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Statutes of repose were enacted to give consumers more rights against large
manufacturers.
a. True
b. False
If a principal debtor defaults on a loan, an absolute surety will have to pay upon
demand of the creditor.
a. True
b. False
All conversions of personal property are trespasses, but not all trespasses to personal
property are conversions.
a. True
b. False
Which of the following is correct with respect to Article 2A of the UCC?
a. It is an analogue of Article 2 that adopts many of the same rules.
b. No states have as yet adopted 2A.
c. Article 2A specifically includes security interests in its scope.
d. All of these.
Tommy's parents died in a plane crash and he went to live with his guardian, Aunt Rose.
Rose had a very small house and did not have a separate bedroom and bath for
12-year-old Tommy. She and Tommy decided to use some of his inheritance to pay for
an addition to the house. He had some shares of stock transferred into Rose's name so
that she could sell them when the money was due to be paid. The stock transfers are:
a. presumed voidable unless Rose can show no unfair advantage was taken.
b. presumed valid unless it can be proven that Tommy was taken advantage of.
c. null and void because of undue influence.
d. presumed void because of duress.
Paper payable "on demand" fails the test of negotiability in that it does not contain a
specific time.
a. True
b. False
Which of the following defenses may be raised by an accountant under Section 11 of
the 1933 Securities Act?
a. Privity and due diligence
b. Privity, but not due diligence
c. Due diligence, but not privity
d. Neither privity nor due diligence
The registration statement must be signed by:
a. the issuer and the chief financial officer.
b. the SEC secretary and the chief financial officer.
c. the chief financial officer only
d. the SEC secretary only.
While employed and even after termination of employment, an employee cannot
divulge trade secrets to a competitor.
a. True
b. False
Under the 1985 Act, the limited partner need not be named in the limited partnership
certificate.
a. True
b. False
An oral stop payment order is binding on the payor bank for 14 calendar days.
a. True
b. False
UCC Article 9 defines a secondary obligor as being a consignee.
a. True
b. False
The Tennessee Valley Authority is an example of a private corporation.
a. True
b. False
The U.S. Patent and Trademark Office issues a patent upon an application containing:
a. a specification, which describes the features that make the invention patentable.
b. claims, which describe the features that make the invention patentable.
c. claims, which describe how the invention works.
d. a summary of the prior similar inventions and an explanation of how this invention is
distinct from them.
The federal courts only have jurisdiction to hear cases involving federal law.
a. True
b. False
Which of the following represents joint property ownership?
a. A cooperative
b. A life estate
c. A lease
d. A fee simple absolute
The test under the one-year provision of the statute of frauds is based on the likelihood
that the contract will be completed within one year.
a. True
b. False
A person is a contributory infringer if he knowingly sells or offers to sell a part or
component of a patented invention.
a. True
b. False
A partial assignment is a transfer of a portion of the contractual rights to one or more
assignees.
a. True
b. False
For $100 each, Helen agrees with Troy Tech to knit 14 sweaters for the soccer team in
their school colors with their names on the front and "Go Tech" on the back. After
Helen has almost finished the last sweater, Troy Tech decides it should spend the money
on repairs to the locker room instead of on the sweaters. Does Helen's contract have to
be in writing for her to enforce it?
a. No, because each sweater only cost $100
b. No, because they are specially manufactured sweaters
c. Yes, because the total cost is $1,400
d. Yes, because they are specially manufactured sweaters
The main purpose doctrine is an exception developed by the courts to the suretyship
provision.
a. True
b. False
Matchthefollowing:
a. The sender of a payment order.
b. A specialized form of draft; an order to pay money, drawn on a bank and payable on
demand.
c. Defenses available against all holders.
d. Signature identifying an indorsee to be paid and making the instrument order paper.
e. A person who is in possession of an instrument with all necessary indorsements.
f. Signature that specifies no indorsee and may consist of merely the signature of the
indorser or her authorized agent.
g. The person who executes a promissory note and who promises to pay it.
h. A written acknowledgment by a bank of the receipt of money that it promises to
repay on demand or at a stated future date, with interest at a stated rate; a specialized
form of promise to pay money that is given by a bank.
i. A party to whom a draft is directed, and who is requested to pay the amount of money
ordered therein; the bank on which a check is drawn.
j. The person who writes a check or draft; the person on whose account a draft is drawn.
k. A signature that attempts to limit the rights of the indorsee in some fashion.
l. A sender's written, electronic, or oral instruction to a receiving bank to pay, or to
cause another bank to pay,
a fixed or determinable amount of money to a beneficiary.
m. The person in whose favor a promissory note or draft is made or drawn.
n. Defenses which are good against holders unless they have rights of holders in due
course.
o. An instrument involving two parties, one of whom promises to pay to the order of the
second a stated sum of money either on demand or at a stated future date.
p. A paper, containing an indorsement, affixed to a negotiable instrument.
q. The transferee of a holder in due course succeeds to the rights of a holder in due
course even if the transferee does not qualify for holder in due course status.
r. The bank in which the payee or holder deposits a check for credit.
s. A bank, other than the depositary or payor bank, involved in the collection process.
t. Legal concept that makes written instruments freely transferable and therefore a
readily accepted form of payment in substitution for money.
1>real defenses
2>special indorsement
3>certificate of deposit
4>check
5>blank indorsement
6>restrictive indorsement
7>negotiability
8> drawee
9>drawer
10> holder
11>maker
12>allonge
13> payee
14>promissory note
15>payment order
16> shelter rule
17> personal defenses
18>originator
19>intermediary bank
20> depositary bank
The SEC's computer system that performs automated collection, validation, indexing,
acceptance, and dissemination
of reports required to be filed with the SEC is known as:
a. SEC-ELS.
b. ELMER.
c. EDGAR.
d. EDMOND.
Tom tries to sell his classic car to Victoria for $12,000. Tom tells Victoria, "I paid
$12,000 for the car in 1978 and it's worth twice that today." Tom really paid $8,000 for
the car in If Victoria buys the car, basing her decision on Tom's statement, which of the
following correctly states the situation?
a. Tom's statements amount to puffing only.
b. Tom's statements provide grounds to set the contract aside.
c. Tom's statements are actionable only if negligently made.
d. Tom's statements amount to fraud in the execution.
Which of the following would most likely be a merchant with respect to the goods in
question under the UCC
definition?
a. Amy is an authorized IBM computer dealer.
b. Brian employs two salesmen to sell his homemade furniture.
c. Clarence has a store in which he sells used lawn mowers.
d. All of these would be merchants.
After reorganization, all debts are forgiven.
a. True
b. False
In which of the following situations will a court grant specific performance?
a. In a case involving breach of contract for the sale of real property or rare goods.
b. In contracts for personal services.
c. Where goods have been identified to the contract.
d. Where goods are mixed with other goods of the same type.
Sean had two beers and felt tipsy. He made a deal with Yoko to buy her stereo. He can
avoid the contract because of lack of capacity.
a. True
b. False
A suit may be brought by the state to challenge the existence of a defactocorporation in
a quowarrantoaction.
a. True
b. False
Which of the following remedies is NOT available for patent infringement?
a. Attorney fees in some but not all cases
b. An accounting for profits
c. Treble damages when appropriate
d. Injunctive relief
Stephens, an employee of bankrupt ABC Company, would be able to receive her $2,000
in unpaid wages earned within 90 days before ABC's filing of the bankruptcy petition
and $2,000 in contributions to her employee benefit plans, for a total of $4,000
beforeany money is paid to Ramsdell, a consumer, to compensate him for a deposit paid
to the company for goods which were never delivered because of the company's going
bankrupt.
a. True
b. False
A partner may not receive a distribution from a limited partnership unless the remaining
assets are deemed sufficient to pay partnership liabilities other than liabilities to
partners on account of their partnership interests.
a. True
b. False
Theodore, as treasurer of Valleyview Corporation, had the duty to invest corporate
earnings as he deemed best for the company. When Valleyview Corporation went
public, the new board decided that a committee of the officers would make such
investment decisions. If Theodore thereafter unilaterally contracted to purchase
investment securities with corporate earnings as he had done many times before, such
contract would be valid:
a. since Theodore would have express authority.
b. since Theodore had implied authority.
c. under apparent authority if the seller knew of Theodore's past transactions.
d. because of ratification if the board did not know of his actions.
The Third Restatement of Torts has abandoned the doctrine of implied voluntary
assumption of risk in tort actions.
a. True
b. False
