A quorum consists of how many justices on the U.S. Supreme Court?
a. 3
b. 5
c. 6
d. 7
Richard owns and operates a small business at an outdoor market where he sells fruits
and vegetables. What does the UCC specifically require of Richard with respect to his
customers?
a. Observance of reasonable commercial standards of fair dealing
b. That he treat them all alike.
c. A clearly stated return policy.
d. No specific standards of behavior apply to Richard.
Even if a party has the power to avoid a contract for lack of capacity, duress, or undue
influence, the party will lose that power by affirming the contract.
a. True
b. False
Robbery and burglary are the same crime.
a. True
b. False
The Constitution authorizes the president to enter into treaties having the legal force of
a federal statute without having to go through the legislative process or without having
to receive advice or consent of the federal legislative branch of government.
a. True
b. False
Professor Dought has a life insurance policy on his own life that provides that in the
event of his death, his mother will receive the proceeds. Professor Dought’s mother is
a(n):
a. incidental beneficiary.
b. creditor beneficiary.
c. donee beneficiary.
d. assignee.
The desired effect of EFTS is to:
a. avoid the delay between issuance of a check and receiving the canceled check.
b. eliminate errors.
c. ease the mobility of society.
d. both avoid the delay between issuance of a check and final payment, and also to
eliminate paperwork.
The United States and the country of El Guapo signed a treaty whereby the United
States agreed to assist the Latin
American country in controlling drug traffic. The United States, following the treaty,
seized 100 square meters of
land and bulldozed it, because it was a suspected haven of drug smuggling. The land in
question was in El Guapo, but belonged to an American citizen. Which of the following
is most accurate?
a. The treaty will supersede any general Constitutional rights because the treaty gave
specific authorization for the act.
b. The act was not offensive to the Constitution, because it occurred in El Guapo.
c. Constitutional rights apply to people, not to property.
d. Constitutional rights supersede treaties.
The test for duress is objective and the act must be classified as a tort or a crime in
order to be wrongful.
a. True
b. False
The Code and the Restatement have no provisions for discharge of contractual duties in
cases involving commercial impracticability.
a. True
b. False
Registration with the SEC ensures a potential investor as to the financial soundness of
the business represented by the stock.
a. True
b. False
When the power of eminent domain is exercised, the owners must be given the fair
market value of the property as of the time of the taking.
a. True
b. False
Albert read Gem City’s ad in the local newspaper advertising a one-quarter carat
diamond ring for $89. Albert rushed to the store to buy the ring, only to be told by the
salesperson that the ad was a misprint and the price should have been $289. Albert gave
the salesperson $89 plus sales tax and demanded the ring. In this case:
a. the ad is a firm offer by the merchant, and the ring must be sold for $89.
b. the ad is a contract and the store must abide by terms stated in the contract.
c. the store must accept the price stated in the ad, but only if Albert has a copy of the ad
with him.
d. Albert is merely making an offer to Gem City to buy the ring for $89 plus sales tax.
If Jim, Ken, and Lee each deposit 10,000 bushels of wheat in a grain elevator, they
would own one-third of the remaining mixture by:
a. accession.
b. adverse possession.
c. prescription.
d. confusion.
After an assignment, only the assignee has a right to the obligor’s performance.
a. True
b. False
A tiger gets loose from the tent of a circus and mauls a passerby. The circus claims it
has always treated the animal well and that it was not at all negligent in its handling of
the animal. The circus has no liability for the injury caused
by the animal.
a. True
b. False
The Uniform Commercial Code covers all the issues involving ownership and transfer
of title to personal property.
a. True
b. False
If an agent exceeds his actual and apparent authority, the principal is not bound, which
makes the agent a party to the contract.
a. True
b. False
The term “public policy” is precisely and narrowly defined in the Restatement and by
state statutes.
a. True
b. False
A contract exists when an offer has been accepted.
a. True
b. False
An agent for an unidentified principal is liable on the contract to the third party no
matter whether the particular transaction is authorized or not.
a. True
b. False
As a general rule, for purposes of attachment of a security interest, a debtor is deemed
to have rights in collateral that she:
a. owns.
b. has in her possession.
c. is in the process of acquiring from a seller.
d. All of these.
Voidable preferences include all of the following EXCEPT:
a. a transfer of property of the debtor to or for the benefit of a creditor.
b. payment of taxes owed to a governmental unit.
c. a transfer of the debtor’s property while the debtor was insolvent.
d. a transfer that enables a creditor to receive more than he would have received under
Chapter
The intentional dispossession or unauthorized use of the personal property of another is
known as:
a. conversion.
b. trespass to personal property.
c. fraud.
d. stealing.
The ethical theory that underlies cost-benefit analysis is:
a. libertarianism.
b. utilitarianism.
c. deontology.
d. ethical relativism.
Which of the following is NOT considered to be an alternative method of dispute
resolution?
a. Special verdict
b. Negotiation
c. Conciliation
d. Mediation
A monopolistic market will produce more goods than a competitive market; however,
the problem the Sherman Act tries to address is the fact that a monopolistic market will
sell those goods at a higher price than a competitive market.
a. True
b. False
Which of the following would ordinarily be a basis for making a contract void for
mutual mistake?
a. Market conditions
b. Genuineness of the source of the subject matter of the contract
c. The financial situation of the parties
d. All of these.
Consideration has only one basic element, which is a bargained-for exchange.
a. True
b. False
One of the most appealing features of a limited partnership is the limited personal
liability it offers to limited partners.
a. True
b. False
The Clean Water Act:
a. establishes one scheme that is to be used for both existing and new sources of
pollution.
b. applies to all navigable waters in the United States, but not to freshwater wetlands or
nonnavigable intrastate waters.
c. carries civil penalties of up to $37,500 per day per violation, as well as possible
criminal penalties.
d. provides for one program for both point and nonpoint sources of pollution.
Courts require that for a contract to be unenforceable based on unconscionability, both
substantive and procedural unconscionability must be equally present.
a. True
b. False