The majority rule controls decisions on ordinary matters connected with partnership
business.
a. True
b. False
Burt, a mentally impaired person, is asked by Carl to sign a piece of pa-per that Carl
says is an autograph book. In fact, the document is a note. If later sued on the note by
an HDC
a. Burt must pay the note.
b. Burts best defense would be fraud in the execution.
c. Burts best defense would be fraud in the inducement.
d. Burts best defense would be mistake.
Mall Stores Corporation owns 95 percent of the shares of Niche Retail Corporation.
Mall Stores combines with Niche Retail, but only Mall Stores continues to exist. This
transaction was
a. a consolidation.
b. a tender offer.
c. ashort-form merger.
d. a termination.
Wilson buys a lottery ticket at his local gas station. Wilson has accepted an offer for
a. abilateral contract.
b. aunilateral contract.
c. a quasi contract.
d. no contract.
Ruff Games, Inc., wishes to ac-quire a controlling interest in Smart Toy Com-pany by
buying its stock. Smart Toy is
a. an alien corporation.
b. an acquiring corporation.
c. a receiver.
d. a target corporation.
A sole proprietor must create a separate business organization to create a sole
proprietorship.
a. True
b. False
In some states, misrepresentation of age by a minor is enough to prohibit disaffirmance.
a. True
b. False
Dobry Die & Mold, Inc., enters into a contract with Chets Refitting Service to fix
Dobrys precisely engineered molding equipment. If Chets delays the repair for five
days, knowing that Dobry will lose a certain percentage of profit for the delay, Dobry
might be awarded consequential damages to
a. establish, as a matter of principle, that Chets acted wrongfully.
b. provide Dobry with funds for a foreseeable loss beyond the contract.
c. provide Dobry with funds for its loss of the bargain.
d. punish Chets and set an example to deter others from similar acts.
One of the most common forms of securities are bonds issued by corporations.
a. True
b. False
Social media posts are routinely included in discovery in litigation.
a. True
b. False
Julia opens a checking account with Washington Bank and deposits funds into the
account. Julia and Washington Bank
a. do not have a contractual relationship.
b. have a creditor-debtor relationship in which Julia is the creditor and Washington
Bank is the debtor.
c. have a creditor-debtor relationship in which Washington Bank is the creditor and
Julia bank is the debtor.
d. do not have a creditor-debtor relationship.
Posing as Platinum Bank, Oswald e-mails Nadia, asking her to update her personal
banking information through a link in the e-mail. She clicks on the link and types in the
data, which Oswald promptly sells to Moe. This is
a. hacking.
b. identity theft.
c. cyberterrorism.
d. bribery.
A promise is a declaration that something will or will not happen in the future.
a. True
b. False
If a partnerships liabilities are greater than its assets, the partners bear the losses.
a. True
b. False
Mountaineer Sales, Inc., is the offeror and Camping Goods Corporation is the offeree
under a unilateral sales contract in which Forest Recreation Products Company is also
interested. Mountaineer is not notified of Campings performance within a rea-son-able
time. Mountaineer
a. may treat the offer as having lapsed.
b. must assume that Camping has started to perform.
c. must contact Camping.
d. must contract with Forest.
Grace applies for a homeowners insurance policy on her house with Heroic Insurance
Company through Ian, a broker. In this transaction, Ian is
a. an agent for both parties.
b. Graces agent, and not Heroics agent.
c. Heroics agent, and not Graces agent.
d. not an agent.
SEC Rule 10b-5 applies to almost all cases involving the trading of securities
a. True
b. False
Jacob writes Phillip an uncertified check for $500 on January 1. Seven months later,
Phillip presents the check at the bank. The bank pays the check in good faith without
consulting Jacob. The bank
a. does not have the right to charge Jacobs account for $500.
b. only has the right to charge Jacobs account for $250.
c. has the right to charge Jacobs account for $500.
d. can be held liable for breach of contract.
Expropriation occurs when a government seizes private property for a proper pur-pose
and awards just compensation.
a. True
b. False
The Fifth Amendment prohibits unreasonable searches and seizures of persons or
property.
a. True
b. False
Beth is an accountant with Coffee Sales Corporation. Doral buys Coffee Sales stock and
loses money on the investment. To recover from Beth under Section 10(b) of the
Securities Exchange Act of 1934 and SEC Rule 10b-5, Doral must prove
a. none of the choices.
b. fraud and reliance only.
c. fraud, reliance, and materiality only.
d. scienter, fraud, reliance, materiality, and causation only.
For consumer goods costing more than $25, a written warranty must be labeled “full or
“limited.
a. True
b. False
A limited liability company is a citizen of every state in which it does business.
a. True
b. False
Trek Transport Company uses a mark associated with its name to distinguish its
services from those of other trucking firms. This mark is
a. a certification mark.
b. a collective mark.
c. a service mark.
d. atrade name.
For an effective bailment, the bailor must deliver possession of the bailed property with
its title
a. True
b. False
Michael, a citizen of Ireland, and Nina, a citizen of the United States, enter into a
contract. When Nina breaches the contract, Michael obtains an award of damages in an
Irish court. He asks a U.S. court to enforce the award. The U.S. court defers to and
enforces the Irish courts decree. This is
a. a travesty of justice.
b. theact of state doctrine.
c. thedoctrine of sovereign immunity.
d. theprinciple of comity.
Bret obtains a fire insurance policy on his rental house with Continental Insurance
Company. Like all insurance, this policy is an arrangement for
a. avoiding the assumption of responsibility.
b. predicting a potential loss based on unknown factors.
c. shifting the imposition of liability.
d. transferring and allocating risk.
A covenant not to compete is never enforceable.
a. True
b. False
Protection against discrimination under the Civil Rights Act of 1964 does not extend to
situations in which individuals are harassed by members of the same gender.
a. True
b. False
A state long arm statute allows a court to exercise jurisdiction over out-of-state
defendants based on activities that took place within the state.
a. True
b. False
The American Law Institute was the only organization involved in developing the
Uniform Commercial Code.
a. True
b. False
Real estate transactions are always governed by Article 2 of the UCC.
a. True
b. False
Miranda orally promises Nicky that she will buy his fishing trawler for $20,000. If
Nicky acts in reliance on this promise, under the doctrine of promissory estoppel, the
transaction is enforceable by
a. either party.
b. Miranda only.
c. neither party.
d. Nicky only.
The case of Max v. National Credit Co. is heard in a trial court. The case of O! Boy! Ice
Cream Co. v. Refrigerated Transport, Inc. is heard in an appellate court. The difference
be-tween a trial and an appellate court is whether
a. the proceedings focus on the presentation of evidence and the examination of
witnesses.
b. the court is appealing.
c. the parties question how the law applies to their dispute.
d. the subject matter of the case involves complex facts.