Generally, State A may exercise “long-arm” jurisdiction over a defendant located in
State B if the defendant:
a. once resided in State A.
b. uses a product produced in State A.
c. made a contract in State A.
d. has relatives in State A.
“Value” is defined as including:
a. consideration under contract law.
b. a binding commitment to extend credit.
c. antecedent debt.
d. All of the above.
Which of the following is correct with regard to the doctrine of respondeat superior?
a. It is a form of liability without fault.
b. It holds an employer liable for the acts of both employees and independent
contractors.
c. The liability of the principal under the doctrine is vicarious and depends upon proof
of wrongdoing by the employee within the course of his employment.
d. Both (a) and (c).
What is required by the substantial evidence test?
a. The conclusions reached must be supported by such relevant evidence as a reasonable
mind might accept as adequate to support a conclusion.
b. It permits the court to try the facts de novo.
c. It requires that the agency set aside action if it is prejudicial.
d. It requires proof beyond a reasonable doubt.
To be negotiable, the instrument must satisfy all except which one of the following
requirements?
a. It must contain a promise or order to pay.
b. It must be for a certain amount.
c. It must be payable on demand.
d. It must be signed.
The definition of price-fixing includes agreements that:
a. may, among other things, depress prices.
b. stabilize prices.
c. raise prices.
d. All of the above.
In Donahue v. Rodd Electrotype Co., Inc., the court’s opinion stated:
a. by definition, a close corporation bears striking resemblance to a partnership.
b. minority shareholders have no right to rely on the loyalty and abilities of the
majority.
c. minority shareholders in a close corporation can cause dissolution of the corporation.
d. when a close corporation purchases the shares of a controlling stockholder, there is
necessarily a preferential distribution of the corporation’s assets.
The Toxic Substances Control Act authorizes the EPA to:
a. require testing of only new substances if their manufacture may present an
unreasonable risk of injury to the environment.
b. require testing of any new or existing substance that may present an unreasonable
risk of injury to health or the environment.
c. establish a priority list for testing that contains no more than 20 substances at any
time.
d. impose civil penalties of up to $50,000 per day for statutory violations.
Bob, a guest in Jim’s house, goes into Jim’s desk and writes a check to himself on Jim’s
checking account, forging Jim’s signature. He indorses the check “Bob” and presents it
to Jim’s bank for payment. If the bank pays, can it collect from Jim’s account?
a. Yes, because Bob is the real payee.
b. Yes, because Jim’s name is on the check.
c. No, because bank should have known the signature is forged.
d. No, because Jim did not know of the check.
Which of the following is true about a constructive trust?
a. It normally contains detailed instructions for the trustee to follow.
b. The court imposes it to redress an injustice.
c. It is revocable by the trustee.
d. It carries out the intentions of the trustee.
Robert Briscoe is 17 years old. He lies to Bouyers Auto in order to induce them to sell
him a new pickup truck. Bouyers falls for this lie and sells him the pickup. Under the
prevailing view, which of the following is correct?
a. Robert may disaffirm and get his money back.
b. Robert may not disaffirm since he lied.
c. Robert may only receive a portion of his money.
d. Robert will receive his money less depreciation.
Which of the following is NOT a basis for involuntary dissolution?
a. A proceeding by the secretary of state, if it is established that the corporation failed to
pay its franchise tax.
b. The directors are deadlocked and the shareholders cannot break the deadlock.
c. The shareholders dissent to a merger and are asserting their appraisal rights.
d. None of the above.
In which of the following situations has conversion NOT occurred?
a. When an instrument is paid on a forged indorsement.
b. When a drawee to whom a draft is delivered for acceptance properly returns it upon
request.
c. When any person to whom an instrument is delivered for payment refuses on demand
to pay or to return it.
d. When a drawee to whom a draft is delivered for payment refuses to return it on
demand.
Harry Jones at Jones Brothers Furniture Co. does not like the Brite Lamp Co.
representative, so he decided that Jones Brothers would boycott Brite. Under the
Sherman Act, this is:
a. per se illegal.
b. no violation.
c. a tying arrangement.
d. vertical market allocation.
Notice of which of the following circumstances should alert a purchaser of a negotiable
instrument that he might not be accorded the favored position of a holder in due course?
a. The instrument has a limited indorsement.
b. The instrument is overdue.
c. The instrument is given as a security interest.
d. None of the above.
Which of the following may a U.S. Court of Appeals do in ruling on a case?
a. Reverse or modify the judgment of the lower court.
b. Remand or send the case back to the lower court.
c. Rehear the case by taking testimony of the witnesses.
d. Both (a) and (b).
The United Nations Commission on International Trade Law:
a. was established by the World Trade Organization in 1956.
b. is made up of 70 member states.
c. develops model laws, such as the CISG and the Model Law on Electronic Commerce.
d. All of the above.
In the case of Michael Silvestri v. Optus Software, Inc., the court held:
a. an objective standard is typically applied to satisfaction clauses in employment
contracts.
b. an objective standard must be used in determining what is satisfactory performance
in any ‘satisfaction’ contracts.
c. idiosyncratic judgments as to what constitutes satisfactory employee performance are
inherently unfair and should not be allowed.
d. in judging a high-level manager’s satisfactory performance, a subjective test is
appropriate.
A plan for reorganization under Chapter 11 does not have to meet which of the
following requirements to be confirmed by the court?
a. Good faith.
b. Feasibility.
c. Be accepted by all creditors.
d. Cash payments for certain classes of creditors.
Assume you are the judge in the Palsgraf case.
Under the Restatement, if there are successive assignments of the same right:
a. the first assignee to notify the obligor prevails.
b. the latest assignee is usually entitled to the assigned right.
c. a prior assignee is entitled to the assigned right to the exclusion of a subsequent
assignee in most circumstances.
d. a subsequent assignee is entitled to the assigned right unless a prior assignee gave
value and obtains either a judgment against the obligor or a new contract with the
obligor.
The Commerce Clause in combination with the __________ limits the power of the
state to tax.
a. Fifth and Fourteenth Amendments
b. Fourteenth Amendment
c. separation of powers
d. Import-Export Clause
Andrew agrees to paint Rosalene’s house for $500. Two days after he starts the job, he
decides that $500 isn’t enough money. He refuses to finish the job, unless Rosalene
agrees to pay him $100 more. What principle applies to this fact situation?
a. The acceptance of additional money to settle a disputed claim is supported by
consideration.
b. A past obligation is sufficient consideration for a new promise.
c. Andrew was already obligated to paint the house. He gives no additional
consideration in return for Rosalene’s promise to pay more money.
d. Rosalene has made a promise in exchange for a forbearance.
Tyler is self-employed and alters some receipts so he will show more expenses and
therefore have a greater total of income tax deductions. Tyler has:
a. committed the crime of extortion.
b. engaged in securities fraud.
c. engaged in no criminal activity.
d. committed the crime of forgery.
If private entities engage in public functions, constitutional guarantees such as free
speech and due process may apply to their actions under the __________ doctrine.
a. state action
b. federal preemption
c. interstate commerce
d. supremacy
UCC Article 4A is designed to provide a statutory framework for electronic funds
transfers by individual consumers.
A qualified indorsement plus delivery would transfer title to the indorsee.
Under the Code an oral contract for specially manufactured goods costing $500 is
enforceable even if the seller has not begun their manufacture.
When the assignee gives consideration in exchange for an assignment, there is a
contract between the assignor and the assignee that prevents the assignor from revoking
the assignment without the assent of the assignee.
Privacy protection for employees includes a federal statute prohibiting private
employers from requiring employees or prospective employees to undergo a lie detector
test.
The promise of a surety is binding even without consideration.
One of the most appealing features of a limited partnership is the limited personal
liability it offers to all of the partners.
Payment of the debt or performance of the obligation discharges both the principal
debtor and the surety.