1) Under the UCC, a contract for a sale of goods that does not include the quantity will
not fail for indefiniteness.
2) The contract term “free on board” indicates that the selling price of goods includes
transportation costs to the specific F.O.B. place named in the contract.
3) A limited liability company must be managed by nonmembers.
4) Some states require the termination of a franchise when there is no “good cause” for
it to continue.
5) If a limited liability company (LLC) agreement does not cover a topic, the state LLC
statute will govern.
6) Blayne is an employee of Chemical Refinery, Inc. Blayne is threatened with a
discharge when he refuses a transfer to a Chemical Refinery department in which
several employees suffered serious injuries from exposure to hazardous chemicals.
Blayne may be entitled to protection from discharge under
a.no law.
b.the Family and Medical Leave Act.
c.the Occupational Safety and Health Act.
d.the state workers’ compensation act.
7) Adrian operates a recycled metals business and contracts to provide ten tons of scrap
steel at $500 per ton to be delivered to Build-It-Rite Materials, Inc., in seven months.
An unforeseen shortage of scrap steel suddenly develops, making it impossible for
Adrian to fulfill the contract for less than $5,000 per ton. Adrian’s best defense against
performing the contract would be that
a.performance of the contract is commercially impracticable.
b.procuring the steel would force the seller into bankruptcy.
c.the law has rendered performance of the contract illegal.
d.the specific subject matter of the contract has been destroyed.
8) InterComp normally sells $50,000 worth of software to Power Source, a retail elec-
tronics store, each summer on terms requiring payment in sixty days. One year,
InterComp wants cash, but Power Source wants the usual sixty days. To meet both
needs, the parties can arrange
a.a certificate of deposit.
b.a bearer bond.
c.a trade acceptance.
d.an international letter of credit.
9) Erin and Dooley, a married couple, borrow $120,000 from Capital & Credit Bank to
buy a home. When Erin and Dooley divorce, they are unable to make payments on the
mortgage. The market value of the home has declined to less than the balance of the
loan. Capital & Credit agrees to a sale of the property for this amount. This is
a.a prepayment penalty.
b.forbearance.
c.foreclosure.
d.a short sale.
10) Intoxicated but still capable of comprehending the consequences of her actions,
Cricket signs a contract to sell her phone app design to Downloads, Inc. This contract is
a.unenforceable because Cricket was intoxicated.
b.enforceable.
c.unenforceable if Cricket disaffirms it.
d.unenforceable if Downloads disaffirms it.
11) Geno’s Italiano Ristorantes, Inc., employs three hundred workers at four locations in
two states. Under federal law, Geno’s must provide each employee, during any
twelve-month period, family or medical leave of up to twelve
a.days.
b.weeks.
c.months.
d.years.
12) Sara believes that she was rejected for a position at Trek n’ Travel Agency on the
basis of her race. Sara files a suit against Trek n’ Travel under the Civil Rights Act of
1964. To establish a primafacie case of employment discrimination, Sara must show all
of the following except that
a.she is a member of a protected class.
b.she applied and was qualified for the job in question.
c.she was rejected for a position by Trek n’ Travel.
d.other persons of her race hold similar positions with other similar employers.
13) Nini, a police officer, wants to search the offices of Operational Business
Corporation. She asks Judge Pearl to issue a warrant. Under the Fourth Amendment, no
warrant for a search can be issued without
a.double jeopardy.
b.probable cause.
c.reasonable doubt.
d.immunity.
14) In 2014, Cloud Computing Corporation registers its trademark as provided by
federal law. After the first renewal, this registration
a.is renewable every ten years.
b.is renewable every twenty years.
c.runs for the life of the corporation plus seventy years.
d.runs forever.
15) Even-Bilt Construction contracts to build a warehouse for Discount E-Sales
Company. Even-Bilt completely performs. Discount E-Sales is entitled to
a.damages.
b.nothing more.
c.to be excused from performance.
d.suspend performance.
16) Transcontinental Tours, a U.S. firm, and Victoria Hotels, Ltd., a Canadian firm,
enter into a contract that does not have a forum-selection or choice-of-law clause.
Litigation between Transcontinental and Victoria over a dispute involving this contract
may occur in
a.Canada only.
b.Canada or the United States, but not both.
c.Canada, the United States, or both.
d.the United States only.
17) Qatar Global Investments is a foreign entity€a firm owned and operated by
investors in a foreign country. With respect to a limited liability company in the United
States, Qatar Global can
a.act as a creditor, but cannot otherwise invest or participate.
b.become a member.
c.not become a member, but can participate in its operations.
d.not become a member or otherwise participate in its operations.
18) Damien buys a copy of the book Exchange. Later, after reading the book, Damien
sells it to his sister. Under the first sale doctrine, Damien’s sale of the book is
a.legal.
b.legal only if the copyright has expired.
c.legal only if Damien sells it for less than he paid for it.
d.illegal.
19) All debts are dischargeable in bankruptcy.
20) For a business law class, Sierra reads and briefs several court opinions using the
IRAC method of legal reasoning. What do the letters I, R, A, and C abbreviate? What
are the steps in the IRAC method?
21) A liquidated damages provision specifies that a certain amount is to be paid in the
event of a future default or breach of contract.
22) Whether a worker is an employee or an independent contractor has no effect on the
employer’s liability for the worker’s actions.
23) In some states, misrepresentation of age is enough to prevent disaffirmance.
24) In some states, the courts prefer to rely on traditional notions of fraud, undue
influence, and duress rather than the concept of unconscionability.
25) In putting together a repayment plan under Chapter 13, a debtor must apply the
means test to identify the amount of disposable income that will be available to repay
creditors.
26) In an auction, a bidder is an offeree.