When the depositary bank is the same bank as the payer bank, the check is referred to
as a(n) ______.
A. on-us item
B. combined item
C. condensed item
D. unitary item
E. uniform item
The person who makes an offer is called the _____________.
A. offeree
B. offeror
C. agreeor
D. agree
E. inquirer
Tina negligently hits student Susie with her car. Which of the following is true?
A. Tina has no duty to come to the aid of Susie.
B. Tina has a duty to come to the aid of Susie because she negligently hit her.
C. Tina has a duty to come to the aid of Susie only if police are not on the scene within
a reasonable amount of time.
D. Tina has a duty to come to the aid of Susie only if Susie has no insurance.
E. Tina has a duty to come to the aid of Susie only if no one else is willing to do so.
Which of the following is true regarding an agent’s liability when the agent commits a
tort while acting as an agent for a principal?
A. The agent is personally liable only if the agent was on a mission for an unidentified
principal.
B. The agent is personally liable only if the agent was on a mission for an unidentified
principal or a partially disclosed principal.
C. The agent is liable regardless of the classification of the principal or the liability of
the principal.
D. The agent is not liable if the principal is liable.
E. The agent is not liable unless the principal is insolvent.
________________ is negotiations between an employer and a group of employees so
as to determine the conditions of employment.
A. Collective bargaining
B. Mediation
C. Arbitration
D. Collusive dealings
E. Mandatory negotiations
With a(n) ______ instrument, payment can be made only at a specific time designated
in the future.
A. time
B. demand
C. recourse
D. nonrecourse
E. immediate
________________ permits repeated transactions and assesses a finance charge on
unpaid balances.
A. Open-ended credit
B. Closed-ended credit
C. Debt-based credit
D. Uncollateralized credit
E. Collateralized credit
Rebecca, a secretary at ABC Software Company, a publicly traded company, enjoyed
snooping through the desk of her boss, Emma. One day while snooping, Rebecca came
across information indicating that ABC Software was in the process of launching a new
type of software that it was believed would be very profitable. Rebecca immediately
purchased a large amount of stock in ABC Company and sold it for a nice profit after
the product was made public. Her conscience was bothering her a bit, so she confessed
her snooping to a friend, Jason. Jason told Rebecca not to worry because she could have
no liability. Is Jason correct; and, if not, what theory of liability could be applied against
Rebecca? Additionally, set forth the definition of insider under Section 10(b) and Rule
10b-5.
What cases are bound by a decision of a state appeals court?
A. The decision being appealed from and future cases in the state, but not past cases.
B. The decision being appealed from, future cases in the state, and past cases that must
be reopened.
C. Only the decision being appealed from.
D. Only future cases.
E. The decision being appealed from and future cases in the state and in surrounding
states, but not past cases.
______________ are responsible for running the day-to-day business of a corporation.
A. Investors
B. Shareholders
C. Officers
D. Administrators
E. Members of the board of directors
Repossession. Tina sold used vehicles. She sold a used pick-up truck to Joan and a used
convertible to Barry. She properly obtained a security interest in both vehicles. Both
Joan and Barry defaulted on payments owed to Tina for the vehicles. Tina told her
assistant, Samantha that the only legal remedy was repossession; that she was going
after the vehicles; and that Samantha should call law enforcement if she did not show
up at the office by 10 a.m. for the next few mornings. Tina decided that she would
repossess Joan’s pick-up at Joan’s house. Therefore, Tina slipped into the driveway at
midnight one night and started the engine. Joan immediately ran out and confronted
Tina. Tina shoved Joan away and drove off in the pick-up truck. Tina was able to
repossess Barry’s convertible in a public parking lot with no altercation with him.
Which of the following is true regarding Tina’s taking possession of Barry’s
convertible?
A. Tina breached the peace because she did not provide Barry prior notification that she
was going to repossess the vehicle.
B. Tina breached the peace because she took the vehicle from a public lot.
C. Tina breached the peace unless she can establish that Barry gave her prior permission
to repossess the vehicle in a public lot.
D. Tina did not breach the peace because she acted in a reasonable manner in taking the
collateral.
E. Tina did not breach the peace because Barry sustained no documented physical
injury.
While driving her car down the street, Susan sees a child playing near the road with no
adult around. Which of the following is most likely true in a given jurisdiction?
A. Because the law holds that every U.S. citizen holds the duty to help a stranger in
peril, she must come to the child’s assistance.
B. She must come to the child’s assistance only because a child is involved.
C. She has no duty to render assistance to the child.
D. She must render assistance to the child only if she can do so without peril to herself.
E. She must render assistance to the child only if she is acquainted with the child’s
parents.
Which of the following are directors who are also officers or employees of the
corporation?
A. Approved directors
B. Outside directors
C. Inside directors
D. Affiliated directors
E. Unaffiliated directors
Guardians may be appointed for which of the following?
A. Only those who are adjudicated insane.
B. Only those who are adjudicated habitual drunkards.
C. Only those whose judgment has been impaired because of a condition such as
Alzheimer’s.
D. Those who are adjudicated insane or those whose judgment has been impaired
because of a condition such as Alzheimer’s, but not those who are adjudicated habitual
drunkards.
E. Those who are adjudicated insane, those whose judgment has been impaired because
of a condition such as Alzheimer’s, and also those who are adjudicated habitual
drunkards.
Which of the following is true regarding when an offeree may reject an offer?
A. Regardless of how long an offeror states that an offer will be held open, once the
offeree rejects it, the offer is terminated.
B. If the offeror states that an offer will be held open for a certain amount of time, then
it is open for that length of time even if a rejection is received prior to the expiration of
that time.
C. An offer must remain open for at least two days before an offeree may reject it.
D. An offer must remain open for at least three days before an offeree may reject it.
E. An offer must remain open for at least four days before an offeree may reject it.
Which of the following are possible exceptions to the statute of frauds?
A. Admission
B. Partial performance
C. Promissory estoppel
D. Admissions, partial performance, and promissory estoppel
E. Admission and partial performance, but not promissory estoppel
Which of the following was the result in Cousins Subs Systems Inc. v. Michael R.
McKinney, the case in the text in which defendant McKinney asserted in a counterclaim
that he was entitled to terminate an agreement requiring that he operate submarine
sandwich shops because Cousins Subs Systems, Inc. failed to meet promises it verbally
made to him?
A. That based on principles of equity McKinney could rely on oral statements in
contradiction of the written agreement involved.
B. That the oral agreements could be relied upon by McKinney because they
supplemented, rather than contradicted, the written agreement.
C. That the alleged oral agreements contradicted the written agreement signed by
McKinney and would not, therefore, be considered.
D. The alleged oral statements should supplement that the court would allow the jury to
determine the written contract.
E. That the written agreement failed to set forth fair principles but that the alleged oral
agreements would be disregarded in favor of a form contract contained in the state’s
franchise law.
Which of the following is true if there is no agreement between a principal and an agent
regarding the amount for which the principal will compensate the agent?
A. It will be assumed that the agent agreed to work for free on a gratuitous basis.
B. The agent will be allowed to set the price that will be enforced unless it is
unconscionable.
C. The principal will be allowed to set the price that will be enforced unless it is
unconscionable.
D. The court will appoint a magistrate to set the price.
E. Compensation will be calculated according to the customary fee in the situation.
When was the Magnuson-Moss Act passed?
A. 1950
B. 1955
C. 1970
D. 1975
E. 2000
Which of the following is liability without fault?
A. Negligence.
B. Assumption of the risk.
C. Strict liability.
D. Storekeeper liability.
E. Homeowner liability.
New State passes a law prohibiting the importation of out-of-state apples in order to
help in-state growers. Which of the following is the best argument for the out-of-state
growers who wish to challenge the new law?
A. That it violates the dormant commerce clause.
B. That it violates the explicit preemption clause.
C. That it violates the First Amendment.
D. That it violates the Fourth Amendment.
E. That it violates due process.
Which of the following is a substitute for cash?
A. A negated instrument
B. A promised instrument
C. A negotiable instrument
D. A promissory agreement
E. A negotiable oral promise
Claims to Funds. Paul had a great job as a bank executive. Unfortunately, his bank
came under scrutiny by federal regulators and while Paul had done nothing illegal, he
ended up being fired. Unfortunately for Paul, he had a number of debts. Among his
assets were a house worth $250,000 on which he owed $150,000 to a bank that held a
security interest; three vehicles; an expensive watch worth $5,000; and $120,000 in an
Individual Retirement Account “IRA”. He owed $900 per month in child support to his
ex-wife Suzy and was behind on payments in the amount of $1,800. He also owed
$2,000 in wages consisting of four months of back pay to Bob who took care of Paul’s
landscaping needs and swimming pool care. Unable to find a job and believing that he
had no other option, Paul filed for Chapter 7 bankruptcy. All debtors angrily demanded
payment from liquidation of Paul’s assets. Paul, on the other hand, claims that he needs
all the above-mentioned assets and that he should not have to give up anything. Only
federal bankruptcy exemptions apply to Paul’s case. Which of the following is true
under bankruptcy in regard to Paul’s claim to the watch?
A. The watch will be sold with the entire proceeds being used to satisfy claims of
creditors.
B. The watch will remain Paul’s property because it is automatically exempt.
C. The watch will remain Paul’s property so long as he can establish that it is needed in
his profession.
D. Paul’s interest in the watch is exempt only up to $1,450.
E. Paul’s interest in the watch is exempt only up to $500.
In a dispute between two secured unperfected parties, which of the following is true?
A. The party who attached its interest first will prevail.
B. The party who attached its interest second will prevail.
C. The parties will divide the proceeds evenly between them.
D. The party who loaned the most money on the collateral has priority.
E. The party who loaned the least amount on the collateral has priority.
Which of the following is a type of ADR?
A. Consultation
B. Mediation
C. Case argument
D. Case analysis
E. Focus grouping
Approximately how many bankruptcy claims were filed in 2014?
A. 100,000
B. 250,000
C. 500,000
D. 1.1 million
E. 2.7 million
When a holder presents an instrument in a timely and proper manner, but acceptance or
payment is refused, the instrument has been _____.
A. destroyed
B. dishonored
C. converted
D. rejected
E. refused
Under UCC Section 1-201(b)(21), the party who possesses a negotiable instrument
payable to the party or to the bearer of the instrument is the __________________.
A. holder
B. deliverer
C. transferor
D. acknowledger
E. orderee
What is the effect of an unqualified, blank endorsement?
A. It turns previous order paper into bearer paper.
B. It turns previous bearer paper into order paper.
C. It turns a blank endorsement into a special endorsement.
D. It turns an allonge into an endorsement.
E. It turns an endorsement into an allonge.
Pet Police. Millie breeds German Shepherd dogs. Bernard, who lives down the street,
took in a stray dog loosely identified as a Corgi-plus. The dog, Casanova, would
definitely be classified as a mixed breed. Bernard allowed Casanova to roam freely.
Unfortunately, Casanova went to visit Millie’s pure-bred German Shepherd. Puppies
resulted which were Shepherd and Corgi-plus puppies. Millie was incensed. She started
a campaign to round up all of the stray dogs, including Casanova, and haul them off to
the animal shelter. She picked up a few cats as well. She posted signs all over the
neighborhood saying that no animal, neither dog, cat, nor fowl, should come into her
yard and that she was going to begin shooting the next time, period. Understandably,
Bernard and some of the other neighbors take offense. Bernard comes to Millie’s house
while she is working in the yard. He walks behind her and shoves her. Millie did not see
him coming. Millie turned around and proceeded to have a heated conversation with
Bernard. Millie drew her fist back and told Bernard that she was going to punch him in
the nose. Millie started to punch Bernard but he stepped back, and all she managed to
do was jab him in the shoulder, causing no actual pain. Sally, who was going by on the
street, saw Millie attempting to hit Bernard. Sally came over and grabbed Millie’s
hands, pinning Millie’s hands behind her back. Assuming that Millie sues Sally, what
would be the most likely result at trial?
A. Sally will be convicted of assault.
B. Sally will be convicted of battery.
C. Sally will be convicted of assault and battery.
D. Sally will not be convicted of anything because she did not actually hurt Millie.
E. Sally will not be convicted of anything because she was acting in the defense of
others.
What is the term for the third party who receives an assignment of contract rights?
A. Transferor
B. Transferee
C. Relator
D. Assignor
E. Assignee
________________ is (are) federal law(s) regulating the credit industry.
A. The Truth-in-Lending Act
B. The Fair Credit Reporting Act
C. The Fair Debt Collection Practices Act
D. The Truth-in-Lending Act, the Fair Credit Reporting Act, and the Fair Debt
Collection Practices Act
E. The Truth-in-Lending Act and the Fair Credit Reporting Act, but not the Fair Debt
Collection Practices Act
In which of the following does a contract arise not from words but from the conduct of
the parties?
A. Implied contracts
B. Express contracts
C. Liquidated contracts
D. Bilateral contracts
E. Unilateral contracts