In most states, a person must be sixteen years of age to execute a valid will.
a. True
b. False
The Childrens Internet Protection Act requires public schools and libraries to use
filtering software to block childrens access to adult contact on Web sites.
a. True
b. False
An employees resignation must be the foreseeable result of an employers
discriminatory action to support a showing of constructive discharge.
a. True
b. False
It is not a crime to defraud the public through the use of ads on television.
a. True
b. False
Title VII of the Civil Rights Act of 1964 prohibits only intentional discrimination.
a. True
b. False
Dina asks Edie to co-sign a credit application so that she can borrow money and buy a
truck from First Street Motors. If, after the loan agreement is signed, Dina agrees to a
higher rate of interest without telling Edie, then Edie is
a. discharged from the agreement.
b. liable at the higher rate of interest.
c. liable at the lower rate of interest.
d. liable for the principal only.
With respect to Egors land, Fig has an easement, Gabe has a profit, and Huck has a
license. A right to possess the land is owned by
a. Egor.
b. Fig.
c. Gabe.
d. Huck.
In no states are communications between an accountant and his or her client privileged.
a. True
b. False
Julia is an agent who purchases wool for Karas Knitting Company. In the course of her
performance for Karas Knitting Company, Julia pays for the gas for the company car
and for some storage boxes for the wool. Karas Knitting Company must reimburse Julia
because of the principals
a. duty of performance.
b. duty of loyalty.
c. duty of compensation.
d. duty of reimbursement.
A constructive trust is “constructed by a property owner to fulfill certain unique
functions outside the usual bounds of a trust.
a. True
b. False
Benny dies without a will, with no surviving spouse or child. Bennys survivors in-clude
his granddaughter Callie, his nephew Duncan, and his cousin Earl. In most states, his
estate would pass to
a. Callie.
b. Duncan.
c. Earl.
d. the state.
Any judgment is enforceable.
a. True
b. False
The possession of land without right is a tenancy at will.
a. True
b. False
The implied warranty of habitability does not apply to substantial physical defects that a
landlord has had a reasonable time to repair.
a. True
b. False
In general, if a contract is illegal, a court will not enforce it.
a. True
b. False
Bayou Boats, Inc., contracts for the sale of seven swamp boats to Eventide Fishing
Tours. Bayou repudiates the contract. Eventides recovery is measured at the time
a. Bayou advertised the goods.
b. Eventide ordered the goods.
c. Eventide learned of the breach.
d. Bayou knew that it would repudiate the contract.
An expression of opinion will usually create a warranty.
a. True
b. False
Frida hires Gert, a real estate broker, to act as her agent to sell her house. The house
burns down before being sold. The agency agreement is likely
a. still in force if Frida gives Gert additional consideration.
b. still in force if Gert does not tell prospective customers.
c. terminated by mutual consent of the parties.
d. terminated by operation of law.
If goods identified to a contract are destroyed through no fault of either party, both
parties are excused from performance.
a. True
b. False
The date when the principal of a bond is returned to the investor is called the maturity
date.
a. True
b. False
According to the view that New Allied Manufacturing Corporation is a “citizen, New
Allied is expected to
a. participate in bettering communities and society.
b. primarily generate revenue for its owners.
c. have no responsibility other than profit maximization.
d. efficiently allocate scarce resources.
Soleful Shoes, Inc. owns property in Somalia. The Somalian government seizes the
property. In order for the seizure to be considered an expropriation and not a
confiscation, the Somalian government must
a. pay just compensation to Soleful Shoes.
b. give Soleful Shoes at least thirty days notice of the seizure.
c. give Soleful Shoes at least ninety days notice of the seizure.
d. notify the U.S. government before the seizure.
There is at least one federal district court in every state.
a. True
b. False
Wendy works as a weather announcer for a TV station under the character name
Weather Wendy. Wendy can register her name as a
a. a certification mark.
b. a collective mark.
c. a service mark.
d. atrade name.
Scot and Tiffany enter into an implied contract. The parties conduct
a. defines the contracts terms.
b. finds the contracts facts.
c. terminates any unintended consequences.
d. undercuts any terms based on the facts.
Jon says to Kristy, “I would like to sell you my sports memorabilia collec-tion. This is
not an offer because it
a. does not describe the subject matter sufficiently.
b. does not include a price term.
c. only expresses an opinion.
d. only invites Kristy to negotiate.
Lyla is a common shareholder in Normans Nutty Nuts Corporation. As a common
shareholder, Lyla is
a. guaranteed regular payments of dividends.
b. not guaranteed any payments of dividends.
c. not given any voting rights.
d. liable for all of Normans Nutty Nutss debts.
Sellers or lessors are liable only for products that are reasonably dangerous.
a. True
b. False
In a sole proprietorship, the owner receives 90 percent of the profits and the
government receives 10 percent.
a. True
b. False
Under the UCC, if a contract does not designate the place of delivery for the goods,
then the goods must be made available at a location halfway between the sellers and the
buyers places of business.
a. True
b. False
A personal check cannot be a negotiable instrument.
a. True
b. False
In some cases, foreign states are not immune from the jurisdiction of U.S. courts. These
circumstances are governed by
a. theUniform Commercial Code.
b. theForeign Sovereign Immunities Act.
c. theEuropean Union.
d. theNorth American Free Trade Agreement.
A preexisting duty may arise from a previous contract.
a. True
b. False
Many different laws may apply to a single business transaction.
a. True
b. False
Adhering strictly to all business laws is all that is necessary to fulfill all business ethics
obligations.
a. True
b. False
A pipe in Gerts house springs a leak. Gert contracts with Hollys Plumbing &
Construction Company to repair the pipe and fix the dam-age to Gerts house. Gert pays
10 percent of the price in advance. Hollys does the work, but Gert refuses to pay the
rest of the price. What can Hollys do, and how is it done?
Andy leases to Burgertown Franchise Corporation a 10,000 square-foot building under
a written lease with a twenty-year term, rent payable an-nually. The lease includes a
clause stating that Burgertown is re-sponsi-ble for making all necessary repairs,
including rebuilding the structure after its destruction by any cause beyond Andys
control. The lease does not include a clause concerning its assignment. One day after
the tenth rental payment, Burgertown, without Andys knowledge or consent, as-signs its
interest in the lease to Chicken Hut Restaurants, Inc. Mean-while, Andy dies and Dotty
inherits Andys interest in the building. Without the knowledge or consent of either
Burgertown or Chicken Hut, Dotty sells the building to Earnest Investments, Inc. The
next month, the building is destroyed in the flood of a nearby river. Burgertown rebuilds
it and files a suit against Earnest for the expense. Earnest responds that the lease has
terminated. Is Earnest correct? If so, when did the lease termi-nate? If not, is Earnest
liable for the cost of re-building the structure? Why or why not?
Shippers Dispatch Corporation orders office equipment from Office Outfitters, Inc.,
which has an unperfected security interest in the equipment until it is paid for.
Meanwhile, Shippers Dispatch takes out a loan from Capital Credit, Inc., subject to a
security interest in Shippers Dispatchs building and equip-ment, which Capital perfects.
Shippers Dispatch files a bankruptcy petition under Chapter 7. If the petition is granted,
in what or-der will Shippers Dispatchs creditors be paid?
Ed, a businessperson, is a friend of Fran, the owner of a Percolated Coffee & Baked
Goods store. Every day, Ed spends five minutes in Frans store, looking at the goods and
usually buying one or two cinnamon buns or bagels. One afternoon, Ed goes into the
store, looks at the items, and picks up a $1 chocolate brownie. Ed waves the brownie at
Fran without saying a word and walks out. Is there a con-tract? If so, how would it be
classified in terms of formation, perform-ance, and enforceability?
For twenty years, Ozzie works for Players Paradise, a destination for vacationers from
across the United States, maintaining golf carts. After a steady stream of positive job
evaluations and merit pay raises, Ozzie is promoted to the position of supervisor of
golf-cart maintenance at three of Playerss courses. Five years later, a new employee,
Quentin, is hired to oversee operations at all ten of Playerss courses. Quentin demotes
Ozzie, who is now over the age of forty, to running only one of the three cart facilities,
and freezes his salary. Quentin demotes five other employees over the age of forty and
places one of Ozzies former facilities under the supervision of Richie, who is
twenty-three. Ozzie overhears Richie say, “Were going to have to do away with these
old, senile men. Less than a year later, Quentin reconsolidates the three cart facilities
operations under Richies charge. Ozzie quits and files a suit against Players for
employment discrimination. Should he prevail? Explain.