Dr. Gavornne advises his very ill patients to prepare a living will. The purpose of a
living will is to
a. make a disposition of property.
b. express a desire not to have extreme medical treatment that would prolong their lives.
c. transfer life insurance.
d. consent to organ donation.
Ramon purchased 5,000 pounds of coffee from Quick Jump Coffee. The coffee was to
be delivered on September 1. Since the contract included a date for performance, time
is of the essence and the delivery date is strictly enforceable.
a. True
b. False
A company that engages in unethical behavior may suffer severe consequences.
a. True
b. False
In a civil case, the plaintiff must prove the case beyond a reasonable doubt.
a. True
b. False
In January 2014, Professor Noe entered into a contract with State University. She
agreed to teach full time during the 2014-2015 academic year. Professor Noe died on
May 31, 2014. Her estate
a. is obligated to find another person who will agree to teach during the academic year.
b. is discharged from any further obligations under the contract.
c. will be discharged from any obligations under the contract only if it can be shown
that her death was unexpected.
d. will not be discharged. If the University has to pay more in order to hire a
comparable substitute professor at the last minute, then the estate will be responsible for
the difference in pay.
Trein, Inc. entered into a one-year, $1 million contract with Mia, a sports celebrity, to
promote Trein’s products. E-presto Inc., a competitor of Trein, was interested in having
Mia promote its products but knew of her contract with Trein. E-presto offered Mia a
three-year, $5 million contract. Mia left Trein and signed with E-presto. If Trein sues
E-presto for tortious interference with a contract, E-presto
a. will be able to establish a justification since E-presto was acting to protect an existing
economic interest.
b. will be able to establish a justification because, in talking to Mia, E-presto was
exercising its First Amendment freedom of speech.
c. will be able to establish a justification because to decide otherwise would subject Mia
to involuntary servitude.
d. will not be able to establish a justification.
The public disclosure tort requires the plaintiff to show all of the following EXCEPT
a. the defendant divulged secret information to a number of people, not just one person.
b. the disclosed facts had been private.
c. the disclosed facts were a legitimate concern to the public.
d. the disclosure is highly offensive to a reasonable person.
When a party to a contract intentionally makes the terms of a contract unclear, it is
called
a. vagueness.
b. duress.
c. ambiguity.
d. a mistake.
John loans George money and they sign a written agreement whereby George will
repay John in monthly installments. Is this loan subject to the Truth-in-Lending Act?
a. Yes, if the loan is for more than $1,000.
b. Yes, if John and George live in different states.
c. No, if John is not in the business of offering credit.
d. No, if John and George are related.
Rachel Retailer sends a preprinted purchase order offering to buy goods from Snidley
Supplier. Snidley acknowledges Rachel’s offer with a preprinted acceptance form. The
terms of the two forms do not mirror each other. To analyze whether an enforceable
contract exists, one must first determine whether the new language in the acceptance is
an additional term or a different term.
a. True
b. False
Doyle contributed $10,000 when he became a general partner in the existing partnership
of R & Z Heating. If Albert wins a judgment for $25,000 against R & Z on a claim that
was incurred before Doyle became a partner, Doyle shares joint and several liability
with his new partners for the whole obligation.
a. True
b. False
A legitimate seniority system is legal even if it perpetrates past discrimination.
a. True
b. False
Courts may award damages called quantum meruit, which means
a. “as much as he deserves.”
b. “to the letter of the law.”
c. “let the buyer beware.”
d. ‘something for something.”
Stanziano Construction needs a backhoe to complete a project. If it pays Hofmann
Rentals for temporary use of the equipment, the transaction will be governed by
a. Article 2 of UCC.
b. Article 2A of the UCC.
c. Article 3 of the UCC.
d. bulk transfer law.
Alex promises to pay $100 to anyone who finds his lost watch. Kate finds and returns
the watch to Alex after hearing of the reward money. Alex and Kate have an enforceable
unilateral contract.
a. True
b. False
Commercial impracticability means some event has occurred that neither
partyanticipated and fulfilling the contract would now be extraordinarily difficult and
unfair to oneparty.
a. True
b. False
The Magnuson-Moss Warranty Act requires manufacturers to provide a warranty on
their products regardless of cost.
a. True
b. False
Landlord-tenant relationships are governed by a mixture of property law, contract law,
and negligence law.
a. True
b. False
Roger, a minor, buys a stereo from Tuneland, Inc. Roger uses the stereo for a few
months, returns it to Tuneland, and demands his money back. Roger may rescind the
contract, return the stereo and get his money back.
a. True
b. False
Pursuant to a public offering, a CPA firm audited the financial statements. After the
offering, omissions and misstatements were found. The CPA firm is now being sued by
the purchasers of the stock. The purchasers are alleging that the erroneous financial
statements in the registration statement caused them to suffer a monetary loss. The CPA
firm can avoid liability if it can prove
a. that it used due diligence in auditing the financial statements.
b. the corporation was the party who made misstatements and omissions.
c. the firm believed that the statements were accurate.
d. None of the above will avoid liability.
The 1934 Act is primarily intended to
a. maintain the integrity of the secondary market for securities.
b. make sure companies who wish to raise money by the sale of securities comply with
disclosure requirements for the initial offering.
c. coordinate federal and state laws with a primary emphasis on allowing the individual
states to maintain primary control over securities law.
d. broaden the SEC’s enforcement power.
Mega Corp. hired permanent replacement workers when its union went out on strike
seeking better medical and retirement benefits. After the strike is over, Mega Corp.
a. must give the striking employees their jobs back since this was an economic strike.
b. must give the striking employees their jobs back since this was an unfair labor
practices strike.
c. may hire additional workers without considering the striking employees who want
their jobs back.
d. does not have to give the striking employees their jobs back since this was an
economic strike.
Country Bank, located in Indiana, loaned Chmelik $5,000 and obtained a security
interest in a copyright Chmelik owns. Chmelik lives in Illinois, but works in Indiana. In
order to perfect its interest, Country Bank files a financing statement in Indiana. The
financing statement provides Chmeliks correct name, his business address, and a
reasonable description of the copyright used as collateral. Is the financing statement
sufficient?
a. Yes, it meets the UCC requirements for contents and filing.
b. No, if the debtor is an individual, the secured party must file in the state of the
debtors principal residence, which in this case would be Illinois.
c. No, the secured party needed to file a financing statement in both Indiana and
Illinois.
d. No, a security interest cannot be attached to a copyright.
Ernest invents a novel, useful, nonobvious product. He
a. must apply for a patent within one year of selling the product commercially.
b. is entitled to a patent over someone else who invents the same product if he is the
first to invent it.
c. may receive patent protection for two years by filing a simpler, shorter, cheaper
provisional patent application while he is working on his complex, regular patent
application.
d. may sell his product for up to five years to see how well it sells before going through
the complex process of filing a patent application with the PTO Office.
A public company instituted a clawback policy. What does this mean?
a. The company can require the CEO and CFO to reimburse the company for any bonus
or profits they recieved from selling company stock within a year of the release of
flawed financials.
b. At least once every three years, companies must take a nonbinding shareholder vote
on the compensation of the five highest-paid executives.
c. The company is prohibited from expelling shareholders unless the firm pays a fair
price for the minority stock and the expulsion has a legitimate business purpose.
d. The company has decided that the compensation level of its executives is not in the
company’s best interests, so it reduces all executive pay levels by a certain percentage.
Richard wrote a song called “College Days.” He copyrighted the composition and had it
professionally printed. A couple years later he was attending a business meeting about
1500 miles from his home. While sitting in a nightclub, he heard a small local band
perform a song called “College Memories.” The music and words were extremely
similar to his song. The composer of “College Memories” claims he never heard of
Richard’s song and that she is offended he would accuse her of stealing his work. If
Richard wishes to sue for copyright infringement, he must prove
a. only that his song and the infringer’s song are substantially the same.
b. that his work was original, and the infringer actually copied his work or that the
infringer had access to his song and that the two works are substantially the same.
c. that he sustained money damages as a result of the infringement.
d. that he registered the song for a copyright.
Public hearings are required in formal administrative agency rulemaking.
a. True
b. False
When Mohammed was hired by Pomico, Inc., he signed the following agreement,
“Upon termination of my employment with Pomico, I agree not to work for a
competing company within 20 miles of Pomico’s headquarters for one year.” This
agreement, important to protecting secret information developed in the employer’s
business, is
a. an unenforceable exculpatory agreement.
b. an unenforceable usurious agreement.
c. an enforceable bailment agreement.
d. an enforceable agreement not to compete.
Charles owns 1,000 shares of stock in Temperan, Inc. Charles wants to obtain corporate
records including the corporation’s minute book and accounting records. Under the
Model Act, Charles is entitled to this information if he requests it in good faith and
a. he has a proper purpose.
b. he owns at least 1 percent of the company or $2,000 of stock.
c. he is an employee of Temperan.
d. he is a controlling shareholder.
When the underwriter buys stock from the issuer and sells it to the public it is referred
to as a
a. best efforts underwriting.
b. firm commitment underwriting.
c. secondary underwriting.
d. public underwriting.
Claims for personal injury are generally assignable.
a. True
b. False
Robert, a minor, buys a stereo from Jane for $200. State law allows a minor to disaffirm
contracts within a reasonable time after turning 18. Robert disaffirms the contract the
day after turning 18 and returns the stereo.
a. This contract was a valid contract, Robert cannot disaffirm.
b. This contract was a voidable contract, Robert can disaffirm.
c. This contract was a void contract.
d. This contract was unenforceable because it needed to be in writing to be enforceable.
Explain the meaning of the following ethics traps: rationalization, conformity, following
orders, lost in a crowd, and blind spots.
Name and describe the types of conditions, explain how conditions are created, and
discuss whether it is important to identify the type of condition in a contract.
Richard received his credit card bill and noticed an error. He wrote to the company the
next week, pointing out the error in his bill. Under the law, what is the credit card’s
obligation once it receives Richard’s letter?
Discuss the purpose of an injunction and how the two types of injunctions covered in
the textbook are used.
Identify the possible remedies for a buyer when the seller breaches a contract.
Major Corporation wants to acquire control of Forte Company. What are some legal
steps Forte can take to resist a hostile takeover?
Discuss the four elements that must be proven in order to win a defamation case.
James purchased an abandoned lot. When he started to develop the land, he discovered
several underground storage tanks containing hazardous waste buried on the site. He
claims the seller, Richard, is liable to him for the cost of removing the tanks. Richard
claims he owned the lot for 20 years and never knew of the underground tanks. Richard
argues he purchased the land from Thomas and that Thomas or his heirs are liable for
the cost of removing the underground tanks. Explain whether Richard is liable to James.
Does Thomas or do his heirs have any liability to James or Richard?
Inez contracted with Filippo Furnaces Co. for the installation of a new furnace. Inez
selected the furnace she wanted, accepting no suggestions from Filippo Furnaces’
heating engineer. The furnace operated fine, but it did not heat the entire house. The
size of the blower on the furnace was too small to accommodate the third floor of the
house. Inez sued Filippo Furnaces Co. for the breach of the implied warranties of
merchantability and fitness. What result?
Explain data mining, how it takes place, and how it relates to behavioral marketing.
What is wrongful dischargeand under what circumstances does the law prohibit the
discharge of a worker?
Discuss the Miller test to determine if a creative work is obscene.
Baker Furniture sold 50 living room sets to King’s Department Store. The parties did
not agree on passage of title, but the delivery term was F.O.B. place of shipment.
Discuss title and risk of loss regarding the furniture.
Isabel, Wesley, Gina, and Lucas worked together intensively to form and become the
only shareholders of a corporation that is environmentally conscious. Is there anything
they can do to avoid having shares of stock in their company sold to someone who does
not share their vision for the environment?
What is the process for filing a suit under Title VII of the Civil Rights Act?
What is the exclusionary rule and what are the three exceptions to the rule?
Discuss the two federal statutes that give Americans the power to acquire or protect
personal information.