Archives: Quiz

Which of the following statements applies to a sale on approval under Article 2 of the UCC? a. both buyer and seller must be merchants. b. the buyer must be purchasing the goods for resale. c. risk of loss for […]

Richardson offered to sell her used motorcycle to Evans for $450. Evans said, “I accept, but would you also replace the front tire.” Neither Richardson nor Evans is a merchant. a. Evans has accepted the offer. b. Evans has rejected […]

The remedy of specific performance will be granted only if a. the buyer cannot buy substitute goods elsewhere. b. the goods are unique. c. the goods are no longer being offered for sale by other sellers. d. all of these. […]

The Social Security system is an example of using law to a. settle disputes. b. promote worthwhile social objectives. c. protect property. d. protect society. An employer found guilty of violating the Occupational Safety and Health Act may be a. […]

Baldo applied to rent an apartment in a building owned by Blair, but was turned down because she had a cat. She claims discrimination against pet owners. Is she correct? A special lien enabling a city to seize property because […]

Upton rented a house from Vincent. Five months after the lease was signed, Vincent died. Is the lease terminated? The State of Tennessee v. Peterson is an example of a case title indicating a(n) ____________________ action. Answer: criminal An offer […]

Congress requires that certain contracts be written in ____________________. A credit card that automatically withdraws money from the cardholder’s bank account is known as a(n) ____________________ card. Answer: debit A creditor’s claim to specific property of a debtor is called […]

Refraining from doing something you have a legal right to do is called ____________________. How does the perfect tender rule under the UCC change the obligations of the seller and the buyer as their obligations existed under the common law? […]

A(n) ____________________ is a contract in which the offeror agrees to hold an offer open for a set time in return for consideration paid by the offeree. The ____________________ is the highest court in the United States. Answer: U.S. Supreme […]

Group insurance expires when the person leaves the group. Pauley owns and operates the only grocery store in a small town of about 500 residents. Has Pauley violated the antitrust laws by creating a monopoly? Answer: No. Monopolies are created […]

Any false statement on an application allows the insurer to cancel the policy. The Truth in Lending Law requires that the cost of credit be stated both in dollars and cents and as a percentage of the amount borrowed. Answer: […]

The Electronic Funds Transfer System (EFTS) allows money to be transferred electronically from a depositor’s bank account into the account of a store where the depositor made a purchase. The U.S. Supreme Court was established by an act of Congress. […]

Stockholders have the power to a. elect directors. b. amend the by-laws. c. approve of a merger. d. all of these. An unpaid seller has the right to stop delivery of goods purchased on credit that were delivered to a […]

The buyer is usually responsible for paying the real estate agent’s commission. Johnson had a charge account at Brown’s Department Store. On the most recent statement, Johnson noticed a $90 charge that she had not made. What action may Johnson […]

Cohen said to Geary, “I’ll give you this radio if you promise to clean out my garage on Saturday.” Geary agreed. Who is the offeror? Who is the offeree? What was the consideration given to Cohen? What was the consideration […]

The Supreme Court case of Marbury v. Madison established the basis for the concept of judicial review in our legal system. In a sale of goods, if the seller breaches the contract by delivering nonconforming goods, risk of loss remains […]

An indorsee is the person who receives an indorsed instrument. A minor cannot be a witness to a will. Answer: F The drawer of a certified check cannot legally force a bank to stop payment on this type of check. […]

An assignment must always be in writing. “I won’t pay $500, but I will pay $300.” This offer to pay $300 instead of $500 is an example of a(n) ____________________. Answer: counteroffer>[/cpmembership] If a local government takes an individual’s land […]

An agreement that harms marriage is illegal because it is opposed to ____________________. ____________________ is the security given to a court to obtain the release of a person from jail until a hearing or trial. Answer: Bail> A merchant who […]

All restraints of trade are a violation of the Sherman Act. When a depositor dies, the authority of the bank to pay or certify the depositor’s checks ends immediately. Answer: F In personal injury lawsuits, attorneys are often paid a(n) […]

The ordinary stock of a corporation is called ____________________. All states permit the formation of limited partnerships. Answer: T A warranty can be given only at the time a product is purchased. Answer: F> The ____________________ signature was invented to […]

The ____________________ rule states that the offeree must match, term by term, what was requested in the offer. A(n) ____________________ is a person who benefits from private information received from a corporate insider. Answer: tippee The ____________________ of a corporation […]

The ambassador from Austria to the United States wanted to sue the ambassador from Chile for injuries in a car accident caused by the Chilean ambassador. In which court will this suit be brought? Perez invented a new type of […]

A taxpayer’s rights are described in publications of the ____________________. An unwitnessed, handwritten will is invalid. Answer: F One principle of our legal system is to acknowledge the equitable considerations of the parties involved. This principle is referred to as […]

All consumers are entitled to a free annual credit report. Delivering a negotiable instrument to the maker discharges it by cancellation. Answer: T A(n) ____________________ indorsement should be used if you mail a check to the bank for deposit. Answer: […]

One who transfers title to real property is called the grantee. Defamation can be either slander or libel. Answer: T Mortgages may always be assumed without the consent of the lender. Answer: F A contract that is so extremely unfair […]

A person who signs a negotiable instrument in an unauthorized manner is subject to ____________________ liability. A bailment in which only one party to the bailment, but not both benefits is called a(n) ____________________. Answer: gratuitous bailment Most businesses in […]

Under the common law, what are the three ways in which a contract can be discharged by impossibility? A limited partner does not have the right to inspect the books of the partnership. Answer: F If a contract is discharged […]

A minor breach of contract discharges the contract. A minor who is no longer under the control and authority of parents is said to be ____________________. Answer: emancipated With fraud in the inducement, the maker never intended to create the […]

The person or institution granting a loan on real property is called the ____________________. Is it true with the assignment of a personal right that all parties involved must agree to the transfer? If so, why? Answer: Yes. It would […]

If the holder of a negotiable instrument alters it in any significant way, the obligation of any affected parties is ____________________. How does full performance differ from substantial performance? Answer: Full performance is when both parties do all that they […]

When the transfer of a negotiable instrument is made either by assignment or by negotiation, the third party becomes a holder. What effect does death have on a contract that has already been formed? Answer: Death does not terminate a […]

If an agreement contains an illegal part that can be separated, the entire agreement is void. What is the significance of the seller sending conforming goods to the buyer? Answer: Conforming goods are goods that meet the requirements of the […]

A novation is another name for an accord and satisfaction. Words such as “Inc.” and “Corp.” indicate that a business is a corporation. Answer: T A hotelkeeper is prohibited from discriminating against potential guests by the ____________________ Act. Answer: Civil […]

A(n) ____________________ instrument is negotiated by indorsement and delivery. If a bailor fails to pack goods properly, a common carrier would not be liable for damage that results from the improper packing. Answer: T A contract for the sale of […]

____________________ is the fee paid by a borrower for the use of money. The statement made by the judge to the jury before jury members retire to the jury room to discuss the case is called the judgment. Answer: F […]

The Consumer Product Safety Commission does not have the power to force a toy manufacturer to place a warning label on its products. Both real and personal property can be the subject of a bailment. Answer: F Agreements enforceable without […]

In a criminal case, the defendant must be proven guilty beyond a reasonable doubt. Indorsers are generally liable in the order in which they indorse the instrument. Answer: T ____________________ is the right granted to a person or business to […]

While illegal contracts have civil penalties, the parties involved may also be subject to criminal penalties. In a(n) ____________________, the original contract is terminated and a new contract formed between the remaining party to the original contract and the new […]

Parol evidence is admissible to show changes after the written contract was made. To ____________________ means to obtain substitute goods elsewhere when the seller breaches the sales contract. Answer: cover Property pledged as collateral must be in the possession of […]

____________________ refers to the amount of time between the date a check is deposited and the date the funds from that check are made available to the depositor. The right of an employer to fire an employee at any time […]

If the seller breaches the sales contract, the buyer has a duty to cover. The concept of ____________________ resulted in the establishment of three branches of government. Answer: separation of powers Rice hired Carter, a real estate broker, to buy […]

A check is always payable on demand. A debtor who makes a part payment of the debt before the due date is still liable for the balance if there is no dispute over the debt. Answer: T The occupier of […]

When a corporation issues new stock, current stockholders may purchase additional shares before these shares are offered to the public. English common law is the basis for much of the law in Europe today. Answer: F A denial of credit […]

“Jurisdiction over the person” means that a court can hear and decide a case because it has authority over the ____________________ in the case. Liability for injuries on international flights is set by the Prague Convention. Answer: F Minors are […]

A trial court has the power to hear an appeal of a decision of a lower court. Remedies for breach of contract may be included in the sales contract. Answer: T Rental of any type of personal property is a […]

Parties to a negotiable instrument who have liability for payment of the instrument are classified as either primary parties or secondary parties. Distinguish between primary parties and secondary parties. A counteroffer ends the original offer and replaces it with a […]

Contrast objective impossibility with commercial impracticability. A(n) ____________________ sale occurs when a merchant sells all or a major part of the business assets. Answer: bulk Willis signed a blank check and left it in his desk drawer. A thief stole […]

A minor may disaffirm or ratify a portion of an agreement. Fram signed a contract to sell his home to Mills, with possession to be given on May 1. If Mills cannot obtain a mortgage by May 1 and the […]

Depositing money in a checking account at the bank results in a(n) ____________________ relationship. What is the significance of becoming the holder of a bearer instrument acquired illegally (e.g. stolen) and then legally having the power to pass the instrument […]