Title VII does not apply to the overseas operations of American firms.
The Uniform Electronic Transactions Act reflects the decision that electronic
transactions do not constitute a written copy because the electronic transaction is not
technically a written document.
A service mark is a mark licensed by a group that has established certain criteria for use
of the mark such as “U.L. Tested” or “Good Housekeeping Seal of Approval.”
The EPA is required to consider implementation costs in setting primary and secondary
National Ambient Air Quality Standards.
Each director has one vote.
Situational ethics is the same thing as ethical relativism.
Life insurance protects a person who is unable to work due to disability.
Nondisclosure involves the active hiding of the truth about a material fact.
If an offeree makes a mistake and sends an acceptance to the wrong address, there is an
acceptance upon dispatch.
Assumption of the risk is a doctrine which makes it easier for a plaintiff to prevail in a
lawsuit.
An insurable interest is the right to insure the goods against any risk exposure such as
damage or destruction.
The National Conference of Commissioners on Uniform State Laws adopted the
Uniform Internet Act to answer questions involving issues involving Internet sales.
In some situations, the law specifies the duty of care one individual owes to another.
Unless otherwise stated in the partnership agreement, even if one partner has an
unusually large proportion of management duties, each partner will have one vote in
determining how the partnership is managed.
A nuisance arises when one person uses his or her property in a manner that
unreasonably interferes with another’s use and enjoyment of his or her land.
If a person’s mental deficiencies have resulted in his being adjudicated insane and a
guardian has been appointed for him, he has no capacity to enter into contracts; and any
contract he attempts to enter into is void.
The right to cure refers to the right to fix errors in a contractual agreement, such as
typographical errors.
In the case of, Toys “R” Us Inc., v. Canarsie Kiddie Shop Inc., evidence of actual
confusion is a prerequisite for the plaintiff to recover in a trademark infringement
action.
Ricardo’s state does not allow a testamentary disposition to a pet; therefore, Ricardo
should consider placing funds for his pet in a trust which would be allowed.
Another name for case law is common law.
Ownership of property is referred to as “title.”
Ethics is not an issue in accounting because of the primarily objective data involved in
that field.
If a person believes that she is a victim of identity theft, she may contact the FTC and
an alert will be placed in her credit files.
Because of the rule of privity, warranties may not extend to third parties to a contract.
A shareholder may not be held personally liable to a corporation for receiving watered
stock.
All employees are agents of their employers, and all agents are employees.
A factor that courts consider in determining whether a party is an incidental or intended
beneficiary is whether the contract directly states that the third party is the benefiting
party.
Agents may have contract remedies available against a principal, but not tort remedies.
A plaintiff in a negligence suit may choose whether the plaintiff wishes pure
comparative negligence or modified comparative negligence to be applied by the court.
A donee beneficiary is a third party that benefits from a contract in which the promisor
agrees to pay the promisee’s debt in return for compensation plus interest.
Subjective opinions are subject to an action for defamation in the same way as
statements of alleged fact.
Regarding liability for negligence to third parties, under the Restatement test, an
accountant is liable to known third-party users of the accountant’s work product and
also to those in the limited class whose reliance on the work the accountant specifically
foresaw.
In District of Columbia v. Wayne Singleton, the case in the text involving the
single-vehicle bus accident, the court applied the doctrine of res ipsa loquitur because a
single-vehicle accident is a type that does not normally occur in the absence of
negligence.
Which of the following is true under the Uniform Partnership Act regarding personal
liability of partners for obligations of the partnership when the partnership itself is
liable?
A. If a partnership is liable, each partner has unlimited personal liability.
B. If a partnership is liable, each partner only has personal liability in proportion to the
number of partnership members.
C. If a partnership is liable, each partner only has personal liability in proportion to the
way in which profits are allocated.
D. If a partnership is liable, each partner only has personal liability in proportion to the
way in which losses are allocated.
E. Partners do not have personal liability for obligations of a partnership when the
partnership itself is liable.
Which of the following was the result at the U.S. Supreme Court level in United States
v. Lopez, the case in which the Court addressed the constitutionality of the Gun-Free
School Zone Act?
A. The Court ruled that the law was a valid exercise of congressional authority under
the full faith and credit clause.
B. The Court ruled that the law was a valid exercise of congressional authority
contained within the Bill of Rights.
C. The Court ruled that Congress exceeded its power under the Bill of Rights when it
passed the act.
D. The Court ruled that Congress exceeded its commerce clause authority when it
passed the act.
E. The Court ruled that the law was a valid exercise of the Court’s authority under the
commerce clause.
Which of the following are franchises in which the franchisor manufactures a product
and licenses a dealer to sell the product in an exclusive territory?
A. Distributorship
B. Manufacturing arrangement
C. Chain-style business operation
D. Approved business franchise
E. Acknowledged standards operation
Harry and Frank are in agreement that Harry will pay Frank $2,000 for a used car. At
what point is there a binding contract?
A. When the agreement is made.
B. When the money is paid.
C. When the car is delivered.
D. Ten days after the car is delivered and approved.
E. Twenty days after the car is delivered and approved.
In order to obtain leave under the Family and Medical Leave Act, an employee whose
need for a leave is foreseeable must advise the employer of that need at least ______
days prior to the anticipated date on which the leave needs to begin or as soon as
practicable.
A. 60
B. 50
C. 45
D. 30
E. 10
Syndicates are usually considered a type of ______, thus they are almost always
governed by ______ law.
A. Limited liability company; corporate
B. Joint venture; partnership
C. Cooperative; corporate
D. Business trust; corporate
E. Joint stock company; partnership
The type of liability that occurs based on a person signing a negotiable instrument is
referred to as which of the following?
A. Warranty liability
B. Payee liability
C. Signature liability
D. Primary liability
E. Secondary liability
Bill contracts with Judy to wash her car and then delegates the duty to Paul. Paul fails
to wash the car. Which of the following is true regarding Bill’s duty to Judy, if any?
A. Bill has no duty to Judy so long as she did not expressly object to the delegation.
B. Bill has no duty to Judy regardless of whether she objected to the delegation.
C. Bill continues to be bound to Judy to see that her car gets washed.
D. Bill continues to be bound to Judy to see that her car gets washed only if the contract
expressly prohibited delegation.
E. Bill continues to be bound to Judy to see that her car gets washed unless he already
paid Paul for the job.
The ______ adherents believe that when one individual, the caregiver, meets the needs
of one other person, the cared-for party, the caregiver is helping to meet the needs of all
the individuals who fall within the cared-for party’s web of care.
A. Deontology
B. Utilitarianism
C. Absolutism
D. Virtue ethics
E. Ethics of care
Which of the following may represent a lack of genuine assent?
A. Acceptance secured through fraud, duress, or misrepresentation, but not acceptance
through undue influence.
B. Acceptance secured through undue influence, misrepresentation, or duress, but not
through fraud.
C. Acceptance secured through fraud or duress, but not through misrepresentation or
undue influence.
D. Acceptance secured through fraud, dress, or undue influence, but not through
misrepresentation.
E. Acceptance secured through fraud, duress, undue influence, or misrepresentation.
When is the winding-up stage in the termination of a partnership complete?
A. When account is taken of the assets of a partner who left the partnership and
redistributed among the other partners.
B. When all assets of the partnership are sold.
C. When all partners sign releases terminating the partnership.
D. When the partnership is dissolved.
E. When all claims against the partnership by third parties are either settled or resolved
in court.
Which of the following is false regarding bankruptcy cases?
A. The Bankruptcy Rules set forth procedures for bankruptcy cases.
B. Bankruptcy cases are referred to bankruptcy judges, under the authority of the
district courts.
C. An appeal of a bankruptcy ruling goes to the district court judge.
D. A jury is not allowed in a bankruptcy proceeding.
E. Bankruptcy cases are filed in federal district courts.
Which of the following types of life insurance provides protection for the entire life of
the insured and has a cash-surrender value?
A. Whole-life
B. Term-life
C. Surrender-life
D. Useful-life
E. Entire-life
Which of the following is true regarding European courts?
A. European courts are in total disagreement with the reluctance of American courts to
interfere with a contract because the value of the item in question has changed since the
agreement.
B. European courts refuse to assume that parties accept the risk when they make a
contract that the value might change later.
C. European courts permit rescission of the contract for a mistake of value when the
mistake involves more than 10 percent of the value at the time of the contract.
D. European courts permit rescission of the contract for a mistake of value when the
mistake involves more than 40 percent of the value at the time of the contract.
E. European courts permit rescission of the contract for a mistake of value when the
mistake involves more than 50 percent of the value at the time of the contract.
The Uniform Anatomical Gifts Act (UAGA) provides that any individual age 21 or
older may give all or any part of his or her body to a donee on death so long as the
closest surviving next-of-kin does not object.
Which of the following is false regarding corporate decisions that might personally
benefit a particular director or officer?
A. There must be full disclosure of the interest by a director who might personally
benefit from a corporate decision.
B. There must be full disclosure of the interest by an officer who might personally
benefit from a corporate decision.
C. The director to benefit may vote on the issue although a majority of all directors
must approve the transaction.
D. The duty to disclose an interest that might personally benefit a director is a fiduciary
duty.
E. The duty to disclose an interest that might personally benefit an officer is a fiduciary
duty.
Which of the following is false regarding the Revised Uniform Partnership Act?
A. There is some disagreement between the Uniform Partnership Act and the Revised
Uniform Partnership Act about the rules of partnership.
B. Changes in relation to the Revised Uniform Partnership Act and the Uniform
Partnership Act are insignificant.
C. The Revised Uniform Partnership Act generally serves to expand the Uniform
Partnership Act.
D. If adopted the Revised Uniform Partnership Act governs partnerships in the absence
of an express agreement.
E. The Revised Uniform Partnership Act has been adopted in approximately half the
states.
With which of the following does a government website address end?
A. .gov
B. .edu
C. .net
D. .org
E. .com
Which of the following is false regarding the elements a party must meet in order to be
considered a holder in due course?
A. The party must be a holder of a complete and authentic negotiable instrument.
B. The holder must take the instrument for value.
C. The holder must take the instrument in good faith.
D. The holder must take the instrument without notice of defects.
E. The holder must either pay for the instrument or receive it as a gift.
Which of the following is used as a basis for discharge by operation of law when
performance is still objectively possible but would be extraordinarily injurious or
expensive to one party?
A. Frustration of purpose
B. Commercial impracticability
C. Alteration of the contract
D. Anticipatory repudiation
E. Anticipatory renunciation
What was the result in the Case Opener in which customers of Apple attempted to
disaffirm purchases of game currency by their children?
A. The court dismissed the lawsuit on the basis that the parents were bound by the
Terms of Service and notifications of their original contracts with Apple binding them
to future purchases of game currency when their passwords were used.
B. The court dismissed the lawsuit on the basis that the parents were bound by the
Terms of Service and notifications of their original contracts with Apple binding them
to future purchases of game currency regardless of whether passwords were used.
C. The court dismissed the lawsuit on the basis that no contractual agreement was
needed in order for the parents to be bound in regard to purchases of game currency so
long as their passwords were used.
D. The court refused to dismiss the lawsuit because no case law was provided to prove
that Apple’s Terms of Service served as a contract for all subsequent transactions.
E. The court refused to dismiss the lawsuit because as a matter of law parents cannot be
required to contractually agree to future purchases by children that are unapproved by
the parents.
“House Painting.” Susie Smith signed a check agreeing to pay, “Annie Greene, Mary
Hodge,” $1,000. The payment was for painting her house. A problem with the note was
that it spelled Annie’s last name, “Greene,” whereas Annie spells it simply, “Green.”
Annie and Mary were having a disagreement regarding how to split up the funds for
painting the house. Annie proceeded to sign the check on the back, “Annie Green,” and
presented it to Bill Brown to satisfy a debt that she owed him. Bill Brown endorsed the
check on the back, “Bill Brown, without recourse,” and gave it to his nephew, Sam, who
took it to the bank for payment. Meanwhile, Susie has stopped payment on the check
because following a rain storm, all the paint on the house looked spotted. Mary is
unhappy because she did not obtain any of the funds and stated that Annie could not
legally endorse the instrument because it misspelled her name and also because she,
Mary, did not sign it.
Which of the following is true regarding the complaint of Mary that she did not also
endorse the instrument?
A. She is correct because both names are required in order to provide legal
endorsement.
B. She is correct in that her name was needed for legal endorsement, but that is only the
case because of the name misspelling of Annie’s name.
C. She is correct because regardless of whether the payees are listed with no
designation as to whether they are alternate or joint, or whether the words, “or,” or
“and,” are used to designated payees, any listed payee must endorse a note in order for
it to be properly payable.
D. She is incorrect because Annie properly endorsed the note, and only her signature
was needed.
E. She is incorrect, but only if it can be established that Bill Brown lacked knowledge
that she had not given her consent to the form of the endorsement.
“Lake House.” Harry has two houses, a house on the lake and a house in town. Rebecca
wants to buy the house on the lake. Harry and Rebecca orally agree that Rebecca will
buy the house on the lake for $300,000. Harry hurriedly writes out a contract providing
that he would sell “his house” to Rebecca for $300,000. Harry signs the top of the
document. Rebecca does not sign at all. No merger clause is included in the contract.
Harry backs out of the contract, and Rebecca sues him. He tells the judge that the
statute of frauds is left unsatisfied because he did not sign the document at the end and
also because Rebecca did not sign at all. He also tells the judge that, at any rate, the
agreement referred to the house in town, not the house on the lake; and that under the
parol evidence rule, he had the right to identify the correct house.
Which of the following is true regarding Harry’s assertion that under the parol evidence
rule he had the right to identify the house referenced in the contract?
A. Harry is correct.
B. Harry is incorrect because under the parol evidence rule, Rebecca, as the buyer,
would be allowed to identify the subject matter in the event of a discrepancy.
C. Harry is incorrect because under the parol evidence rule, the judge would likely
allow oral evidence regarding the house at issue in order to clarify an ambiguity.
D. Harry is incorrect because the parol evidence rule would not apply in situations
involving an ambiguity.
E. Harry is incorrect because the parol evidence rule would not apply in the absence of
a merger clause.
The term ______ refers to the fact that an agreement is so unfair that it is void of
conscience.
A. Unreasonable
B. Outrageous
C. Unconscionable
D. Unrealistic
E. Unbelievable
Which of the following is an individual who takes over administration of the debtor’s
estate?
A. Administrator
B. Aligner
C. Organizer
D. Reformer
E. Trustee
Which is the most difficult part of establishing the defense of assumption of the risk?
A. Showing that the plaintiff assumed the risk of the actual harm suffered.
B. Showing that the defendant was aware that the plaintiff assumed the risk.
C. Showing that the plaintiff was aware of applicable law.
D. Showing that the plaintiff signed the contract assuming the risk without duress.
E. Showing a lack of contributory conduct on the part of other defendants.
What type of agency is the Federal Trade Commission?
A. Executive
B. Independent
C. Collateral
D. Approved
E. Certified
“Bank Robbery.” Safe Bank was robbed of a significant sum of cash by a robber later
identified as Victor Victory. Safe Bank offered a reward of $10,000 to anyone who
captured or provided information leading to the capture of Victor. Ted, a police officer
in town, promised Safe Bank officials that he would apprehend Victor. While on duty,
Ted arrested Victor at a hamburger joint in town. He found Victor based upon a hunch
he had after Ursula, who dated Victor, told him about various places Victor enjoyed
eating. The bank refuses to pay either Ursula or Ted any of the reward money.
In a lawsuit between the bank and Ursula, regarding the reward funds, who is likely to
prevail and why?
A. The bank is likely to prevail because Ursula only provided past consideration.
B. The bank is likely to prevail because Ursula was tainted by being Victor’s girlfriend.
C. The bank is likely to prevail because no valid bilateral contract existed.
D. Ursula is likely to prevail because a valid bilateral contract existed.
E. Ursula is likely to prevail because an enforceable unilateral contract exists based on
her provision of information leading to the capture of Victor.
When, if ever, does the Environmental Protection Agency give a state the first
opportunity to prosecute violators of the Resource Conservation and Recovery Act?
A. When the state has set up its own program for managing hazardous waste that is at
least as stringent as the federal program.
B. When the state has reduced hazardous waste production at least 10% per year for
each of the previous three years.
C. When the state has reduced hazardous waste production at least 5% per year for each
of the previous three years.
D. When the state has stronger criminal penalties for violation of its hazardous waste
laws than does the Resource Conservation and Recovery Act.
E. The Environmental Protection Agency never gives a state the first opportunity to
prosecute violators of the Resource Conservation and Recovery Act.
“Family Trust.” Gracie had made lots of money in the stock market. She was getting
older and was concerned about the integrity of her children and grandchildren who
seemed unwilling to work. She decided that she would place the majority of her money
in a trust and instruct that it be distributed only to family members who were gainfully
employed or attending school on a full-time basis throughout the next twenty years. The
remainder of the trust at that time was to be given to a local animal shelter. She also told
her lawyer, Joe, that although she was in good health and mind at the present time, she
would like a document drawn up giving her daughter Marcy the power to make
decisions for her, including financial decisions, should her health deteriorate to the
point that she could not handle her own affairs.
Which of the following, if any, identifies the type of trust Gracie set up to encourage her
family members to go to school or work?
A. This type of trust would be identified as an illegal trust because it would not be
enforced.
B. Relative review
C. Relative pushing
D. Family encouragement
E. Family incentive
Richard is president of a pharmaceutical company which is based in the U.S. but has a
substantial amount of sales in other countries. Richard’s company manufactures drugs
prescribed to those infected with HIV and other illnesses. He is informed by some
missionary workers that millions of people in Africa have HIV and that many have
died. He is asked to provide medication to certain locations in Africa free of charge. On
the other hand, Richard has also been asked by a group in the U.S. to provide
medication free of charge to HIV positive individuals in this country and to donate
other drugs his company makes for the treatment of other illnesses. Richard, in good
faith and based on a good review of the company’s financial position, believes that the
company can afford to donate some supplies but not in the quantities requested by both
foreign and U.S. concerns. What do you believe is the ethical thing for Richard to do
under the circumstances?
What is the effect of an appraisal clause in a policy of insurance, and how do these
usually work?
Set forth the two exceptions to the time-certain requirement for negotiability discussed
in the text.
Set forth what a registration statement filed with the SEC generally contains.
List the purposes of the law and discuss why these purposes are necessary for an
ordered society.
Which of the following must a buyer do in obtaining cover?
Define an express contract and an implied contract; set forth the three conditions that
generally must be met for the courts to find an implied contract, and give an example of
an express and implied contract.
What items should a stop payment order list?
Set forth the steps that a creditor must take to become a secured party.
Set forth the reasons cited for the comprehensive changes to bankruptcy law included in
the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.
Recommend steps that an employer should take to avoid claims of sexual harassment.
Set forth the exceptions that would permit a court to invalidate a contract on grounds of
unilateral mistake.
Set forth the advantages and disadvantages of forming a general corporation.
Define “course of performance,” and discuss its relationship to decisions regarding
whether goods conform to contract specifications.
Judge Sally Justice, who is newly appointed to the bench, is presented with a question
of law involving a cat named Chester who scratched a neighbor’s antique jalopy. The
neighbor, George, demands justice in the form of full payment from Chester’s owner,
Sue, and also requests that Chester be shipped to the local animal shelter. Sue says that
she should not have to pay anything because Chester had never scratched before, that
Chester should be allowed to stay in the neighborhood, and that she should be
reimbursed for her legal fees by George who is a grump and never should have brought
the lawsuit. Judge Justice is perplexed and wants to make a good decision since she is
new to the bench. Describe how the judge should go about reaching a decision. Discuss
in your answer the impact of cases from other jurisdictions assuming there is no
relevant law in Judge Justice’s jurisdiction. Also, assuming there is relevant law in
Judge Justice’s jurisdiction, discuss the applicable legal standard when case law
conflicts with a later passed state statute.
How can the Federal Trade Commission protect consumers if most companies within
one industry are using the same unfair or deceptive practices?