Travis had too many beers at the baseball game. Ed realized Travis was so intoxicated
he wouldnt know what he was doing, so he got Travis to sign a promise to sell his
motorcycle to Ed for $50. When Travis gets sober, he may void the contract.
a. True
b. False
Immanuel Kant was a German philosopher who was a proponent of utilitarian ethics.
a. True
b. False
Tariffs are generally higher in developing countries than in developed countries.
a. True
b. False
A valid contract can legally be voided by either party.
a. True
b. False
The doctrine of estoppel would most often apply in situations of:
a. implied authority.
b. apparent authority.
c. transaction authority.
d. actual authority.
A product liability case may be brought in warranty, negligence, or strict liability, but it
must have the element that a person or business has been hurt by goods.
a. True
b. False
The CAN-SPAM Act:
a. applies to virtually all promotional e-mails, whether or not the sender has a
pre-existing relationship with the recipient.
b. provides unavoidable requirements for senders of promotional e-mails.
c. requires recipients of unsolicited, pornographic e-mails to notify the Justice
Department.
d. requires senders of promotional e-mails to provide a valid return address, which may
be a post office box or a specific physical location.
Heather applied for a promotion, but her manager promoted a co-worker because the
manager knew Heather was seven months pregnant. The manager did not want to
promote someone who would probably be taking time off of work for childbirth and
child care. The manager has acted legally and reasonably to protect her companys
interests.
a. True
b. False
If a consumer cancels a door-to-door sale within the required time, how many days does
the seller have to return the buyer’s money?
a. Three.
b. Ten.
c. Twenty-one.
d. Thirty.
A letter of intent is not likely to be enforceable unless:
a. there is a clearly stated start date for the contract.
b. both parties agree on compensation.
c. it is clear that both parties intended to be bound by the letter.
d. conditions in the letter are met.
Hanna intends to give her granddaughter, Melodee, her antique hat pin. This heirloom
has been kept under lock and key in the wall vault in the library of Hannas house in
Virginia. The hat pin is currently the only item in the vault. When Hanna is visiting
Melodee in Connecticut, Hanna gives Melodee the only key to the vault. Melodee is
grateful for the present and excitedly accepts. In this situation has there been a
completed gift?
a. No. There has been no physical delivery of the hat pin.
b. Yes. There has been physical delivery of the hat pin.
c. No. There has only been constructive delivery of the hat pin.
d. Yes. There has been constructive delivery of the hat pin.
Mark signs a periodic year-to-year lease at the River’s Edge Warehouse. After the year
expires, Mark stays in the warehouse and the landlord acquiesces. Mark:
a. has a month-to-month periodic lease, which can be terminated by either party’s giving
a 30-day notice.
b. has a tenancy at sufferance which is not a true tenancy at all.
c. has another one-year lease. Periodic tenancies automatically renew unless either party
gives proper notice to the other that the tenancy will terminate upon the expiration of
the time period.
d. None of the above.
Why should ethics be a concern to business?
a. Society as a whole benefits from ethical behavior.
b. People feel better when they behave ethically.
c. Unethical behavior can be very costly.
d. All of these.
Standard provisions in a contract that are often listed under the heading “Miscellaneous
are called:
a. boilerroom.
b. boilerplate.
c. boilerpot.
d. boilertape.
Firing an employee for her refusal to violate the law would raise a claim of wrongful
discharge.
a. True
b. False
Which of the following is a valid defense to a defamation claim?
a. The statement was true.
b. The statement was only an opinion.
c. The person making the statement made it only to the plaintiff, not to any third parties.
d. All of the above.
The statute of limitations for breach of warranty under the UCC is?
a. one year.
b. two years.
c. three years.
d. four years.
Psychologist Holtz is working with a patient, Rebecca, who has expressed the intention
to seriously harm two of her acquaintances. If you apply the principle set forth by the
Supreme Court of California in the Tarasoff v. Regents of the University of California
case, Psychologist Holtz:
a. has, because of the bystander rule, no duty to warn the foreseeable victims about
Rebeccas expressed intention to harm them.
b. has a duty to exercise reasonable care to protect foreseeable victims of Rebeccas
violence.
c. is in a special relationship with patients, and this relationship creates a privilege of
confidentiality between the communicants.
d. will be held to a strict duty of care and will be held liable for any victims injuries if
Holtz failed to warn them of Rebeccas potential violence toward them.
The Johnsons decided to sell their summer cabin on Beech Lake. They sent flyers out to
all who previously had expressed an interest in buying the cabin stating that they were
planning on selling their cabin. The flyer described the location of the property, the size
of the lot, and the price. If one of the recipients responds by sending a letter accepting,
an agreement:
a. will not be formed because the flyer was sent out as an invitation to make an offer.
b. will be formed because the first to respond gets the property.
c. will be formed because the price is included.
d. will not be formed because of the parol evidence rule.
An insurance contract is not considered to be a legalized form of gambling because:
a. one must have an insurable interest in the person being insured.
b. insurance contracts are underwritten by reputable companies.
c. insurance activities are regulated by the state department of insurance.
d. All of the above.
Assume that three automobile manufacturers all merged into one car company. Such a
merger would be a:
a. vertical merger.
b. vertical cooperative arrangement merger.
c. horizontal merger.
d. intracompetitive merger.
MagNet, a small United States computer company, started doing business in a foreign
country. The foreign country later decided to take over all computer industry, including
MagNet’s operation. The foreign country paid MagNet adequate compensation in
United States dollars. The foreign countrys action is called:
a. comity.
b. repatriation.
c. expropriation.
d. inflow profit streaming.
Both the buyer and seller may have an insurable interest in the same goods at the same
time.
a. True
b. False
“Scriveners error is another (fancier) name for a typo.
a. True
b. False
Unethical behavior in an organization can create:
a. a cynical workforce.
b. a resentful workforce.
c. an unproductive workforce.
d. All of these.
A security interest in money may be perfected by:
a. filing a financing statement.
b. creating a PMSI.
c. possession only.
d. redemption.
The purpose of the Export Administrative Act of 1985 is:
a. to set national quotas on exported goods.
b. to limit the export of certain items which may pose a security risk.
c. to document all new exports to facilitate tracking.
d. All of the above.
Axle Corporation imports goods into the United States. Who is required to pay the duty
on the imported goods?
a. The importer, Axle Corporation.
b. The World Trade Organization.
c. Each party pays one-half the duty.
d. The exporter of the goods.
In a derivative lawsuit, the named plaintiff:
a. is the corporation on whose behalf the lawsuit is filed.
b. is the particular class of shareholders primarily injured by the wrong.
c. consists of all the corporation’s shareholders.
d. is the board of directors for the corporation.
Stanziano Construction needs a backhoe to complete a project. If it pays Hofmann
Rentals for temporary use of the equipment, the transaction will be governed by:
a. Article 2 of UCC.
b. Article 2A of the UCC.
c. Article 3 of the UCC.
d. bulk transfer law.
Section 2-306 of the UCC expressly disallows output contracts in the sale of goods.
a. True
b. False
By creating three independent and equal branches of the federal government, the U.S.
Constitution prevented the federal governments power from being concentrated in one
person.
a. True
b. False
Wilfred was driving at a normal rate of speed, unaware of the icy bridge ahead. He slid
on the ice and hit Sally’s car. Sally can sue Wilfred in criminal court.
a. True
b. False