Edgy Engine Components, Inc., a maker of vehicle parts, refuses to sell to Fidgety
Fix-It, Inc., a national vehicle service firm. Edgy Engine convinces Greasy Motor Parts
Company, a competitor, to do the same. This is
a. a group boycott.
b. a market division.
c. a joint venture.
d. an exclusive-dealing contract.
Jay is a member of Kappa, LLC, a limited liability company. Jay is liable for Kappa’s
debts
a. in proportion to the total number of members.
b. to the extent of his capital contribution.
c. to the extent that the other members do not pay the debts.
d. to the full extent.
Nestor establishes a phony account in Meet+Greet, a social network, and creates a
fictitious persona to cyberbully Leona. This is
a. cyber stalking.
b. employment fraud.
c. phishing.
d. vishing.
Elise is a trustee for a federal bankruptcy court. Elise’s duties include
a. collecting a debtor’s property.
b. establishing priority for the payment of unsecured creditors.
c. operating a debtor’s business to obtain maximum profit for creditors.
d. submitting to an examination under oath by the creditors.
International Gem Corporation agrees to sell Jewel Outlets, Inc. (JOI), fifty new
diamonds, but the contract does not specify a place of delivery. JOI is expected to pick
up the goods. The place of delivery is
a. International’s place of business.
b. JOI’s place of business.
c. the Annual Gems and Jewels Convention.
d. the U.S. Postal Service office nearest to JOI’s place of business.
Congress enacts a statute to outlaw a specific type of anticompetitive business
agreement. Like other laws that regulate economic competition, this law is referred to
as
a. a federal trade commission act.
b. an antitrust law.
c. an interstate commerce act.
d. a suppressive restraint on trade.
Stan incorporates his scientific products business as Tech Supply, Inc. Unless the
articles of incorporation state otherwise, Tech Supply most likely has
a. a finite, yet-to-be-determined existence.
b. a one-year, nonrenewable existence.
c. a one-year, renewable existence.
d. perpetual existence.
Bild-Rite, Inc., is a Colorado-based firm that does business with clients throughout
North America. Bild-Rite oversees construction projects, and buys and sells commercial
buildings, undeveloped land, and construction supplies and other goods. Bild-Rite has
had to deal with work-site theft and vandalism. With respect to these circumstances, the
Uniform Commercial Code (UCC) provides a framework for
a. commercial transactions for the sale of and payment for goods.
b. international construction contracts.
c. domestic and foreign transactions in real estate.
d. prosecuting crimes against business interests.
Lee is seventy years old and Mira is gay. Based on this information, members of
protected classes include
a. Lee and Mira.
b. Lee only.
c. Mira only.
d. neither Lee nor Mira.
Caleb is a witness in a controversy involving the U.S. Drug Enforcement
Administration. Caleb can be compelled to appear before an administrative law judge if
he is served with
a. an order for specific performance.
b. a rule for parol evidence.
c. a subpoena.
d. a politely worded request.
Timber, Inc., and Wood Corporation enter into an oral contract for the sale of a lumber
mill and the land on which it is situated from Timber to Wood. Under the Statute of
Frauds, this contract is enforceable by
a. the seller.
b. the buyer.
c. any interested third party, such as the mortgagee or title company.
d. none of the choices.
Truckers Storage Depot, a private company, wants to build a warehouse on private land.
For this action, an environmental impact statement is
a. prohibited.
b. required.
c. unnecessary.
d. voluntary.
Fact Pattern 26-2
In January, Jazz Dance Studio owes Kay, its musical director, $1,800 for current wages,
receives $700 as a down payment for dance lessons from Lora, and pays a Music, Inc.,
a sheet music supplier, $1,500 of $3,000 owed. In February, the studio files for
bankruptcy under Chapter 7.
Refer to Fact Pattern 26-2. The highest priority with respect to payment of claims
belongs to
a. Kay and Music, Inc.
b. Jazz Dance Studio.
c. Lora.
d. unnamed general creditors.
Wanda tells Vito that she would like to buy his Chocolate Goodies store. Vito declines,
but later decides to sell and sends to Wanda, and others, a flyer describing the details.
Wanda responds with a letter of “acceptance.” Wanda and Vito have
a. a contract.
b. no contract, because Vito sent the letter to more than one party.
c. no contract, because Vito was only inviting bids.
d. no contract, because the letter was an invitation to negotiate.
Genie.com initiates an online dating service. To attract subscribers and encourage
participation, Genie.com creates and posts profiles of fictitious persons and exaggerated
profiles of actual users. Fooled by the false profiles, Ham buys a subscription. He is
most likely a victim of
a. undue influence.
b. fraud.
c. mistake.
d. nothing.
Chemo Solvents Corporation has waste that it wants to discharge into navigable waters.
Under the Clean Water Act, Chemo must apply for a permit
a. after discharging waste.
b. before discharging waste.
c. during the discharge of waste.
d. only if a regulatory agency challenges the discharge.
Lia works for Media Marketing Company. Her job includes putting ‘spin” on the firm’s
successes and failures. In this context, ethics consist of
a. “bad” versus “good” publicity.
b. questions of rightness and wrongness.
c. the firm’s quarterly revenue.
d. whatever is legal.
Hadley, an accountant, accumulates working papers while performing an audit for Ilene.
After the audit, these documents belong to
a. Hadley, with Ilene having a right of access to the papers.
b. Ilene, with Hadley having a right of access to the papers.
c. neither Hadley nor Ilenethe papers must be disposed of.
d. the Public Company Accounting Oversight Board.
Lena offers Miguel a job, representing falsely that it will be long term. In reliance,
Miguel takes the job but is laid off shortly thereafter and successfully sues Lena for
fraud. With respect to the employment-at-will doctrine, this is
a. an example of the doctrine.
b. an exception based on contract theory.
c. an exception based on public policy.
d. an exception based on tort theory.
Dino hires Eve to perform at Dino’s Club, but Eve later breaches the agreement to
accept a higher-paying job at First Star Arena. Dino files a suit against Eve. The court
will most likely
a. award damages to Dino.
b. cancel Dino and Eve’s contract.
c. order Eve to perform the contract.
d. reform Dino and Eve’s contract.
The U.S. Congress enacts a new federal statute that imposes liability on businesses
emitting significant amounts of a certain pollutant into the environment. This statute
applies
a. only to matters not covered by state law.
b. only to those states that adopt the statute.
c. to all of the states.
d. to none of the states.
The legislature of the state of Missouri enacts a new statute that sets standards for the
liability of businesses selling defective products. This statute applies
a. only in Missouri.
b. only in Missouri and its border states.
c. in all states.
d. in all states but only to matters not covered by other states’ laws.
Clayton dies without a will. The distribution of Clayton’s property, including his farm
near Lincoln, Nebraska, is prescribed by
a. a court-appointed executor.
b. federal probate statutes.
c. state intestacy laws.
d. the degree of consanguinity between Clayton and his next of kin.
EZ Credit Company signs an instrument payable to the order of Flem that states, “The
maker of this note at the date of maturity, May 1, 2013, can extend the time of payment,
but for no more than a reasonable time.” This instrument is
a. negotiable.
b. nonnegotiable, because it includes an extension clause.
c. nonnegotiable, because it is not payable within a definite time.
d. nonnegotiable, because it is payable to a specific payee.
In Las Vegas, Nevada, Kurt places a bet on a football game with a bookmaker via a
Web site based in Las Vegas. In Cleveland, Ohio, Dorothy places a bet on the same
game with a bookmaker via a Web site based in Cleveland. Gambling is regulated in
a. all states.
b. only a few states.
c. no state.
d. Ohio only.
Petra signs a check payable to Quincy, who indorses the back, gives it to Regional
Credit Union, and receives cash. The transfer of the check from Quincy to the credit
union is
a. an assignment.
b. a negotiation.
c. a payment.
d. a sale.
Thalia is an employee of Universal Insurance Company. Universal’s employee manual
states that workers will be dismissed only for good cause. With respect to the
employment-at-will doctrine, this is
a. an example of the doctrine.
b. an exception based on contract theory.
c. an exception based on public policy.
d. an exception based on tort theory.
In a suit against Clem, Dona obtains the cancellation of a contract. This is
a. an injunction.
b. damages.
c. rescission.
d. specific performance.
Wally’s Warehouse offers to sell a certain used forklift to Value Lumber Outlet, but it is
stolen before Value accepts. Most likely, Wally’s must obtain
a. a forklift for Value if Wally’s insurance covers the loss.
b. a forklift for Value if it still wants one.
c. nothing for Value because that would extend the time of the offer.
d. nothing for Value because the theft terminated the offer.
Jack and Kyra are partners in Law Firm, LLP, a limited liability partnership. Jack
supervises Kyra, who negligently fails to appear in court on behalf of Milo, a client.
Liability to Milo rests with
a. Jack and Kyra.
b. Jack only.
c. Kyra only.
d. neither Jack nor Kyra.
A person who enters into a contract when he or she is intoxicated can void the contract
if the terms are obviously favorable to the other party.
The checks and balances in the U.S. Constitution prevent any one branch of
government from exercising too much power.
A check “payable to the order of bearer” is neither an order instrument nor a bearer
instrument.
State and local government projects require federal environmental impact statements.
A contract is always enforceable even if one party is aware that the other party made a
mistake of fact.
Non-workers do not have a right to picket an employer during a strike.
In choosing a form of business organization for a new enterprise, important factors
include the ambiance of the home office.
Administrative agencieslike the Securities and Exchange Commission, the Federal
Trade Commission, and the Food and Drug Administrationmake rules. What are the two
basic types of rules called, and how binding are they? What must an administrative rule
NOT do?
Offers may not be revoked before they are accepted.
A person has an insurable interest in property if he or she would sustain a financial loss
from damage to the property.
A certification mark distinguishes products approved, or “certified,” by the government.
Inadequate consideration may indicate undue influence.
Exchanging pirated, copyrighted works with others is a not crime unless money is
involved.
A franchisee normally does not pay a fee for a franchise license until after the first year
of using it.
Unless the parties agree otherwise, the buyer must make payment at the time and place
that the goods are received.
Most contracts are discharged by rescission.
An offer to form a unilateral contract is accepted by a promise to perform.
To pierce the corporate veil means to ignore the corporate structure, exposing the
shareholders to personal liability.
Any conspiracy that has a substantial effect on U.S. commerce is within the reach of the
U.S. antitrust laws.