Oral contracts that come under the provisions of the statute of frauds are:
A. void.
B. illegal.
C. unenforceable.
D. valid.
Answer:
An acceptance is effective as soon as it is dispatched:
A. if the offeree uses only an authorized means of communication.
B. if the offeree uses only a stipulated means of communication.
C. if the offeree uses an authorized or a stipulated means of communication.
D. if the offeree uses any reasonable means of communication.
Answer:
The _____ of 1886 provided that in order to deposit or discharge “refuse” into a
navigable waterway, a discharge permit had to be obtained from the Army Corps of
Engineers.
A. River and Harbor Act
B. Clean Water Act
C. Federal Water Pollution Control Act
D. National Pollution Discharge Elimination Act
Answer:
This act requires CEOs and CFOs of publicly traded corporations to certify that, to
their knowledge, all financial information in quarterly and annual reports is not false or
misleading.
A. Landrum-Griffin Act
B. Clayton Act
C. Sarbanes-Oxley Act
D. Norris-LaGuardia Act
Answer:
When a buyer has a right to inspect the goods, the right usually must be exercised:
A. before the goods are shipped.
B. after paying for them.
C. before accepting the goods.
D. within 15 days after accepting the goods.
Answer:
According to the Fair Credit Billing Act (FCBA), if the credit card holder thinks that
the card issuer has made an error on the statement:
A. he has 90 days from the time the card was issued to report, in writing, the error.
B. he has 30 days from the time the statement was mailed to report the error.
C. he has 60 days from the time the statement was mailed to report, in writing or orally,
the error.
D. he has 60 days from the time the statement was mailed to report, in writing, the error.
Answer:
If a drawee bank certifies a check, which of the following is/are discharged of their
liability on the check?
A. The drawer only.
B. Only persons who previously indorsed the check.
C. The liability remains as before.
D. Both the drawer and the persons who previously indorsed the check.
Answer:
Punitive damages:
A. are usually unavailable. They are sometimes awarded for bad faith breach.
B. are so called because they are small in amount, not more than $10.00.
C. usually punish and are frequently available as a performance remedy.
D. are so called because they are small in amount and are usually specified in the
contract.
Answer:
(p. 423; 424) Under the “procuring cause” rule, when the agent is the primary factor in
a purchase:
A. the agent may be entitled to a commission regardless of who eventually completes
the sale.
B. the agent is not entitled to compensation after termination of the agency relationship.
C. the agent is not entitled to compensation because the agent did not actually ‘seal the
deal.”
D. the agent is entitled to compensation only if he completes the sale even after
termination of the agency relationship.
Answer:
A surety could avoid liability for a principal’s default if the principal had refused to pay
the seller-creditor because:
A. the principal was a minor and therefore lacked the capacity to contract.
B. the principal had filed for bankruptcy.
C. the principal was induced to contract with the seller-creditor by fraud or duress.
D. the principal was insane.
Answer:
A breach of warranty is normally considered to have occurred:
A. anytime within five years after the buyer discovers the defect.
B. when the goods are delivered to the buyer.
C. anytime within 15 years after the buyer discovers the defect.
D. the moment the buyer discovers the defect in the product.
Answer:
A promise or order is “payable on demand” if:
A. it states that it is payable only to the bearer.
B. it states a time for payment.
C. it states that it is payable on the fulfillment of a condition.
D. it states that it is payable at the will of the holder of the instrument.
Answer:
If the surety has to perform the principal’s obligation, then the surety acquires all the
rights that the creditor had against the principal. This is known as the surety’s:
A. right to contribution.
B. right of subrogation.
C. right to compensation.
D. right to reimbursement.
Answer:
An important distinction between valid insurance contracts and wagering contracts is
that:
A. insurance contracts create a new risk that did not previously exist while wagering
contracts don’t.
B. wagering contracts are not contrary to public policy while insurance contracts are.
C. insurance contracts transfer existing risks while wagering contracts create new ones.
D. unlike insurance contracts, wagering contracts are indemnity contracts.
Answer:
Which of the following statements is TRUE of the Employee Polygraph Protection
Act?
A. If the state law regarding the use of lie detector tests is stricter than the federal law, it
is preempted.
B. The act permits private employers to use mechanical lie detector tests for the purpose
of screening applicants.
C. The act allows manufacturers and distributors of controlled substances wider use of
mechanical lie detector tests.
D. It permits the employer to use lie detector tests on employees only if the employer is
engaged in an investigation of theft.
Answer:
In the business world, the goal of preventative law is to increase profits by:
A. imposing higher inheritance and income taxes on wealthy people.
B. avoiding losses through fines and damage judgments.
C. involving the client in the business-planning process.
D. creating unenforceable contracts.
Answer:
Graham is a landlord who owns an apartment where Sam and several other tenants
live. Graham refuses to install lights, new locks, and a security system, even though
Sam and several other tenants have been burglarized repeatedly in the past two weeks.
Under the modern trend of landlord liability:
A. Graham has no duty to protect Sam from third-party conduct.
B. Graham can be held liable for breach of implied warranty of habitability.
C. Graham has a duty to protect Sam and the other tenants from foreseeable criminal
conduct.
D. Graham is liable for breach of the implied warranty of quiet enjoyment.
Answer: