Ross, an employee at Super Snowboard Company, is laid off. Before he exits Super’s
building, he e-mails the company’s marketing campaign to Winter Sports Corporation,
Super’s competitor, without permission. This is
a. copyright infringement.
b. patent infringement.
c. trademark infringement.
d. a theft of trade secrets.
Scot and Tiffany enter into an implied contract. The partie’ conduct
a. defines the contract’s terms.
b. finds the contract’s facts.
c. terminates any unintended consequences.
d. undercuts any terms based on the facts.
Luc writes a check for $1,000 drawn on Ridgetop Bank and presents it to Bianca.
Bianca presents the check for payment to Ridgetop Bank, which dishonors it for
insufficient funds. The party most likely liable to Bianca is
a. Luc in a civil suit.
b. Luc in a criminal prosecution.
c. Ridgetop Bank in an administrative proceeding.
d. neither Luc nor Ridgetop Bank.
Adult Shoppe in Bay City sells a variety of publications, including child pornography.
Bay City enacts an ordinance prohibiting the sale of such materials. This ordinance is
most likely
a. an invalid restriction of individual’ privacy.
b. an unconstitutional restriction of speech.
c. a violation of adult’ rights to enjoy certain privileges.
d. constitutional under the First Amendment.
Denise, Ervin, and Flem occupy the positions of directors on the board of Gallery
Corporation. As directors, they may not
a. authorize major corporate policy decisions.
b. decide to issue stock and bonds, and declare dividends.
c. select and remove corporate officers.
d. subordinate the corporation’s welfare to their personal interests.
Reed borrows $150,000 from Suburban Credit Union to buy a home, which secures the
loan. Three years later, Reed stops making payments on the loan. After Suburban Credit
repossesses and auctions off the property to Tyler, equity remains. This amount most
likely belongs to
a. Reed.
b. Suburban Credit Union.
c. Tyler.
d. the county in which the property is located.
Wytex, Inc., a U.S. firm, and Findora Commercial, a Nigerian firm, are parties to a
contract that specifies that the official language of the contract is English. This is
a. a choice-of-forum clause.
b. a choice-of-language clause.
c. a choice-of-law clause.
d. an arbitration clause.
On January 10, Winchester Pet Supplies orders fifty small dog collars from Quality
Collars, Inc. to be delivered by January 15. On January 13, Quality Collars tenders fifty
large dog collars. Winchester Pet Supplies rejects the shipment. Quality Collars has
a. no right to cure.
b. until January 15 to cure.
c. until the end of the business day on January 13 to cure.
d. unlimited time to cure.
Juli types onto a computer what she intends to be “My Will” and prints it out. Juli has
capacity. “My Will” is
a. invalid.
b. valid if Juli signs it.
c. valid if Juli signs it and has three witnesses sign it.
d. valid if Juli signs it, has three witnesses sign it, and files it in a certain state office.
Fresh Vegetables, Inc., a wholesaler, refuses to sell its produce to Good Mart Stores,
Inc., a retailer. This is
a. “an unfair or deceptive act or practice.”
b. a per se violation.
c. not a violation.
d. subject to analysis under the rule of reason.
Peyton, Qiana, and River form a syndicate to buy a professional basketball franchise.
This syndicate could be set up as
a. a joint venture.
b. a corporation.
c. a sole proprietorship.
d. a limited liability company.
Raul agrees to ship to Ben one hundred ceiling fans for $5,000. Raul initials his notes of
the deal, which include the terms, and files the notes in his office. Ben initials his own
notes of the deal, which include the terms, and files the notes in his office. Raul fails to
ship the fans. Against Raul, as a contract, the deal is
a. enforceable, because under the UCC a contract need not written.
b. enforceable, because Raul’s initialed notes are a sufficient writing.
c. enforceable, because Ben’s initialed notes are a sufficient writing.
d. not enforceable.
Fred and Joanne are married. Joanne purchases a car. Fred and Joanne each technically
own an undivided one-half interest in the car. This is
a. a joint tenancy.
b. fee simple ownership.
c. community property.
d. illegal.
Thermo Gas, Inc., and Uno Oil Corporation refine and sell gasoline and other
petroleum products. To limit the supply of gas on the market and thereby raise prices,
Thermo Gas and Uno Oil agree to buy “excess” supplies from dealers and “dispose” of
it. This is
a. a deal that neither restrains trade or harms competition.
b. a legal restraint of trade.
c. a per se violation of the Sherman Act.
d. subject to analysis under the rule of reason.
Region Construction Company has a right to drive its trucks across Staple Business,
Inc.’s property, which is adjacent to Region’s office. This right is
a. a leasehold estate.
b. a license.
c. an easement.
d. a profit.
Consumer Finance Corporation (CFC) extends credit to consumers. CFC is subject to
the Equal Credit Opportunity Act, which prohibits credit discrimination based on
a. intelligence.
b. education.
c. income.
d. race.
Double D Ranch and Esau enter into a contract on August 1 for the sale of 200 cattle.
Esau cancels the contract ten days later. Double D is unable to sell the cattle to another
buyer. Double D is entitled to
a. force Esau to accept the cattle and recover the contract price.
b. keep the cattle and recover the contract price from Esau.
c. keep the cattle only.
d. recover the contract price from Esau but must destroy the cattle.
Sid rents an apartment from Town Properties, Inc. The lease, which ends on May 31,
does not include an option for renewal, and Sid and Town do not discuss whether Sid
can stay on at the end of the term. On June 1, Sid has
a. an implied option to renew the term.
b. a right to remain contingent on notice from Town.
c. a right to remain subject to notice to Town.
d. no right to remain.
Ludwig receives from Milo a marimba stolen from Nadine. To be criminally liable,
Ludwig must know
a. Milo.
b. Nadine.
c. that the marimba is stolen and Ludwig must intend to keep it.
d. what a marimba is.
In studying the legal environment of business, Professor Dooley’s students also review
ethics in a business context. Ethics includes the study of what constitutes
a. fair or just behavior.
b. financially rewarding behavior.
c. legal behavior.
d. religious behavior.
Albert buys a surround sound system from his neighbor George at George’s garage sale.
Albert writes George a check for $250 for the sound system. George is
a. the certifier.
b. the drawee.
c. the drawer.
d. the payee.
Bubbly Cola features Sparkly Cola’s trademark without its owner’s permission.
Bubbly’s use of the mark is actionable provided
a. consumers are confused.
b. Bubbly’s use is intentional.
c. Bubbly’s use reduces the value of Sparkly’s mark.
d. Sparkly’s mark is registered.
Odell is a director of Price Rite, Inc. As a director, with respect to the corporation, Odell
is
a. a fiduciary.
b. a forum.
c. a proxy.
d. a quorum.
Chocolate Sundry LLC’s members and managers are Devlin, Effie, and Flavia. After
Devlin’s relationship to the firm ends, Effie and Flavia agree to discontinue the
business. This is
a. illegal.
b. optional.
c. required.
d. wrongful.
Even-Bilt Construction contracts to build a warehouse for Discount E-Sales Company.
Even-Bilt completely performs. Discount E-Sales is entitled to
a. an accord.
b. rescission.
c. novation.
d. nothing more.
Kelsey obtains a business liability insurance policy from Loyal Insurance Company for
Kelsey’s Framing & Art Supplies store. When an event occurs that gives rise to a claim,
Loyal has a duty to
a. investigate to determine the facts.
b. file a suit against Kelsey so that a court can settle the claim.
c. find a third party on whom to impose liability.
d. refund any unearned amount of the premium.
Dahlia borrows $125,000 from Clearview Credit Union to buy a home. The interest rate
and other terms that are required to be disclosed under federal law must be
a. based on uniform formulas of calculation.
b. expressed in lender’ language.
c. set out in a formula unique to each loan.
d. stated in “legalese.”
Corporate Bank wants to perfect its security interest in inventory owned by Outdoor
Outfitters, Inc. Most likely, a financing statement should be filed with
a. the bank manager.
b. the county clerk.
c. the U.S. Department of the Interior.
d. the secretary of state.
Kathy is the secured party in a transaction with Julie, who is the debtor. The collateral is
a 2007 Chevrolet F150 pick-up truck. Kathy files a financing statement in which she
describes the collateral as “a vehicle.” To perfect Kathy’s interest this is
a. not sufficient.
b. sufficient.
c. sufficient as long as the financing statement also includes Julie’s signature.
d. sufficient as long as the financing statement also includes the location of the
collateral.
Richard is an adult. He enters into a contract to sell sixteen-year-old Jane his car for
$3,000. The next day Richard recieves an offer of $4,000 for his car from
twenty-year-old Bill. Richard
a. cannot disaffirm his contract with Jane because he is an adult.
b. can disaffirm his contract with Jane because Bill is an adult and contracts with adults
take precedence over contracts with minors.
c. cannot disaffirm his contract with Jane because she is a minor.
d. can disaffirm his contract with Jane because the contract has not been ratified.
Martha has a checking account with Homeplace Bank. Martha signs a check “payable
to Phillipa” drawn on Martha’s account. Homeplace Bank is
a. the payer.
b. the drawee.
c. the drawer.
d. the payee.
Muni Investment Company signs a check payable to Enterprise Lenders, Inc., to buy a
promissory note executed by Fallow Corporation. This check
a. does not constitute sufficient consideration for HDC status.
b. does not satisfy the value requirement for HDC status.
c. satisfies the consideration requirement for HDC status.
d. satisfies the value requirement for HDC status.
Inadvertently, Brent leaves his backpack at Chat n Coffee when he stops for coffee and
an hour of Facebook. The backpack is
a. abandoned property.
b. bailed property.
c. lost property.
d. mislaid property.
Della, an officer for Energy Petrol Corporation (EPC), buys 100 shares of EPC stock.
One week later, EPC announces that it will merge with a competitor, Fuel Oil Company,
and the price of EPC stock increases. One month later, Della sells her shares for a
profit. Under Section 16(b) of the Securities Exchange Act of 1934, Della would not be
liable if, after buying the stock, she had waited
a. less than fourteen days to sell it.
b. more than six months to sell it.
c. ninety days to sell it.
d. two months to sell it.
Businesspersons are expected to make decisions that are ethically sound.
Some states provide that in the absence of an agreement to the contrary each member of
a limited liability company has one vote.
SEC Rule 10b-5 prohibits the commission of fraud in connection with the purchase or
sale of any security.
A check is not a substitute for cash.
A marketing technique can be a trade secret.
A promissory note can be a negotiable instrument.
If a buyer wrongfully refuses to accept goods that conform to a contract, the seller can
recover damages.
In a bailment, possession of the property is transferred to the bailee.
Under the UCC, a seller’s tender of goods that do not conform in every way to a
contract is still a valid tender.
A court may depart from a precedent if the precedent is no longer valid.
A bank is not obligated to pay an uncertified check presented less than six months from
its date.
To commit an intentional tort, one person must intend to harm a certain person.
The termination provision of a franchise contract is usually more favorable to the
franchisor.
In a sole proprietorship, the proprietor shares the burden of any losses or liabilities
incurred by the business enterprise with the government.
A trademark can be diluted by the use of a similar mark.
A forum-selection clause indicates the forum, or location, for the delivery of goods
purchased online.
Labels must use words that are easily understood by the ordinary marketing executive.