JD 26241

subject Type Homework Help
subject Pages 16
subject Words 5056
subject Authors Daniel Herron, Linda Barkacs, Lucien Dhooge, M. Neil Browne, Nancy Kubasek

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page-pf1
Under which sections of the UCC are buyers and lessees obligated to accept and pay for
conforming goods in accordance with the contract?
A. 2-301 and 2A-516(1)
B. 2-508 and 2A-513
C. 2-613 and 2A-221
D. 2-612(2) and 2A-510(1)
E. 1-205(1) and 208(1)
Kite Sales. Wendy is president of a business that manufactures kites. The kites of her
company, ABC Kites, are sold to large toy stores. After Wendy learned a great deal
about kites, she started to make kites at home and to promote them to large toy stores.
She also started selling kites to friends. Some of the directors learned about her kite
sales and accused her of wrongdoing. Wendy denied any wrongdoing. What remedy
will be imposed on Wendy, if any, for her home kite sales?
A. Nothing because Wendy did not engage in any wrongdoing.
B. She will be required to cede to the corporation half of any profits she earned as a
result of the breach.
C. She will be required to cede to the corporation only profits she earned as a result of
the breach that the corporation can prove by a preponderance of the evidence it lost as a
result of her actions.
D. She will be required to cede to the corporation any profits she earned as a result of
the breach unless she can by a preponderance of the evidence that the corporation lost
no sales as a result of her actions.
E. She will be required to cede to the corporation all the profits she earned as a result of
the breach.
page-pf2
________________ is the agency responsible for enforcing the Federal Food, Drug, and
Cosmetic Act.
A. The U.S. Food and Drug Administration
B. The Federal Consumer Administration
C. The Federal Consumption Administration
D. The Federal Safety Commission
E. The U.S. Uniform Drug Commission
Hot Toaster. Rebecca bought a toaster from Super Store and brought it home. A friend
of hers, Greg, was at her house making toast. The toaster malfunctioned and shocked
Greg resulting in a small burn to his hand requiring medical attention. At a garage sale,
Rebecca also purchased a blender from a friend, Samantha. When she paid for the
blender, Rebecca said that it would be great for making smoothies. Samantha said
nothing and just smiled while taking Rebecca's money. Unfortunately, the blender was
not powerful enough to make smoothies. Based on the facts presented, what type of
warranty did Super Store give Rebecca?
page-pf3
A. An express warranty.
B. An implied warranty of merchantability.
C. An implied warranty of fitness for a particular purpose.
D. An express warranty, an implied warranty of merchantability, and an implied
warranty of fitness for a particular purpose.
E. An implied warranty of merchantability and an implied warranty of fitness for a
particular purpose, but not an express warranty.
Which of the following is the supreme court of appeal in England?
A. The House of Lords
B. The Crown Court
C. The Supreme Court
D. The High Court
E. The Queen's Bench
page-pf4
An instrument that reads, "Pay to the order of Jones or Green," is payable to _________
payees.
A. joint
B. concurrent
C. consecutive
D. alternative
E. alternate
Which of the following are written documents signed by a party that makes an
unconditional promise to pay a specific sum of money on demand or at a certain time to
the holder of the instrument?
A. Negotiable instrument.
B. Informal contracts.
C. Simple contracts.
D. Letters of credit.
E. Formal contracts.
page-pf5
Roofing Issues. Sally agrees to roof a house for Bob. After doing his research, Bob
chooses Sally based on her great reputation for being conscientious and doing good
work. Bob knows little about roofing and stays away from all the noise involved. Sally
provides her own tools for herself and other workers, sets her own schedule, and
charges a flat rate of $10,000 to be paid when the job is completed. Sally hires Trudy,
Glen, and Fred to help with the roofing. She pays them an hourly rate, supervises their
work, provides them with tools and materials, and sets their schedules. Curious about
what is going on there, Bob's friend Spencer walks by the house while the roofing is
being done. Glen absent-mindedly throws some old shingles off the roof and hits
Spencer in the head resulting in him going to the local emergency room and receiving a
couple of stitches in his scalp. Spencer decides to sue all the roofers and also Bob and
Sally for his hospital expenses and for pain and suffering. Assuming Glen was
negligent, which of the following is the most likely result in a lawsuit against Trudy and
Fred brought by Spencer?
A. Spencer will win because Trudy and Fred were coworkers with Glen.
B. Spencer will win because Trudy and Fred were independent contractors on the same
job as Glen.
C. Spencer will win only if it can be established that both Sally and Bob are insolvent
and unable to pay any judgment.
D. Spencer will lose because Trudy and Fred were not negligent and were not
employees of Spencer.
E. Spencer, Trudy, and Fred must all bear 1/3 of any judgment because they are
employees of the same rank.
page-pf6
Shaky Bicycles. Rhonda, an incorporator who filed the articles of incorporation for
ABC Corporation, a corporation set up to sell bicycles, listed the correct town and street
but incorrectly put the wrong street number in the document. Helen, a manufacturer of
bicycle parts, had sold a number of parts to ABC Corporation. Unfortunately, the
corporation was not making any profit, and Helen was not paid in a timely manner.
Rhonda told her that the corporation was not liable because it was not validly formed
due to the address mistake. Bernice, another creditor of ABC Corporation, also claimed
that a shareholder of Shaky Bicycles, Slick, was personally liable to her. Bernice
alleged that Slick committed fraud against her when he told her that ABC Corporation
was making large amounts of money, that if she would only loan $50,000 to the
corporation he would marry her, and that the corporation would make so much money
that she would be wealthy in six months. She loaned the funds, but the corporation has
been unable to repay her. Slick told her that he is sorry, but that her only avenue of
recovery is through the corporation. Which of the following is the likely result of
Helen's attempt to hold the corporation liable for her debt?
A. She will likely be successful.
B. She will be successful only if ABC Corporation removes its de jure status.
C. She will be successful only if ABC Corporation removes its de facto status.
D. She will be successful only if ABC Corporation has at least 50 shareholders.
E. She will likely be unsuccessful.
George offers to sell Penelope a ring that George found in his yard. He and Penelope
look at the ring and decide that they are not sure what it is, probably just a shiny stone.
Penelope pays George $10 for the ring. The ring turns out to be a diamond worth much
more than $10. George wants the ring back, and Penelope refuses. What is the most
likely result?
A. The ring will be returned to George because of mutual mistake.
B. The ring will be returned to George because of unilateral mistake.
page-pf7
C. The ring will be returned to George because of equity.
D. The ring will remain with Penelope unless George can establish that she was
negligent in not recognizing the ring's true value.
E. The ring will remain with Penelope because the parties contracted on the assumption
that they did not know the value of the ring.
An agent's obligation to inform the principal of the agent's actions on the principal's
behalf and of all relevant information is a __________________.
A. duty of notification
B. duty of information
C. requirement of conveyance
D. constructive notification
E. constructive information
page-pf8
In which of the following cases did the U.S. Supreme Court rely on precedent to strike
down a school's admissions policy that reserved slots for members of minority races?
A. Story v. Price
B. Brown v. Board of Education
C. University of California v. Bakke
D. Grover v. University of Mississippi
E. Adkins v. Price
The Burial Emporium. Fred operates a funeral home called Fred's Burial Emporium.
Fred likes to keep things simple. He has one flat price with no itemization and requires
that customers purchase a complete package from him if they want any services
whatsoever. Fred also goes door-to-door selling funeral packages. He tries to visit
neighborhoods in which there has been a recent death because residents in the
neighborhood will have final arrangements on their minds. He believes and informs
customers that once customers sign a contract for burial services, there is no backing
out. Fred also obtains a good deal of business from phone solicitation. He enjoys calling
late at night, between 10 p.m. and 11 p.m., when people are tired, but before they go to
bed. He believes that if people do not feel well, they are more likely to consider funeral
arrangements. After some pesky consumer complaints, the Federal Trade Commission
and other federal agencies investigate Fred. He hires a good lawyer with his profits in
an attempt to stay out of trouble. Which of the following is true regarding Fred's
door-to-door solicitation and his practice of informing customers that there is no
backing out of contracts entered into for funeral services?
A. There is no problem with Fred's actions so long as he truly gives specific notice that
he will not agree to any cancellations.
B. Fred must give customers at least 24 hours in which to cancel such a contract, but
that is only because funeral services are involved.
page-pf9
C. There is no problem with Fred's actions even if he does not give specific notice that
he will not agree to any cancellations.
D. Because door-to-door sales are involved, Fred must give consumers 24 hours in
which to cancel.
E. Because door-to-door sales re involved, consumers must have three days in which to
cancel purchases.
Which of the following is used as a basis for discharge by operation of law when
performance is still objectively possible but would be extraordinarily injurious or
expensive to one party?
A. Frustration of purpose
B. Commercial impracticability
C. Alteration of the contract
D. Anticipatory repudiation
E. None of these because there is no such concept.
page-pfa
What do business laws protect?
A. All contracts
B. Employment decisions
C. Payments to suppliers
D. Embezzlement
E. All contracts, employment decisions, and payments to suppliers
___________________ are directors who are not officers or employees of the
corporation.
A. Approved directors
B. Outside directors
C. Inside directors
D. Affiliated directors
E. Unaffiliated directors
page-pfb
Which type of law involves the rights and responsibilities involved in relationships
between persons, and between persons and their government?
A. Criminal
B. Procedural
C. Civil
D. Natural
E. Positive
Garage sale. Richard, who is cleaning out his garage, offers to sell Dawn a used
computer for $200. Dawn replies that "I'll think about it and buy it if I decide to do so."
Richard also calls Denise and offers to give Denise a used business law book. She is
excited to receive the book and tells him that she will pick it up the next day. Richard
also agrees to sell a communications book for $50 to Jill who promises to pick it up the
next day. Meanwhile, Sam comes to visit, offers Richard $20 for the business law book
and Richard sells it to him. Sam also offers Richard $50 for the used computer. Richard
sells it to Sam because he does not expect to hear from Dawn. Sam sees the
communications book and offers Richard $60 for it. Richard decides to forget about Jill
and proceeds to sell the book to Sam for $60. Denise is very angry because Richard did
not save the book for her and claims that he breached a contract because she had
accepted his offer. Jill is also angry because Richard sold the communications book and
informs him that he breached the contract he had with her. Exactly 31 days later, Dawn
tells Richard that she would like the computer. She tells him that her response
constituted consideration in that it bound him to an option contract and that he should
have awaited her final decision. Richard tells Sam that he needs to return everything for
a full refund. Sam refuses. Which of the following is true regarding Denise's claim that
Richard breached a contract with her because Richard did not save the book for her
after she had accepted his offer?
page-pfc
A. Denise is correct, and Richard breached a contract he had with her.
B. Denise is correct only if she can show that she had given past consideration in other
dealings with Richard.
C. Denise is correct only if she can show that Richard did not really need the money.
D. Denise is incorrect because her acceptance was illusory.
E. Denise is incorrect because she did not provide any consideration.
Self-Centered President. Tina is the new president of "We Manage You," a corporation
set up to manage physician practices. Tina has never been very concerned with minority
shareholders because she does not believe that they have any influence over the
company because they cannot even elect a director. She is told, however, that the
corporation has a practice of cumulative voting. An election is coming up in which 10
directors will be elected. Minority shareholders own 2,000 shares while majority
shareholders own 8,000 shares. Tina tells her vice president, George, that she wants to
ignore minority shareholders and focus her interests on majority shareholders and the
directors. She also tells George that she wants to be particularly conscientious toward
directors because the directors appoint officers, and she does not believe that she owes
any actual duties to shareholders. She further orders George to destroy some documents
subpoenaed in a criminal investigation against the company for illegal tax evasion.
When George protests, Tina tells him not to worry because officers cannot be held
responsible for criminal actions so long as the actions are done as part of the duties of
an officer. She explains to him that only the corporation can be charged with liability in
such cases. How many votes will the minority shareholders have in the election?
A. 2,000
B. 4,000
C. 6,000
D. 10,000
E. 20,000
page-pfd
In a(n) _____ relationship, the agent is authorized to act for and on behalf of the
principal, who hires the agent to represent him or her.
A. authority
B. principality
C. agency
D. decreed
E. conferred
The ______ is a significant body of law to business activities including sales, banking,
and warranty.
A. Federal Business Code
B. Model Business Code
C. Uniform Transactional Model
page-pfe
D. Uniform Commercial Code
E. Marketing Transaction Code
The _____ terms of a contract are those terms that would allow a court to determine
what the damages would be in the event that one of the parties breaches the contract.
A. important
B. significant
C. material
D. adequate
E. identifiable
What type of notice prevents a holder from being a holder in due course?
A. Notice that the instrument is overdue.
page-pff
B. Notice that the instrument has been dishonored.
C. Notice that the instrument was issued as part of a series that is in default.
D. Notice that the instrument is overdue, notice that the instrument has been
dishonored, and also notice that the instrument was issued as part of a series that is in
default.
E. Notice that the instrument is overdue or notice that the instrument has been
dishonored, but not notice that the instrument was issued as part of a series that is in
default.
Positive abstractions that capture our sense of what is good or desirable are ______.
A. ethical ideas
B. values
C. conscience demands
D. desirable principles
E. action goals
page-pf10
Pet Pig Farm. Marcy wanted to buy Lucy's land and use it to breed small pigs to be kept
as pets. Marcy told Lucy that having water on the property was very important. Lucy
assured her that a spring ran through one corner of the property. Therefore, Marcy
agreed to buy the farm. Although she did not ask Lucy anything about it, Marcy, who
loved pigs, assumed that the neighbors would be pleased with the pigs being in the area.
In a separate contract, Lucy also agreed to sell Marcy a used truck for $5,000. After the
contract for the land sale was entered into, it was discovered that actually the spring did
not run through the corner of Lucy's property. The area in which the spring ran actually
belonged to a neighbor. Additionally, when Lucy brought Marcy the used truck, Marcy
said, "That's not the truck!" It was discovered that Lucy, who had two trucks, thought
that Marcy had bought the older truck when Marcy thought she had purchased the
newer truck. Marcy was also surprised when she received a petition signed by all
surrounding landowners objecting to the presence of the pigs and threatening to sue
Marcy for nuisance. Assuming that Lucy fraudulently made a misrepresentation
regarding the spring running through the corner of the farm knowing the statement was
not correct, considering only the lack of a spring issue, which of the following is true if
Marcy does not want to go through with the sale of the farm?
A. Marcy may rescind the contract, and she will recover $10,000 in damages that is an
amount set by federal law.
B. Marcy may rescind the contract, but she may not recover damages.
C. Marcy may sue for damages regardless of whether she can establish injury, but she
may not rescind the contract.
D. Marcy may rescind the contract, and she may also sue for damages if she can
establish injury.
E. Marcy may rescind the contract and she may also recover damages, but only nominal
damages.
page-pf11
A firm offer must be _____.
A. oral and indefinitely revocable
B. oral and irrevocable for up to one year
C. in writing and indefinitely revocable
D. in writing and irrevocable for up to three months
E. in writing and irrevocable for up to one year
Which of the following is true of the Supreme Court in Japan?
A. The Japanese system utilizes a well-developed jury system.
B. The Japanese discovery process is similar to that in the U.S.
C. The Japanese legal system has a distinct pretrial stage.
D. At the first meeting between the parties, discovery is conducted.
E. None of these.
page-pf12
What do UCC Sections 2-601 and 2A-509 indicate in reference to the perfect tender
rule?
A. That if goods or tender of delivery fail in any respect to conform to the contract, the
buyer/lessee has the right to accept the goods, reject the entire shipment, or accept part
and reject part.
B. That if goods or tender of delivery fail in any material respect to conform to the
contract, the buyer/lessee has the right to accept the goods, reject the entire shipment, or
accept part and reject part.
C. That if goods or tender of delivery fail in any respect to conform to the contract, the
buyer/lessee has the right to accept the goods or reject the entire shipment, but not the
right to accept part and reject part.
D. That if goods or tender of delivery fail in any material respect to conform to the
contract, the buyer/lessee has the right to accept the goods or reject the entire shipment,
but not the right to accept part and reject part.
E. That if goods or tender of delivery fail in any respect to conform to the contract, the
buyer/lessee only has the right to accept the entire shipment and sue for damages.
The process of questioning potential jurors to ensure that the jury will be not show
biases towards the parties is:
A. Discovery.
B. Voir dire.
C. Peremptory challenge.
D. Motion.
E. Opening statement.
page-pf13
Which of the following is true regarding rights of a trustee in a Chapter 7 bankruptcy?
A. The trustee takes possession of the debtor's property and has it appraised.
B. If someone else holds the debtor's property, the trustee has the power to require the
person to return that property.
C. The trustee may temporarily take over the debtor's business.
D. The trustee takes possession of the debtor's property and has it appraised; if someone
else holds the debtor's property, the trustee has the power to require the person to return
that property; and the trustee may temporarily take over the debtor's business.
E. The trustee takes possession of the debtor's property and has it appraised; and if
someone else holds the debtor's property, the trustee has the power to require the person
to return that property; but the trustee may not take over the debtor's business even
temporarily.
In which of the following does a shareholder sue alleging that he or she has suffered
damages caused by the corporation?
page-pf14
A. Investigative action
B. Shareholder's action suit
C. Shareholder's direct suit
D. Shareholder's derivative suit
E. Active allocation suit
Roofing Issues. Sally agrees to roof a house for Bob. After doing his research, Bob
chooses Sally based on her great reputation for being conscientious and doing good
work. Bob knows little about roofing and stays away from all the noise involved. Sally
provides her own tools for herself and other workers, sets her own schedule, and
charges a flat rate of $10,000 to be paid when the job is completed. Sally hires Trudy,
Glen, and Fred to help with the roofing. She pays them an hourly rate, supervises their
work, provides them with tools and materials, and sets their schedules. Curious about
what is going on there, Bob's friend Spencer walks by the house while the roofing is
being done. Glen absent-mindedly throws some old shingles off the roof and hits
Spencer in the head resulting in him going to the local emergency room and receiving a
couple of stitches in his scalp. Spencer decides to sue all the roofers and also Bob and
Sally for his hospital expenses and for pain and suffering. Which of the following is the
most likely characterization of Sally in relation to Bob?
A. She is both an employee and an independent contractor.
B. She is an employee.
C. She is an independent contractor.
D. She is an undisclosed principal.
E. She is both an employee and a disclosed principal.
page-pf15
Owners of ___________________________ own a portion of a corporation but do not
enjoy any preferences.
A. acknowledged
B. complex
C. simple
D. preferred
E. common
A(n) _____ accepts and signs a draft to agree to pay the draft when it is presented.
A. maker
B. acceptor
C. drawer
D. endorser
page-pf16
E. promisor
A promise to your mother to refrain from going to bed later than 11:00 p.m. on a school
night is what type of consideration?
A. A benefit to the promisor.
B. A promise to refrain from doing something.
C. A promise to do something.
D. A detriment to the promisor.
E. A detriment to the promisee.

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