Archives: Quiz

The expectations augmented Phillips curve argues that unemployment varies with anticipated inflation. If a company’s total costs per day increase from $200 to $400 by adding another worker, but its additional benefits are $300, it is sensible to add that […]

Excess demand in an unregulated market will cause the price of a product to fall. During recessions, the full utilization of the capital stock raises labor productivity. Answer: FALSE Governments sometime create an excess demand for a product by setting […]

An increase in the price level increases the transaction demand for money. When federal government spending exceeds tax revenues, the federal government runs a budget surplus. Answer: FALSE An increase in taxes will increase total planned expenditures for goods and […]

A country facing a balance of payments deficit will change the pegged value of its currency; this is called a revaluation. Additional Application INFLATION-INDEXED BONDS IN THE UNITED STATES Are there bonds that can protect your investments from inflation? In […]

Flexible exchange rates require the coordination of economic policies between countries. All topics concerning taxes are within the realm of macroeconomics. Answer: FALSE A country that experiences population growth (holding K constant) will experience real GDP growth. Answer: TRUE When […]

The legal rule of imputed knowledge means that the principal is assumed to know what the agent knows. An act of an employer to prevent employees from entering the work premises when the employer reasonably anticipates a strike is known […]

One of the parties being intoxicated at the time of marriage is a ground for a legal annulment. Natural monopolies are found to violate Section 2 of the Sherman Act. Answer: FALSE The deferred posting rule allows banks to fix […]

In small claims courts, it is necessary that the parties are represented by a lawyer at all times. Acceptance of a part of any commercial unit is acceptance of the entire unit. Answer: TRUE Financing statements are effective for five […]

Separate property does not include property owned by a spouse prior to the marriage. According to Regulation A, securities of up to $5 million can only be sold to accredited investors. Answer: FALSE If an employer refuses to promote a […]

A ticket to a movie theater or sporting event is an example of a license. A buyer or lessee who rightfully covers may sue the seller or lessor for additional expenses paid. Answer: TRUE A maker or drawer can appoint […]

Traditional contract rules do not apply to e-contracts. The Critical Legal Studies School of jurisprudential thought seeks to restrict the subjective decision-making powers of judges. Answer: FALSE The United States considers Native American tribes as “domestic dependent” nations with limited […]

An offer is not effective until it is actually received by the offeree. The measure of damages for nondelivery is the difference between the contract price and the market price at the time the breach is realized. Answer: TRUE The […]

Relativism is one of the principles of Kantian ethics that states that the actor must abide by the rule he or she uses to judge the morality of someone else’s conduct. A corporation can be incorporated in several states. Answer: […]

The Department of Homeland Security is an example of a federal administrative agency. Decisions reached by an administrative law judge are final and cannot be appealed. Answer: FALSE ISPs provide e-mail accounts to users, Internet access, and storage on the […]

Complaints regarding violations of the ADA are filed with the U.S. Department of Justice. Firearms represent an example of consumer products which do not come under the CPSC rules. Answer: TRUE Goods in possession of bailees are considered to be […]

Bylaws of a corporation must be filed with a government official. An undeveloped real estate property is an example of future goods. Answer: FALSE To create an implied-in-fact contract, it must be established that a plaintiff provided a property or […]

Limited partners of a limited liability limited partnership (LLLP) are involved in the management functions of the partnership. If the value of the collateral securing a secured loan is less than the secured interest, the secured creditor is an oversecured […]

Discharge of an instrument by payment can be raised against enforcement of a negotiable instrument by an ordinary holder. A personal articles floater helps insure specific items like heirlooms. Answer: TRUE Joint marital debts are debts incurred by the spouses […]

The Federal Trade Commission (FTC) does not require the registration of the disclosure document with the FTC prior to its use. Workers who quit work without just cause can claim unemployment benefits. Answer: FALSE Shareholder voting agreements have to be […]

Some states that do not permit same-gender partners to marry provide that they can enter into civil unions. Without mutual assent, there is no contract. Answer: TRUE An existing limited partnership cannot be converted to a limited liability limited partnership. […]

If a person owns real property in fee simple, his or her ownership has no limitation on inheritability. A special indorsement is negotiable by indorsement and delivery. Answer: TRUE A registration statement need not contain details on how the proceeds […]

In a destination contract, title passes to the buyer when the seller tenders delivery of the goods at the specified destination. Nuncupative wills are legally binding oral wills that are made on a testator’s deathbed in the absence of witnesses. […]

A terminated life estate property reverts to the grantor or the grantor’s estate or other designated person. In a lease transaction, title to the leased goods passes to the lessee. Answer: FALSE An offer is terminated if the subject matter […]

The Uniform Transfers to Minors Act establishes procedures for adults to make irrevocable gifts of money and securities to minors. For a life insurance, insurable interest is necessary at the time of loss. Answer: FALSE Only outstanding shares have the […]

According to a minor’s duty of restoration, the goods received from an adult should be returned in status quo after the contract has been disaffirmed by the minor. A consignee is a person to whom a common carrier makes a […]

Agency relationships created against public policy are void and unenforceable. The Law and Economics School of jurisprudential thought believes that promoting market efficiency should be the central goal of legal decision making. Answer: TRUE If no time is stated in […]

State governments do not have the power to regulate commerce with foreign nations. The Consumer Product Safety Commission (CPSC) is an independent federal administrative agency empowered to regulate potentially dangerous consumer products and issue product safety standards. Answer: TRUE Only […]

A franchise is an example of a license. A bargaining unit must consist of employees from a single company. Answer: FALSE A bridge would be an example of real property. Answer: TRUE Persons who transfer goods without proper title breach […]

Once the number of board of directors is fixed by the articles of incorporation, the number cannot be amended. If an accession is made wrongfully, the improver acquires title to the improved property and does not have to pay the […]

In all child custody cases, only the custodial parent has the right to make decisions on behalf of the child. A reward is a form of bilateral contract. Answer: FALSE A single failure by a franchisee to meet a quality-control […]

If both parties to a contract are minors, both parties have the right to disaffirm the contract. A check that has been outstanding for more than three months is considered stale, and the bank is under no obligation to pay […]

An indorsement that purports to prohibit further negotiation of an instrument does not destroy the negotiability. A third party who sues to recover on a partnership contract need not name all the general partners in the lawsuit. Answer: FALSE The […]

Indorsements are required to negotiate bearer papers. If no document of title is required, title only passes at the time and place of delivery. Answer: FALSE Kantian ethics is based on the premise that people can use reasoning to reach […]

The duty of restitution states that a competent party should be placed in status quo by the minor upon disaffirmance of a contract. The mislabeling of medicinal devices is prohibited under the Nutrition Labeling and Education Act. Answer: FALSE Abstractions […]

The Sarbanes-Oxley Act requires the chief executive officer (CEO) and chief financial officer (CFO) to certify annual and quarterly reports. After becoming sober, an intoxicated person can ratify the contracts he or she entered into while intoxicated. Answer: TRUE For […]

A person who was legally insane at the time of entering a contract is relieved of his or her duties from the contract. Ordinances are not codified into code books. Answer: FALSE Express contract can be stated orally. Answer: TRUE […]

Disclaimer of consequential damages is unlawful in most instances. In a sublease, no legal relationship is formed between the landlord and the sublessee. Answer: TRUE To be enforceable, a contract must be supported by consideration. Answer: TRUE A debtor-in-possession is […]

The merger of two grocery store chains that serve the same geographical market is an example of a horizontal merger. An agency by ratification occurs when a principal ratifies an authorized act. Answer: FALSE An easement is a form of […]

Profits and losses from a Limited liability company (LLC) do not have to be distributed in the same proportion. Shareholders are responsible for determining how much will be paid in dividends. Answer: FALSE A stop-payment order can be issued either […]

An unequivocal acceptance must not contain conditions or exceptions. The 2005 act requires an attorney certificationwhereby an attorney who represents a client in bankruptcy must certify the accuracy of the information contained in the bankruptcy petition. Answer: TRUE The EPA […]

The patent term begins to run from the date the patent is issued. Section 5 of the Federal Trade Commission (FTC) Act can be used to prohibit unfair and deceptive business practices. Answer: TRUE A person can sue for nonperformance […]

Apparent agency arises when a franchisee creates the appearance of being a franchisor’s agent when in fact an actual agency does not exist. Predictions about the future generally do not form the basis for fraud. Answer: TRUE A general partnership […]

An S corporation cannot have more than 100 shareholders. The Endangered Species Act applies only to private parties. Answer: FALSE Only one continuation statement can be filed for a financing statement. Answer: FALSE The CAN-SPAM Act does not regulate spam […]

The act of people interested in the lawsuit joining as parties to an existing lawsuit is called arbitration. Any contract entered into by a person who has been adjudged insane is void. Answer: TRUE Powers not given to the federal […]

A contract that has been fully performed by both sides is called an executory contract. A statute of limitations establishes the time period during which a lawsuit must be brought. Answer: TRUE According to the failing company doctrine, two or […]

A risk utility analysis requires showing that a product is more dangerous than the ordinary consumer would expect. A complainant can file his or her claim of discrimination with a state fair employment practices agency instead of the Equal Employment […]

A contract is considered to be supported by legal value if the promisor suffers a legal detriment. If a delegatee has not assumed the duties under a contract, the delegatee is not liable to the obligee for nonperformance. Answer: TRUE […]

The ULPA contains provisions for the formation, operation, and dissolution of limited partnerships. Terms such as ‘sell,” “convey,” and “give” indicate the intent to transfer a contract right. Answer: TRUE Proof of actual deception is required for an advertising to […]

According to the RMBCA, only corporations with 50 or fewer shareholders may elect statutory close corporation status. In an auction with reserve, the bidder is the offeror. Answer: TRUE A holder can convert a blank indorsement into a special indorsement […]

A divorce is the only method for legally terminating a marriage. The Due Process Clause of the U.S. Constitution grants Congress the power “to regulate commerce with foreign nations, and among the several states, and with Indian tribes.” Answer: FALSE […]