Article 2 of the Uniform Commercial Code (UCC) is also applied by federal courts to
sales contracts governed by federal law.
The Law and Economics School believes that legal decision making should be
functional to market efficiency.
Liquidated damages are awarded only if actual damages are precisely determined.
If a person believes that he or she has been discriminated against in the workplace, he
or she cannot immediately file a lawsuit against the employer.
The warranty against infringements protects trademarks and copyright claims.
Secondary boycott picketing is not lawful if it is against the primary employer’s
product.
A seller of a defective product cannot be held strictly liable if it can be proved that he or
she took all possible care in the preparation and sale of the product.
A bystander who suffers severe emotional distress on witnessing a heinous crime can
claim damages for intentional infliction of emotional distress.
The Magnuson-Moss Warranty Act does not govern warranties of commercial or
industrial transactions.
If there is no space for an indorsement on the instrument, a new instrument has to be
made to accommodate the indorsement.
No new evidence or testimony is heard in the state supreme courts.
A partially disclosed agency can be created by mistake.
An accommodation party who signs an instrument guaranteeing payment is secondarily
liable on the instrument.
Which of the following is true in the event an assignee does not provide a notice of
assignment to the obligor?
A) The assignee’s only course of action is to sue the obligee for damages.
B) The assignee cannot sue the assignor for damages.
C) The obligor’s only recourse is to sue the assignee for damages.
D) The assignee cannot sue the obligor to recover payment.
Which of the following is true of a bailment?
A) Only personal property can be used in a bailment.
B) Intangible property cannot be used in a bailment.
C) Only physical deliveries can become a bailment.
D) All bailments must be expressed in writing to be effective.
________ is a process that establishes the right of a secured creditor against other
creditors who claim an interest in the collateral.
A) Disposition of collateral
B) Retention of collateral
C) Perfection of a security interest
D) Repossession of a security interest
Which of the following is true about the duty of care?
A) Breach of duty of care is not actionable unless the plaintiff suffers injuryor injury to
his or her property.
B) Reasonable person standard is used to determine the amount of damages that a
defendant owes a plaintiff.
C) A firefighter who refuses to put out a fire when his safety is not at stake does not
breach his duty of care.
D) The damages recoverable for breach of the duty of care are independent of the effect
of the injury on the plaintiff’s life or profession.
A merger between two or more companies that compete in the same business and
geographical market is known as ________.
A) horizontal merger
B) vertical merger
C) market extension merger
D) conglomerate merger
Which of the following moral theories would closely follow the categorical imperative
“Do unto others as you would have them do unto you”?
A) Kantian ethics
B) moral relativism
C) utilitarianism
D) Rawls’s social justice theory
A limited partnership is formed when the ________ is filed.
A) certificate of cancellation
B) articles of limited partnership
C) limited trade affidavit
D) certificate of limited partnership
A monopoly power is characterized by ________.
A) a market share of below 20 percent
B) an inability to control prices in the market
C) an ability to exclude all competition from other sellers
D) a presence of multiple substitute goods at competing prices
Which of the following is an example of an e-signature?
A) using a credit card at the grocery store to pay for groceries
B) using a debit card to fill gas at the local gas station
C) ordering Chinese food over the phone and paying with a credit card
D) paying the electricity bill online using a smart card
What is the purpose of a pretrial hearing?
A) requesting the other party to produce all documents relevant to the case
B) assessing the factual accuracy of the deposition of witnesses
C) instructing the judge to decide the case without a jury
D) facilitating the settlement of a case before it goes to trial
An exclusive license is defined as ________.
A) a license that grants access to exclusive information for a limited period
B) a license that restricts the licensee to some information only
C) a license that grants rights to only one party for a specific period
D) a license that grants licensees only a few rights in intellectual property
The ________ authorizes the U.S. government to clean up oil spills and spills of other
hazardous substances in ocean waters within 12 miles of the shore and on the
continental shelf and to recover the cleanup costs from responsible parties.
A) Clean Water Act
B) Comprehensive Environmental Response, Compensation, and Liability Act
C) Federal Water Pollution Control Act
D) Marine Protection, Research, and Sanctuaries Act
Who is the beneficiary in a deed of trust transaction?
A) the creditor
B) the debtor
C) the trustee
D) the trustor
When does an auditor submit a disclaimer of opinion? What is the significance of an
auditor’s opinion?
When is nonperformance by a contractual party excusable?
Explain, with an example, the duty of care owed by a general partner.
What does the Delaware antitakeover statute provide? How can an acquirer evade the
restrictions imposed by this statute?
What are the requirements for imposing secondary liability for a negotiable instrument?
What are qualified indorsements?
What is the role of an innkeeper as a bailee? How does the innkeepers’ statute help an
innkeeper?
Give an account of termination of offer due to lapse of time.