Assume there are no provisions in the corporation’s articles of incorporation or bylaws
regarding quorum requirements. If there are 13 total directors of General Grain
Corporation and the minimum number of directors are present to transact business, how
many votes normally would be necessary for those present to approve an action as a
board?
a. 7.
b. 4.
c. 6.
d. 11.
The 1992 and 1997 Horizontal Merger Guidelines:
a. were issued by the Justice Department to be additional to the FTC’s separate
guidelines.
b. require a mechanical application; in order to reduce the previously used analytic
framework, which was far too subjective and uncertain.
c. rejects use of the Herfindahl-Hirschman Index.
d. None of the above.
A buyer’s remedies for breach of the warranty to transfer marketable title include all but
which of the following?
a. Specific performance with a price reduction.
b. An injunction.
c. Rescission and restitution.
d. Damages for loss of bargain.
The courts in common law systems have developed a body of law that serves as
precedent for determination of later controversies. This is called:
a. judge-made law.
b. case law.
c. common law.
d. All of the above.
If a foreign corporation wishes to avoid being considered doing business in Arkansas, it
would be careful NOT to do which of the following in Arkansas?
a. Maintain a telephone listing there.
b. Make contracts in the state.
c. Maintain an office to conduct intrastate business.
d. All of the above.
Which of the following can meet the scienter requirement to establish fraud in the
inducement?
a. Actual knowledge.
b. Lack of belief in the statement’s truthfulness.
c. Reckless indifference as to a statement’s truthfulness.
d. All of these are correct.
The parol evidence rule does NOT apply to:
a. a typographical error that obviously does not represent the agreement of the parties.
b. evidence showing one of the parties to the contract lacks contractual capacity.
c. All of the above.
d. None of the above.
__________, usually called debentures, have only the obligation of the corporation
behind them.
a. Secured bonds
b. Income bonds
c. Unsecured bonds
d. None of the above.
Wendell owes Liz $75,000. Liz signs a written statement granting Troy a gratuitous
assignment of her rights from Wendell. If Liz dies prior to delivering the statement to
Troy:
a. Liz’s death has no effect on the assignment.
b. the assignment is terminated upon Liz’s death.
c. the signing of the statement makes the assignment irrevocable.
d. the assignment is invalid, because it is gratuitous.
Under the Americans with Disabilities Act of 1990:
a. only governmental employees are covered.
b. punitive and compensatory damages are not recoverable.
c. an employer may not use tests that screen out workers with disabilities.
d. punitive damages for intentional discrimination are subject to a ceiling depending on
company size.
Which warranties does a collecting bank give?
a. Warranty of no alteration only.
b. Good title, genuine signatures, no material alteration, no defense good against it, and
no knowledge of insolvency.
c. Only good title and genuine signatures.
d. A collecting bank does not give any warranties.
The concept of consideration in contract law includes:
a. that each party to a contract must unintentionally exchange a legal benefit.
b. an inducement to each party to make a return exchange.
c. that each party takes out an insurance bond if the possibility of damages is above
$500.
d. All of the above.
All statutes require LLPs to:
a. designate themselves as LLPs.
b. register or obtain a certificate of authenticity if they are foreign LLPs.
c. make a new filing with the secretary of state after any change in membership.
d. follow the laws of the jurisdiction under which they are registered regarding internal
affairs and organization.
Mary’s car was parked just outside the east door of the Civic Center. When she tried to
exit, three ominous-looking gang members were blocking that door. She called the
police, who arrested the three for loitering. If Mary brings suit against them for false
imprisonment, she will:
a. lose if there was another exit she could have used.
b. lose because she was not harmed by the confinement.
c. win even if there was another way out because she was, in effect, being confined to
the Civic Center.
d. win because they were blocking her passage to her car.
Which of the following is an objective of the North American Free Trade Agreement
(NAFTA)?
a. Create trade barriers to the movement of goods and services across the borders.
b. Promote conditions of fair competition in the free trade area.
c. Decrease investment opportunities in certain parts of the area.
d. Provide adequate and effective enforcement of all types of property rights.
Identify which of the following meet the Article 3 negotiability requirement of being
payable at a definite time: (a) A note payable ‘on or before June 14, 2012.’ (b) A dated
instrument payable ’30 days after date.’ (c) An undated instrument payable ’30 days after
date.’ (d) An instrument payable ‘when Baxter is promoted to plant manager.’ (e) A note
payable on December 31, subject to acceleration by the holder.’ (f) A note granting the
holder the option to extend maturity of the instrument for an indefinite period.
Under the CISG, which of the following would NOT always be considered a material
alteration to an offer?
a. A change in payment.
b. A change in time of delivery.
c. A change in color of goods ordered.
d. The addition of an arbitration clause for settlement of disputes.
Sam is George’s agent. George decides to fire Sam. Mel is an old customer of George’s
and he has dealt on credit with Sam for over twenty years. Ellie is a prospective
customer that Sam has spoken with on numerous occasions in his capacity as George’s
agent, and George was aware of the preliminary negotiations. Mel orders goods from
Sam after Sam has been fired but Mel has no knowledge of the firing. Later, Sam takes
an order from Ellie. Under the Second Restatement, if George does not give notice of
the firing, George will:
a. be liable for the contract with Mel.
b. not be liable on the contract with Mel.
c. not be liable on the contract with Ellie.
d. Both (a) and (c).
The Consumer Product Safety Commission:
a. only has the authority to educate the public concerning product safety problems.
b. uses data it gathers to set uniform product safety standards for goods such as toys and
lawn mowers.
c. can only make manufacturers voluntarily submit their products for testing if the
product falls below its regulatory standards.
d. have no enforcement powers since compliance with its regulations is left up to the
manufacturer.
A holder does not include a person who is in possession of a negotiable instrument that
is payable to bearer.
The various chapters of the Bankruptcy Code are the only options for resolving the
conflict between creditor rights and debtor relief.
A statement of misleading half-truth is considered the equivalent of a false
representation.
The more conditions to which a promise is subject, the more content the promise has.
A lease is the transfer of title to goods from seller to buyer for a price.
Edward, an engineer, is working on a new design for some highly technical equipment
which Martus, Inc. hopes to market within the next five years. The employment
agreement between Edward and Martus states that Edward will not go to work for
another company in the same business for a period of two years after termination of his
employment with Martus, Inc. This agreement is void and unenforceable because,
although Martus is a very specialized company, the agreement would make it difficult
for Edward to find other employment.
The Securities Act of 1933 is also called the “Truth in Securities Act.”