A finding of undue influence would most likely not occur in a contract between:
a. parent and child.
b. attorney and client.
c. neighbor and neighbor.
d. guardian and ward.
A decedent’s transfer of $10,000 to a trustee, to be held in trust for A, will fail to create
a valid trust if:
a. it was not supported by consideration.
b. the trustee lacks capacity.
c. A is not a family member of the decedent.
d. the trustee had no opportunity to renounce the trust.
Claims for wages, salaries, or commissions have priority in the payment of unsecured
debts over:
a. costs and expenses of the administration of the bankruptcy case.
b. claims arising in the ordinary course of business after commencement of the case.
c. claims arising for contributions to employee benefit plans.
d. all of the above.
Which of the following can constitute an effective delivery of a deed?
a. a physical delivery
b. a symbolic delivery
c. a constructive delivery
d. all of the above
An instrument is order paper if:
a. it is payable to bearer or the order of bearer.
b. it is payable to cash.
c. the last or only indorsement is a blank indorsement.
d. none of the above.
After a proper demand has been made, for assurance of performance to be adequate, it
must:
a. include consideration.
b. allow for the additional examination of the goods.
c. be sufficient to assure a reasonable person that the contract will be performed.
d. be written.
An agreement under which one party agrees to pay drafts drawn by a creditor is called
a:
a. contract of surety.
b. guaranty contract.
c. letter of credit.
d. debtor’s agreement.
A trust may be terminated:
a. by its own terms.
b. by merger of all interests in the same person.
c. via revocation by the settlor if allowed by the terms of the trust.
d. all of the above.
The legal relation that arises when one person delivers possession of personal property
to another under an express or implied agreement to return the property at a later date is
called a:
a. tenancy agreement.
b. bailment.
c. rental agreement.
d. trust arrangement.
Original jurisdiction courts are generally ____________.
a. supreme courts
b. appellate courts
c. trial courts
d. limited courts
To analyze a copyright infringement claim in the context of computer programs, courts
will primarily examine:
a. the total number of program steps that are substantially similar.
b. the number of significant program steps that are substantially similar.
c. whether the programs appear substantially similar in ordinary language.
d. whether the programs appear substantially similar in machine language.
Which of the following is not characteristic of the “living” Constitution?
a. strong government
b. strong President
c. administrative agencies
d. states’ powers equal to federal powers
Parol evidence generally is admissible to explain:
a. ambiguous terms.
b. why signatures are missing.
c. why a contract was not performed.
d. implied terms.
A motion for a directed verdict is appropriate:
a. immediately after the pleadings are filed.
b. immediately after discovery is concluded.
c. immediately after the presentation of all evidence at trial.
d. on appeal.
An offer to perform is known as a(n) __________.
a. rendering
b. offering
c. tinder
d. tender
The scope of an agent’s authority may be determined from the:
a. express words of the principal.
b. words or deeds of the principal.
c. customs of the trade or business.
d. all of the above.
When an employer intentionally treats some employees less favorably than others, the
legal theory that applies is:
a. disparate impact.
b. affirmative action.
c. reverse discrimination.
d. disparate treatment.
An offer of a reward for the arrest and conviction of a criminal is an example of a:
a. unilateral contract.
b. bilateral contract.
c. quasi contract.
d. formal contract.
Who serve as agents of the corporation and run the “day-to-day” operations of the
business?
a. officers
b. directors
c. shareholders
d. employees
A contract in which one party agrees to purchase goods from another contingent upon
the purchaser’s ability to locate suitable financing is said to:
a. be illegal.
b. result from undue influence.
c. contain a waiver.
d. contain a conditional promise.
When a negotiable instrument is negotiated by delivery without indorsement, the
warranty liability of the transferor runs:
a. only to the immediate transferee.
b. not to the immediate transferee, but to all subsequent transferees.
c. to both the immediate transferee and all subsequent transferees.
d. neither to the immediate transferee, nor to any subsequent transferees.
Which of the following statements made by the seller does not likely constitute an
express warranty?
a. “This looks beautiful on you.”
b. “This is 100 percent wool.”
c. “This motor generates 100 horsepower.”
d. “This is a 3.2 liter rotary engine.”
A party working for and under the control of another and authorized to enter into
contracts for that other person or entity is called an:
a. employee.
b. agent.
c. independent contractor.
d. attorney.
Philip Laws leased an apartment from Candice Sutton. Laws had notified Sutton on
more than one occasion that the wooden steps to his apartment were decaying and in
need of repair. Laws claimed that he had to leave the outside light on to avoid portions
of the steps that no longer would bear his weight when he came in at night. Sutton
promised to repair the steps while Laws was away on a business trip. Accordingly,
Laws did not leave lights on during his absence. When he returned three nights later,
Laws was injured when one of the steps broke under his weight as he was entering his
apartment. Laws sued Sutton. Sutton replied that she should not bear liability for Laws’
injury because Laws knew of the condition of the steps and had not taken the customary
precaution of lighting the area. Based on what you have learned in this chapter, decide
the case.
Which of the following situations create(s) an exception to the statute of frauds writing
requirement?
a. non-resellable goods
b. receipt and acceptance
c. Payment
d. all of the above
Members of administrative agencies are ordinarily
a. pre-selected.
b. elected.
c. assigned.
d. appointed.
When goods are delivered to a common carrier for immediate shipment and while they
are in transit, who is normally liable for any loss or damage to the goods?
a. the shipper
b. the consignee
c. the carrier
d. the individual designated as responsible in the bill of lading
What is a correct statement concerning burden of proof?
a. The insured has the burden of proving that the loss was a covered loss.
b. The insurer has the burden of proving that the loss was not covered.
c. Exceptions to coverage are liberally interpreted in favor of the insurer.
d. Exceptions to coverage are disregarded in life insurance matters.
When an insurance policy is ambiguous, the policy is interpreted:
a. against the insurer.
b. in favor of the insurer.
c. according to the dictionary meaning of the words.
d. according to the meaning of the words in the insurance industry.
Title VII of the Civil Rights Act of 1964 applies to:
a. the hiring process.
b. discipline.
c. discharge
d. all of the above.
What constitutes negligence is the same for an accountant who is a full-time employee
as it is for an independent outside auditor.
A sale or return is a completed sale with an option for the buyer to return the goods.
Any disclaimer by an accountant that excludes liability for malpractice based on
negligence is void.
Antedating an instrument affects an instrument’s negotiability.
Consumer protection statutes may require a writing that is more detailed than the
writing required by the statute of frauds provision of the Uniform Commercial Code.
In addition to issues of social responsibility, business values and ethics play an
important role in the success or failure of a business.
An offer gives the offeror the power to bind the offeree by contract.
States that do not meet federal standards under The Clean Air Act are known as
nonattainment areas.
A quasi contract may arise in a situation in which no contract exists.
Even if part of a contract is illegal, the court may enforce a divisible, legal part of the
contract.
The zoning power permits any regulation that is conducive to advancing public health,
welfare, and safety.
The term apparent authority is used when an appearance of authority has been created
by a principal, but actual authority does not exist.
To be set aside as a preference, a transfer must be fraudulent.
A new state law mandates that all employers must prohibit smoking on employer
premises. The law further provides that any employer who allows an employee or a
client/ customer to smoke on its premises is subject to a court order requiring the
employer to enforce the law. Describe this statute in terms of all possible classification
methods.
Ordinarily, the drawee bank is liable to the drawer when it pays a check on which the
drawer’s signature has been forged.
When a third person makes payment to an authorized agent, such payment is deemed
made to the principal at the time the agent remits the payment to the principal.