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A[n] ______ deed is the most commonly used deed to transfer property and contains
certain promises by the grantor.
A. Quitclaim
B. Special warranty
C. Approved
D. General warranty
E. Specific
Which of the following was a finding of the court in Shiftan v. Morgan Joseph Holdings
Inc., the case in the text involving stock appraisal rights following a merger?
A. That standard rules of contract interpretation do not apply to the interpretation of
certificates of incorporation.
B. That the rule of contra proferentem, meaning that contracts are construed in
accordance with standard criteria for contract interpretation, is applied when
interpreting certificates of incorporation.
C. That parol evidence, while often available, is inadmissible when interpreting
certificates of incorporation.
D. That an appraisal proceeding takes into account and considers any relevant element
of value arising from the accomplishment or expectation of a merger or consolidation.
E. That in valuing the stock at issue, the fact that the stock would have been entitled to a
mandatory redemption a few months after the merger was irrelevant.
Fixtures are treated like ______ property.
A. Real
B. Personal
C. Valued
D. Appraised
E. Substantive
A[n] ______ is a judgment in favor of the plaintiff that occurs when the defendant fails
to answer the complaint, and the plaintiff's complaint alleges facts that would support
such a judgment.
A. Default judgment
B. Automatic judgment
C. Delineated response judgment
D. Dismissal
E. Pleading judgment
Which of the following describes a plan set up by ABC Company whereby its other
shareholders may purchase shares of ABC stock at a significantly reduced price if any
individual or entity obtains a majority of ABC Company's stock?
A. Protection method
B. Beachhead defense
C. Poison pill
D. Exchange offer
E. Chose in action
Which of the following is true regarding material considered goods under the UCC?
A. Minerals taken from real estate and sold by the owner, soil taken from real estate and
sold by the owner, and the right to remove soil from real estate are all considered goods
under the UCC.
B. Soil taken from real estate and sold by the owner is considered a good under the
UCC, but neither minerals taken from real estate and sold by the owner nor the right to
remove soil from real estate are considered goods under the UCC.
C. The right to remove soil from real estate is considered a good under the UCC, but
neither minerals taken from real estate and sold by the owner nor soil taken from real
estate and sold by the owner are considered goods under the UCC.
D. Minerals taken from real estate and sold by the owner and soil taken from real estate
and sold by the owner are considered goods under the UCC, but the right to remove soil
from real estate is not considered a good under the UCC.
E. Minerals taken from real estate and sold by the owner and the right to remove soil
from real estate are considered goods under the UCC, but soil taken from real estate and
sold by the owner is not considered a good under the UCC.
Which of the following is the difference between the amount of money the plaintiff
earned since the discriminatory act and the amount of money she or he would have
earned had the discriminatory act never occurred?
A. Front pay
B. Statutory pay
C. Back pay
D. Mandated pay
E. Employment-based pay
"Partnership Disruption." Bruce, Sandra, and Minnie want to form a partnership to
assist students with resume preparation and employment searches. Bruce asks Sandra
and Minnie if they should draw up some sort of agreement. Sandra replies that a written
agreement is not legally required and that an oral agreement will set up a partnership.
Upon the urging of Bruce and Minnie, however, Sandra agreed to a written document
which they all signed setting up the partnership. It was a simple agreement listing the
partners that did not specifically address the right to management or allocation of
profits and losses. Sandra has an opportunity to assist some students with resumes and
does so without revealing her employment to the partnership. She keeps the funds she
receives for herself. When Bruce and Minnie found out, Sandra replied that she was
doing two-thirds of the partnership work, particularly in regard to management; that
she, therefore, had two-thirds of the voting rights; and that she voted that her actions
were appropriate. The articles of partnership did not address the right to share in
management, but Bruce and Minnie strongly disagreed with Sandra.
Which of the following is correct regarding Sandra's statement to the effect that she had
greater management rights because she was doing a greater percentage of work for the
partnership?
A. Sandra is incorrect because unless otherwise stated in the articles of partnership, all
partners share equally in the management of the partnership.
B. Sandra is incorrect because unless otherwise stated in the articles of partnership,
partners share in management rights in proportion to their rights to profits.
C. Sandra is incorrect because unless otherwise stated in the articles of partnership,
partners share in management rights in proportion to their obligation for losses.
D. Sandra is correct only if the proportion of work she was doing was inequitable.
E. Sandra is correct only if she can establish that the other partners are guilty of
mismanagement in such a significant manner that a breach of fiduciary duty has
occurred.
Which of the following are commonly used theories of recovery in product liability
cases?
A. Negligence, negligence per se, and breach of warranty.
B. Strict product liability, negligence per se, and breach of warranty.
C. Breach of warranty, negligence, and negligence per se.
D. Negligence, strict product liability, and breach of warranty.
E. Civil, criminal, and administrative.
Which of the following refer to state securities laws?
A. Pink-sky laws
B. Blue-sky laws
C. Orange-sky laws
D. Brown-ground laws
E. Green-grass laws
A condition ______ is a particular event that must occur in order for a party's duty to
arise.
A. Precedent
B. Subsequent
C. Concurrent
D. At large
E. Certain
With a[n] ______ instrument, the payee or subsequent holder can demand actual
payment at any time.
A. Time
B. Demand
C. Recourse
D. Nonrecourse
E. Immediate
"The Big Sale." Christy, the owner of ABC department store, needed to hire a number
of employees in a hurry because of a big summer sale she was planning. Bob was hired
by Christy to run a cash register and to assist customers with taking large purchases to
their cars. Bob encountered a particularly annoying customer, Frank. Frank started
complaining the minute he saw Bob. Frank complained about having to wait for Bob to
assist him with carrying his television purchase to his car, about the merchandise in the
store, and about the quality of the store's employees. Bob tried to control himself while
he carted Frank's television to the car. The final straw, however, came when Bob told
Frank that he should get the earring out of his ear, cut his hair, and act professionally.
Bob threw the television to the ground and punched Frank in the nose. Frank did
investigation and discovered that Bob has been fired from his previous three jobs for
taking violent action against customers. Two of his former employers are willing to
testify that if Christy had called them, they would have disclosed Bob's tendencies to
her. Bob listed the former employers on his application, but because she was in a hurry
to hire employees, Christy did not take the time to check with the former employers.
Another problem confronting Christy during the big sale is that Susie, a long-time
employee of Christy who had never caused any problem before, accidentally, but
negligently, dropped a box on the foot of Greg, a customer. Greg had to have an X-ray
and is threatening to sue both Christy and Susie.
Which of the following is true regarding whether Greg has any right of recovery against
Christy for his injured foot?
A. Greg has no right of recovery against Christy because Susie had not dropped any
boxes before, and Christy had no reason to suspect she would injure Greg.
B. Greg has a right of recovery against Christy only if Susie is insolvent.
C. Greg has a right of recovery against Christy, but only for 50% of his damages.
D. Greg has no right of recovery against Christy unless he is able to establish
wrongdoing on her part in hiring Susie.
E. Greg has a right of recovery against Christy.
Which of the following is an extension of negotiation?
A. Arbitration
B. Minitrials
C. Neutral case evaluations
D. Mediation
E. Private trials
"Animal Care." Susan, a licensed veterinarian, was recently elected to the U.S. Senate.
Susan is very concerned about the lack of care for homeless cats and dogs. She
proposes legislation that citizens of all states be taxed sufficiently to provide for no-kill
animal shelters that citizens in states with higher than average incomes be taxed at a
higher rate than citizens of other states. She also proposed that federal funds for state
highways be denied to any state that fails to provide assistance to low income citizens
in covering pet vaccinations. Bill, another new senator, tells Susan that, apart from the
mandated federal income tax, Congress lacks the authority to tax states because the
U.S. Constitution expressly reserves that right to the states. Sam, another senator, tells
Susan that Congress has no authority to link highway funds or any other funds with
social welfare objectives. Ellen, a clerk in the Senate, tells Susan that Congress is
absolutely prohibited from taxing residents of one state at a higher rate than citizens of
another state.
Which amendment prohibits cruel and unusual punishment?
A. Second
B. Fourth
C. Fifth
D. Eighth
E. Tenth
Which of the following is the term for a person creating an endorsement?
A. An allonge
B. A transferor
C. A transferee
D. An endorser
E. An endorsee
Which of the following is the term used to identify the duty of an agent to perform
specified duties with reasonable skill and care?
A. Duty of action
B. Duty of contract
C. Express duty of action
D. Duty of performance
E. Duty of obedience
The UCC requires that sellers and lessors tender ______ goods to the buyer or lessee.
A. Adequate
B. Transforming
C. Conforming
D. Reasonable
E. Superior
Assume a plaintiff files a case in state court that could also have been filed in federal
court. Does the defendant have any choice in the matter?
A. The defendant has a right to move the case to federal court.
B. The defendant can have the case moved to federal court only if federal jurisdiction
question is involved.
C. The defendant can have the case moved to federal court only if the state trial court
judge grants permission in his or her discretion.
D. The defendant can have the case moved to federal court only if the plaintiff's filing
expenses in state court are paid by the defendant.
E. The defendant has no choice, and the case will stay in state court.
In a conditional sales contract, a contract is a ______ if the seller allows the buyer to
take possession of the goods before deciding whether to complete the contract by
making the purchase.
A. Sale-on-approval contract
B. Sale-or-return contract
C. Condition-or-sale contract
D. Return-or-purchase
E. Return-or-sale
An ethical theory that urges managers to take those actions that provide the greatest
pleasure after having subtracted the pain or harm associated with the action in question
is called ______.
A. Deontology
B. Utilitarianism
C. Kantian ethics
D. Absolutism
E. Ethical relativism
"Surprise Arrival." Gracie was surprised and pleased to find that she was pregnant. She
worked as a waitress at Good Food and was aware that Groucho, her employer, had
allowed employees who were ill for reasons that were not work related to take paid time
off. For example, her friend Craig was off with pay for two months after suffering a
mild heart attack, and her friend Bonnie was off work for three months when she ran
her personal watercraft into a dock and broke her leg. Gracie, therefore, happily told
Groucho about her pregnancy. He very angrily told her that, as set forth in the employee
handbook, pregnancy was completely voluntary; that she was not entitled to a dime
when she was off work; and that she would be lucky if he even allowed her to continue
working at all because she would not be as cute when she gained weight. According to
Groucho, being slender was a bona fide occupational qualification for females as well
as males. He said that he serves families, and he does not want the kids asking
embarrassing questions of their parents regarding Gracie's condition. Gracie was very
angry and threatened to sue. Groucho told her, however, that he had business law back
in 1980 and that discrimination based on pregnancy is not even covered by Title VII.
Which of the following is true regarding Groucho's comment that pregnancy-based
discrimination is not covered by Title VII?
A. He is correct, and pregnancy-based discrimination is not prohibited by federal law.
B. He is correct, and pregnancy-based discrimination is not prohibited by Title VII; but
it is prohibited by Title IV.
C. Whether he is correct depends on the number of employees he has. Title VII was
amended in 1989 to include pregnancy within its protection, but only for employers
with over 50 employees.
D. He is incorrect because Title VII was amended in 1987 to include pregnancy within
its protection.
E. He is incorrect because Title VII was amended in 1997 to include pregnancy within
its protection for all employees other than professional level employees.
Blaine and Amanda orally agreed with Medical Center X for an in vitro fertilization
procedure that would not result in the birth of an autistic child. They later signed a
written contract stating that the medical center could not promise an absence of physical
or mental defects and assumed no responsibility for such defects. The child conceived
had autism. Which of the following is the most likely result of the parents' suit for
breach of the oral agreement if the court follows the decision Scalisi et al. v. New York
University Medical Center discussed in the text?
A. The oral agreement will be enforced, and the parents will prevail under the exception
to the parol evidence rule involving contracts conditioned on orally agreed upon terms.
B. The oral agreement will be enforced, and the parents will prevail under the exception
to the parol evidence rule involving contracts that are not final as they are part written
and part oral.
C. The oral agreement will be enforced, and the parents will prevail under the exception
to the parol evidence rule involving contracts that are incomplete.
D. The oral agreement will be enforced, and the parents will prevail under the exception
to the parol evidence rule involving evidence of prior dealings or usage of trade.
E. The medical center will prevail based upon the written contract.
Which of the following did the appellate court recognize in SCM Group, U.S.A. Inc., v.
Custom Designs & Manufacturing Co. Inc., the case in the text in which the plaintiff
sued the defendant after the defendant refused to pay for equipment?
A. That the issue of whether a reasonable time for inspection of goods has passed is
generally a question of law for the judge, not the jury, to decide.
B. That an effective acceptance is not made unless the buyer affirmatively notifies the
seller in writing that the goods were conforming.
C. That an effective acceptance is not made unless the buyer affirmatively notifies the
seller in writing that the goods while not conforming were acceptable with appropriate
deductions.
D. That an effective acceptance is not made unless the buyer affirmatively notifies the
seller orally or in writing that the goods while not conforming were acceptable with
appropriate deductions.
E. That a failure to reject results in liability not only for the contractual price, but also
for damages suffered as a result.
Which of the following conditions occur when each party's performance is conditioned
on the performance of the other?
A. Precedent
B. Subsequent
C. Concurrent
D. At large
E. Certain
Which of the following is needed in order for the implied warranty of merchantability
to be applied?
A. Both parties must be merchants and a sale, not a lease, must be involved.
B. Both parties must be merchants, and either a sale or lease must be involved.
C. The seller must be a merchant and a sale, not a lease, must be involved.
D. The seller must be a merchant, and either a sale or lease must be involved.
E. The seller must be a merchant, goods valued at over $500 must be involved, and
either a sale or lease must be involved.
When money is transferred by an electronic terminal, telephone, or computer, this
transfer is called a[n] ____.
A. Automatic fund transfer
B. Electronic fund transfer
C. Computer generated transfer
D. Wire transfer
E. Consumer electronic transfer
Which of the following is false regarding agency law in the United Arab Emirates
(UAE)?
A. UAE Commercial Transaction Law is relevant in regard to agents.
B. The UAE Civil Code is relevant in regard to agents.
C. Registered agents may seek compensation when an agency ends even if the
termination occurs in accordance with the terms of the agency agreement.
D. Only registered agents are entitled to seek compensation in the event of termination.
E. In regard to disputes about compensation of agents, court-appointed experts are
usually the entities that are responsible for determining compensation amounts.
Which of the following is true regarding lost property?
A. In most states the finder of lost property has title to the lost good against all
including the person who lost the property.
B. In most states the finder of lost property has title to the lost good against all except
the person who lost the property.
C. In most states the finder of lost property has no title to the lost good because the
good is to be turned over to the police department for later sale if the true owner cannot
be located.
D. In all states the finder of property has an obligation to put a notice in the local paper
looking for the true owner before the finder of the property can claim ownership.
E. In most states the finder of lost property has title to the lost good against all except
the person who lost the property, but that right only arises after the finder of the
property can establish that the finder spent at least one-fifth of the fair market value of
the property in locating the owner.
Which of the following is the period beginning when an issuer begins to think about
issuing securities and ends when the issuer files the registration statement and
prospectus with the SEC?
A. The initial filing period
B. The beginning filing period
C. The prefiling period
D. The required filing period
E. The waiting period
"Tutoring Concerns." Wally and Sally want to go into business together and plan on
offering a tutoring service to high school and college students. Wally proposes that they
share control of the business and split profits equally and not bother with a written
agreement. Sally, however, is concerned about being able to pay their debts since they
will have to rent tutoring space, and purchase computers and supplies. She is also
concerned about parents and students who may sue if their test scores do not improve.
She tells Wally that she just bought a new boat and car, and that she does not want her
assets to be in jeopardy. She tells Wally that they should form a corporation to shield
their personal assets. Wally, however, tells their personal assets are not in danger with
his proposal because they are a business and that, furthermore, forming a corporation
would even result in tax being imposed twice.
Is Wally correct that with his proposal that they share control of the business and split
profits equally there could be no personal liability for debts?
A. Yes, he is correct so long as they do not reach an agreement in writing.
B. Yes, because they will be considered a partnership regardless of whether any
agreement is in writing.
C. Yes, because so long as they have nothing in writing, their arrangement will be
considered a joint venture.
D. Yes, so long as they sign no contracts by which they agree to be personally liable.
E. No, he is incorrect.
Under the UCC, the buyer must bring a lawsuit on a breached contract within ______
year(s) of when the breach occurred or when the buyer became aware of it.
A. One
B. Two
C. Three
D. Four
E. Six
