Question 1
Jose transfers his house by means of a deed to his mother for her lifetime and with a remainder to go to his sister. Thus,
a)Jose created a “life estate” in favor of his sister.
b)Jose reserved a remainder for himself.
c)C. Jose created a remainder in favor of his sister.
d)D. Jose did nothing since all future interests in real property are illegal.
Question 2
Which of the following would not be a misappropriation of a trade secret?
a)Paying an engineer who is working at a competitor to disclose the trade secret to you.
b)Buying the competitor's product, then tearing it apart and analyzing it in your laboratory to reveal how the product works.
c)Hiring a spy to break into a competitor's offices to acquire the secret.
d)Asking one of your current engineers to disclose a trade secret of her former employer and she does so.
Question 3
A City ordinance that restricts some vendors selling certain “ethnic foods” from doing business in a heavily trafficked area would likely be struck down under constitutional provisions covering
a)equal protection.
b)procedural due process.
c)substantive due process.
d)the right to privacy.
Question 4
Where the articles of incorporation are silent as to what constitutes a quorum of shareholders at a shareholders' meeting, what typically is a quorum?
a)The articles must provide for the amount that constitutes a quorum.
b)A majority of the shares entitled to vote.
c)Two-thirds of the shares entitled to vote.
d)One-third of the shares entitled to vote.
Question 5
X offers to sell Y a computer. Y sends an acceptance via the mail. This acceptance is generally effective when it is
a)in transit.
b)received.
c)sent or dispatched.
d)written.
Question 6
Which of the following statements is false?
a)Notice-and-comment rulemaking is the most common rulemaking procedure used by administrative agencies in the United States to make law.
b)Tort law provides legal remedies for both personal injury and property damage.
c)To commit an intentional tort, a person must intend the consequences of his or her act or know with substantial certainty that certain consequences will occur.
d)To commit an intentional tort, a person always must act with an evil motive to commit physical harm.
Question 7
Which of the following is a true statement?
a)In a limited liability company in the U.S., members cannot participate in management.
b)In a limited liability company in the U.S. members must participate in management.
c)The typical state limited liability company (LLC) statute in the U.S. would provide that unless the members agree otherwise, all profits of the LLC will be divided equally.
d)Corporations do not possess any rights under the U.S. Constitution since corporations are artificial legal entities and not real persons.
Question 8
Which of the following is a true statement?
a)The “police power” of a state does not give the state any general authority to regulate business.
b)Garbage that is transported across state lines can be considered to be interstate commerce regardless of economic value.
c)The Commerce Clause of the Constitution gives Congress the power to regulate commerce with foreign nations and Indian tribes only.
d)Congress can only regulate activities that are actually interstate commerce but not activities that affect interstate commerce.
Question 9
To be convicted of a crime under U.S. laws, the prosecution typically must prove the case against the defendant:
a)By a preponderance of the evidence.
b)By clear and convincing evidence.
c)Beyond a reasonable doubt.
d)None of the above.
Question 10
A corporation typically may not have:
a)a single incorporator.
b)a single shareholder.
c)a single director.
d)it may have any of the above.
Question 11
The requirement that goods tendered to a buyer must conform in all ways to the terms of the contract is called the:
a)Complete Performance rule.
b)Perfect tender rule.
c)No right to cure rule.
d)Substantial performance rule.
Question 12
Which is NOT a violation of U.S. anti-trust law?
a)Horizontal price-fixing by competitors
b)Vertical price-fixing that is not supported by the Rule of Reason
c)A group boycott of manufacturers against retailers motivated by economic reasons
d)A unilateral refusal to deal by a manufacturer against a retailer who disregards the manufacturer's MSRP (manufacturer's suggested retail price).
Question 13
Which of the following is/are true about the principal agency relationship?
a)In a non-disclosed principal situation, the agent is typically initially liable to the third party.
b)Under the ratification doctrine, a principal can ratify and thus authorize an agent’s contract with a third party that was not originally authorized by the principal.
c)Under the imputed knowledge and notice doctrine, a principal can be charged with the knowledge of facts that had been disclosed to the principal’s agent.
d)All of the above.
Question 14
A law passed by a state to give its courts jurisdiction over persons and businesses located in other states in known as:
a)Total jurisdiction statute.
b)Venue statute.
c)Long-arm statute.
d)In personam statute.
Question 15
Who can be deemed liable for trading on material inside information based on U.S. securities laws?
a)Misappropriators of inside information
b)Insiders and tipees in conspiracy with insiders
c)Inadvertent tipees who are in a fiduciary relationship with the disclosing party
d)All of the above.
Question 16
The requirement(s) of a valid offer in contract law is(are) the following:
a)The manifestation of a definite intent to enter into a contract by the offeror and the communication of this intent to the offeree
b)Reasonable definitiveness in the terms of the offer
c)Serious intent on the part of the offeror as determined by the "reasonable person" test
d)All of the above.
Question 17
Which of the following is true regarding contract validity?
a)A void contract is one where a party has the option to avoid her contractual liability.
b)A voidable contract is one in which a party may avoid his or her obligation under that contract.
c)A voidable contract is one that has no legal effect because one of the essential elements is missing.
d)An executory contract is also unenforceable.
Question 18
Which of the following is not a correct statement concerning the reasons sufficient to give a court power to dissolve a partnership?
a)A partnership may be dissolved if one of the partners is declared physically disabled or mentally incompetent.
b)A partnership may be dissolved because a partner is shown to be not adequately performing his or her part of the partnership contract.
c)A partnership may be dissolved if the business can only be carried on with substantial continuing losses.
d)A partnership may be dissolved if one of the partners commits misconduct or gross negligence or materially breaches the partnership agreement.
Question 19
Which form of real property ownership includes the greatest degree of ownership?
a)Fee simple subject to condition subsequent.
b)Fee simple determinable.
c)Fee simple absolute.
d)Absolute life estate.
Question 20
The purpose of a proxy is to:
a)Allow a shareholder to transfer shares to another.
b)Allow a shareholder to place shares in trust.
c)Allow a shareholder to assign her right to vote to another.
d)Allow a shareholder to assign her dividends to another.
Question 21
The major disadvantage of a sole proprietorship is:
a)The difficulty and cost of formation.
b)The unlimited liability for the business's debts.
c)The sharing of management authority with others.
d)The difficulty in transferring ownership to others.
Question 22
Which of the following is a true statement?
a)The Uniform Commercial Code is an example of federal Congressional law in the United States.
b)The Uniform Commercial Code’s implied warranty of fitness for a particular purpose applies only to merchants.
c)To disclaim the implied warranty of merchantability the exact word “merchantability” must be used.
d)A Uniform Commercial Code contract must have a definite price term or it will be struck down for vagueness.
Question 23
Even an employee at-will can sue for wrongful discharge when he or she:
a)Is discharged in violation of Title VII of the Civil Rights Act.
b)Is discharged in violation of the Public Policy doctrine.
c)Is negligently discharged by the employer.
d)All of the above.
Question 24
Which of the following is a false statement?
a)Pursuant to the UCC, an agreement modifying a contract generally needs no new consideration to be binding.
b)An oral contract for goods that are specially manufactured for a particular buyer may be enforceable under the UCC even without a writing.
c)The Convention on Contracts for the International Sale of Goods closely follows the Uniform Commercial Code of U.S. law.
d)Pursuant to the Uniform Commercial Code, a merchant who sells one type of good will be considered a merchant for any other type of good that he or she sells since a merchant is a merchant.
Question 25
An offer lapses upon the following except:
a)Counteroffer.
b)Rejection.
c)Reliance.
d)Death of theofferor.
Question 26
Which of the following is a FALSE statement?
a)Congress has the power in Article I of the Constitution to regulate interstate commerce.
b)The power of Congress to regulate business pursuant to the interstate commerce clause in the Constitution is very broad.
c)States cannot pass any law that regulates any aspect of interstate commerce since the federal Congress has sole and exclusive jurisdiction in this area.
d)States may be able to pass laws that regulate certain aspects of interstate commerce for health and safety reasons if there is no direct conflict with federal law, no discrimination against commerce from other states, and no undue burdens placed on interstate commerce.
Question 27
Each of the following is a function of law except:
a)Helping to shape moral views and standard
b)Helping to maintain the status quo
c)Allowing personal retaliation by victims against their aggressors
d)Helping to facilitate orderly change.
Question 28
Which is NOT a violation of U.S. anti-trust law?
a)Horizontal price-fixing by competitors
b)Vertical price-fixing that is not supported by the Rule of Reason
c)A group boycott of manufacturers against retailers motivated by economic reasons
d)A unilateral refusal to deal by a manufacturer against a retailer who disregards the manufacturer’s MSRP (manufacturer’s suggested retail price).
Question 29
Where there is no agreement to share profits in a partnership, but one partner has devoted twice as much time to the partnership as the other over the course of the year, how are profits to be split?
a)In the ratio of time devoted to the partnership.
b)Fairly, as determined by a court or other neutral party.
c)The profits must remain in the partnership and not be distributed.
d)Equally.
Question 30
A bridge’s design is defective and soon after completion it begins to visibly sway in the wind. Everyone stays off, except Carl, who wants to show off. Carl falls from the bridge and sues its maker, who can raise the defense of
a)assumption of risk.
b)commonly known danger.
c)product misuse.
d)none of the above.
Question 31
“Cyber” crimes today encompass:
a)Identity theft
b)“Cyber stalking”
c)“Hacking” and “spamming”
d)All of the above.
Question 32
Which of the following is a false statement?
a)The U.S. Constitution expressly states that Congress has the power to regulate interstate commerce.
b)When state regulations in the U.S. impinge on interstate commerce, commerce must yield to the state regulations, no matter how heavy the burden placed on the commerce since states possess sovereignty within their borders.
c)When there is a direct conflict between a federal and state law in the U.S., the state law is rendered invalid.
d)Some federal constitution protections in the U.S. apply to business entities such as corporations.
Question 33
a)The requirement(s) of a valid offer in contract law is(are) the following:
b)The manifestation of a definite intent to enter into a contract by the offeror and the communication of this intent to the offeree
c)Reasonable definitiveness in the terms of the offer
d)Serious intent on the part of the offeror as determined by the “reasonable person” test
All of the above.
Question 34
Which is true about corporate criminal liability?
a)Corporations have always been just as subject to criminal liability as individuals.
b)Because a corporation cannot be sent to prison, they generally cannot be held criminally liable for the actions of their officers.
c)If the criminal conduct can be traced to a specific person or persons, those persons will be liable and not the corporation.
d)There can be liability for both the individuals who commit crimes and for the corporation on whose behalf the crimes were committed.
Question 35
a)The seller can recover the purchase price for the goods only under certain circumstances, including when:
b)The buyer accepts, but fails to pay for the goods.
c)The goods are destroyed after risk of loss passes to the buyer.
d)The buyer rejects specially manufactured goods that cannot be resold.
e)A, B and C.
Question 36
Which of the following is a true statement?
a)The Federal Trade Commission is the federal agency in the U.S. that is empowered to prevent and punish unfair and deceptive marketing and advertising practices in trade or commerce.
b)The Consumer Products Safety Commission in the U.S. prohibits manufacturers from selling and marketing products unless they are marked with the agency’s official “seal of approval.”
c)Common law legal doctrines no longer apply to polluters in the U.S. since they are so big and powerful and thus can only be regulated by federal statutory law.
d)An environmental impact statement is required in the U.S. for all federal and state government development projects and for all proposed federal and state legislation.
Question 37
All written contracts that have a set of promises are
a)Formal
b)Valid
c)Bilateral
d)Executed
Question 38
What is the significance of a "defect" in a products liability case based on strict liability?
a)It is not necessary, but can be used to eliminate the need to prove that there was an injury.
b)It is a required element in the proof of such a case.
c)Its presence would eliminate liability for the defendant.
d)The party who caused the defect is the only one who can be held liable.
Question 39
Under which of the following can a party collect damages?
a)Unilateral mistake
b)Mutual mistake
c)Palpable mistake
d)Fraud in the inducement.
Question 40
Which of the following is a false statement?
a)If only one item is flawed out of thousands of similar items that were manufactured, the one flawed product might not be the basis for a negligence lawsuit but could be the basis for a products liability lawsuit based on strict liability.
b)Failure to warn about the dangers of a product can make an otherwise safe product defective pursuant to strict liability law.
c)A defect in a manufactured product can make the manufacturer liable for injuries caused by the product even if the manufacturer exercised due care in the manufacture of the product.
d)In a products liability lawsuit based on strict liability, an injured plaintiff need only prove that the product caused him or her harm.
Question 1
Which ethical theory would be described as the most “democratic” one?
a)Locke’s Natural Rights theory
b)Rousseau’s Social Contract theory
c)Kant’s Categorical Imperative
d)Machiavelli’s The Prince
Question 2
Which of the following is NOT an accurate statement?
a)One problem with utilitarianism is that there is no principle in the theory to determine how the greater good should be distributed.
b)The effect of an action on society as a whole always will be an important factor in any utilitarian calculation.
c)One problem with the Act version of utilitarianism is that it is subject to the rationalization of pre-determined moral judgments.
d)The Rule version of utilitarianism requires that individual, unique, particular, concrete actions be subject to the utilitarian test.
Question 3
Which of the following is not accurate?
a)One benefit to being a sincere ethical emotist is that one is morally infallible.
b)One convenience to being an ethical emotist is that one can change one’s mind about a moral issue simply by expressing a different feeling about an action.
c)Morality is a societal-based phenomena according to the doctrine of ethical relativism.
d)Cultural relativism is a prescriptive ethical theory that sets forth moral norms.
Question 4
The ethical theory of Ethical Emotism can best be characterized by:
a)The consultation of an outside source, such as a book or person, for guidance.
b)The belief that persons who have a “veil of ignorance” about their place or station in society should determine moral rules.
c)The belief that a person must decide what course of action is proper based on that person’s own set of feelings.
d)Determining which course of action produces the greatest amount of good for the greatest number of people.
Question 5
Someone who believes that moral decisions should be made so that the greatest amount of good in total results from the actions believes in what ethical theory?
a)Ethical relativism
b)Utilitarianism
c)Ethical fundamentalism
d)Kantian ethics
Question 6
Which of the following is FALSE about Socrates?
a)He believed that there was universal, objective, and permanent truth to ethics and morality.
b)He believed along with the Sophists that virtue comes from having money and the best reputation that money can buy.
c)His Socratic Method contained an important element of inductive reasoning and argumentation.
d)He equated virtue with knowledge.
Question 7
President Abraham Lincoln very succinctly explained his rationale for his condemnation of and opposition to slavery, to wit: "As I would not be a slave, so I shall not be a master." Lincoln's reasoning best exemplifies what ethical theory?
a)Legal Positivism of Thomas Hobbs
b)Ethical Relativism of the Sophists
c)The Categorical Imperative of Immanuel Kant
d)Utilitarianism of Bentham and Mills.
Question 8
Kant was a believer in:
a)Fatalism
b)Determinism
c)Free Will
d)Relativism
Question 9
A problem with the theory of ethical relativism is:
a)Defining the appropriate “society.”
b)The inability to make comparative moral judgments between and among societies.
c)The inability to criticize a society as immoral for its moral norms.
d)All are problems.
Question 10
Pete, an employee of Quality Sales, Inc., takes a Kantian duty-based approach to ethics. Pete believes that he must
a)achieve the greatest good for the most people.
b)avoid unethical behavior as determined by reason regardless of the consequences.
c)conform to society’s standards.
d)place his employer’s interest first.