The Dodd-Frank Wall Street Reform and Consumer Protection Act reorganizes federal
government supervision of the banking system, regulates previously unregulated
financial products and institutions, and adds a new consumer protection agency to
protect consumers from abusive lending and banking practices.
A distinguishing characteristic of embezzlement is that the wrongdoer initially had
proper custody or access to the property that was embezzled.
Co-ownership of a business is essential to create a partnership, and the most important
factor in determining co-ownership is whether the parties share the business’s profits
and management responsibility.
The failure to provide adequate instructions never constitutes a legal basis for a strict
liability claim.
The drawer can stop payment on a certified check.
Limited partners are personally liable for the debts and obligations of the LLP.
The offer can stipulate that acceptance must be by a specified means of communication.
Such stipulation is called implied authorization.
Negligent misrepresentation is commonly referred to as fraudulent misrepresentation.
At a criminal trial, if the defendant is found not guilty, the government cannot appeal.
If the board of directors of a target corporation does not agree to a merger or an
acquisition, the acquiring corporation can make a tender offer for the shares directly to
the shareholders of the target corporation.
A person who perfects a security interest by possession of the collateral is not required
to file a formal financing statement, but must publish notice in a newspaper announcing
the existence of the lien.
For a fraudulent transfer to be voided, it must have been made to an insider of the
bankruptcy petitioner.
The Federal Trade Commission is empowered to enforce federal antitrust laws.
Generally, all parties to a negotiable instrument are discharged from liability if (1) the
party primarily liable on the instrument pays it in full to the holder of the instrument, or
(2) a drawee in good faith pays an unaccepted draft or check in full to the holder.
Disparagement requires injury to the plaintiff but does not require a specific intent by
the defendant to injure.
Under the Fair Labor Standards Act, persons age 18 and older may only work a set
number of hours at a hazardous job.
Instruments that are payable at a definite time are called demand instruments.
Although CDs qualify for copyright protection, MP3 files do not.
A one-year lease for an apartment that is 12 pages long, printed, covers all details of the
parties’ obligations, and contains the dated signature of each party is a formal contract.
Some subjects, such as fringe benefits, are compulsory subjects of collective
bargaining.
A sole proprietorship can be easily transferred or sold if and when the owner desires to
do so; no other approval (such as from partners or shareholders) is necessary.
Section 2 of the Clayton Act is commonly referred to as the Robinson-Patman Act.
A negotiable instrument may be a conditional promise or order to pay.
In a processing plant franchise, the franchisor provides a secret formula or the like to
the franchisee; the franchisee then manufactures the product at its own location and
distributes it to retail dealers.
A dissolution is an order of the court declaring that a marriage did not exist.
A quitclaim deed contains the greatest number of warranties and provides the most
protection to a grantee.
Parol evidence may not be admitted in court if it explains ambiguous language.
An exculpatory clause is not valid if one, but not the other, party is released from
liability for negligence.
A person who has dealt with an insane person must place the insane person in status
quo if the contract between them is void; however, a person who has dealt with an
insane person need not place the insane person in status quo if their contract is voided
by the insane person.
The Torro system is a method of determining title to real property in a judicial
proceeding at which everyone claiming an interest in the property can appear and be
heard.
If a “month-to-month” periodic tenancy exists, under common law either party must
give a one-month notice to terminate the tenancy.
Felonies, but not misdemeanors, can be punished by imprisonment.
In the case of a life insurance policy on the insured’s own life, it is not necessary for the
named beneficiary to have an insurable interest in the insured.
Under the UCC, who holds the risk of loss in a finance lease during transit?
A) supplier or vendor
B) lessor
C) lessee
D) common carrier
E) bailee
Murder is defined as the unlawful killing of a human being by another with ________.
A) mala prohibita
B) mala in se
C) malice aforethought
D) malice afterthought
E) reasonable foreseeability
Many lending institutions offer ________ loans. These loans tie the interest rate to
some set measure, such as a major bank’s prime rate or another well-known rate; as a
result, the interest changes during the life of the loan.
A) prime
B) sub-prime
C) variable
D) jumbo
E) usurious
A local zoning law is an example of which of the following?
A) ordinances
B) statutes
C) executive orders
D) regulations
E) judicial mandates
A ________ is a long-term, unsecured instrument that is based on a corporation’s
general credit standing.
A) debenture
B) bond
C) note
D) promissory note
E) primogeniture
Assume that Congress passes a statute that bans the use of personal watercraft on any
body of water before 8:00 a.m. and after 9:00 p.m. Congress based its passage of the
law on its authority to regulate interstate commerce because it believed that fewer
persons would buy personal watercraft because of this law. In a constitutional
challenge, most likely:
A) the law would be found constitutional only if it did not conflict with a valid state
law.
B) the law would be found to violate the Equal Protection Clause because it applied on
water, but not on land.
C) the law would be constitutional because of the federal government’s police power.
D) the law would be found unconstitutional because any effect on interstate commerce
is too remote for this to be a valid exercise of federal power.
E) the laws would likely be a violation of equal protection rights under the U.S.
Constitution.
When does title pass in a lease contract?
A) when the goods are identified
B) when the goods are delivered
C) when the risk of loss transfers from the buyer to the seller
D) a title never passes in a lease contract
E) when the parties enter into the lease contract
The accountant’s duty of care to avoid negligence is determined by which of the
following standards?
A) a reasonable accountant
B) a reasonable person
C) a reasonable professional
D) a reasonable man or a reasonable woman
E) a reasonable expert
Wildboards Company introduces a product called a “Rollerboard” for which it is
granted a registered trademark. The Rollerboard is a snowboard with a removable row
of wheels along the center of the underside. With the wheels attached, the user can
attain extremely high speed in hard packed snow conditions. In addition, many users
have found that they can use their snowboards on streets with the wheels attached. This
new use of snowboards becomes very popular, and many competing snowboard makers
introduce similar products. The sport becomes known generally as rollerboarding and
most people refer to all such wheeled snowboards as rollerboards. The consequence of
this is that:
A) Wildboards cannot stop competitors from using the term “rollerboard” for their
products.
B) competitors must pay royalties to Wildboards for using the term “Rollerboard.”
C) Wildboards can no longer use the name Rollerboard on its boards.
D) competitors must put a disclaimer on its boards that they are not the original
Rollerboard.
E) Wildboards can stop competitors from using the term “Rollerboard” for their
products.
A supervening illegality of the object of a contract occurs in which of the following
circumstances?
A) the illegality existed when the offer was made
B) the object of the contract is illegal where made, but would be legal in another
location
C) the object of the contract was legal when the offer was made, but has subsequently
become illegal
D) the offeror had an honest and reasonable belief that the object of the contract was
legal when the offer was made, but later learned that the offer was illegal
E) the object of the contract was illegal when made, but has subsequently become legal
John entered into a contract with Barb to restore Barb’s antique Ford for $9,000.
Because John owes his younger brother a large sum of money, John assigned, prior to
notifying Barb of the assignment, his right to receive payment to his brother. John
began the restoration, but quickly stopped working on the car. Because of this, Barb
retrieved the car from John. Almost no restoration work had been performed. Which of
the following is true in this situation?
A) As a result of the assignment, John’s brother is entitled to payment despite the fact
that John did not perform the restoration.
B) Because of the assignment, John’s brother was responsible for John’s performance.
C) John’s brother does not have a right to collect the $9,000 from Barb.
D) Barb is obligated to allow John’s brother to complete the restoration if he so desires.
E) John’s assignment of his right to payment without Barb’s consent was improper and
discharged John’s duties under the contract.
In a lease, the tenant receives a(n) ________ estate in the real property.
A) freehold
B) fee simple
C) conditional
D) unconditional
E) nonfreehold
Workers’ compensation is a(n) ________ remedy.
A) conditional
B) unconditional
C) exclusive
D) non-exclusive
E) fault-based
The UCC statute of limitations provides that an action for breach of any written or oral
sales or lease contract must commence within ________ year(s) after the cause of the
action accrues.
A) one (1)
B) two (2)
C) three (3)
D) four (4)
E) five (5)
The parol evidence rule would not allow which of the following items into evidence
when interpreting a written contract?
A) Evidence of a price change agreed upon after the contract was signed.
B) Evidence based on prior conduct in similar contracts between the parties to explain
the meaning of an ambiguous term in the contract.
C) Evidence of an oral statement regarding the contract price made when the written
contract was signed that was different from the price in the written contract.
D) Evidence of the meaning of a term in the parties’ line of business that differs from
the meaning of that term in everyday language.
E) All the above would be allowed into evidence under the parol evidence rule.
Mary, a 68-year-old widow, hired an electrician to make some wiring repairs to her
home. The electrician accidentally started a fire that destroyed her house. Mary was not
injured, but watched her house burn along with all her possessions. It was emotionally
devastating to watch as she lost a whole life’s worth of memories. Can she recover for
the intentional infliction of emotional distress?
A) yes, because the electrician was the cause of her emotional distress through his
outrageous conduct of starting the fire
B) yes, because her distress was genuine
C) no, because the electrician did not intentionally cause the fire
D) no, because she assumed the risk by having someone do electrical work in her home
E) yes, but only if she can prove that the electrician was negligent
Felonies include inherently evil crimes known as ________ crimes.
A) mala in se
B) mala prohibita
C) mala forma
D) prohibita in se
E) forma prohibita
There are three (3.) parties to an ordinary check: (1.) the ________, the customer who
maintains the checking account and writes checks against the account; (2.) the
________, the bank on which the check is drawn; and (3.) the ________, the party to
whom a check is written.
A) payee; drawer; drawee
B) payee; drawee; drawer
C) drawer; payee; drawee
D) drawee; payee; drawer
E) drawer; drawee; payee
If the buyer pays by check, payment is ________ on the check being ________ when it
is presented to the bank for payment.
A) conditional; honored
B) unconditional; honored
C) conditional; dishonored
D) unconditional; dishonored
E) certified; processed
Which of the following is not one of the most commonly used top-level extensions for
domain names?
A) .office
B) .mobl
C) .bz
D) .name
E) .museum
________ holds that individuals must decide what is ethical based on their own feelings
about what is right and wrong.
A) Ethical fundamentalism
B) Ethical absolutism
C) Ethical relativism
D) Kantian ethics
E) Rawl’s social justice theory
An employee whose employer breaches an employment contract can recover lost wages
or salary as ________ damages.
A) dispensatory
B) liquidated
C) compensatory
D) punitive
E) nominal
Which of the following is not a privilege recognized under the Fifth Amendment?
A) psychiatrist/psychologist-patient privilege
B) parent-child privilege
C) spouse-spouse privilege
D) teacher-student privilege
E) priest/rabbi/minister/imam-penitent privilege
A(n) ________ is defined as a verification of a company’s books and records.
A) confirmation
B) certification
C) assurance
D) audit
E) affirmation
Which of the following is true?
A) The maker of a note has primary liability upon signing a note, but the drawer of a
check does not have primary liability upon signing the check.
B) The maker of a note has primary liability upon signing the note, and the drawer of a
check has primary liability upon signing the check.
C) The maker of a note has primary liability upon signing the note, and the drawee of a
check has primary liability upon the drawer’s signing of the check.
D) The drawer of check has primary liability upon signing the check, but the maker of a
note does not have primary liability upon signing the note.
E) The maker of a note does not have primary liability upon signing the note, nor does
the drawer of a check upon signing the check.
Which of the following is true regarding the General Assembly of the United Nations?
A) It is composed of ten member nations.
B) Its resolutions are normally enforced militarily.
C) It is the legislative body of the United Nations.
D) It administers to the day-to-day operations of the United Nations.
E) It adopts resolutions related to trade, finance and economics, but does not adopt
resolutions related to human rights.
Warrantless arrests are judged by the ________ standard.
A) substantial likelihood
B) proof beyond reasonable doubt.
C) absolute certainty
D) probable cause
E) foreseeability
Only ________ writings are subject to copyright registration and protection.
A) tangible
B) intangible
C) formal
D) informal
E) non-commercial
Reba works for a major bank. The revised employee handbook that she received five
years ago says that all employees with 25 years of service will receive a gold watch.
She is about to hit 25 years of service and has announced her retirement. Her manager
tells her that the company, based on her years of service, will throw her a party and
present her with a gold watch. Reba retires on her 25th anniversary and her manager
announces that the company will not throw the party or give her the watch..
A) Because of past consideration, no party or watch is owed.
B) The company is required to throw the party, but no watch is owed.
C) The company is required to present her with the watch, but no party is owed.
D) The company is required to present her with the watch and throw her the party.
E) Because Reba didn’t accept the offer, no party or watch is owed.
________, who won the Nobel Prize in economics when he taught at the University of
Chicago, advocated the theory of maximizing profits for shareholders.
A) Benjamin Stein
B) Milton Friedman
C) John Maynard Keynes
D) Adam Smith
E) Arthur Laffer
To be actionable as fraud, a misrepresentation must be of a past or existing ________
fact.
A) demonstrable
B) identifiable
C) material
D) definable
E) quantifiable
In most states today the period of minority ends:
A) upon reaching the age of 18 for both males and females.
B) upon reaching age 18 for females and age 21 for males.
C) upon reaching the age of 21 for both males and females.
D) upon marrying or reaching age 21, whichever occurs first.
E) upon reaching the legal driving age of 16 for both males and females.
The two general elements required in order to prove guilt in an intent crime are:
A) criminal act and damages.
B) criminal act and criminal intent.
C) criminal act and at least one impartial witness.
D) criminal act and resultant harm.
E) criminal act and physical injury.
How is an assessment fee billed?
A) as a flat quarterly fee
B) as a flat monthly fee
C) as a flat annual fee
D) as a percentage of gross sales
E) either as a flat monthly or annual fee, or as a percentage of gross sales