A certificate of deposit differs from a promissory note in that, with a certificate of
deposit:
a. the maker is always a bank.
b. there are three parties to the transaction.
c. the payee of a CD must be paid on demand.
d. a writing is required.
A dissenting shareholder can stop a merger or consolidation.
a. True
b. False
Who is primarily liable on a note?
a. The maker
b. The indorsers
c. The drawee bank
d. The holder
Although mensreais a required element for most crimes, many regulatory crimes
dispense with it.
a. True
b. False
A subagent owes a fiduciary duty to only the principal.
a. True
b. False
Janet promises Eli $4,000 for one of his original paintings on the condition that she
receive $1 million from her mother’s will. Janet has made:
a. an illusory promise.
b. a legally sufficient promise unless Janet knew at the time she made the promise that
she could not inherit the$1 million.
c. a conditional promise which is not sufficient to form consideration.
d. a legally inadequate promise, and the courts will therefore not enforce it.
For the purposes of procedural due process, social security payments and food stamps.
a. the right of free speech
b. equal protection
c. property
d. liberty
Mr. Homayer hired Blake Painters to paint his house. Blake decides it has too many
jobs and delegates the duties to the Andrews Company. Andrews does a poor job, and
drips paint on the Homayers’ flowers and windows. Mr. Homayer:
a. can sue both Blake and Andrews.
b. can sue Blake, but he cannot sue Andrews.
c. can sue Andrews, but he cannot sue Blake.
d. cannot sue, because he has accepted the benefits of the assignment.
Management buyouts commonly make extensive use of borrowed funds. a. True
b. False
The Lanham Act prohibits “palming off” but not “reverse palming off.”
a. True
b. False
A sale of substantially all of the assets of a corporation in the ordinary course of
business of the corporation will not require shareholder approval.
a. True
b. False
Identify the following trade symbols according to their type.
a. The Underwriter’s Laboratory Mark.
b. The apple used by Apple Computers.
c. The “GM” symbol that appears on General Motors’ automobiles.
d. The “A” symbol used by American Airlines.
e. The Muppets characters Miss Piggy and Kermit the Frog.
f. The Union Made symbol.
Actual authority terminates upon:
a. illness of one of the partners.
b. dissolution of the partnership.
c. physical destruction of partnership papers.
d. All of these.
The Action Corporation and the Braker Corporation combine to form the Cable
Corporation. This is a merger.
a. True
b. False
In order for Bill to receive a permit for his plastic factory in a nonattainment area, he
must show that the factory’s emission rates will be within the average range for the
industry.
a. True
b. False
All intervening events that occur subsequent to the defendant’s negligent conduct will
relieve the defendant of liability.
a. True
b. False
Who among the following is most likely notconsidered a merchant according to Article
2 of the UCC?
a. Jim who owns a wholesale auto parts business.
b. Tom who, as a hobby, builds and sells birdhouses on the weekends.
c. Kay who sells her 3-year-old fishing boat to her neighbor.
d. Jan who is not knowledgeable about selling sailboats, but employs an experienced
person in the trade.
Mail fraud does not require the victim to be actually defrauded.
a. True
b. False
Al agrees to sell goods to Betty for a contract price of $3,000 due on delivery. Betty
wrongfully rejects the goods and refuses to pay anything. Al resells the goods in strict
compliance with the Code for $2,000. He incurs incidental damages for sales
commissions of $200 but saves $150 in expenses because of the resale. Al is entitled to
recover
$1,050 from Betty.
a. True
b. False
Apparent authority may arise in all but which of the following ways?
a. The acts are customary of an agent in similar positions in an organization.
b. The principal has acquiesced to prior similar transactions between the agent and the
third party.
c. The agent shows the third party a power of attorney from the principal authorizing
the agent to enter such a transaction.
d. An agent tells the third person she has the authority to transact such business on
behalf of the principal.
A(n) is a type of transaction generally involving three parties instead of two.
a. finance lease
b. consumer lease
c. sale
d. None of these.
Which of the following conduct would be likely to invalidate a will?
a. Maria urges her husband to leave all of his property to her.
b. Leah, who was not a blood relative, took care of Austin in his last illness. While he
was in a weakened condition, she urged him to name her sole beneficiary to the
exclusion of his children, which he did.
c. Paul does not mention his oldest child in his will.
d. All of these.
Sexual harassment is covered by Title VII.
a. True
b. False
Which of the following is true of dissociation?
a. All of the common law causes of dissociation are also causes under the RUPA.
b. A partner has the power to dissociate at any time by expressing the intent to withdraw
from the partnership.
c. Which dissociations are wrongful are set forth by statute and cannot be modified by
the partnershipagreement.
d. The partnership agreement cannot modify the effects of wrongful dissociation.
An attorney retained to handle a particular transaction is an independent contractor and
also an agent regarding that transaction.
a. True
b. False
Both negotiable instruments and nonnegotiable undertakings are transferable by
assignment and can result in the
transferee’s becoming a holder.
a. True
b. False
How is ‘sovereign immunity” interpreted under U.S. law today?
a. It gives absolute immunity to a foreign nation from all U.S. laws.
b. It gives immunity to foreign governments for commercial activity carried on in the
U.S. by the foreign government.
c. It exempts the public acts of a foreign government, such as those involving
diplomatic activity, from all U.S. laws.
d. All of these.
The Code and the Restatement both contain definitions of what constitutes
“unconscionable” conduct.
a. True
b. False
Which of the following is NOT correct with regard to the Bill of Rights?
a. It serves as a major restriction on the powers and authority of the federal government.
b. It does not apply directly to the states, but the Supreme Court has held that the
Fourteenth Amendment makes many of its principles applicable to the states.
c. It consists of ten amendments to the U.S. Constitution that were adopted in
d. It was added to the U.S. Constitution about 3 weeks after the Constitution was first
ratified.
Where a contract is unenforceable because of the statute of frauds, a party may recover
the benefits conferred on the other party in reliance on the contract.
a. True
b. False
Revised Article 3 adopts a definition of good faith that has both a subjective and an
objective component.
a. True
b. False