Island Breeze Company designs and makes desk, window, and ceiling fans. In a product
liability suit based on negligence, Island Breeze could be liable for vioÂlating its duty
of care with respect to all of the following except
a. the design of the fans.
b. the production process used to make the fans.
c. the warnings on the labels of the fans.
d. a consumer’s unforeseeable misuse of a fan.
Answer:
Fresh Fruit Company has assets of less than $10 million and fewer than fifty
shareholders. Gourmand Pastries, Inc., has assets of more than $50 milÂlion and more
than five hundred shareholders. The Securities Exchange Act of 1934 applies to
a. Fresh Fruit and Gourmand Pastries.
b. Fresh Fruit only.
c. Gourmand Pastries only.
d. neither Fresh Fruit nor Gourmand Pastries.
Answer:
Closed meetings of the National Security Agency and other federal administrative
agencies are permitted when
a. the subject of the meeting concerns accusing a person of a crime.
b. open meetings would frustrate the implementation of future actions.
c. the subject of the meeting involves matters relating to future litiÂgaÂtion or
rulemaking.
d. all of the choices.
Answer:
Miranda is a U.S. citizen working in Europe for Tourist Vacations, Inc., a U.S. travel
agency. Tourist fires Miranda for reasons that she believes vioÂlate U.S. antidisÂ-
crimination laws. Those laws apply
a. extraterritorially.
b. only to signatories of the North American Free Trade Agreement.
c. only to members of the World Trade Organization.
d. only within U.S. borders.
Answer:
Cattle Ranch Company offers its stock for sale only in a single state. The law in Cattle
Ranch’s state is like the law in most states. Cattle Ranch’s offer is subÂject to state
securities statutes that include
a. antifraud and disclosure provisions.
b. antifraud provisions only.
c. disclosure provisions only.
d. neither antifraud nor disclosure provisions.
Answer:
Miklos employs Nathalie to handle a list of financial transactions on Miklos’s behalf.
This power will terminate on
a. any transaction causing a loss to Miklos.
b. Miklos’s death or incapacity.
c. Miklos’s sixty-fifth birthday.
d. Nathalie’s handling of one of each stipulated transaction.
Answer:
Valley View Construction Corporation wants to obtain a zoning variance for a part of its
property. The variance must not
a. compromise the campaign promises of the zoning board members
b. include a burden that has a connection to the property.
c. result in a profit for its proponent.
d. alter the essential character of the property.
Answer:
Febo is an employee of Guitar & Drum Company. Guitar & Drum’s employee manual
states that workers, such as Febo, 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.
Answer:
Lipstik, Inc. makes cosmetics. Lipstik intentionally mislabels its packaged products to
conceal a defect. Trusting and relying on the mislabeling, Mikayla buys a Lipstik
product and suffers an injury. Lipstik is most likely liable for
a. product misuse.
b. fraud.
c. privity.
d. puffery.
Answer:
Leif files a petition in bankruptcy. Among his debts are unÂpaid taxes, fines owed to
the government, student loans owed to Metro University, and support owed to his
ex-wife Nadia. Most likely to be disÂcharged are
a. back taxes accrued within the previous three years.
b. fines outstanding less than eight years.
c. student loans whose payment would impose undue hardship.
d. spousal-support debts unpaid for more than eighteen months.
Answer:
Jayne develops a new color of lipstick. To market her lipstick, Jayne uses a computer
design program to show a famous model using Jayne’s lipstick. Jayne does not ask the
model’s permission. The model can sue Jayne for
a. battery.
b. fraudulent misrepresentation.
c. defamation.
d. appropriation.
Answer:
FastBreak Inc. is dissatisfied with its ranking in Google Inc.’s search results. FastBreak
files a suit against Google, seeking an injunction. Google argues that its search results
are constitutionally protected speech. FastBreak’s best argument against Google’s
position is that
a. the First Amendment protects humans against state censorship and protecting a
computer’s speech is not related to that purpose.
b. the trillions of decisions made by computers each day do not all constitute protected
speech.
c. computerized algorithms, which generate computer language, do not constitute
speech.
d. search results constitute commercial speech, for which the First Amendment provides
only limited protection.
Answer:
BioChem Corporation, ChemCo Company, and DexLabs Inc. make and distribute toxic
chemicals. In a product-liability suit against all of these parties, the court is most likely
to impose market-share liÂability if it cannot be proved which of the parties
a. was in privity with the injured plaintiff.
b. exercised the least amount of due care in making the product.
c. supplied the particular product that caused the injury.
d. holds the largest share of the market for the product.
Answer:
Dina asks Edie to co-sign a credit application so that she can borrow money and buy a
piano from First Chair, a musical instruments and supplies seller. 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.
Answer:
Juan is a judge. How Juan and the judges in other courts interpret a particular statute
determines
a. how that statute will be applied.
b. how the law needs to be changed.
c. how the common law should be codified.
d. nothing.
Answer:
Kamal reproduces Lorena’s copyrighted work ‘Musica’ without paying royalties. Kamal
is most likely excepted from liability for copyright infringement under the ‘fair use’
doctrine if
a. Kamal copies the entire work.
b. Kamal distributes the copies without charge to the public.
c. Kamal’s use has no effect on the market for Lorena’s work.
d. Kamal’s use is for a commercial purpose.
Answer:
The U.S. Congress enacts a new federal statute that imposes liability on businesses
hiring employees without verifying their citizenship status. This statute applies
a. only to businesses not covered by state law.
b. only to those states that consent to apply it.
c. to all of the states.
d. to none of the states.
Answer:
Intoxicated but still capable of comprehending the consequences of her actions, Cricket
signs a contract to sell her phone app design to Downloads, Inc. This contract is
a. unenforceable because Cricket was intoxicated.
b. enforceable.
c. unenforceable if Cricket disaffirms it.
d. unenforceable if Downloads disaffirms it.
Answer:
The Wisconsin state legislature enacts a statute that prohibits the advertising of video
games ‘because the games might be harmful to minors.’ Despite this new statute, the
president of xGamez, Inc., orders xGamez marketers to place ads in various media.
When an xGamez ad appears on YUTV, a local television station, xGamez and YUTV
are charged with violating the statute. What is the defendants’ best defense against a
conviction?
Answer:
Mango Corporation believes that Melon Corporation engages in anticomÂpetiÂtive
behavior in an attempt to drive Mango and its other competitors out of the market.
Antitrust laws can be enforced against Melon by
a. Mango and Melon’s other competitors.
b. Mango and Melon’s customers.
c. any federal government agency.
d. any business with a significant impact on interstate commerce.
Answer:
Directors are prevented from ever having financial dealings with the corporations they
serve.
Answer:
An action in strict product liability requires that a product be in a defective condition
caused by its purchaser.
Answer:
Under a shipment contract, if the seller does not make a reasonable contract for
transportation or notify the buyer of the shipment, the buyer can reject the goods if a
material loss results.
Answer:
The tort of trespass to land is designed to protect the right of an owner to exclusive
possession.
Answer:
Most states do not allow automobile repair shops to hold a customer’s car when the
customer refuses to pay for repairs already completed.
Answer:
One of the key advantages of the corporate form is the unlimited liability of its owners.
Answer:
Generally, the strict liability of manufactures and other sellers does not extend to
injured bystanders.
Answer:
A principal is always directly responsible for an agent’s misrepresentation made within
the scope of the agent’s authority.
Answer: