The person to whom the order in a draft is addressed is known as the:
a. payee.
b. drawee.
c. drawer.
d. maker.
A term of a lease required that the landlord provide exterminating services monthly to
control rats and other pests. The landlord failed to do this despite numerous requests
placed by the tenant, and the premises became overrun by rats. This may be considered:
a. a breach of the covenant of quiet enjoyment.
b. a physical eviction.
c. active waste.
d. a constructive eviction.
Corporations may ________ officers, directors, employees, and agents when they act in
good faith, in a manner not opposed to corporate interests and with no reason to believe
their conduct was unlawful.
a. ratify
b. breach
c. indemnify
d. authorize
The Robinson-Patman Act:
a. prohibits charging different prices to different buyers when the margin costs are the
same.
b. allows sellers to offer incentives and bonuses to certain customers.
c. allows sellers to refuse to deal with anyone for any reason.
d. all of the above.
A holder through a holder in due course:
a. has greater rights than a holder in due course.
b. has fewer rights than a holder in due course.
c. has the same rights as a holder in due course.
d. must meet the requirements for becoming a holder in due course in order to achieve
holder in due course status.
An employment contract of indefinite duration is:
a. terminable at will by the employer.
b. terminable at will by the employee.
c. both a. and b.
d. invalid.
Which of the following is a correct legal conclusion regarding reorganization
bankruptcy?
a. Individuals, partnerships, and corporations in business may be reorganized.
b. A plan for reorganization may be filed only by a committee of creditors.
c. When a reorganization plan is confirmed by the court, the creditors can revert back to
their original position if they are not satisfied with the plan.
d. Individuals within a particular class of creditors can be treated differently if they
object to the reorganization plan.
An unlawful sale under the Insider Trading Sanctions Act of 1984 can result in a civil
penalty of up to how many times the profit gained or loss avoided?
a. two (2)
b. three (3)
c. four (4)
d. five (5)
An individual who has been authorized to vote the share of another stockholder is said
to be voting by:
a. trust.
b. proxy.
c. estoppel.
d. agency.
To be negotiable, an instrument must:
a. be in writing.
b. be signed by the maker or the drawer.
c. contain a promise or order to pay.
d. all of the above.
The degree of care required of a person is:
a. that degree of care the person exercised in the situation at hand.
b. that degree of care an extraordinary person would exercise under similar
circumstances.
c. that degree of care an ordinarily prudent person would exercise under similar
circumstances.
d. none of the above.
When a bailor sues the bailee for damages to the bailed property, who has the burden of
proving fault and that such fault was the proximate cause of the bailor’s loss?
a. the person in possession of the property
b. the bailor
c. the bailee
d. the jury
Frank has two interests in property. On property “X,” Frank has a life estate measured
by the life of his Uncle Sal. On property “Y,” Frank has a fee simple estate. Frank
wishes to transfer, upon his death, his interest in the two properties to his wife,
Samantha. Prior to Frank’s executing his will, Uncle Sal dies. Frank still wishes to will
the properties to his wife, but he now is uncertain whether he has the right to do so. Can
Frank will the two property interests to Samantha?
Under the Sherman Act competitors are permitted to agree not to deal with certain
buyers.
Liens on land may be created voluntarily by the owner of land or involuntarily against
the wishes of the owner.
Courts tend to resolve ambiguities in limited partnership agreements against the general
partners.
Consequential damages are those that necessarily flow from the breach.
A firm offer is an offer that states that it is to be irrevocable, or irrevocable for a stated
period of time.
Moral standards based on positive law may allow businesses to conduct themselves
unfairly so long as their actions are not illegal.
An implied warranty arises automatically from the fact a sale has been made.