The United States constitution places the most significant limitations on administrative
investigation in the area of:
a. search and seizure of the person.
b. aerial inspection.
c. search and seizure of papers and records.
d. guarantee against self-incrimination.
A person who attempts to monopolize any part of the trade or commerce among the
states:
a. is guilty of a misdemeanor.
b. is guilty of a felony.
c. can be fined up to $500,000.
d. none of the above.
When a person makes a contract as an agent for another but lacks authority to do so, the
contract:
a. binds the principal but not the agent.
b. binds the principal and the agent.
c. does not bind the principal.
d. none of the above.
A bond:
a. that is unsecured is called a debenture bond.
b. is a negotiable security
c. generally has a life of five years or longer.
d. all of the above.
Which of the following is not a question business ethicist Laura Nash has developed to
help businesspeople reach the right decision in ethical dilemmas?
a. Have you defined the problem accurately?
b. How would you define the problem if you stood on the other side of the fence?
c. How did the situation occur in the first place?
d. Does your proposed solution to the problem effectively balance the competing
objectives of ethical decision-making and corporate profitability?
The effect of the making of a partial payment to satisfy an admitted debt is an example
of the rule that:
a. past benefits cannot be consideration for a later promise.
b. a conditional promise may be consideration.
c. doing what one is already under a legal obligation to do is not consideration.
d. consideration must be adequate to be binding.
Which of the following events excuses a promisor from performing his or her
contractual obligations?
a. a riot
b. a shortage of materials necessary for production of goods and/or provision of
services called for under the contract
c. an unanticipated increase in the cost of performance
d. destruction of the subject matter through no fault of either party
In a contract in which a tenant borrowed money from a bank for the purpose of adding a
bathroom to her apartment, the landlord is:
a. a direct beneficiary.
b. in privity of contract with the tenant.
c. a third-party beneficiary.
d. an incidental beneficiary.
Comparative negligence:
a. has been rejected by most of the states.
b. allows a comparison of negligence between plaintiff and defendant.
c. only applies when the plaintiff has signed a release.
d. is a bar to recovery under common law.
When a party expressly declares that performance will not be made when required, this
declaration is a(n):
a. anticipatory repudiation.
b. injunction.
c. negotiating technique.
d. waiver of breach.
The dissolution and winding up of a limited partnership is governed by the same
principles applicable to a __________.
a. “Subchapter S”corporation.
b. limited liability company.
c. general partnership.
d. none of the above.
An accountant may be able to raise the defense of lack of privity in a malpractice suit:
a. brought under federal securities statutes.
b. based on negligence.
c. based on fraud.
d. all of the above.
A corporation is liable to a third person for the act of its agent:
a. to the same extent as a natural person would be liable.
b. only if the agent was expressly authorized to perform the act.
c. only if the agent’s act was a crime.
d. only if the agent’s act was based on an intent to benefit the corporation.
Dissolution of a partnership:
a. always means that the business has ended.
b. increases the authority of the partners.
c. both a. and b.
d. neither a. nor b.
An agreement to modify a contract for the sale of goods:
a. is only binding if supported by consideration.
b. has to be voluntary in order to be enforceable.
c. is only binding if the original contract is invalid.
d. all of the above.
A purchaser of a nonnegotiable warehouse receipt:
a. receives no implied warranties.
b. may acquire rights superior to those of the transferor.
c. acquires only the title and the rights the transferor had authority to transfer.
d. may be considered to have the rights of a holder in due course.
Meetings are to be open to the public under:
a. the Administrative Protection Act.
b. the Sunshine Act.
c. the Freedom of Information Act.
d. none of the above.
When an individual owns a share of stock in a corporation, that individual:
a. has an ownership interest in the corporation.
b. is a creditor of the corporation.
c. generally has no voting rights.
d. is in possession of a debt security.
Corporations come into existence as the result of the activities of one or more persons
known as promoters.
Persons who are not a party to a contract can never sue on the contract.
The federal government is not subject to any type of environmental quality regulation
An action for negligence rests upon common law tort principles.
A mediator has the power to actually make a decision in a dispute.
A societ© anonyme is the European counterpart of a U.S. corporation.