1) tina cosigns a promissory note at globe bank for $500.00 for her friend tom. tom
defaults on the loan, and globe bank collects $500.00 from tina. tina then collects
$500.00 from tom. tina could collect money from tom because of her right of _____.
a.subrogation
b.reimbursement
c.contribution
d.attachment
2) the _____ underwriting is typically used only to sell common shares to existing
shareholders pursuant to a preemptive rights offering.
a.standby
b.sponsorship
c.best efforts
d.firm commitment
3) mel is a securities broker who holds shares in beanbag inc. mel does not disclose this
to his customer kim, whom he advises to buy beanbag shares. mel hopes that by not
disclosing his conflict of interest, he will influence kim to buy the shares. kim,
believing the information on beanbag shares is given from mels disinterested point of
view, declares that buying beanbag shares sounds like an excellent idea and purchases
the shares. which of the following statements is most accurate?
a.kim cannot hold mel liable because mel did not make a misstatement of material fact.
b.kim will have to prove that mel acted negligently in order to prove a rule 10b5
violation.
c.kim will most likely be able to make a successful claim against mel under rule 10b5.
d.mel did not have a duty to disclose his conflict of interest to kim.
4) in which of the following circumstances is a debt settlement a binding contract?
a.where the amount of the debt is uncertain or subject to dispute.
b.where the amount of the debt is certain and undisputed.
c.where the only consideration the creditor gives the debtor is his promise not to sue the
debtor on the original debt.
d.where the settlement is part of a composition agreement.
5) the llc is not ordinarily liable for the wrongful acts of:
a.manager members in a member-managed llc.
b.nonmanager members in a manager-managed llc.
c.nonmanager members in a member-managed llc.
d.manager members in a manager-managed llc.
6) which of the following is most likely to constitute undue influence?
a.a firm demanding more in terms of pricing by withholding essential supplies.
b.a clergyman using a parishioners emotional susceptibility to get the parishioner to
contract with the clergyman.
c.threatening to commence a frivolous criminal prosecution against someone, in order
to get them to contract with you.
d.grabbing someones hand and forcing them to sign on a contract you have prepared.
7) which of the following requires tenants to be married to each other?
a.tenancy in partnership
b.tenancy in common
c.joint tenancy
d.tenancy by the entirety
8) usually, who may have the power to surrender the instrument if full payment is
made?
a.indorser
b.accommodation maker
c.party to whom the holder presents the instrument
d.drawer
9) the usual penalty resulting from a final decision against the respondent is a:
a.fine of $20,000.
b.cease-and-desist order.
c.fine of $10,000.
d.consent order.
10) an offer which is unclear about the form of acceptance that is necessary to create a
contract, is called a(n) _____ offer.
a.ambiguous
b.reasonable
c.implied
d.counter