the injury
C. Employer must be more than 30% negligent for the injury
D. Employer must be more than 75% negligent for the injury
The _____ provided that people had to obtain a discharge permit from the Army Corps
of Engineers to deposit or discharge refuse into a navigable waterway.
A. The Marine Protection, Research, and Sanctuaries Act
B. The Safe Drinking Water Act
C. Toxic Substances Control Act
D. The River and Harbor Act
Which of the following arises when there has been an incomplete disposition of trust
property and the creation of a trust is necessary to effectuate a settlor’s intent or avoid
unjust enrichment?
A. Express trust
B. Spendthrift trust
C. Totten trust
D. Resulting trust
Gorgeous is a conglomerate and its major businesses include department store chains
and grocery store chains. Gorgeous recently acquired Connect Corp., a mobile-network
operator. Connect has the third-largest share of the mobile-network market. This is
Gorgeous’s first venture into the mobile-network business. Which of the following
theories is the most appropriate one for challenging the acquisition of Connect by
Gorgeous under Section 7 of the Clayton Act?
A. Elimination of actual potential competition
B. Potential reciprocity
C. Unfair advantage
D. Elimination of perceived potential competition
Who is liable for the acts of the managers of the LLC?
A. Only the LLC itself
B. The organizers of the LLC
C. The members of the LLC
D. The incorporators of the LLC
Which of the following states that the agent has authority only to make representation
contained in the contract and that only those representations bind the principal?
A. Representation clause
B. Exculpatory clause
C. Liability clause
D. Agent’s clause
Which of the following characterizes the statute of limitation?
A. The time period fixed by the statute of limitations is uniform throughout the states.
B. The recording of the contract stops the running of the statute of limitations.
C. The time period fixed by the statute of limitations begins when the contract is
recorded.
D. The time period for oral contracts is different from that of written ones.
A(n) _____ is a cancellation of a contract and a return of the parties to their
precontractual position.
A. injunction
B. ordinance
C. rescission
D. restatement
Express authority:
A. is created by agreement of partners.
B. is based on what is usual business for partnerships of the same general type.
C. is the sole determinant of a partner’s actual authority.
D. is established only in writing.
A voluntary petition under Chapter 7:
A. cannot be filed by an insurance corporation.
B. requires that the debtor’s debts exceed his assets by $5,000.
C. requires that the debtor have at least three creditors.
D. cannot be made by an individual.
A supermajority vote is rarely required to:
A. decide with which suppliers the corporation should deal.
B. terminate the employment contract of an employee-shareholder.
C. reduce the level of dividends.
D. change the corporation’s line of business.
Which of the following serves as constructive notification of the termination of an
agent’s apparent authority?
A. A direct personal statement to the third party
B. The death of the principal
C. A writing delivered personally or to the third party’s place of business
D. Advertising the agency’s termination in a newspaper
Tom, Brady, and Alex are members of a golf country club (a nonprofit corporation).
Tom holds 5 percent of voting power, Brady holds 8 percent of voting power, and Alex
holds 1 percent of voting power in the club. They would like to call a special meeting of
the club to discuss renovation of some of its facilities. Who amongst them can call such
a meeting?
A. Brady and Alex
B. Alex and Tom
C. Alex, Tom, and Brady
D. Tom and Brady
Which of the following is true in the case of a lease for a term of more than one year to
be enforceable?
A. It should be in writing only.
B. It cannot be subleased.
C. It cannot be assigned.
D. It can be oral or in writing.
Which of the following statements holds true for conversion?
A. Conversion occurs if an instrument has the indorsement necessary for negotiation.
B. Conversion occurs if an instrument is purchased or paid by a drawee to a person
entitled to payment.
C. An action for conversion may not be brought by the maker, drawer, or acceptor of
the instrument.
D. An action for conversion may not be brought by a payee or an indorsee who received
delivery of the instrument.
Morton Reeves, a building subcontractor, submitted a bid for construction of a portion
of a high-rise office building. The bid contained material errors in computation. Lago
Corp., the general contractor, accepted the bid with the knowledge of Reeves’ errors.
Reeves:
A. must perform the contract unless he can show that Lago acted fraudulently.
B. must perform the contract according to the stated terms since his errors were
unilateral.
C. can avoid liability on the contract only if his errors were not due to his negligence.
D. can avoid liability on the contract since Lago knew of his errors.
What is a remedy for a party that is in material breach of a contract but has incurred
economic harm by already performing substantially for the contract?
A. Liquidated damages
B. Quasi-contract
C. Bilateral contract
D. Incorporation
Which of the following requires parties to the merger agreement for planned mergers
involving dollar values of stock or assets exceeding certain amounts to provide advance
notice to the FTC and the Justice Department?
A. Section 7 of the Clayton Act
B. The Robinson-Patman Act
C. Section 2 of the Sherman Act
D. The Hart-Scott-Rodino Antitrust Improvement Act
A(n) _____ is a clause attempting to block recovery of certain damages.
A. promissory estoppel
B. condition subsequent
C. implied warranty
D. remedy limitation
The Equal Protection Clause is derived from which amendment to the U.S.
Constitution?
A. First
B. Fourteenth
C. Tenth
D. Second
What occurs during an arraignment of a criminal defendant?
A. Defendant is informed of charges against them and pleads guilty or not guilty.
B. Both the prosecutor and defense select a jury for trial.
C. The prosecutor and defense argue over the admissibility of key evidence.
D. The jury delivers its verdict of the case.