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Business Law Fundamentals CHAPTER 12-Mul-US-Moderate Final Exam 1 Sample: QN=1 The law set the rules of conduct for
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Business Law Fundamentals
CHAPTER 12-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
A(
QN=1
) is one in which two or more people are bound both jointly and severally.
a.
Joint and several contract
b.
Joint contract
c.
Several contract
d.
None of the choices “Joint and several contract, Joint contract and Several contract”
e. f. ANS:
A
PTS:
1
CHAPTER:
12
MIX CHOICES:
Yes
QN=2
Third party can become involved in a contract by (
a.
Novation
b.
Assignment
c.
Delegation
d.
Novation, assignment and delegation
).
e. f. ANS:
D
PTS:
1
CHAPTER:
12
MIX CHOICES:
Yes
QN=3
When a joint contract is not carried out may the aggrieved party must sue (
a.
Either of joint- parties individually
b.
All of joint-parties together
c.
None of joint-parties
d.
Several-parties
e. f. ANS:
B
PTS:
1
CHAPTER:
12
MIX CHOICES:
Yes
).
QN=4
The third party beneficiary may claim for his/ her rights under the contract in the case of ( ).
a.
Donnie beneficiary
b.
Creditor beneficiary
c.
Incident beneficiary
d.
Either of Donee beneficiary, Creditor beneficiary or Incident beneficiary
e. f. ANS:
B
PTS:
1
CHAPTER:
12
MIX CHOICES:
Yes
QN=5
When one assigns rights under a contract the assignee (ng chuyen nhuong) can receive ( ).
a.
Greater rights than the assignor held
b.
Less rights than the assignor held
c.
Equal rights that the assignors held
d.
The rights to extent which depends on the assignor’s intention
e. f. ANS:
C
PTS:
1
CHAPTER:
12
MIX CHOICES:
Yes
QN=6
Unless otherwise expressed, a promise made by two or more people is generally presumed to be ( ).
a.
Joint contract
b.
Several contract
c.
Joint and several contract
d.
Based on later consent of both parties
e. f. ANS:
B
PTS:
1
CHAPTER:
12
MIX CHOICES:
Yes
QN=1
The common law and equity law system in the United States was emerged from ( ).
a.
France
b.
Russia
c.
England
d.
Germany
e. f. ANS:
C
PTS:
1
CHAPTER: 1
MIX CHOICES:
QN=2
Yes
The law set the rules of conduct for many transactions so that we will know how to (
) disputes (tranh chấp).
a.
Avoid
b.
Terminate
c.
Carry
d.
Take
e. f. ANS:
A
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
QN=3
Why was the Bill of Rights enacted?
a.
To protect the civil rights and liberties of the citizens and the states.
b.
To oppose the world war.
c.
To protect the citizens against the bad impact of nature.
d.
All of the choices “To protect the civil rights and liberties of the citizens and the states”, “To oppose the world war”, and “To protect the citizens against the bad impact of nature”.
e.
f. ANS:
A
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
QN=4
Law is a rule of conduct that enacted and enforced by the Sovereign State.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
QN=5
The basic relationship between the government and citizen is defined by (
a.
Judicial decisions
b.
Constitutions
c.
Administrative agency orders
d.
Ordinances
).
e. f. ANS:
B
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
QN=6
In the field of business law, (
a.
The Uniform Commercial Code
b.
CISG
c.
Incoterms 2010
d.
Trade practice
) is the most important statute.
e. f. ANS:
A
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
QN=7
In the United States of America, courts will mainly base on precedent to settle down the dispute.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
QN=8
A Precedent means the court’s decision for the previous case is applied to determine the decision for the later case if ( )
a.
It is found similarities between them.
b.
It is found difference between them.
c.
No law is available.
d.
No court’s rules are good enough.
e. f. ANS:
A
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
QN=9
Law is issued by the chairman of a corporation.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
QN=10
Common Law is English custom recognized by (
a.
Government
b.
National Assembly
c.
Courts
d.
Prosecution
) as binding
e. f. ANS:
C
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 13-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
If a contract states no time for performance, when must it be performed?
a.
Performance must ordinarily be rendered within a reasonable time
b.
Performance must ordinarily be rendered within a time agreed by contractual parties
c.
Performance will be rendered at any time
d.
None of the choices: “Performance must ordinarily be rendered within a reasonable time”, “Performance must ordinarily be rendered within a time agreed by contractual parties” and “Performance will be rendered at any time”
e. f. ANS:
A
PTS:
1
CHAPTER:
13
MIX CHOICES:
Yes
QN=2
Bankruptcy leads to (
).
a.
Terminate a contract by law
b.
Invalidate a contract
c.
Avoid a contract
d.
Invalidate the contract
e. f. ANS:
A
PTS:
1
CHAPTER:
13
MIX CHOICES:
Yes
QN=3
Liquidated damage is (
a.
Agreed by both parties to a contract in advance in the event a breach of the contract
b.
Announced by the court to punish aggrieving party if needed
c.
Fixed equal to injuries to enforce fairness
d.
Punished when no damage occurs
e. f. ANS:
A
PTS:
1
CHAPTER:
13
MIX CHOICES:
Yes
).
QN=4
A person has the rights to sue based on (
a.
Statue of limitation
b.
Time issued by court in case by case
c.
Time fixed by both party before hand
d.
Statue of timing-suit.
).
e. f. ANS:
A
PTS:
1
CHAPTER:
13
MIX CHOICES:
Yes
QN=5
After singing the contract, the obligation under contract is impossible to perform, both parties may treat the contract ( ).
a.
Invalid
b.
Discharged
c.
Voidable
d.
Unenforcable
e. f. ANS:
B
PTS:
1
CHAPTER:
13
MIX CHOICES:
Yes
QN=1
(
) are tangible personal property.
a.
Loans
b.
Bonds
c.
Copyrights
d.
Cars
e. f. ANS:
D
PTS:
1
CHAPTER:
14
MIX CHOICES:
Yes
QN=2
Title does not transfer by ( ) until the person who made the will dies and appropriate judicial proceedings have taken place.
a.
Will
b.
Purchase
c.
Descent
d.
Gift
e. f. ANS:
A
PTS:
1
CHAPTER:
14
MIX CHOICES:
Yes
QN=3
A gift is one way to obtain the title of personal property.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
14
MIX CHOICES:
Yes
QN=4
Fungible goods are goods of homogeneous nature sold by weight or measure.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
14
MIX CHOICES:
Yes
QN=5
The finder of lost property has a right of possession against everyone.
a.
False
b.
True
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
14
MIX CHOICES:
Yes
QN=6
One may acquire personal property by creation.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
14
MIX CHOICES:
Yes
QN=7
The laws of an intestate's state of residence determine how the heirs acquire title to personal property.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
14
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 14-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1 a.
Under UCC, the seller expects to acquire the goods in the future either by ( manufacture. Sell
b.
Purchase
c.
Borrow
d.
Lease
e. f. ANS:
B
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
QN=2
The sale of bonds is a sale of goods under UCC.
a.
True
b.
False
c. d. e.
) or by
f. ANS:
B
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
QN=3
The reasonable price for the same goods in the market shall be implied, in case there is no express term on the price.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
QN=4
Under UCC, (
a.
A sale of furniture
b.
A sale of copyrights
c.
A sale of land
d.
A sale of shares
) is a sale of goods.
e. f. ANS:
A
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
QN=5
In accordance with UCC, (
a.
A purchase of a real estate
b.
A purchase of automobiles
c.
A purchase of potatoes
d.
A sale of computers
) is not a sale contract.
e. f. ANS:
A
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
QN=6
Goods, in a sale of goods, mean (
a.
Immovable property
).
b.
Intangible movable property
c.
Tangible movable property
d.
Immovable property, intangible movable property and tangible movable property
e. f. ANS:
C
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
QN=7
Under UCC, price in a sale of goods could be paid for by (
a.
Money
b.
Goods
c.
Services
d.
Money, goods and services
e. f. ANS:
D
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
).
QN=8
Under UCC, a Sale contract will not be valid even if it does not state the exact price.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
QN=9
Under UCC, if the sale is divisible with a legal part and an illegal part, the court will ( )
a.
Enforce the legal part only.
b.
Announce the whole contract invalid
c.
Recognize the whole contract valid
d.
Leave choice to avoid contract to both parties
e. f. ANS:
A
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
QN=10
Under UCC, which property subjects to Sales?
a.
House
b.
Land
c.
Copyrights
d.
Horse
e. f. ANS:
D
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
QN=11
Under UCC, if a party to a sale contract indicates that the price must be fixed by them or by third party at a later date, will the contract be binding?
a.
Yes
b.
No
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 16-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
The (
a.
Offeror
b.
Offeree
c.
All of the choices: “Offeror”, “Offeree”, and “Bidder”
d.
Bidder
e. f. ANS:
D
) is the one who makes the offer in the auction sales.
) disputes.
PTS:
1
CHAPTER:
17
MIX CHOICES:
Yes
QN=2
Under UCC, an oral contract may be enforced if the buyer has made full ( contract.
a.
Agreement
b.
Termination
c.
All of the choices: “Agreement”, “Termination” and “Payment”
d.
Payment
e. f. ANS:
D
PTS:
1
CHAPTER:
17
MIX CHOICES:
Yes
QN=3
(
a.
Receipts
b.
Bill of sale
c.
Invoice
d.
None of the choices: “Receipts”, “Bill of sale” and “Invoice”
e.
) is taking possession of the goods.
) on the
f. ANS:
A
PTS:
1
CHAPTER:
17
MIX CHOICES:
Yes
QN=4
Under UCC, if the sale price of a contract for the sale of goods is equal to or more than $500, the contract will not be valid if it is not ( ).
a.
In writing
b.
In writing and the oral evidence is not permitted
c.
Under seal
d.
Under signature
e. f. ANS:
B
PTS:
1
CHAPTER:
17
MIX CHOICES:
Yes
QN=5
Under UCC, the contracts with equal to or more than 500 USD will not invalid if proof of oral contract is permitted.
a.
True
b.
False
c. d.
e. f. ANS:
A
PTS:
1
CHAPTER:
17
MIX CHOICES:
Yes
QN=6
The bidder is the one who makes the offer in the auction sales.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
17
MIX CHOICES:
Yes
QN=7 a.
Under UCC, an oral contract cannot be enforced if the buyer has made full payment on the contract. False
b.
True
c. d.
e. f. ANS:
A
PTS:
1
CHAPTER:
17
MIX CHOICES:
Yes
QN=8 a.
Under UCC, must all contracts for the sale of goods exist in writing when the sale price is $500 or more, unless otherwise provided by law? Yes
b.
No
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
17
MIX CHOICES:
Yes
Business Law Fundamentals Sample:
CHAPTER 17-Mul-US-Moderate
Final Exam 1
QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
The title to existing goods, identified at the time of contracting and not to be transported, passes to the buyer ( ).
a.
At the time and place of delivery
b.
At the time of delivery and place of the seller
c.
At the time and place of contracting
d.
At the time the seller has completes the delivery
e. f. ANS:
D
PTS:
1
CHAPTER:
18
MIX CHOICES:
Yes
a.
In case existing goods require transporting, when does title to the goods pass to the buyer? Title to the goods passes to the buyer when the seller has completed delivery.
b.
Title to the goods passes to the buyer when delivery has just begun.
c.
Title to the goods passes to the buyer before the seller’s manufacture finishes.
d.
All of the choices: “Title to the goods passes to the buyer when the seller has completed delivery”,” Title to the goods passes to the buyer when delivery has just begun”, and “Title to the goods passes to the buyer before the seller’s manufacture finishes”.
QN=2
e. f. ANS:
A
PTS:
1
CHAPTER:
18
MIX CHOICES:
Yes
QN= 3
In case a contract for sale of goods is ( the goods to the initial carrier.
a.
A shipment contract
b.
A destination contract
c.
A COD contract
d.
A F.O.B (UCC) contract
e. f. ANS:
A
PTS:
1
CHAPTER:
18
), the seller shall be obliged to deliver
Mix choices
Yes
QN=4
Regarding international trade, Incoterms are widely used.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
18
MIX CHOICES:
Yes
a.
Fungible goods are goods of a homogeneous or like nature that may be sold by weight or measure. True
b.
False
QN=5
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
18
MIX CHOICES:
Yes
QN=6 a.
For future goods marking and shipment, title and risk of loss pass to the buyer when shipment or delivery occurs. True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
18
MIX CHOICES:
Yes
QN=7 a.
After the risk of loss passes to the buyer, a seller has no liability for any damage to the goods. False
b.
True
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
18
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 18-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
A statement "this is a good engine" is (
a.
Merely the seller's opinion
b.
An express warranty
c.
An implied warranty
d. e. f.
).
) disputes.
ANS:
A
PTS:
1
CHAPTER:
19
MIX CHOICES:
Yes
QN=2
An implied warranty differs from an express warranty in that (
).
a.
It is made by the seller and is imposed by the law
b.
c.
All of the choices: “It is made by the seller and is imposed by the law”, “It is not made by the seller but is imposed by the law”, and “It is made by the seller but is imposed by the law”. It is not made by the seller but is imposed by the law
d.
It is made by the seller but is imposed by the law
e. f. ANS:
C
PTS:
1
CHAPTER:
19
MIX CHOICES:
Yes
QN=3 a.
For food or drink, the sale carries the ( purpose of human consumption. Limited warranty
b.
Implied warranty
c.
Express warranty
d.
Full warranty
e.
) that the food is fit for its ordinary
f. ANS:
B
PTS:
1
CHAPTER:
19
MIX CHOICES:
Yes
QN=4
Warranty implied by all sellers is (
a.
Title
b.
Merchantability
c.
patent or trademark infringement
d.
Fitness for particular use of buyer
).
e. f. ANS:
A
PTS:
1
CHAPTER:
19
MIX CHOICES:
Yes
QN=5
Warranties of all sellers include (
a.
Warranty of title
b.
Warranty against encumbrances
c.
Warranty of conformity to description, sample and model
d.
Warranty of fitness for a particular purpose
).
e.
Warranty of title, warranty against encumbrances, warranty of conformity to description, sample and model and warranty of fitness for a particular purpose
f. ANS:
E
PTS:
1
CHAPTER:
19
MIX CHOICES:
Yes
QN=6
The seller says as "Our products are on the top of the World." His oral statement is ( ).
a.
An express warranty
b.
An implied warranty
c.
The seller's puffing
d. e. f. ANS:
C
PTS:
1
CHAPTER:
19
MIX CHOICES:
Yes
QN=7
The seller's statement shall be considered as a warranty if it contains the word "warranty" or "guarantee".
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
19
MIX CHOICES:
Yes
QN=8
A warranty of title cannot be excluded in any case.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
19
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 19-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
In order to try a case a court must have jurisdiction (
a.
Only over the subject matter of the case
b.
Only over the persons involved in the case
c.
Over both the subject matter of the case and the persons involved
d.
Courts do not always have to have jurisdiction
e. f. ANS:
C
PTS:
1
CHAPTER:
2
).
) disputes.
MIX CHOICES:
Yes
QN=2
The Supreme Court of the United States (
a.
Are review courts
b.
Belong to state courts system
c.
Are the highest courts in the United states.
d.
Belong to federal courts system.
).
e. f. ANS:
D
PTS:
1
CHAPTER:
2
MIX CHOICES:
Yes
QN=3
(
a.
Jurisdiction
b.
Answer
c.
Interrogatory
d.
Summons
e. f. ANS:
A
PTS:
1
) is the authority of a court to hear a case.
CHAPTER:
2
MIX CHOICES:
Yes
QN=4
(
) are part of the federal government.
a.
County courts
b.
Federal courts
c.
District courts.
d.
State courts.
e. f. ANS:
B
PTS:
1
CHAPTER:
2
MIX CHOICES:
Yes
QN=5
The power or authority of a court to hear cases is called its (
a.
Jurisdiction
b.
Illegal right
c.
None of all.
d.
Liberty right
e. f. ANS:
A
).
PTS:
1
CHAPTER:
2
MIX CHOICES:
Yes
QN=6
The chief functions of the court are to (
a.
Interpret and apply the law from whatever source to a given situation.
b.
Resolve disputes even in the case those disputes were not brought before the court
c.
Punish the criminal only
d.
Award the injured party in civil suit only
).
e. f. ANS:
A
PTS:
1
CHAPTER:
2
MIX CHOICES:
Yes
QN=7
Taken an approach of governmental unit setting up the court, the court may be divided into federal court, state court and municipal courts.
a.
True
b.
False
c. d. e.
f. ANS:
A
PTS:
1
CHAPTER:
2
MIX CHOICES:
Yes
QN=8
The Supreme Courts has original jurisdiction or trial jurisdiction over cases of ( ).
a.
Any kinds
b.
Ambassadors, public ministers, and consuls and in cases in which state is a party
c.
Special matters which will be decided late by Judges.
d.
Ambassadors, public ministers, and consuls
e. f. ANS:
B
PTS:
1
CHAPTER:
2
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 2-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
) disputes.
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
The duty of proving the amount of damage in a tort lawsuit belongs to (
a.
Defendant
b.
Court
c.
All
d.
Plaintiff
).
e. f. ANS:
D
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=2
A trademark gives the owner the ( product or a service.
a.
Exclusive duty.
b.
Exclusive right.
) to use a word or device to distinguish a
c.
Inclusive duty
d.
Inclusive right.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=3
( ) is the unauthorized use or confusingly similar imitation of another person’s mark or name.
a.
Trade name infringement.
b.
Violation.
c.
Infringement.
d.
All of the choices “Trade name infringement”, “Violation” and “Infringement”.
e. f. ANS:
A
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=4
A tort (
).
a.
Is always based on a negligent activity.
b.
Is prosecuted by a district attorney.
c.
Is a civil wrong for which damages may be recovered.
d.
Is the result of a failure to exercise reasonable care toward someone.
e. f. ANS:
C
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=5
The failure to exercise a duty of care is (
a.
Constitution
b.
Equity
c.
Negligence
d.
Precedent
).
e. f. ANS:
C
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=6
Interference with a contract or economic advantage which causes a party to a contract to break off the contract is committed business tort.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=7
The doctrine of strict liability makes a manufacturer liable without proof of negligence for dangerous product.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER: MIX CHOICES:
3 Yes
QN=8
A battery is the intentional harmful or offensive touching of another without consent or privilege.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=9
If a person is injured when he/she is using a product, the manufacturer of the product shall be held liability for such injury.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 3-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
(
a.
The employee
b.
The agent
c.
The owner
d.
The creditor
e. f. ANS:
C
) of the sole proprietorship has ultimate and unlimited liability for its debts.
PTS:
1
CHAPTER:
31
MIX CHOICES:
Yes
QN=2
Laura sets up a store in a form of a sole proprietorship, namely "Laura Fashion". Laura Fashion has unpaid debt. May the creditor require Laura to pay this unpaid debt?
a.
Yes
b.
No
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
31
MIX CHOICES:
Yes
QN=3
The (
a.
General partner
b.
Proprietor
c.
Shareholder
d.
Joint venture party
e.
) shall have the limited liability.
f. ANS:
C
PTS:
1
CHAPTER:
31
MIX CHOICES:
Yes
QN=4
A corporation is (
).
a.
An agreement of individuals
b.
An association created by law into an entity
c.
A person
d.
An agreement of individuals, an association created by law into an entity and a person
e. f. ANS:
B
PTS:
1
CHAPTER:
31
MIX CHOICES:
Yes
QN=5
A corporation must be registered as a legal entity.
a.
True
b.
False
c.
d. e. f. ANS:
A
PTS:
1
CHAPTER:
31
MIX CHOICES:
Yes
QN=6
The nature of Articles of Corporation is a/an (
a.
Commitment
b.
Promise
c.
Contract
d.
Unilateral contract
).
e. f. ANS:
C
PTS:
1
CHAPTER:
31
MIX CHOICES:
Yes
QN=7
Members in joint-stock company have (
a.
Limited liability
b.
Unlimited liability
).
c.
Either of limited liability or unlimited liability
d.
Both of limited liability and unlimited liability
e. f. ANS:
B
PTS:
1
CHAPTER:
31
MIX CHOICES:
Yes
QN=8
There are only three types of business organization.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER: 31 MIX CHOICES:
Yes
QN=9
A general partnership is (
).
a.
A partnership with no limitation on rights of partners
b.
A partnership with no limitation on duties of partners
c.
A partnership with no limitation on rights, duties and/or liabilities of partners
d. e. f. ANS:
C
PTS:
1
CHAPTER: 31 MIX CHOICES:
Yes
QN=10
A proprietor must be (
a.
A person
b.
A legal entity
c.
A corporation
d.
A household
e. f. ANS:
A
PTS:
1
CHAPTER: 31 MIX CHOICES:
Yes
).
Business Law Fundamentals
CHAPTER 31-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
The right to have a corporate seal is (
a.
Incidental power of corporation
b. c.
All of the choices: “Incidental power of corporation”, “Express power of corporation”, and “Implied power of corporation” Express power of corporation
d.
Implied power of corporation
e. f. ANS:
A
PTS:
1
CHAPTER:
34
).
MIX CHOICES:
Yes
QN=2
Knight Corporation signs a contract for purchase of land to build its factory. Its action is within ( ).
a.
Express power
b.
Implied power
c.
Incidental power
d. e. f. ANS:
C
PTS:
1
CHAPTER: 34 MIX CHOICES:
Yes
QN=3
Every corporation has three types of powers: express, incidental, and implied.
a.
True
b.
False
c. d. e. f.
ANS:
A
PTS:
1
CHAPTER: 34 MIX CHOICES:
Yes
QN=4
A corporation shall not be held liable on contracts negotiated by its promoter on its behalf prior to incorporation unless ( ).
a.
Such contracts benefit it
b.
Such contracts do not harm it
c.
It ratifies or adopts such contracts
d.
Such promoter becomes its director
e. f. ANS:
C
PTS:
1
CHAPTER: 34 MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 34-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
) disputes.
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
Watered stock is (
).
a.
Reacquired by a corporation
b.
With assigned face value
c.
Giving special advantage
d.
Issued as fully paid up, but paid with property of inflated values
e. f. ANS:
D
PTS:
1
CHAPTER:
35
MIX CHOICES:
Yes
QN=2
The common shareholder is an owner of (
a.
Common share(s)
b.
Voting preference share(s)
c.
Dividend preference share(s)
).
d.
Redeemable preference share(s)
e. f. ANS:
A
PTS:
1
CHAPTER:
35
MIX CHOICES:
Yes
QN=3
A stock option gives an individual an option to purchase shares at fixed price for a stated period of time.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER: 35 MIX CHOICES:
Yes
QN=4
In case, ownership of shares is not evidenced by a stock certificate, ownership is shown on ( ).
a.
The corporation’s corporate record book
b.
The corporation's bylaws
c.
The corporation's articles of incorporation
d. e. f. ANS:
A
PTS:
1
CHAPTER: 35 MIX CHOICES:
Yes
QN=5
A stock certificate presents the capital stock of a corporation.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER: 35 MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 35-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
a.
To be valid, a stockholders’ meeting requires the presence of a minimum number of shares that must be represented in order that business may be lawfully transacted. This is called ( ). Requirement on quasi contract
b.
Requirement on quorum
c.
Requirement on voting trust
d.
Requirement on voting
e. f. ANS:
B
PTS:
1
CHAPTER:
36
MIX CHOICES:
Yes
QN=2
Who manages the corporation?
a.
Officers
b.
Both of the choices: “Directors” and “Officers”
c.
Directors
d.
None of the choices “Directors” and “Officers”
e. f. ANS:
B
PTS:
1
CHAPTER:
36
MIX CHOICES:
Yes
QN=3
Right to purchase new shares in proportion to shares owned is called (
a.
Preemptive right
b.
Right of voting
c.
Right to stock option
d.
All of the choices: “Preemptive right”, “Right of voting”, and “Right to stock option”
e. f. ANS:
A
).
PTS:
1
CHAPTER:
36
MIX CHOICES:
Yes
QN=4
A stockholder who holds 51% of shares of common stock has no the right to participate in direct management of a corporation.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER: 36 MIX CHOICES:
Yes
QN=5
A director has a right to vote for issues falling within power of stockholders.
a.
True
b.
False
c. d.
e. f. ANS:
A
PTS:
1
CHAPTER: 36 MIX CHOICES:
Yes
QN=6
Is voting the most important right of a stockholder?
a.
Yes
b.
No
c. d. e. f. ANS:
A
PTS:
1
CHAPTER: 36 MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 36-Mul-US- Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
) disputes.
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1 a.
Personal property that securely attached to real estate in order to become part of the real estate is called ( ). Cars
b.
Fixture
c.
All of the choices: “Cars”, “Fixture”, and “Cups”
d.
Cups
e. f. ANS:
B
PTS:
1
CHAPTER:
41
MIX CHOICES:
Yes
QN=2
The most common ways real property can be owned by more than one person include ( ).
a.
Tenancy in common
b.
Joint tenancy
c.
Tenancy in entirety
d.
All of the choices: “Tenancy in common”, “Joint tenancy” and “Tenancy in entirety”
e. f. ANS:
D
PTS:
1
CHAPTER:
41
MIX CHOICES:
Yes
QN=3
To see whether Personal Property is regarded as real property, it is essential to look at ( ).
a.
What is the purpose of attachment and who attached the personal property?
b.
Intention to install the personal property only
c.
Person installing the personal property needs to be true owner only
d.
Whether the personal property is tangible or intangible
e. f. ANS:
A
PTS:
1
CHAPTER:
41
MIX CHOICES:
Yes
QN=4
When many persons own property in a way of tenancy in common, they cannot inherit the outsiders.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
41
MIX CHOICES:
Yes
QN=5
Multiple ownership of husband and wife during marriage is (
a.
Tenancy in common
b.
Joint tenancy
c.
Tenancy by entirety
d.
Common tenancy
e. f. ANS:
C
PTS:
1
CHAPTER:
41
MIX CHOICES:
Yes
).
Business Law Fundamentals
CHAPTER 41-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
A voidable contract (
a.
Must be in writing.
b.
Must be rejected by both parties.
c.
Gives one party the choice to abide by it or reject it.
d.
Is never effective.
e. f. ANS:
C
PTS:
1
CHAPTER:
5
).
) disputes.
MIX CHOICES:
Yes
QN=2 a.
A( ) is one in which the terms are set forth in writing rather than expressed orally. Executed contract
b.
Executory contract
c.
Written contract
d.
Oral contract
e. f. ANS:
C
PTS:
1
CHAPTER:
5
MIX CHOICES:
Yes
QN=3
A(
a.
Executory contract
b.
Oral contract
c.
Formal contract
d.
None of the choices “Executory contract”, “Oral contract” and “Formal contract”
e. f. ANS:
C
PTS:
1
) must be in a special form or be created in a certain way.
CHAPTER:
5
MIX CHOICES:
Yes
QN=4
A (an) (
) consists of a mutual exchange of promises to perform some future acts.
a.
Bilateral contract.
b.
Bilateral contract, Quasi contract and Executory contract.
c.
Quasi contract.
d.
Executory contract.
e. f. ANS:
A
PTS:
1
CHAPTER:
5
MIX CHOICES:
Yes
QN=5
According to the contract law of the US, how many requirements that a contract must meet in order to be valid
a.
5
b.
4
c.
3
d.
6
e. f. ANS:
A
PTS:
1
CHAPTER:
5
MIX CHOICES:
Yes
QN=6
Failure to perform contractual duties is breach of contract.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
5
MIX CHOICES:
Yes
QN=7
The King offers to pay $100,000 to anyone who kills the Monster and brings the Princess back to the Kingdom. Robin cuts the Monster' head off and brings the beautiful Princess back, the King gives such hero the bonus of $100,000. In this case, there is ( ).
a.
A bilateral contract existing
b.
A unilateral contract existing
c.
No contract existing
d. e. f. ANS:
B
PTS:
1
CHAPTER:
5
MIX CHOICES:
Yes
QN=8
Simple contracts may be (
a.
Implied from the conduct of the parties
b.
Imposed by Law
c.
A quasi-contract
d.
Implied from the conduct of the third party
).
e. f. ANS:
A
PTS:
1
CHAPTER:
5
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 5-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f.
) disputes.
ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
Advertisements, window displays, catalogs, price lists, etc. are common types of ( make an offer.
a.
Invitation.
b.
New offer.
c.
Disagreement.
d.
New acceptance.
) to
e. f. ANS:
A
PTS:
1
CHAPTER:
6
MIX CHOICES:
Yes
QN=2
An offer that does not specify a ( reasonable under the circumstances.
a.
Particular manner
b.
Participated manner
c.
Unparticipated manner
d.
Particular manner, Participated manner and Unparticipated manner are right.
e. f. ANS:
A
) of acceptance may be accepted in any manner
PTS:
1
CHAPTER:
6
MIX CHOICES:
Yes
QN=3
A manifestation must (
a.
Be definite
b.
Show the manifesting person's intention to be legally bound
c.
Be communicated to a person who the manifesting person intents to be bound with
d.
Be definite, show the manifesting person's intention to be legally bound and be communicated to a person who the manifesting person intents to be bound with
) to be an offer.
e. f. ANS:
D
PTS:
1
CHAPTER:
6
MIX CHOICES:
Yes
QN=4
If the offer is communicated by means of facsimile without specifying any particular manner of acceptance, the acceptance could be ( ).
a.
Communicated by email
b.
Communicated by email or facsimile
c.
Communicated in an reasonable manner
d.
Communicated as required in the offer
e. f.
ANS:
C
PTS:
1
CHAPTER:
6
MIX CHOICES:
Yes
QN=5
A revocation of an offer is valid if communicated to the offeree (
a.
Prior to a counteroffer
b.
At any time before its acceptance
c.
At any time.
d.
Prior to inquiry
).
e. f. ANS:
B
PTS:
1
CHAPTER:
6
MIX CHOICES:
Yes
QN=6
An offer directed to a specific individual or firm cannot be accepted by anyone else.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
6
MIX CHOICES:
Yes
QN=7
The offer must be communicated to the offeree.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
6
MIX CHOICES:
Yes
QN=8
An option can be revoked at will.
a.
False
b.
True
c. d. e. f.
ANS:
A
PTS:
1
CHAPTER:
6
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 6-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
Almost all of a minor's contracts are avoidable at the minor's option.
a.
True
b.
False
c.
d. e. f. ANS:
A
PTS:
1
CHAPTER:
7
MIX CHOICES:
Yes
QN=2
A( ) who contracts with an adult may avoid the contract or treat the contract as valid and then the adult is bound by it.
a.
Intoxicated person.
b.
Minor.
c.
Convict.
d.
None of Intoxicated person, Minor and Convict
e. f. ANS:
B
PTS:
1
CHAPTER:
7
MIX CHOICES:
Yes
QN=3
Who are not capable of making a legally enforceable contract
a.
Adults
b.
Minors
c.
Mentally incompetent people
d.
Minors and/ or mentally incompetent people
e. f. ANS:
D
PTS:
1
CHAPTER:
7
MIX CHOICES:
Yes
QN=4
After reaching majority, minors may treat the contract made by them during minority to extent which ( ).
a.
Rejects it at any time
b.
Ratifies it within reasonable time
c.
Keeps silence to reject it
d.
Accepts it at any time
e. f. ANS:
B
PTS:
1
CHAPTER:
7
MIX CHOICES:
Yes
QN=5
Does the term disaffirmance mean the repudiation of a contract?
a.
No
b.
Yes
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
7
MIX CHOICES:
Yes
QN=6
If an adult purchases personal property from a minor, the adult has only a voidable title to the property.
a.
False
b.
True
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
7
MIX CHOICES:
Yes
QN=7
Minor is a person under the age of majority.
a.
False
b.
True
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
7
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 7-Mul-US-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
) disputes.
QN=1
According to Vietnamese Law, which below property is defined as real property
a.
Motorbike
b.
Chicken
c.
Horse
d.
Property attached securely to land
e. f. ANS:
D
PTS:
1
CHAPTER:
41
MIX CHOICES:
Yes
QN=2
According to Vietnamese Law, husband and wife possess community property by common ownership by integration
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
41
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 41-Mul-VN-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
In Vietnam, if dividend payment is made in cash, it must be made in (
a.
Vietnam dong
b.
USD
c.
Singapore dollar
d.
Any other currencies
e. f. ANS:
A
PTS:
1
).
CHAPTER:
35
MIX CHOICES:
Yes
QN=2
a.
In Vietnam, The General Meeting of Shareholders shall be conducted where the number of attending shareholders represents at least ( ) per cent of the voting shares. 65
b.
55.
c.
75
d.
50
e. f. ANS:
A
PTS:
1
CHAPTER:
35
MIX CHOICES:
Yes
QN=3
According to the law of Vietnam, the charter capital of the corporation is (
a.
The total money value of its assets
b.
The minimum capital required by law
c.
The amount of money registered in the business registration certificate
d.
The declared money value of its outstanding stock
e. f. ANS:
C
)
PTS:
1
CHAPTER: 35 MIX CHOICES:
Yes
QN=4
According to the law of Vietnam, the ordinary shares may not be converted into preference shares.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER: 35 MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 35-Mul-VN-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
) disputes.
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
According to Vietnamese law, a limited liability company must have three members at least.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
31
MIX CHOICES:
Yes
QN=2
In Vietnam, state owned company is stated in detail in (
a.
2005 Civil Code
b.
2005 Commercial Law
c.
2009 Law on Personal Income Tax.
).
d.
None of the choices: “2005 Civil Code”, “2005 Commercial Law” and “ 2009 Law on Personal Income Tax”.
e. f. ANS:
D
PTS:
1
CHAPTER:
31
MIX CHOICES:
Yes
Which is the following sentence right?
QN=3 a.
In Vietnam, private company is entitled to issue share.
b.
In Vietnam, private company is entitled to issue stock.
c.
In Vietnam, private company has unlimited liability.
d.
In Vietnam, private company has limited liability.
e. f. Answer
C
PTS
1
Chapter
31
Mix choices
Yes
QN=4
According to the law of Vietnam, (
a.
A member of a limited liability company
) has an unlimited liability.
b.
A shareholder
c.
A general partner
d.
An owner of an one-member limited liability company
e. f. Answer
C
PTS
1
Chapter
31
Mix choices
Yes
QN=5
According to the law of Vietnam, (
a.
A sole proprietorship
b.
A branch of a corporation
c.
A representative office of a corporation
d.
A partnership
) is a legal entity.
e. f. Answer
D
PTS
1
Chapter
31
Mix choices
Yes
QN=6
According to the law of Vietnam, members in joint-stock company have (
).
a.
Unlimited liability
b.
Limited liability
c.
Both of unlimited liability and limited liability
d.
Either of unlimited liability or limited liability
e. f. Answer
B
PTS
1
Chapter
31
Mix choices
Yes
QN=7
According to the law of Vietnam, a member of a limited liability company with two or more members must be an individual.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER: 31 MIX CHOICES:
Yes
QN=8
According to the law of Vietnam, the number of members of a limited liability company shall not exceed ( ).
a.
02
b.
05
c.
15
d.
50
e. f. ANS:
D
PTS:
1
CHAPTER: 31 MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 31-Mul-VN-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
) disputes.
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
Under Vietnamese 2005 Commercial Law, if the purchase and sale contract states the time of delivery of goods, then ( ).
a.
The contractual parties are required to deliver goods at the time agreed in the contract
b.
The contractual parties are required to deliver goods at the time not to be agreed in the contract The contractual parties are required to deliver goods at the time agreed in another document All of The contractual parties are required to deliver goods at the time agreed in the contract, The contractual parties are required to deliver goods at the time not to be agreed in the contract and The contractual parties are required to deliver goods at the time agreed in another document
c. d.
e. f. ANS:
A
PTS:
1
CHAPTER:
18
MIX CHOICES:
Yes
QN=2
Under Vietnamese 2005 Commercial Law, unless otherwise agreed, where the subject of the contract is goods currently in transit then the risk of loss or damage to the goods shall not pass to the purchaser as from the time of entering into the contract.
a.
False
b.
True
c. d.
e. f. ANS:
A
PTS:
1
CHAPTER:
18
MIX CHOICES:
Yes
QN=3
a.
According to Vietnamese 2005 Commercial Law, unless otherwise agreed, the risk of loss or damage to goods shall pass to the purchaser if the goods are not clearly identifiable by codes or signs on them or by transportation vouchers; if the goods have not been notified to the purchaser or; if the goods are not able to be verified by any other means. False
b.
True
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
18
MIX CHOICES:
Yes
Business Law Fundamentals Sample:
CHAPTER 18-Mul-VN-Moderate
Final Exam 1
QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
Under Vietnamese 2005 Commercial Law, international purchases and sales of goods must be implemented on the basis of an oral contract.
a.
False
b.
True
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
17
MIX CHOICES:
Yes
QN=2 a.
According to Vietnamese 2005 Commercial Law, international purchase and sale of goods cannot be implemented in the form of import. False
b.
True
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
17
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 17-Mul-VN-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
) disputes.
MIX CHOICES:
Yes
QN=1
In Vietnam, liability to compensate for damage occurs when (
).
a.
At Fault and Wrongdoing
b.
Wrongdoing
c.
Injury and Wrongdoing
d.
At Fault, Wrongdoing, Injury and Causality between Injury and Wrongdoing
e. f. ANS:
D
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=2
According to the law of Vietnam, a person who causes damage while acting within the requirement of emergency situation shall not be liable for such damage.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=3
According to the law of Vietnam, causation means that (
a.
The damage must occur
b.
The damage results from the violation of law
c.
The injured person must prove the amount of damage
d.
The injured person must prove the fault of the wrongdoer
).
e. f. ANS:
B
PTS:
1
CHAPTER: 3 MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 3-Mul-VN-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
In Vietnam, the Supreme People’s Court has all of trial, appeal and review jurisdiction.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
2
MIX CHOICES:
Yes
QN=2
In Vietnam, according to Vietnamese law, the court system includes, the court can be divided into Vietnamese Supreme People’s court, People’s Courts of provinces and cities directly under central authority and People’s Courts of districts, prefectures, towns or cities under the provinces.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
2
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 1-Mul-VN-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
) disputes.
QN=1
According to the law of Vietnam, the number of members of the board of management ( ).
a.
Must be three at least
b.
Must be eleven at least
c.
Must be three at least but not more than eleven
d.
Must be three at least but not more than eleven unless otherwise provided by the charter
e. f. ANS:
D
PTS:
1
CHAPTER: 36 MIX CHOICES:
Yes
QN=2
According to the law of Vietnam, a member of the board of management must be a shareholder.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER: 36
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER36-Mul-VN- Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
Accordingly the Law on Enterprise of Socialist Republic of Vietnam, a corporation must have two shareholders at least.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
34
MIX CHOICES:
Yes
QN=2
In 2005 Enterprise Law, the minimum number of shareholders in joint-stock company is ( ).
a.
03
b.
06
c.
07
d.
08
e. f. ANS:
A
PTS:
1
CHAPTER:
34
MIX CHOICES:
Yes
QN=3
According to the law of Vietnam, a founding shareholder means a shareholder involved in formulating, approving and signing the first charter of a shareholding company.
a.
True
b.
False
c. d.
e. f. ANS:
A
PTS:
1
CHAPTER:
34
MIX CHOICES:
Yes
QN=4
According to the law of Vietnam, the scope of business must be indicated in the business registration certificate.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER: 34 MIX CHOICES:
Yes
Business Law Fundamentals Sample:
CHAPTER 34-Mul-VN-Moderate
Final Exam 1
QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
In Vietnam, the rights and interests of the consumers shall be protected by ( ).
a.
The Law on Protection of Consumer's Interests
b.
The Civil Code
c.
The Law on Protection of Consumer's Interests and Civil Code
d.
The Law on Protection of Consumer's Interests and Civil Code and other relevant legal instruments enacted by the State
e. f. ANS:
D
PTS:
1
CHAPTER: 19 MIX CHOICES:
Yes
QN=2
According to the law of Vietnam, a period of warranty for a sold object is calculated from the time the buyer actually receives the sold object.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER: 19 MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 19-Mul-VN-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
) disputes.
MIX CHOICES:
Yes
QN=1
In Vietnam, form of contract for purchase and sale of goods shall be expressed ( ).
a.
Orally
b.
In writing
c.
By specific conduct
d.
Orally, or in writing, or by specific conduct
e. f. ANS:
D
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
QN=2
In Vietnam, which particular law governs domestically commercial activities
a.
The Commercial Law 2005
b.
The Enterprise Law 2005
c.
The Constitution.
d.
The Investment Law 2005
e. f. ANS:
A
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
QN=3
Vietnam is a member of the United Nations Convention of Contracts for the International Goods (CISG)
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
QN=4
Under Vietnamese law, which property is subject to Sale contracts regulated by the Commercial Law 2005?
a.
House owned by an individual person (not a business person) sold to his neighbor for residence
b.
Land
c.
Pictures
d.
Forests
e. f.
ANS:
C
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
QN=5
According to Vietnamese law, a contract for sale of goods shall be governed by the Law on Commerce of 2005 if both parties are business men
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 16-Mul-VN-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
) disputes.
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
In Vietnam, car is not personal property.
a.
False
b.
True
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
14
MIX CHOICES:
Yes
QN=2
Under Vietnamese 2005 Civil Code, intellectual property rights are personal property.
a.
True
b.
False
c.
d. e. f. ANS:
A
PTS:
1
CHAPTER:
14
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 14-Mul-VN- Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
) disputes.
QN=1
According to Vietnamese law, when all the obligations under contract is carried out fully, the contract will be discharged.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
13
MIX CHOICES:
Yes
QN=1
In Vietnam, either of parties to a contract dies, which cannot be replaced by a new party because of personal requirements, the contract will be ( ).
a.
Void
b.
Unenforceable
c.
Voidable
d.
Discharged
e. f. ANS:
D
PTS:
1
CHAPTER:
13
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 13-Mul-VN-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
Vietnamese law does not allow any of parties to a contract is replaced by the outsider even with the same terms.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
12
MIX CHOICES:
Yes
QN=2
Under Vietnamese law, when one transfers rights under contract, a notice needs to be given to the non-assigning party in a form of ( ).
a.
Oral
b.
Written
c.
Conduct
d.
Any kinds
e. f. ANS:
B
PTS:
1
CHAPTER:
12
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 12-Mul-VN-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
In Vietnam, adult are full (
a.
16 years old.
b.
18 years old.
c.
19 years old.
d.
15 years old.
) or older:
e. f. ANS:
B
PTS:
1
CHAPTER:
7
MIX CHOICES:
Yes
QN=2
In Vietnam, minor is under full (
a.
18
b.
21
c.
25
) years old.
d.
None of 18, 21, and 25
e. f. ANS:
A
PTS:
1
CHAPTER:
7
MIX CHOICES:
Yes
QN=3
a.
In Viet Nam, contracts made by persons who are between full six years old and under full eighteen years old must have the consents of their representatives at law when establishing and performing civil transactions, except those transactions to meet their daily-life needs suitable to their age group or otherwise provided for by law. True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
7
MIX CHOICES:
Yes
Business Law Fundamentals Sample:
CHAPTER 7-Mul-VN-Moderate
Final Exam 1
QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
According to Vietnamese law, offer can be revoked if (
a.
Communicated to offerree before his/her acceptance
b.
Communicated to offerree at any time
c.
Communicated to offerree at reasonable time
d.
Communicated to offerree after his/her acceptance
).
e. f. ANS:
A
PTS:
1
CHAPTER:
6
MIX CHOICES:
Yes
QN=2
In Vietnam, offer and acceptance are governed by (
)
) disputes.
a.
2005 Civil Code
b.
2005 Enterprise Law
c.
Constitution
d.
Land law
e. f. ANS:
A
PTS:
1
CHAPTER:
6
MIX CHOICES:
Yes
QN=3 a.
Under Vietnamese 2005 Civil Code, the acceptance of an offer to enter into a contract is the offeree’s reply to the offeror on the acceptance of the whole contents of the offer. True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
6
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 6-Mul-VN-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
In Vietnam, a court grants a decision based on (
a.
Its higher court's decision for the previous similar case
b.
The supreme court's decision for the previous similar case
c.
Its own decision for the previous similar case
d.
Statutes
e. f. ANS:
D
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
).
) disputes.
QN=2
(
) is the most important source of law in both Vietnam and America.
a.
Constitution
b.
Statue Rules
c.
Judicial decisions
d.
Administrative orders
e. f. ANS:
A
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
QN=3
In Vietnam, the Constitution is enacted by (
a.
The Government
b.
The Supreme People's Court
c.
The National Assembly
d.
The People
e. f. ANS:
C
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
).
QN=4
According to Vietnamese law, judge’s decision is one of the sources of law.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
QN=5
According to Vietnamese law, hierarchy of applying legal documents sets out in ( ).
a.
The Commercial Law 2005
b.
The Law on issuing the legal normative documents 2008
c.
The Civil Code 2005
d.
The Enterprise Law 2005
e. f. ANS:
B
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 1-Mul-VN-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
According to Vietnamese 2005 Civil Code, to be effective, a civil transaction must ( ).
a.
Be created by the persons having full civil act capacity
b.
Have the purposes and contents which do not violate prohibitory provisions of law and are not contrary to social ethics. Be created voluntarily by the persons participating in the civil transaction
c. d.
All of the choices: “Be created by the persons having full civil act capacity; “Have the purposes and contents which do not violate prohibitory provisions of law and are not contrary to social ethics”; and “be created voluntarily by the persons participating in the civil transaction”
e. f. ANS:
D
PTS:
1
CHAPTER:
5
MIX CHOICES:
Yes
QN=2
In Vietnam, a civil contract will be governed by (
a.
2005 Civil Code
b.
2005 Enterprise Law
c.
Constitution
d.
Housing law
).
e. f. ANS:
A
PTS:
1
CHAPTER:
5
MIX CHOICES:
Yes
QN=3
Under Vietnamese 2005 Civil Code, civil transactions with purposes and contents violating prohibitory provisions of law or contravening social ethics will be ( )
a.
Void
b.
Valid
c.
Voidable
d.
Legal
e. f.
ANS:
A
PTS:
1
CHAPTER:
5
MIX CHOICES:
Yes
QN=4
According to Vietnamese law, lack of consideration makes a contract invalid.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
5
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 5-Mul-VN-Moderate
Final Exam 1
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e.
) disputes.
f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
According to Vietnamese law, if a law and the Constitution are contrasted with each other, ( ).
a.
The Constitution will prevail
b.
The Law will prevail
c.
Both of the Law and the Constitution will be terminated
d.
Both of the Law and the Constitution will be applicable together.
e. f. ANS:
A
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
QN=2
In Vietnam, the Decree issued by the Government is (
).
a.
Beyond the law issued by the National Assembly and will be followed by the law issued by the National Assembly
b.
Below the law issued by the National Assembly and has to follow the law issued by the National Assembly
c.
The highest or beyond any law issued by the other state bodies
d.
The lowest or below any law issued by the other state bodies
e. f. ANS:
B
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
QN=3
According to Vietnamese law, the Decision issued by the Prime Minister cannot against the Decree made by the Government.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 1-Mul-US-hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
) disputes.
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
Pursuant to the Vietnamese law of contract, the obligor is entitled to refuse to perform the obligations assigned from the obligee to the assignee in case ( unless otherwise agreed by the parties.
a.
He is not prior notified of the assignment in writing
b.
The assignment is not approved by him in advance
c.
The assignment is notified him but he does not approve
d.
The assignment does not benefit the obligor
e. f. ANS:
A
PTS:
1
CHAPTER:
12
MIX CHOICES:
Yes
)
QN=2
Under Vietnamese law, when one transfer duties to others, it is vital to ask for permission of non-delegating party to a contract, otherwise it will be held invalid.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
12
MIX CHOICES:
Yes
QN=3
In Vietnam, the contract for the third party’s interest cannot be revoked except in the case that ( ).
a.
The third party agreed so.
b.
If the third party is donee beneficiary
c.
Two parties to a contract agreed to do so
d. e. f. ANS:
A
PTS:
1
CHAPTER:
12
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 12-Mul-VN-Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
According to Vietnamese law, the contract for sale of goods shall be terminated in case ( ).
a.
The Seller performs the late delivery of goods
b.
The Buyer breaches his payment obligation
c.
The goods are destructed on the way to the Buyer's store
d.
It is unilaterally rescinded by the Seller/Buyer in the event agreed in the contract
e. f. ANS:
D
PTS:
1
CHAPTER:
13
MIX CHOICES:
Yes
QN=2
According to Vietnamese law, one party to a contract may unilaterally terminate the contract unilaterally when ( ).
a.
Prohibited by Law
b.
Banned by Law
c.
Provided under contract that either of party is entitled to do so
d.
Agreed by court
e. f. ANS:
C
PTS:
1
CHAPTER:
13
MIX CHOICES:
Yes
QN=3
In Vietnam, if the contract is not impossible to perform on the ground that subject matter of the contract no longer exists, the parties to a contract may ( ).
a.
Agree to make the contract invalid
b.
Treat the contact voidable
c.
Agree to substitute the subject matter of the contract with another subject matter or to compensate for any damage
d.
Unilaterally terminate the contract
e.
f. ANS:
C
PTS:
1
CHAPTER:
13
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 13-Mul-VN-Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
In Viet Nam, motorbike is a personal property.
a.
True
b.
False
c.
) disputes.
d. e. f. ANS:
A
PTS:
1
CHAPTER:
14
MIX CHOICES:
Yes
QN=2
According to Vietnamese 2005 Civil Code, right to possession is one of three basic rights of ownership right.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
14
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 14-Mul-VN-Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
According to Vietnamese Commercial Law 2005, the subject of sale contracts are things attached to Land.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
1
MIX CHOICES:
Yes
QN=2
In Vietnam, if both parties under Contract are not businessman and having contracted for life- needs. If, dispute happens, court will employ ( ) to resolve the case.
a.
The Commercial Law 2005
b.
The Civil Code 2005
c.
The Enterprise Law 2005
d.
The Civil Law 2005
e. f. ANS:
B
PTS:
1
CHAPTER:
16
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 16-Mul-VN-Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
) disputes.
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
Under Vietnamese 2005 Commercial Law, international purchases and sales of goods must be implemented on the basis of a written contract or in other forms with equivalent legal validity.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
17
MIX CHOICES:
Yes
QN=2
According to Vietnamese 2005 Commercial Law, international purchase and sale of goods cannot be implemented in the form of export.
a.
False
b.
True
c. d. e.
f. ANS:
A
PTS:
1
CHAPTER:
17
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 17-Mul-VN-Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
Under Vietnamese 2005 Commercial Law, if the purchase and sale contract contains a clause on transportation of the goods and the seller is not obliged to deliver the goods at a certain location, then ( ).
a. b. c. d.
The risk of loss or damage to the goods shall pass to the purchaser when the goods have been handed over to the initial carrier The risk of loss or damage to the goods shall pass to the purchaser before the goods have been handed over to the initial carrier The risk of loss or damage to the goods shall pass to the purchaser at any time None of The risk of loss or damage to the goods shall pass to the purchaser when the goods have been handed over to the initial carrier; The risk of loss or damage to the goods shall pass to the purchaser before the goods have been handed over to the initial carrier; and The risk of loss or damage to the goods shall pass to the purchaser at any time
e. f. ANS:
A
PTS:
1
CHAPTER:
18
MIX CHOICES:
Yes
QN=2
Under Vietnamese 2005 Commercial Law, unless otherwise agreed, where the subject of the contract is goods currently in transit then the risk of loss or damage to the goods shall pass to the purchaser as from the time of entering into the contract.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
18
MIX CHOICES:
Yes
QN=3
According to Vietnamese 2005 Commercial Law, unless otherwise agreed, the risk of loss or damage to goods shall not pass to the purchaser if the goods are not clearly identifiable by codes or signs on them or by transportation vouchers, if the goods have not been notified to the purchaser or if the goods are not able to be verified by any other means.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
18
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 18-Mul-VN-Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
) disputes.
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
According to the 2005 Civil Code of Vietnam, the seller shall be liable to compensate the consumption buyer for the damage caused by the article sold to the buyer if ( ).
a.
The damage occurs at any time within the period of warranty
b.
There is a technical defect in the article
c.
The damage results from the technical defect in the article during the period of warranty
d.
The damage results from the defect in the article
e. f. ANS:
C
PTS:
1
CHAPTER: 19 MIX CHOICES:
Yes
QN=2
According to the 2005 Civil Code of Vietnam, in case the article caused damage to the consumption buyer as a result of technical defect of such article, he/she may ( ) during a period of warranty.
a.
Demand the seller to perform the obligation of warranty, but must waiver the right to require the seller to compensate for damage
b.
Demand the seller to compensate for damage, but must waiver the right to demand the seller to perform the obligation of warranty
c.
Demand the seller to perform the obligation of warranty and compensate for damage
d. e. f. ANS:
C
PTS:
1
CHAPTER: 19 MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 19-Mul-VN- Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
) disputes.
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
In Vietnam, to solve a dispute, a court shall apply (
).
a.
A previous decision of its same-level court
b.
Law contained in the written legal documents
c.
Rules of court
d.
A previous decision of the Vietnamese People’s Supreme Court
e. f. ANS:
B
PTS:
1
CHAPTER:
2
MIX CHOICES:
Yes
QN=2
Taken into consideration of jurisdiction, the court in Vietnam will look at ( )
a.
Subject matter, court’s level, geographic area, plaintiff’s choice
b.
Geographic area, subject matter and Person involved
c.
The place’s residence of defendant, Subject matter, and court’s level
d.
Court’s level, Subject matter, and plaintiff’s choice
e. f. ANS:
A
PTS:
1
CHAPTER:
2
MIX CHOICES:
Yes
QN=3
An accident happens in Hanoi, the place of residence of parties involved is in Ho Chi Minh city, ( ).
a.
The court in Hanoi will have jurisdiction over this case
b.
The court in Ho Chi Minh city will have jurisdiction over this case
c.
The People’s Supreme Court will have jurisdiction over this case
d.
Both of court in Hanoi and Ho Chi Minh city have original jurisdiction over this case by plaintiff’s choice
e. f. ANS:
A
PTS:
1
CHAPTER:
2
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 2-Mul-VN- hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
Mr. Nam's tree fell down on Mr. Trung's roof, in accordance with the 2005 Civil Code of Vietnam, ( ).
a.
Mr. Nam must be liable to pay a sum of money regardless of the damage occurring or not
b.
Mr. Nam must be liable to compensate Mr. Trung for the damage caused by the tree falling
c.
Mr. Nam will be liable to compensate Mr. Trung for the damage caused by the tree falling if Mr. Nam proves that the tree falling is at Mr. Trung's fault
d. e. f. ANS:
B
PTS:
1
CHAPTER: 3 MIX CHOICES:
Yes
QN=2
According to the law of Vietnam, a legal entity must be liable to compensate for damage caused by a person belonging to it if ( ).
a.
Such person causes damage during the employment contract is valid
b.
Such person causes damage during performance of work assigned by the legal entity
c.
Such person causes damage to the legal entity's customers
d. e. f. ANS:
B
PTS:
1
CHAPTER: 3 MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 3-Mul-VN-Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
) disputes.
QN=1
In Vietnam, all business organizations shall be established and operate under the 2005 Enterprises Law of Vietnam.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER: 31 MIX CHOICES:
Yes
QN=2
Nam and XYZ shareholding company want to set up a partnership. May they set up a partnership owned by only Nam and XYZ shareholding company in accordance with the law of Vietnam?
a.
Yes
b.
No
c. d. e. f. ANS:
B
PTS:
1
CHAPTER: 31 MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 31-Mul-VN- Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 31-Mul-VN- Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
) disputes.
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 34-Mul-VN- Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
According to the law of Vietnam, ( ) shall be entitled to vote.
a.
A shareholder who owns dividend preference shares
b.
A shareholder who owns redeemable preference shares
c.
A shareholder who owns ordinary shares and/or a shareholder who owns voting preference shares
d.
No shareholder
e. f. ANS:
C
PTS:
1
CHAPTER: 35 MIX CHOICES:
Yes
QN=2
According to the law of Vietnam, ( ) has a power to decide distribution of dividend to the shareholders.
a.
The board of management
b.
The inspection committee
c.
The general meeting of shareholders
d.
The legal representative
e. f. ANS:
C
PTS:
1
CHAPTER: 35 MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 35-Mul-VN- Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
) disputes.
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
According to the law of Vietnam, the charter of the corporation shall be enacted by ( ).
a.
The board of management
b.
The general meeting of shareholders
c.
The inspection committee
d.
The managing director
e. f. ANS:
B
PTS:
1
CHAPTER: 36 MIX CHOICES:
Yes
QN=2
According to the law of Vietnam, all corporations must have inspection committees.
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER: 36 MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER36-Mul-VN-Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
) disputes.
QN=1
Under Vietnamese Law, co-ownership of husband and wife, is one kind of (
a.
Integrative multiple ownership
b.
Mixed multiple ownership
c.
Multiple ownership by shares
d.
Common multiple ownership
).
e. f. ANS:
A
PTS:
1
CHAPTER:
41
MIX CHOICES:
Yes
QN=2
Under Vietnamese Law, Personal property even attached to the land securely still cannot be considered as real property on the ground that it is not immovable
a.
True
b.
False
c. d. e. f. ANS:
B
PTS:
1
CHAPTER:
41
MIX CHOICES:
Yes
Business Law Fudamentals
CHAPTER 41- Mul-VN- hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
Under Vietnamese 2005 Civil Code, civil transactions due to performance by minors or persons having lost their civil act capacity or having had their civil act capacity restricted will be treated as ( )
a.
Voidable contract
b.
Void contract
c.
Valid contract
d.
Valid agreement
e. f. ANS:
A
PTS:
1
CHAPTER:
5
MIX CHOICES:
Yes
QN=2
Under Vietnamese law, which of the following sentences is right?
a.
Principal contract is a contract which its effect does not depend on the auxiliary contract
b.
Principal contract is a contract which its effect depends on the auxiliary contract
c.
Principal contract is a contract which its effect depends on the bilateral contract
d.
Principal contract is a contract which its effect depends on the unilateral contract.
e. f. ANS:
A
PTS:
1
CHAPTER:
5
MIX CHOICES:
Yes
Business Law Fundamentals Sample:
CHAPTER 5-Mul-VN-Hard
Retake Exam
QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
) disputes.
e. f. ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
Under Vietnamese 2005 Civil Code, offering to enter into a contract means the expression of the intention to enter into the contract and to be bound on this offer of the offering party to the other specified party.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
6
MIX CHOICES:
Yes
QN=2
Under Vietnamese 2005 Civil Code, shall an offer to enter into a contract terminate if the offeree replies not to accept the offer?
a.
Yes
b.
No
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
6
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 6-Mul-VN-Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f.
) disputes.
ANS:
B
PTS:
1
CHAPTER:
3
MIX CHOICES:
Yes
QN=1
In Viet Nam, contracts made by persons who are between full six years old and under full eighteen years old must ( ).
a.
Have the consents of their representatives at law when establishing and performing civil transactions, except those transactions to meet their daily-life needs suitable to their age group or otherwise provided for by law
b.
Have the consents of their representatives at law when establishing and performing civil transactions in all cases
c.
Have the consents of their friends
d.
All of the choices: “Have the consents of their representatives at law when establishing and performing civil transactions, except those transactions to meet their daily-life needs suitable to their age group or otherwise provided for by law”; “Have the consents of their representatives at law when establishing and performing civil transactions in all cases”; and “Have the consents of their friends”.
e. f. ANS:
A
PTS:
1
CHAPTER:
7
MIX CHOICES:
Yes
QN=2
According to Vietnamese law, a person was drunk at the time of having contracted, ( ).
a.
He may ask the court to invalidate the contract at any time
b.
He may ask the court to invalidate the contract on the ground that he was too drunk to understand and control his conduct within time-limits of litigation.
c.
He may not do anything to avoid the contract
d.
He never invalidates the contract
e. f. ANS:
B
PTS:
1
CHAPTER:
7
MIX CHOICES:
Yes
QN=3
In Viet Nam, contracts made by persons who are between full six years old and under full eighteen years old must have the consents of their representatives at law when establishing and performing civil transactions in all cases.
a.
False
b.
True
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
7
MIX CHOICES:
Yes
QN=4
In Viet Nam, contracts made by persons who are between full six years old and under full eighteen years old must not have the consents of their friends.
a.
True
b.
False
c. d. e. f. ANS:
A
PTS:
1
CHAPTER:
7
MIX CHOICES:
Yes
Business Law Fundamentals
CHAPTER 7-Mul-VN-Hard
Retake Exam
Sample: QN=1
The law set the rules of conduct for many transactions so that we will know how to (
a.
Avoid
b.
Terminate
c.
Both of the choices: “Avoid” and “Terminate”
d.
None/ All of the choices: “Avoid” and “Terminate”
e. f. ANS:
B
PTS:
1
) disputes.
CHAPTER:
3
MIX CHOICES:
Yes
CHAPTER 1—INTRODUCTION TO LAW MULTIPLE CHOICE 1. The legal system we have in America: a. b. c. d. ANS: B
PTS: 1
2. Courts of equity: a. b. c. d. ANS: D
Is an equal mixture of laws from all the colonies of America. Is based heavily on the English legal system of common law and equity. Is unlike any other legal system. Was an entirely new invention of the colonists before the Revolutionary War.
Never recognized legal rights. Gave only money damages as a remedy. Are a separate class of courts in all states. Provided preventative action. PTS: 1
3. Judicial interpretation is important to the legal process because: a. It allows courts to interpret laws differently. b. It prevents previous case law from being overturned. c. Interpretations by the highest courts set precedents follow by lower courts. d. Any state supreme court can reverse the Supreme Court of the United States. ANS: C
PTS: 1
4. The document containing specific guarantees of individual liberty is: a. The Bill of Rights. b. The Uniform Commercial Code. c. The Constitution. d. A restraining order. ANS: A
PTS: 1
5. Administrative agencies: a. b. c. d. ANS: A
PTS: 1
6. A criminal action: a.
May be filed by a private citizen to protect private rights. Requires a lower standard of proof than a civil action. Results in the awarding of damages to the injured person. Punishes offenses that injure society as a whole.
b. c. d. ANS: D
Have the power to regulate particular matters or implement laws. Are composed of people elected by the voters. Have limited power to set up rules of procedure. Have the power to make rules that supercede statutes.
PTS: 1
7. The crimes that carry the most severe penalties are called: a. Wobblers. b. Felonies. c. Misdemeanors. d. Infractions. ANS: B
PTS: 1
8. A tort: a. b. c.
Is always based on a negligent activity. Is prosecuted by a district attorney. Is a civil wrong for which damages may be recovered. Is the result of a failure to exercise reasonable care toward someone.
d. ANS: C
PTS: 1
9. Ethical principles: a. b.
Are static and unchanging. Are developed from religious beliefs, experience, and cultural background. Are determined by Congress. Are usually a set of lower standards of behavior than laws.
c. d. ANS: B
PTS: 1
10. Ethical standards in business: a. b. c. d. ANS: B
Require businesses to consider only the impact behavior has on "the bottom line." Help determine an individual's business practices. Represent a code of conduct found in every profession. Represent a lower standard than that required by law.
PTS: 1
YES/NO 11. Can law be correctly defined as a rule that prescribes conduct? ANS: N
PTS: 1
12. If an agency decision conflicts with a statute, does the statute takes precedence? ANS: Y
PTS: 1
13. Is the Uniform Commercial Code uniform throughout the country? ANS: N
PTS: 1
14. Are statutes easier to repeal or amend than constitutions? ANS: Y
PTS: 1
15. Do all states have separate equity courts? ANS: N
PTS: 1
16. Can the law change when circumstances change? ANS: Y
PTS: 1
MATCHING
a. b. c. d. e. f.
Constitution Equity Negligence Precedent Stare decisis Statute
17. 18. 19. 20. 21. 22.
A document that defines the relationships of the parts of the government to each other. The principle that a court decision controls the decision of a similar future case. A justice system based on fairness that provides relief other than money damages. A decided case that determines the decision of a subsequent case because they are similar. A law enacted by a legislative body. The failure to exercise reasonable care.
17. 18. 19. 20. 21. 22.
ANS: ANS: ANS: ANS: ANS: ANS:
A E B D F C
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
ESSAY 23. Explain what business law is and how it developed. ANS: Business law is the class of laws that are concerned primarily with rules of conduct prescribed by government for the performance of business transactions. These laws developed over time as a result of society's changing concepts of what is right and wrong to deal with new technology or circumstances. PTS: 1
CHAPTER 2—COURTS AND COURT PROCEDURE MULTIPLE CHOICE 1. In order to try a case a court must have jurisdiction: a. Only over the subject matter of the case. b. Only over the persons involved in the case. c. Over both the subject matter of the case and the persons involved. d. Courts do not always have to have jurisdiction. ANS: C
PTS: 1
2. Special federal courts: a. Have unlimited jurisdiction. b. Have jurisdiction limited by Congress. c. Have jurisdiction limited by the executive. d. Is another name for courts of appeals. ANS: B
PTS: 1
3. Federal district courts: a. Are appellate courts. b. Do not hear criminal cases. c. Have jurisdiction of civil suits where the amount in controversy is less than $5,000. d. Hear all criminal cases involving a violation of federal law.
ANS: D
PTS: 1
4. The U.S. Supreme Court: a. Does not have original jurisdiction of any cases. b. Has appellate jurisdiction in cases based on the U.S. Constitution, a federal law, or a treaty. c. Does not hear any cases appealed directly from a federal district court. d. Must take all cases appealed to it. ANS: B
PTS: 1
5. In a typical jury trial: a. The jury is selected before opening statements are made. b. The defendant's evidence is presented before the plaintiff's. c. The verdict may never be set aside. d. The defendant has the burden of proof. ANS: A
PTS: 1
6. An appeal to a higher court from a trial court: a. Can only be made by a defendant. b. Requires a new trial. c. Requires a complete transcript of the trial. d. Requires no preconditions by the appellant. ANS: C
PTS: 1
YES/NO 7. Are there two court systems in every state because the federal and state court systems have very different functions? ANS: N
PTS: 1
8. Is it the chief function of courts to interpret and apply the law to a given situation? ANS: Y
PTS: 1
9. May the parties in a civil action normally represent themselves in court? ANS: Y
PTS: 1
10. Must parties to civil or criminal actions always be represented by lawyers? ANS: N
PTS: 1
11. Is it the plaintiff who has the burden of proving facts adequate to support the allegations in the complaint? ANS: Y
PTS: 1
12. Is a decision of a federal court of appeals binding upon all lower courts?
ANS: N
PTS: 1
13. Does a jury decide points of law as well as the weight to be given to evidence? ANS: N
PTS: 1
14. Is it much simpler to file and try a suit in a small claims court? ANS: Y
PTS: 1
MATCHING
a. b. c. d. e. f.
Admission Answer Interrogatory Jurisdiction Summons Venue
15. 16. 17. 18. 19. 20.
A written question to be answered in writing. Notice of a law suit. The location where a case is to be tried. The request to agree that a certain fact is true or a matter of law is decided. The defendant's response to the facts alleged in a complaint. The authority of a court to hear a case.
15. 16. 17. 18. 19. 20.
ANS: ANS: ANS: ANS: ANS: ANS:
C E F A B D
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
ESSAY 21. Xavier drove a car that was involved in an auto accident. The other driver claimed she was totally disabled as a result of the accident and that she had the right of way at the intersection where the accident occurred. Xavier's lawyer, Rosie, wants to get further information to refute the claims of the other driver. What might she do? ANS: Rosie might want to conduct various types of discovery to obtain relevant information. In this case, she would probably want to have the other driver submit to a medical examination by a physician. She might also ask written questions the other driver would have to answer in writing and examine the other driver outside court and under oath. Finally, she might request that the other driver agree that certain facts about the accident are true or a matter of law is decided. PTS: 1
CHAPTER 3—BUSINESS TORTS AND CRIMES TRUE/FALSE 1. In order to recover for a tort based on negligence, an injured person must show a duty of the other person, a breach of the duty, and that the breach was the actual and proximate cause of the injury and injury or damage. ANS: T
PTS: 1
2. There is a tort of interference with a contract or economic advantage whenever a person causes a party to a contract to break off the contract. ANS: F
PTS: 1
3. A trademark gives the owner an exclusive right to use a word to distinguish a product. ANS: T
PTS: 1
4. Any word or symbol qualifies for protection as a trademark. ANS: F
PTS: 1
5. A trademark must be registered. ANS: F
PTS: 1
6. Civil suits under RICO have been popular because the law provides recovery of three times the damages suffered. ANS: T
PTS: 1
7. Computer trespass can be harmless. ANS: T
PTS: 1
8. Imitation of another's trademark does not always constitute infringement. ANS: F
PTS: 1
MATCHING
a. b. c. d. e. f.
Business Crime Confusion of source Embezzlement Injurious falsehood Theft Unfair competition
9. 10. 11. 12. 13. 14.
The fraudulent conversion of lawfully possessed property. Representing goods or services as being the goods or services of someone else. A false statement of face that degrades the quality of another's goods or services. When the total impression a product gives to the consumer results in confusion as to the origin of the product. Taking another's property without consent. A crime committed by using a business.
9. 10. 11. 12. 13. 14.
ANS: ANS: ANS: ANS: ANS: ANS:
C B D F E A
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
COMPLETION 15. A person whose action causes a private wrong or injury to another is called a(n) ____________________. ANS: tortfeasor PTS: 1 16. A doctrine that makes manufacturers liable without proof of negligence is called ____________________. ANS: strict tort liability PTS: 1 17. Telling a third person a false statement is called ____________________. ANS: communication PTS: 1 18. A word, symbol, device, or combination of them used to identify and distinguish goods is ____________________. ANS: trademark PTS: 1 19. Taking and carrying away of property without consent is ____________________. ANS: larceny PTS: 1 20. Causing all of a bank's deposits to be credited to one person's account constitutes a business ____________________.
ANS: fraud PTS: 1 ESSAY 21. Jim Adams, a high school student, was considered by his friends to be very good with computers. In order to show off his abilities Jim decided to try to break in to the Department of Defense computers in the Pentagon and leave some kind of message. If he is successful at breaking in, but is eventually detected, what would he be called? Could he be in any real trouble? ANS: If Jim is successful in breaking in to the Department of Defense computers and leaving a message, he would be in very serious trouble. Jim would be a hackeran unauthorized outsider who gained access to someone else's computer system and he would have committed a computer trespass. Computer trespass is the use of computer time without permission and is technically the theft of computer time. If he does no more than leave a message he has committed a crime and hacking into the Department of Defense computers would probably be considered a threat to national security. PTS: 1
CHAPTER 4—GOVERNMENT REGULATION OF BUSINESS MULTIPLE CHOICE 1. CERCLA imposes liability for cleanup of hazardous substances on: a. Owners of contaminated sites. b. Disposers of the substances. c. Operators of contaminated sites. d. All of these choices. ANS: D
PTS: 1
2. Government regulation of business: a. Is to set rules under which some businesses compete. b. Is to discourage abuses. c. Is to enhance the quality of life for a select few in society. d. Affects the operation of only a few businesses. ANS: A
PTS: 1
3. No administrative agencies have the power to: a. Enact rules that cannot be appealed. b. Fix the prices that a business may charge. c. Determine whether the activity of the entity regulated is acceptable or not. d. Allow a business to enter the field being regulated. ANS: A
PTS: 1
4. The purpose of antitrust laws is to:
a. b. c. d.
Promote competition among businesses. Prohibit restraints of trade. Prohibit acts that tend to create a monopoly. All of these choices.
ANS: D
PTS: 1
5. The Water Pollution and Control Act: a. Seeks to restore the proper chemistry only of navigable waters. b. Allows suits by private citizens. c. Provides only civil remedies. d. Is enforced by municipalities and local governments. ANS: B
PTS: 1
6. Most administrative agency regulation: a. Is used to increase the federal government's revenue. b. Is not done by administrative agencies, but by individual officials. c. Exists because of the complex nature of the area of regulation. d. Exists because the nature of the area of regulation is so simple. ANS: C
PTS: 1
YES/NO 7. Are all administrative agencies run by a commission? ANS: N
PTS: 1
8. May a business legally make sales at unreasonably low prices in order to eliminate competition? ANS: N
PTS: 1
9. Generally, is it the activity itself, not its effect, that is the most important element in deciding whether the Sherman Act has been violated? ANS: N
PTS: 1
10. Does most administrative agency regulation occur because of the complex nature of the area of regulation? ANS: Y
PTS: 1
11. May private citizens sue on the basis of the Water Pollution and Control Act? ANS: Y
PTS: 1
12. Does CERCLA impose liability only on current owners of facilities where hazardous substances have been released? ANS: N
PTS: 1
13. Must all persons who generate or transport hazardous waste, and owners and operators of facilities for the treatment, storage, or disposal of such waste, obtain a permit? ANS: Y
PTS: 1
14. Under the Clean Air Act, do the states set minimum standards for air quality? ANS: N
PTS: 1
COMPLETION 15. Agencies that dispense benefits for social and economic welfare are called ____________________. ANS: nonregulatory agencies PTS: 1 16. Enacting administrative rules by publishing the proposed rule and then the final rule without holding formal hearings is called ____________________. ANS: notice and comment rule making PTS: 1 17. The four groups of people on whom CERCLA imposes liability are ____________________, ____________________, ____________________, and ____________________. ANS: owners, operators, disposers, and transporters PTS: 1 18. Statutes that seek to promote competition among businesses are called ____________________. ANS: antitrust laws PTS: 1 19. The power of a regulatory agency to fix the prices that a business may charge is called ____________________. ANS: rate-making power PTS: 1 20. Activities that are illegal regardless of their effect are called ____________________. ANS: per se violations PTS: 1
ESSAY 21. Explain what regulatory and nonregulatory administrative agencies are and the difference between them. ANS: Regulatory agencies govern the economic activity of businesses by prescribing rules stating what should or should not be done in particular situations. Nonregulatory agencies, also called social regulatory agencies, dispense benefits for social and economic welfare and issue regulations governing the distribution of benefits. PTS: 1
CHAPTER 5—NATURE AND CLASSES OF CONTRACTS MULTIPLE CHOICE 1. Contracts: a. Must be in writing. b. Can be between any two parties. c. Must be of a substantial nature. d. Are binding on all parties. ANS: D
PTS: 1
2. A voidable contract: a. Must be in writing. b. Must be rejected by both parties. c. Gives one party the choice to abide by it or reject it. d. Is never effective. ANS: C
PTS: 1
3. Simple contracts: a. Can be implied from the conduct of the parties. b. Never need to be in writing. c. Must be in a particular form. d. Must be sued on within one year if they are breached. ANS: A
PTS: 1
4. Contracts are important in business because: a. Failing to perform a contract is a crime. b. The law provides a remedy to a party if the other fails to perform. c. All agreements are enforceable. d. They are of a substantial nature. ANS: B
PTS: 1
5. If Adams advertises a $5,000 reward for information about the robbery of his store and Jessup tells him who robbed the store: a. A bilateral contract has been made. b. There has been a mutual exchange of promises. c. Only Adams has made a promise.
d. Jessup had a duty to disclose the information. ANS: C
PTS: 1
6. Unjust enrichment: a. Occurs when both parties to a contract benefit. b. Is a violation of statutory law. c. Is used when the parties make a specific agreement. d. Offends our ethical principles. ANS: D
PTS: 1
TRUE/FALSE 7. A contract is an agreement to do something, but cannot be to refrain from doing something. ANS: F
PTS: 1
8. If the law requires a certain contract to be in a particular form, and it is not in that form, it is automatically void. ANS: F
PTS: 1
9. Unlike the case of an oral contract, when a contract is written, there cannot be a dispute between the parties as to the terms of the agreement. ANS: F
PTS: 1
10. When a contract is required to be sealed, no substitute for an actual seal may be used. ANS: F
PTS: 1
11. Only one party needs to supply consideration to have an enforceable contract. ANS: F
PTS: 1
12. One may have rights and obligations imposed by law when no real contract exists. ANS: T
PTS: 1
COMPLETION 13. The failure of one of the parties to perform the obligations assumed under the contract is ____________________. ANS: breach of contract PTS: 1 14. A contract in which the terms of the agreement are not specified in words but understood from their acts or conduct is called a(n) ____________________.
ANS: implied contract PTS: 1 15. A formal contract to do an act required by law and entered into before a court is a(n) ____________________. ANS: recognizance PTS: 1 16. A contract enforceable against all parties is called a(n) ____________________. ANS: valid contract PTS: 1 17. A contract that has been fully performed by all parties is ____________________. ANS: executed PTS: 1 18. One benefiting unfairly at the expense of another is called ____________________. ANS: unjust enrichment PTS: 1 19. A contract that would be enforceable but, because of the capacity of a party, one or both parties may set aside is called a(n) ____________________. ANS: voidable contract PTS: 1 20. The imposition of rights and obligations by law is called a(n) ____________________ contract. ANS: quasi PTS: 1 ESSAY 21. The Davidsons decide to hold a formal dinner party. They invite five couples to the party. All five couples tell the Davidsons they will attend. At the last minute two couples phone the Davidsons to say they cannot come. One couple had unexpected houseguests arrive and the other couple caught the flu. What is the liability of each couple to the Davidsons and why? ANS:
Neither couple is liable to the Davidsons. While the Davidsons had agreements with the two couples to attend the dinner party, there was no contract with the couples. The subject matter of these agreements does not involve a business transaction. PTS: 1
CHAPTER 6—OFFER AND ACCEPTANCE MULTIPLE CHOICE 1. A valid offer: a. Must appear to be seriously intended. b. Must be expressly stated. c. Must be in writing. d. May be accepted by anyone who knows of it. ANS: A
PTS: 1
2. In order to have a valid contract there must be: a. An offer and an acceptance. b. A written expression of the terms. c. A reliable witness if the contract is oral. d. An understanding of the terms by one of the parties. ANS: A
PTS: 1
3. For an offer to be accepted: a. The acceptance must be in writing. b. Mental intention to accept is sufficient. c. There is a prescribed procedure the acceptor must follow. d. The acceptance must be communicated to the person making the offer. ANS: D
PTS: 1
4. A revocation of an offer occurs when: a. The offeror intends to revoke. b. A letter of revocation is dictated. c. The revocation is communicated to the offeree prior to acceptance. d. The offeror's intent to revoke is clearly shown to a person other than the offeree. ANS: C
PTS: 1
5. When no time is specified in the offer, the reasonable time an offer is open: a. Varies with each case depending on the circumstances. b. Is never more than 30 days. c. Can never be less than a week. d. Is set at two weeks. ANS: A
PTS: 1
6. A sales letter is an offer if:
a. The wording is such as to indicate that the writer is merely trying to evoke an offer on certain terms. b. It is a circular sales letter. c. It is an advertisement. d. It is a personal sales letter containing an offer. ANS: D
PTS: 1
7. An offer can be accepted: a. In any manner the person receiving it chooses to accept it. b. By putting a properly mailed acceptance in a mailbox. c. Only by the same means by which the offer was communicated. d. By fax only if it is received by fax. ANS: B
PTS: 1
8. An intended acceptance that varies the offer: a. Cannot be accepted by the original offeror. b. Is a rejection of the original offer. c. Keeps the offer open for negotiation. d. All of these choices. ANS: B
PTS: 1
TRUE/FALSE 9. An offer directed to a specific individual or firm cannot be accepted by anyone else. ANS: T
PTS: 1
10. All offers for the sale of merchandise must include the price. ANS: F
PTS: 1
11. Considering advertisements and window displays invitations to make offers rather than offers provides a protection to consumers. ANS: F
PTS: 1
12. An option can be revoked at will. ANS: F
PTS: 1
13. An advertisement may be an offer when it clearly shows it is intended as an offer. ANS: T
PTS: 1
14. An offeree may make an inquiry without rejecting the offer. ANS: T
PTS: 1
MATCHING
a. b. c. d. e. f.
Inquiry Invitation Offeree Offeror Option Revocation
15. 16. 17. 18. 19. 20.
What advertisements, window displays, and catalogs are normally considered to be. The person who makes a proposal to make a contract. Withdrawal of an offer prior to acceptance. A binding promise to hold an offer open. A request to consider different contract terms without rejecting an offer. The person who accepts an offer, forming a contract.
15. 16. 17. 18. 19. 20.
ANS: ANS: ANS: ANS: ANS: ANS:
B D F E A C
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
ESSAY 21. Edsall, a merchant, received an unsolicited faxed offer to sell copy paper from Eagle Office Supplies Corporation. Discuss whether Edsall may accept by mail, telegraph or fax and what the consequences are for each proposed method of acceptance. ANS: Unless the faxed offer stipulates the manner of acceptance, Edsall may accept it in any manner reasonable under the circumstances. Thus, Edsall may accept by mail, telegraph, or fax. A properly mailed acceptance is effective when it is posted. Acceptance of an offer by telegraph is effective when delivered to the telegraph company. A faxed acceptance creates a contract on the date and at the place the fax acceptance is sent. PTS: 1
CHAPTER 7—CAPACITY TO CONTRACT YES/NO 1. Does the law presume that all parties have the legal competence to contract? ANS: Y
PTS: 1
2. Must a minor always disaffirm a voidable contract during minority or within a reasonable time after becoming of age?
ANS: N
PTS: 1
3. Is the age in which a person is considered a minor the same in all states? ANS: N
PTS: 1
4. If minors misrepresent their age are can they repudiate contracts with no penalty? ANS: N
PTS: 1
5. May a minor ratify a contract at any time? ANS: N
PTS: 1
6. If a person on drugs cannot understand the meaning of the contract, does that make the contract voidable? ANS: Y
PTS: 1
TRUE/FALSE 7. Almost all of a minor's contracts are voidable at the minor's option. ANS: T
PTS: 1
8. If a minor does not still have possession of property received under a contract, the contract cannot be disaffirmed. ANS: F
PTS: 1
9. If two minors enter into a contract, each has the right to avoid it. ANS: T
PTS: 1
10. Silence ratifies a minor's contracts. ANS: T
PTS: 1
11. A person formally adjudicated to be incompetent cannot make a valid contract. ANS: T
PTS: 1
12. All minors are bound on contracts induced by misrepresenting their age. ANS: F
PTS: 1
13. In determining a mentally incompetent person's capacity to contract, the intensity and duration of the incompetency must be determined. ANS: T
PTS: 1
14. If an intoxicated person make a foolish contract that would not have been entered into if the party had been sober, that makes the contract voidable. ANS: F
PTS: 1
COMPLETION 15. The liability of an underage person for items required for living at a reasonable standard is ____________________. ANS: quasi-contractual PTS: 1 16. The indication of one's willingness to be bound by promises made during minority is ____________________. ANS: ratification PTS: 1 17. The repudiation of a contract is called ____________________. ANS: disaffirmance PTS: 1 18. To be protected when dealing with a minor, a businessperson should have an adult join in the contract as a(n) ____________________. ANS: cosigner PTS: 1 19. A contract made by a person who has been formally adjudicated incompetent is ____________________. ANS: void PTS: 1 20. A person who has been found by a court to be guilty of a major criminal offense is a(n) ____________________. ANS: convict PTS: 1 ESSAY
21. When she was 17, Gloria got a full-time job and moved into her own apartment. She bought most of her food at a corner store where she charged her purchases. When Gloria failed to pay her bill the store sued her. Gloria claimed she did not have to pay since she was a minor. What, if any, liability does Gloria have? ANS: Although Gloria was a minor, the contracts for food were clearly contracts for something she needed in order to live. As a result, she must pay for the food, but she only must pay the reasonable value of what she received. She may not have to pay the contract price if it was not reasonable. PTS: 1
CHAPTER 8—CONSIDERATION MULTIPLE CHOICE 1. A promise to pay part of a debt constitutes consideration for cancellation of the entire debt if: a. There is promissory estoppel. b. There is adequacy of past consideration. c. It is accompanied by a promise to do something you are already obligated to do. d. The amount of the debt is in dispute. ANS: D
PTS: 1
2. A new contract replacing an old one is enforceable: a. If features are added that benefit both parties. b. If the new contract is the result of difficulties because of a strike. c. If the new contract is the result of a change in prices. d. Only if added features benefit both parties equally. ANS: A
PTS: 1
3. Refraining from doing something is valid consideration when the act refrained from: a. Would be a tort. b. Is something the promisor has no right to do. c. Is something the promisor has a right to do. d. Would result in a violation of law. ANS: C
PTS: 1
4. Partial payment of a past-due debt: a. Cancels the debt if the parties agree on the amount due. b. Is not consideration for the cancellation of the balance of the debt. c. Is consideration since the other party is already entitled to it. d. Is consideration if an unsecured note is given and accepted in discharge of a secured note. ANS: B
PTS: 1
5. If Agnes agrees to give $1,000 to her college: a. The agreement is enforceable without consideration. b. She receives consideration from the college. c. The agreement requires all the elements of any other contract. d. The agreement meets all the technical requirements of ordinary contracts.
ANS: A
PTS: 1
6. The doctrine of promissory estoppel: a. Requires that promises be supported by consideration. b. Does not require the promisee to show any harm by of reliance on the promise. c. Requires the promisor to reasonably expect the promise to induce action by the promisee. d. Allows the promisor to claim lack of consideration. ANS: C
PTS: 1
TRUE/FALSE 7. Consideration is necessary to support an obligation of record, such as a judgment. ANS: F
PTS: 1
8. If there is more than one creditor and all agree to accept in full settlement only a fraction of the amount owed, the agreement will cancel the unpaid balance due them. ANS: T
PTS: 1
9. A voluntary subscription is not enforceable unless under seal. ANS: F
PTS: 1
10. In the case of construction contracts, unforeseen difficulties always constitute consideration for the payment of more than the contract price. ANS: F
PTS: 1
11. Consideration is required when a contract for the sale of goods is modified by agreement of the parties. ANS: F
PTS: 1
12. An act performed prior to a promise to pay constitutes valid consideration. ANS: F
PTS: 1
13. When a debt is evidenced by a note, cancellation and return of the written evidence cancels the debt. ANS: T
PTS: 1
14. If one person makes a promise to another and that other person acts in reliance upon the promise, the promisor will not be permitted to claim lack of consideration. ANS: T COMPLETION
PTS: 1
15. What the promisor requires as the price for a promise is known as ____________________. ANS: consideration PTS: 1 16. If a debtor agrees, with approval from the bankruptcy court, to pay a discharged debt, the debt is ____________________. ANS: revived PTS: 1 17. In order for a promise to constitute consideration, the promise must impose a(n) ____________________ upon the person making it. ANS: obligation PTS: 1 18. Normally, the adequacy of consideration is ____________________. ANS: irrelevant PTS: 1 19. An act performed prior to a promise to pay does not make the promise enforceable and is called ____________________. ANS: past performance PTS: 1 20. In order for a promise to constitute consideration, the promise must impose a(n) ____________________ on the person making the promise. ANS: obligation PTS: 1 ESSAY 21. Joseph got into some trouble with the police when he was a teenager. He dropped out of college and did not have a steady job at age 22. His grandfather was very concerned, so he promised Joseph that if he got a steady job, did not break the law again, and would go back to college if he could be admitted, the grandfather would pay Joseph $20,000. Discuss whether these various promises on Joseph's part would constitute valid consideration for the payment of the $20,000. ANS:
Since Joseph did not have a steady job at the time the promise was made, getting such a job would constitute valid consideration for the grandfather's promise. The promise to pay Joseph if he did not break the law does not add any requirement to Joseph's behavior, so it would not be valid consideration. The promise to go back to college if admitted was valid consideration on Joseph's part even though the promise was conditional. PTS: 1
CHAPTER 9—DEFECTIVE AGREEMENTS MULTIPLE CHOICE 1. A mutual mistake concerning a material fact: a. Makes the contract unenforceable. b. Always makes the contract voidable. c. Always makes the contract void. d. Allows the contract to be re-written by the mistaken party. ANS: A
PTS: 1
2. When the contract specifies what is to happen in the case of a mistake: a. The contract provision applies only if it is unconscionable. b. Since the law is supreme it overrules conflicting contract provisions. c. The contract provision applies even if the law would be otherwise. d. The contract provision applies when the mistake is unilateral. ANS: C
PTS: 1
3. A mutual mistake makes a contract defective when: a. There is a mistake of law. b. There is a mistake as to expectations. c. There is a mistake as to the terms of the contract. d. Enforcing the contract would cause a harsh result. ANS: D
PTS: 1
4. In order to establish fraud to invalidate a contract: a. A false statement could be made recklessly rather than intentionally. b. One party must make a false statement. c. The person making the false statement need not intend to induce the innocent party to act. d. A party must actually does something or take steps to cause a fraud. ANS: A
PTS: 1
5. A contract would be invalid as a result of duress if: a. One party drives a very hard bargain and takes advantage of the other's urgent need to make the contract. b. A third party creditor of a party to a contract threatens to sue if the contract is not carried out. c. One party threatens to truthfully report the other drove in excess of the speed limit. d. One party to a contract threatened to harm the other party's child. ANS: D
PTS: 1
6. A mutual mistake as to value, quality, or price: a. Invalidates only executory contracts. b. Does not affect the validity of a contract. c. Is not a risk assumed by the parties to a contract. d. Invalidates all contracts. ANS: B
PTS: 1
7. When a contract is voidable: a. The injured party may sue to have it declared void. b. Either party may set the contract aside. c. Both parties must perform if the contract is executory. d. The injured party may only sue for damages. ANS: A
PTS: 1
8. If a contract is entered into as a result of fraud, duress, or undue influence, the innocent party: a. Need do nothing to avoid it. b. May not recover damages if the contract is ratified. c. May ratify the contract by some act or word indicating an intention to be bound. d. Need not return anything received under the contract if the contract is rescinded. ANS: C
PTS: 1
TRUE/FALSE 9. Whether a mistake affects the validity of a contract normally depends on whether just one of the parties or both parties have made a mistake. ANS: T
PTS: 1
10. Economic duress exists when a person agrees to a contract because of difficult financial circumstances that are not the fault of the other party. ANS: F
PTS: 1
11. A mistake as to the terms of the contract does not affect the validity of a written contract. ANS: T
PTS: 1
12. When there is a unilateral mistake the mistaken party never can obtain legal relief. ANS: F
PTS: 1
13. A person can be guilty of fraud even without making any false statements. ANS: T
PTS: 1
14. Refraining from disclosing pertinent facts unknown to the other party normally constitutes fraud.
ANS: F
PTS: 1
MATCHING
a. b. c. d. e. f.
Fraud in the Execution Fraud in the Inducement Passive fraud Recission Reformation Undue influence
15. 16. 17. 18. 19. 20.
Seeking to put the parties in the position they were in before a contact was made. A failure to disclose information when there is a duty to do so. When a person in a special relationship causes another to act contrary to free will. The judicial correction of a contract. A party intends to make a contract and is defrauded into making it. A party is tricked into signing a contract when the nature of the writing could not be understood.
15. 16. 17. 18. 19. 20.
ANS: ANS: ANS: ANS: ANS: ANS:
D C F E B A
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
ESSAY 21. Bloxham was an attorney on whom Diaz relied to draw up business contracts. Diaz was ninety-three years old and in poor health. Bloxham's brother-in-law owned a company that Boxham told Diaz he should do business with. Bloxham drew up a contract with the company. Diaz did not want to do business with that company, but Bloxham visited Diaz and politely asked him to sign the contract every day for a week until Diaz signed it. Is the contract binding or does Diaz have any recourse? ANS: Even though Bloxham made no threats to Diaz and did not use any force, he was in such a relationship as the attorney for Diaz and with Diaz in poor health, as to exert undue influence on him. It is very likely that Diaz was helpless in Bloxham's hands and did not exercise free will. The contract would be voidable. PTS: 1
CHAPTER 10—ILLEGAL AGREEMENTS MULTIPLE CHOICE 1. A contract is that is not for a lawful purpose to be achieved in a lawful manner: a. Is still enforceable. b. Involves the commission of a crime. c. Is normally void.
d. Can only be enforced by an appellate court. ANS: C
PTS: 1
2. The courts will: a. Find all gambling contracts to be illegal. b. Allow any type of gambling contract to be enforced. c. Not enforce contracts to trade on the grain market unless actually delivery of the commodity will be made. d. Generally leave the parties to a private gambling contract where it finds them. ANS: D
PTS: 1
3. A person who operates a business or profession without the required license: a. May not be competent to operate the business or profession. b. Is not subject to imprisonment when the law is designed solely as a revenue measure. c. Is never permitted to sue to collect for the services. d. Is never viewed as committing a crime. ANS: A
PTS: 1
4. It is an unreasonable restraint of trade: a. To include a provision not to compete when buying a business. b. For a manufacturer to control the price of a good by selling directly to the public. c. To contract to limit production to reduce supply. d. To discriminate in price between competing buyers of goods of various grades. ANS: C
PTS: 1
5. A contract that limits the freedom of marriage: a. Is always void. b. Can be enforced by the innocent party. c. Can only be enforced for a reasonable time. d. Is contrary to public policy. ANS: D
PTS: 1
6. It is NOT a contract injuring the public service to agree to: a. Appear before a public authority to oppose passage of a bill. b. Obtain a pardon or parole. c. Pay a public official less than the statutory salary. d. Hire a person in return for aid in achieving the promisor's election to office. ANS: A
PTS: 1
YES/NO 7. Must all contracts be for a lawful purpose to be achieved in a lawful manner? ANS: Y
PTS: 1
8. If a contract is indivisible, may parts of it be enforceable?
ANS: N
PTS: 1
9. According to most courts, is a loan to enable a person to gamble a gambling debt? ANS: N
PTS: 1
10. Are most violators of Sunday acts rarely prosecuted? ANS: Y
PTS: 1
11. If a borrower has paid a usurious rate of interest will the courts require the lender to refund the amount in excess of the contract rate? ANS: Y
PTS: 1
12. Is the maximum rate of interest that can be charged the same for all kinds of loans? ANS: N
PTS: 1
13. Is an agreement not to prosecute a thief if stolen goods are returned void? ANS: Y
PTS: 1
14. If a contract has the tendency to obstruct justice is it unenforceable? ANS: Y
PTS: 1
MATCHING
a. b. c. d. e. f.
Contrary to licensing laws Contract not to compete Gambling contract Legal rate Maximum contract rate Usurious contract
15. A contract to borrow money at a rate of interest in excess of the limit in state law. 16. A contract of a person operating a business or profession without the proper government approval and certification. 17. A contract wherein the parties stand to win or lose based on pure chance. 18. A contract prohibiting the seller of a business from engaging in business in an area for a specified length of time. 19. The rate of interest charged when a sale is on credit, but the rate is not agreed upon. 20. A rate of interest above which the rate is usurious. 15. 16. 17. 18.
ANS: ANS: ANS: ANS:
F A C B
PTS: PTS: PTS: PTS:
1 1 1 1
19. ANS: D 20. ANS: E
PTS: 1 PTS: 1
ESSAY 21. Zwicki told Shahadi he thought the stock market would go up at least 200 points in the next week. Shahadi said that was crazy and asked Zwicki if he wanted to put his money where his mouth was. Zwicki pulled out a 100 dollar bill and Shahadi did the same. They gave the bills to Dominguez to hold for a week. They told him to give them to Zwicki if the stock market went up as much as 200 points in the next week, otherwise to give them to Shahadi at the end of a week. At the end of the week the stock market had gone up 250 points but Dominguez kept the money. Explain whether Shahadi or Zwicki has any recourse against Dominguez. ANS: Since the contract Zwicki and Shahadi entered into was based on chance (neither could affect what the market did), it was a gambling contract. Such a contract is prohibited by law. While the courts will normally leave the parties to such a contract where it finds them, in this case Dominguez was a stakeholder and no state will permit the stakeholder, who is merely the trustee of the funds, to keep the money. A court would require Dominguez to return each wagerer's deposit. PTS: 1
CHAPTER 11—WRITTEN CONTRACTS YES/NO 1. Is one of the advantages of a written contract that its existence cannot be denied? ANS: Y
PTS: 1
2. Can an oral contract required under the Statute of Frauds to be in writing be set aside after it is fully performed? ANS: N
PTS: 1
3. Is an oral contract to sell mineral rights enforceable? ANS: N
PTS: 1
4. If Joe buys a painting on credit and asks the seller to deliver the painting to Margaret, must the transaction be in writing? ANS: N
PTS: 1
5. Is a promise to pay the debts of an estate from the personal funds of the executor considered a contract to become responsible for the debts of another? ANS: Y
PTS: 1
6. Must a promise to pay a sum of money to another in consideration of marriage be in writing to be enforceable? ANS: Y
PTS: 1
7. Must the note or memorandum required by the Statute of Frauds always set forth all the material terms of the transaction? ANS: N
PTS: 1
8. Does the parol evidence rule prohibit oral testimony of alteration when a written contract appears to be complete? ANS: N
PTS: 1
TRUE/FALSE 9. Oral contracts which are required by the Statute of Frauds to be in writing are illegal. ANS: F
PTS: 1
10. If one party has made part performance of an oral contract and would be hurt if the contract was not enforced, courts will allow enforcement of it. ANS: T
PTS: 1
11. If there is an oral contract to lease a building for 18 months and the building is occupied for that time, but the rent is not paid, payment can be compelled. ANS: T
PTS: 1
12. The Statute of Frauds only requires the party against whom a claim for breach of promise is made to have signed a note or memorandum. ANS: T
PTS: 1
13. A written contract that incorporates other writings into it cannot be modified by the other writings. ANS: F
PTS: 1
14. The Statute of Frauds applies only to executory contracts. ANS: T
PTS: 1
COMPLETION 15. A contract that cannot be performed within a certain time must be written to be enforceable. That time is ____________________. ANS: one year PTS: 1
16. A breach of a contractual obligation other than the payment of money is called a(n) ____________________. ANS: default PTS: 1 17. An obligation to pay money is a(n) ____________________. ANS: debt PTS: 1 18. Under the theory of ____________________, a party who has paid money under an oral contract that is required to be in writing may recover the money. ANS: unjust enrichment PTS: 1 19. Spoken words that will not be permitted to modify the terms of a written contract is known as ____________________. ANS: parol evidence PTS: 1 20. The Statute of Frauds applies only to ____________________ contracts. ANS: executory PTS: 1 ESSAY 21. Belden signed a form contract to buy a house. The form had blank lines where the names of the parties, the terms of the sale (such as price, down payment, subsequent payments and description of the property) could be inserted. While the names of the parties and the price were written in the blanks, the payment terms were left blank. Later Belden and the seller disagreed about just what the payment terms were. Belden sued and tried to introduce oral testimony about the payment terms. Discuss whether this will be allowed. ANS: The parol evidence rule does not permit oral testimony to add to, modify, or contradict the terms of a written contract that appears to be complete. However, if a written contract is clearly incomplete, the parol evidence rule does not apply and oral testimony will be permitted to explain the contract. In this case the contract was clearly not complete since the payment terms had not been filled out and Belden should be allowed to introduce oral testimony about what those terms were. PTS: 1
CHAPTER 12—THIRD PARTIES AND CONTRACTS
YES/NO 1. If an event must occur before a donee beneficiary is benefited, may the contracting parties change the beneficiary? ANS: Y
PTS: 1
2. Does everyone who benefits by the performance of a contract between others have rights under the contract? ANS: N
PTS: 1
3. May all rights under a contract be assigned? ANS: N
PTS: 1
4. May the parties to a contract include a prohibition of the assignment of rights thereunder? ANS: Y
PTS: 1
5. Generally, if a party to a contract makes several assignments and notice of all is given, does the law give priority in the order in which the assignments were made? ANS: Y
PTS: 1
6. May an assignment by the parties to a contract be written or oral? ANS: Y
PTS: 1
7. Does a delegation relieve the delegating party of all liability under the contract? ANS: N
PTS: 1
8. When a joint contract is not carried out may the aggrieved party sue just one of the obligors? ANS: N
PTS: 1
TRUE/FALSE 9. A right to personal services cannot be assigned. ANS: T
PTS: 1
10. A novation can be implied from the parties' actions. ANS: T
PTS: 1
11.The nonassigning party retains all rights and defenses as though there had never been an assignment. ANS: T
PTS: 1
12. An assignor makes no warranties as a result of an assignment. ANS: F
PTS: 1
13. Incidental beneficiaries may not sue for damages for nonperformance of a contract. ANS: T
PTS: 1
14. An assignment must be in writing. ANS: F
PTS: 1
MATCHING
a. b. c. d. e. f.
Assignee Assignor Creditor beneficiary Donee beneficiary Incidental beneficiary Third party beneficiary
15. 16. 17. 18.
A person to whom the promisee owes no legal duty and for whom performance is a gift. The person who makes a transfer of rights under a contract. A person not party to a contract who the parties to a contract intend to benefit. A non-party to a contract to whom the promisee owes an obligation that would be discharged to the extent that the promisor performs the promise. 19. A person not a party to a contract who unintentionally benefits from performance of the contract. 20. The person to whom rights under a contract are transferred. 15. 16. 17. 18. 19. 20.
ANS: ANS: ANS: ANS: ANS: ANS:
D B F C E A
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
ESSAY 21. Gladys and Sam married. When they bought a house, Sam's father signed the mortgage note with them and made the monthly house payments. Several years later, Gladys moved out of the house and Sam's father stopped making the monthly payments. Shirley moved into the house with Sam, but they did not make the payments. The mortgage company told Gladys to make the payments. Gladys took a business law course many years before and remembers the terms third-party beneficiary and novation. Can either of these principles help her?
ANS: No. Gladys is not a third-party beneficiary because she signed the mortgage note making her obligated on it. Sam's father simply made a gift of the house payments to Gladys and Sam. Even though Shirley is living in the house there was no novation since Shirley did not agree to any payments and there is no indication a novation was intended. PTS: 1
CHAPTER 13—TERMINATION OF CONTRACTS TRUE/FALSE 1. When a contract states no time for performance the parties may perform at any time. ANS: F
PTS: 1
2. If a contract calls for performance satisfactory to the personal taste of a party, that party may reject performance on the ground it is not satisfactory even if most people would find the performance acceptable. ANS: T
PTS: 1
3. All creditors may enforce their contracts after a discharge in bankruptcy. ANS: F
PTS: 1
4. Refusal of a tender of payment discharges a debt. ANS: F
PTS: 1
5. Rescission of a contract releases an aggrieved party from all obligations not yet performed. ANS: T
PTS: 1
6. A party who intentionally and without the consent of the other party alters a written contract can be held to either the original contract terms or the terms as altered. ANS: T
PTS: 1
MATCHING
a. b. c. d. e. f.
Discharge Malpractice Performance Satisfactory performance Substantial performance Tender of performance
7. An offer to carry out an obligation in satisfaction of the terms of a contract.
8. Such nearly complete carrying out of a contract that it would be a great injustice to deny a party compensation for carrying it out. 9. A party doing what all that is required under the terms of a contract. 10. Failure of a professional person to perform professional services with the duty and care normally exercised by others in the profession. 11. When the parties to a contract agree not to carry out its terms. 12. When a definite measure of completion exists, completing a contract in a manner that would satisfy an ordinary, reasonable person. 7. 8. 9. 10. 11. 12.
ANS: ANS: ANS: ANS: ANS: ANS:
F E C B A D
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
COMPLETION 13. When a contract does not state the time it is to be carried out, it must ordinarily be carried out within a(n) ____________________. ANS: reasonable time PTS: 1 14. The failure or refusal to perform one's contractual obligations is ____________________. ANS: breach PTS: 1 15. An amount of money paid to one part to a contract in order to punish the other party is called ____________________. ANS: punitive damages PTS: 1 16. A sum of money awarded to an injured party is called ____________________. ANS: damages PTS: 1 17. When one party, prior to the time the other party is entitled to performance, announces an intention not to perform there is ____________________. ANS: anticipatory breach
PTS: 1 18. An offer to pay money in satisfaction of a debt when one has the ability to pay is a(n) ____________________. ANS: tender of payment PTS: 1 19. A suit to compel a party to carry out the terms of a contract is a suit for ____________________. ANS: specific performance PTS: 1 20. Any form of lawful money is called ____________________. ANS: legal tender PTS: 1 ESSAY 21. Esteva made business purchases at Koury and Sons store and made two payments on the debt. His business was slow so he closed it and a year after the last payment moved out of state. The statute of limitations on this type of debt was 2 years. Three years later Esteva moved back and made one more payment on his debt. Three years after that Koury and Sons sued him for the remaining debt. How should the court figure out whether the debt is enforceable against Esteva? ANS: The debt was enforceable against Esteva for two years after he made the second of the original two payments. However, Esteva moved out of state within that two year period, so the statute of limitations did not run for the three years he was out of state. When he moved back, there was still a year before the statute of limitations ran. When Esteva made the final payment, the statute started running all over again. However, Koury and Sons waited three years to sue, and the statute ran out a year before the suit. PTS: 1
CHAPTER 14—NATURE OF PERSONAL PROPERTY YES/NO 1. Is an interest in land less than complete ownership, such as a leasehold, classified as real property? ANS: N
PTS: 1
2. Must a copyright be registered in order for the owner to sue for infringement? ANS: Y
PTS: 1
3. When confusion of property occurs by common consent of the owners, will each party be considered the owner of a proportionate part of the mass? ANS: Y
PTS: 1
4. May a bailment be established without actual delivery and acceptance of the goods? ANS: Y
PTS: 1
5. Is the bailee in a bailment for the sole benefit of the bailee an insurer of the property? ANS: N
PTS: 1
6. When the bailment is for the sole benefit of the bailor, may the bailee receive the benefits of ownership during the bailment? ANS: N
PTS: 1
TRUE/FALSE 7. Title to property is transferred by will after the person who made the will dies and appropriate judicial proceedings have taken place. ANS: T
PTS: 1
8. A bailment arises when property is left for repair even though when returned it is repaired and therefore not identical to the property left. ANS: T
PTS: 1
9. In order to have a valid gift, the donor need only have the intention to make the gift. ANS: F
PTS: 1
10. The laws of an intestate's state of residence determine how the heirs acquire title to personal property. ANS: T
PTS: 1
11. A bailee rendering services in a mutual benefit bailment always receives a fee or monetary payment. ANS: F
PTS: 1
12. The finder of lost property has a right of possession against everyone. ANS: F
PTS: 1
13. There cannot be a bailment of fungible goods. ANS: F
PTS: 1
14. A bailment is based upon and governed by a contract. ANS: T
PTS: 1
MATCHING
a. b. c. d. e. f.
Abandoned property Accession Bailee Bailment Bailor Lost property
15. 16. 17. 18. 19. 20.
The transfer of possession of personal property on condition the property will be returned. Acquiring property by means of adding personal property of another. Property unintentionally left with no intention to discard it. Property that has been discarded with no intention to reclaim it. The person who temporarily gives up possession of personal property to another. The person who is temporarily given possession of personal property by its owner.
15. 16. 17. 18. 19. 20.
ANS: ANS: ANS: ANS: ANS: ANS:
D B F A E C
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
ESSAY 21. After arriving in Florida for a vacation, Himsey rented an economy car from Smart Shopper Car Rental. While going around a Jersey barrier at a construction site on the street, Himsey came too close and scratched the right front bumper and fender. Then while driving at the speed limit on the smooth interstate, the rear window of the car suddenly fell into the back seat with a loud crash. Himsey was so distracted by the noise he veered into another lane and collided with another car. Himsey had serious injuries. Explain the responsibilities of the parties. ANS: The rental of the car was a mutual-benefit bailment. As such, Himsey was required to exercise reasonable care under the circumstances and Smart Shopper was required to furnish a safe car to Himsey. Himsey was negligent in driving too close to the Jersey barrier and would be liable to Smart Shopper for the scratch to the bumper and fender. However, Smart Shopper did not furnish a safe car to Himsey since car windows should not suddenly fall into cars while driving on smooth highway. It was understandable that Himsey was distracted and Smart Shopper would be liable for his injuries. PTS: 1
CHAPTER 15—SPECIAL BAILMENTS
YES/NO 1. Is a common carrier of goods an insurer of the safety of the transported goods? ANS: Y
PTS: 1
2. May a common carrier refuse service because the service is not one for which it is properly equipped? ANS: Y
PTS: 1
3. Is a common carrier liable for damage if health official seize goods that are a menace to health? ANS: N
PTS: 1
4. May a common carrier limit its extraordinary liability simply by writing the limitation in its printed bill of lading form? ANS: N
PTS: 1
5. Must a hotelkeeper serve without discrimination all who request lodging? ANS: Y
PTS: 1
6. Is a passenger on a common carrier entitled to a seat? ANS: N
PTS: 1
TRUE/FALSE 7. The laws of hotelkeepers do not apply to boardinghouse keepers. ANS: T
PTS: 1
8. A carrier's high degree of liability lasts until the goods are picked up after being transported. ANS: F
PTS: 1
9. The initial and final carriers are each liable for a common-carrier loss occurring on the line of a connecting carrier. ANS: T
PTS: 1
10. A third party may obtain greater rights than the original shipper or consignee had. ANS: F
PTS: 1
11. A carrier must notify passengers of arrival at destinations and stop long enough to permit them to disembark. ANS: T
PTS: 1
12. A hotel that caters to both permanent residents and transients is a hotelkeeper only with respect to the transients. ANS: T
PTS: 1
13. A hotelkeeper is liable even if a guest's behavior increases the risk of criminal attack. ANS: F
PTS: 1
14. If hotel charges are not paid within a reasonable time, the hotelkeeper may sell a guest's baggage to pay the charges and keep any amount obtained thereby. ANS: F
PTS: 1
COMPLETION 15. The person who ships by common carrier is the ____________________. ANS: consignor PTS: 1 16. A person engaged in the business of transporting goods or persons for a fee only under special instances and arrangements is a(n) ____________________. ANS: private carrier PTS: 1 17. A contract requiring delivery of shipped goods only to the person to whom they are shipped is called a(n) ____________________ bill of lading. ANS: straight PTS: 1 18. The final carrier of a shipment of goods is called the ____________________. ANS: terminal carrier PTS: 1 19. A transient person who has been received by a hotel for accommodations is a(n) ____________________. ANS: guest PTS: 1 20. A person regularly engages in the business of offering lodging to all transient persons is a(n) ____________________.
ANS: hotelkeeper PTS: 1 ESSAY 21. Tietjen delivered a load of apples to the railroad to be shipped to Philadelphia when the paperwork was ready. Tietjen's secretary got the flu and did not complete the paperwork for four days. When the railroad received the papers it hauled the apples to Philadelphia and notified the consignee they were at the depot. It took the consignee five more days to pick up the apples. A number of the apples had begun to spoil. What standard of care did the railroad have toward the apples while it had possession of them? ANS: The railroad was liable as an insurer of the apples only during the time it transported them. While waiting to ship the apples and while waiting for the consignee to pick them up after they were shipped, the railroad was only liable as a mutual-benefit bailee. PTS: 1
CHAPTER 16—SALES OF PERSONAL PROPERTY YES/NO 1. If both parties to a sales contract that does not meet the requirements of the UCC choose to abide by its terms, can one later avoid the contract? ANS: N
PTS: 1
2. Must the price in a sales contract always be expressed in terms of money? ANS: N
PTS: 1
3. When a contract includes the supplying of both services and articles covered by Article 2 of the UCC is the contract always a contract for the sale of goods? ANS: N
PTS: 1
4. Must the consideration in a sales contract always be payable in money? ANS: N
PTS: 1
5. Must goods be existing to be the subject of a sale? ANS: Y
PTS: 1
6. Is the United Nations convention regarding the international sale of goods very similar to the UCC? ANS: N
PTS: 1
TRUE/FALSE 7. Sales contracts need only have the essentials of any other contract. ANS: F
PTS: 1
8. A sales contract must state the price or else it will not be binding. ANS: F
PTS: 1
9. Title to future goods does not pass immediately to the buyer when the goods come into existence. ANS: T
PTS: 1
10. If a contract calls for the price to be fixed in the future the contract is binding even if the price is not so fixed. ANS: F
PTS: 1
11. The owner of property normally bears the risk of loss to it. ANS: T
PTS: 1
12. Generally a buyer needs a bill of sale as evidence of ownership. ANS: F
PTS: 1
13. A contract to sell passes ownership of the subject matter at once. ANS: F
PTS: 1
14. Parties to international business contracts for the sale of goods may choose not to be governed by the United Nations convention. ANS: T
PTS: 1
COMPLETION 15. The transfer of ownership to movable personal property for a consideration is called a(n) ____________________. ANS: sale PTS: 1 16. Evidences of ownership of personal property, such as contracts, copyrights, certificates of stock, and accounts receivable are called ____________________ personal property. ANS: intangible PTS: 1
17. Goods the seller and buyer have agreed are to be received by the buyer are ____________________. ANS: identified goods PTS: 1 18. The transfer of ownership of goods prohibited by law, such as stolen property, is a(n) ____________________. ANS: illegal sale PTS: 1 19. The word sale as used in the UCC only applies to ____________________ personal property. ANS: movable PTS: 1 20. To help determine what law applies to an international business contract for the sale of goods, the United States has ratified the United Nations ____________________________________________. ANS: Convention on Contracts for the International Sale of Goods PTS: 1 ESSAY 21. Allis enters into a contract to buy a restored Model T. At the time the contract is entered into the Model T has not yet been restored. Prior to completion of the restoration, a fire destroys the car. Explain what the consequences of the destruction of the car are. ANS: Although the Model T is in existence at the time of the agreement, it is not in the form it is to be in when it is transferred to Allis. Therefore this is clearly not a sale but a contract to sell in the future. Since there has been no sale title remains with the owner and the risk of loss is also with the owner. PTS: 1
CHAPTER 17—FORMALITIES OF A SALE YES/NO 1. If the sale price of a contract for the sale of goods is less than $500 may the contract be oral, written, or implied from conduct? ANS: Y
PTS: 1
2. Does a check or promissory note always constitute payment under the Statute of Frauds?
ANS: N
PTS: 1
3. If a person purchases four items, each selling for less that $500, from the same seller on one day and for which separate sales slips are written, but the total is more than $500, may all the arrangements be oral? ANS: Y
PTS: 1
4. Is a writing required when the person against whom enforcement of the contract is sought voluntarily admits, in the course of legal proceedings, to having made the contract? ANS: N
PTS: 1
5. May a party sign the writing required by the Statute of Frauds by initialing it? ANS: Y
PTS: 1
6. Must the writing required by the Statute of Frauds only indicate that a sale or contract to sell has been made and state the quantity of goods involved? ANS: Y
PTS: 1
TRUE/FALSE 7. The Statute of Frauds requirement that a contract for the sale of goods for more than $500 must be in writing has been included in the UCC. ANS: T
PTS: 1
8. Part payment of an oral contract allows the seller to enforce the entire contract. ANS: F
PTS: 1
9. A negotiable instrument executed by a third person, negotiated by the buyer and accepted by the seller constitutes payment under the Statute of Frauds. ANS: T
PTS: 1
10. An auction sale for any amount is valid even though it is oral. ANS: T
PTS: 1
11. Cash register receipts and invoices generally do not satisfy the requirements for a writing required by the Statute of Frauds. ANS: T
PTS: 1
12. The writing required by the Statute of Frauds must be made before a sale takes place. ANS: F
PTS: 1
13. When a transaction is between merchants, the failure of a party to repudiate within 10 days a confirming letter sent by the other party is binding, just as though the letter had been signed. ANS: T
PTS: 1
14. A purchase order, cash register receipt, or sales ticket is commonly is a writing that satisfies the Statute of Frauds. ANS: F
PTS: 1
MATCHING
a. b. c. d. e. f.
Acceptance Auction Bidder Conditional With reserve Without reserve
15. 16. 17. 18. 19. 20.
The law of commercial papers classifies a check or note as this type of payment. The person who makes the highest oral offer on goods when the seller orally asks for such offers. The sale of property to the person who makes the highest oral offer. Auction goods that cannot be withdrawn after the bidding starts unless no bid is received. Auction goods that can be withdrawn after the bidding starts. Assent of the buyer to become the owner of specific goods.
15. 16. 17. 18. 19. 20.
ANS: ANS: ANS: ANS: ANS: ANS:
D C B F E A
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
ESSAY 21. Brummitt ordered two dress gowns to be made for her by Groskopf's Boutique, Inc. Each gown was agreed to cost $700. Brummitt picked up one gown and wore it to a gala, but when Groskopf's asked her when she was going to pick up the second, Brummitt said she did not want it. Can Groskopf's enforce the oral contract for the two gowns? Explain. ANS: Groskopf's can enforce the oral contract with respect to the gown Brummitt picked up and wore. Even though the contract was oral, Brummitt clearly accepted the first gown by wearing it. Whether the contract for the purchase of the second gown can be enforced depends on whether the gown was of such an unusual nature that it would not be suitable for sale in the ordinary course of Groskopf's business. PTS: 1
CHAPTER 18—TRANSFER OF TITLE AND RISK IN SALES CONTRACTS YES/NO 1. Until the buyer has received the goods, does just the seller have an economic interest in the sales transaction? ANS: N
PTS: 1
2. Is the essential element in determining who bears the risk of loss identifying the party who has control over the goods? ANS: Y
PTS: 1
3. Does title to existing goods requiring transporting pass to the buyer at the time and place of contracting? ANS: N
PTS: 1
4. Does the seller of future goods have an insurable interest in the goods until they are shipped or delivered? ANS: Y
PTS: 1
5. If goods are purchased by a merchant for resale, is a returnable-goods transaction deemed a sale on approval? ANS: N
PTS: 1
6. May the owner of property be estopped from asserting ownership and denying the right of another person to sell the property to a good-faith purchaser? ANS: Y
PTS: 1
TRUE/FALSE 7. A buyer of a motor vehicle does not bear the risk of loss when the transaction between the buyer and seller is completed until the state has issued a new title in the buyer's name. ANS: F
PTS: 1
8. When goods must be manufactured by the seller, the seller's act of labeling goods to be delivered to the buyer gives the buyer an insurable interest in them. ANS: T
PTS: 1
9. If goods that were identified at the time of contracting are damaged through no fault of either party before the risk of loss passes, the buyer may not assert a claim for breach of contract against the seller. ANS: T
PTS: 1
10. In the case of a consignment, title does not normally pass to the consignee.
ANS: T
PTS: 1
11. Shipping goods COD does not affect when title or risk of loss passes. ANS: T
PTS: 1
12. The UCC provides that title to an undivided share of an identified mass of fungible goods does not pass until delivery to the buyer. ANS: F
PTS: 1
13. After the risk of loss passes to the buyer, a seller has no liability for any damage to the goods. ANS: F
PTS: 1
14. Sellers can never transfer a greater title than they possess. ANS: F
PTS: 1
MATCHING
a. b. c. d. e. f.
Destination contract Document of title Incoterms Shipment contract Voidable title Warehouse receipt
15. 16. 17. 18. 19.
A document that shows ownership issued by a storage company for goods stored. The buyer's ownership when goods are obtained by fraud. A writing that evidences ownership of property. Sales terms widely used in international trade. A sales contract under which the seller's performance is not completed until the goods are delivered to the end location. 20. A sales contract under which the seller completes performance when the goods are delivered to a carrier for transport to the buyer. 15. 16. 17. 18. 19. 20.
ANS: ANS: ANS: ANS: ANS: ANS:
ESSAY
F E B C A D
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
21. Dechert's camera fails to focus properly so he takes the camera to a camera store that sells new and used cameras and also repairs them. When Dechert returns to the store a week later to pick up the camera it is not found. It turns out after the camera was fixed a dishonest employee sold it to a customer who came in to buy a used camera. If Dechert finds out the name of the customer who bought the camera can he recover it from the customer? ANS: No. This is a situation that is an exception to the rule that a thief cannot transfer legal title to property. Since the camera store sold both new and used cameras Dechert entrusted his camera to a merchant who dealt in goods of the kind. Such a merchant has the power to transfer Dechert's title to anyone who buys in the ordinary course of business. PTS: 1
CHAPTER 19—WARRANTIES, PRODUCT LIABILITY, AND CONSUMER PROTECTION MULTIPLE CHOICE 1. Which of the following statements is a warranty: a. This computer is the finest money can buy. b. The "Cheesier" pizza has a pound of cheese. c. You will love this car. d. I guarantee you'll catch your limit of bass with this lure. ANS: B
PTS: 1
2. All sellers make a warranty of: a. Title. b. Merchantability. c. Freedom from patent or trademark infringement. d. Fitness for the buyers intended use. ANS: A
PTS: 1
3. Full warranties: a. Permit a refund or replacement if the product contains a defect after reasonable attempts to remedy it. b. Are always oral. c. May limit the duration of implied warranties. d. May limit consequential damages for breach of warranty in any way. ANS: A
PTS: 1
4. The parties to a sales contract can orally agree to exclude: a. The warranty of fitness. b. The warranty of merchantability without mentioning the word "merchantability." c. Warranties if the provision is not unconscionable. d. Warranties without calling the disclaimer to the buyer's attention. ANS: C
PTS: 1
5. The warranty against encumbrances:
a. b. c. d.
Arises in the case of all sales. Applies to goods at the time the sale is made. Does not arise if the buyer has constructive notice of the encumbrance. Is made by all sellers.
ANS: D
PTS: 1
6. The Consumer Product Safety Commission: a. May not order a halt to the manufacture of unsafe products. b. May not totally ban any products. c. Issues orders that are not reviewable by any court. d. Has broad power to promulgate safety standards for many products. ANS: D
PTS: 1
TRUE/FALSE 7. An expression of opinion by the seller on a matter of which the seller has no special knowledge and on which the buyer may be expected also to have an opinion and exercise judgment is not a warranty. ANS: T
PTS: 1
8. The warranty of fitness for a particular purpose arises when the buyer relies on the seller's skill or judgment to select suitable goods and the seller knows of the buyer's reliance. ANS: T
PTS: 1
9. The UCC abolished the requirement of privity against the seller by members of the buyer's family, household, and guests in actions for personal injury. ANS: T
PTS: 1
10. The warranty of merchantability imposes upon manufacturers the duty to sell the safest product. ANS: F
PTS: 1
11. Truth in Lending Act disclosures must be made in the solicitation literature when a company solicits an application for a credit card. ANS: T
PTS: 1
12. Some consumer protection laws are designed to give consumers the ability to make intelligent choices when comparing products. ANS: T
PTS: 1
13. Warranties can be excluded or modified by the agreement of the parties as long as the exclusion or modification is not unconscionable. ANS: T
PTS: 1
14. People whose rights under the Fair Credit Reporting Act have been violated may sue and recover ordinary damages if the harm resulted from negligent noncompliance. ANS: T
PTS: 1
MATCHING
a. b. c. d. e. f.
APR Express warranty Finance charge Implied warranty Model Sample
15. 16. 17. 18. 19. 20.
A portion of a whole mass that is the subject of a transaction. A statement of guarantee made by the seller. The amount charged for a loan expressed as a percentage of the amount borrowed. An assurance an article conforms to a standard imposed by the law. A replica of an article. The total dollar amount a borrower will pay for a loan.
15. 16. 17. 18. 19. 20.
ANS: ANS: ANS: ANS: ANS: ANS:
F B A D E C
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
ESSAY 21. Stephenson went to the store that sold appliances and told the salesperson she wanted a machine to wash clothes. The salesperson showed her a number of machines with various features. The machine Stephenson really liked was the "Superwasher." The salesperson said, "Your clothes will be cleaner than they have ever been if you use a Superwasher." Stephenson bought a Superwasher. What warranties were made in this sale? ANS: The warranties that apply to all sales, title, against encumbrances, conformity to the model in the store, and fitness for the purpose of washing clothes. As a merchant seller, the store also made warranties against infringement and of merchantability. The statement that Stephenson's clothes would "be cleaner than they have ever been" was puffing and did not constitute a warranty. PTS: 1
CHAPTER 20—NATURE OF NEGOTIABLE INSTRUMENTS YES/NO
1. May a party to whom a negotiable instrument is transferred acquire rights superior to those of the original owner? ANS: Y
PTS: 1
2. Is a note actually a type of draft? ANS: N
PTS: 1
3. Is order paper negotiated merely by handing the paper to another person? ANS: N
PTS: 1
4. Are checks and trade acceptances special types of drafts? ANS: Y
PTS: 1
5. Does the law require a person to accept a negotiable instrument in payment of a debt? ANS: N
PTS: 1
6. Are banks required to be able to supply legible copies of checks at a customer's request for seven years? ANS: Y
PTS: 1
TRUE/FALSE 7. A holder of a demand promissory note may demand payment at any time and for any reason. ANS: T
PTS: 1
8. Any commercial paper may be transferred by negotiation. ANS: F
PTS: 1
9. The same individual may be designated by one term at one state and by another at a later stage through which the instrument passes before it is collected. ANS: T
PTS: 1
10. The rights given the original parties differ in the case of negotiation and assignment. ANS: F
PTS: 1
11. A customer's liability for an unauthorized EFT is always limited to $50. ANS: F
PTS: 1
12. A preauthorized debit allows a recurring bill to be automatically charged to a credit card.
ANS: F
PTS: 1
MATCHING
a. b. c. d. e. f. g. h.
Bearer Bearer paper Electronic fund transfer Holder Indorsee Indorser Order paper Payee
13. 14. 15. 16. 17. 18. 19. 20.
Commercial paper payable to the order of a named person. Commercial paper payable to whoever has possession of it. The payee of an instrument made payable to whomever is in possession of it. The person to whom an instrument is payable upon execution. A transfer of funds initiated by means of a telephonic instrument. The payee who signs the back of an instrument. The person in possession of an instrument payable to that person. The holder of a negotiable instrument by indorsement that names the holder as the person to whom the instrument is negotiated.
13. 14. 15. 16. 17. 18. 19. 20.
ANS: ANS: ANS: ANS: ANS: ANS: ANS: ANS:
G B A H C F D E
PTS: PTS: PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1 1 1
ESSAY 21. Justine owes Smithers a debt and wants to pay Smithers with a negotiable instrument. Should Smithers accept a negotiable or nonnegotiable instrument, and why? ANS: Smithy should accept a negotiable instrument not a nonnegotiable instrument. A negotiable instrument might be negotiated to another party so Smithy could conceivably receive cash for it rather than rely on Justine to make the payment. Smithy is more likely to be able to negotiate an instrument rather than assign a nonnegotiable instrument since when a negotiable instrument is negotiated the party receiving it may acquire rights superior to Smithy's. PTS: 1
CHAPTER 21—ESSENTIALS OF NEGOTIABILITY
YES/NO 1. Can an unsigned instrument be negotiable? ANS: N
PTS: 1
2. May an instrument be binding on the parties even though it is nonnegotiable? ANS: Y
PTS: 1
3. May a note still be negotiable when the amount in words on the instrument calls for a different amount than the figures call for? ANS: Y
PTS: 1
4. Is an instrument payable in gold bullion negotiable? ANS: N
PTS: 1
5. Can a check that reads, "Pay to Jones" be negotiable? ANS: Y
PTS: 1
6. If no time is specified, is commercial paper payable on demand? ANS: Y
PTS: 1
7. Is order paper negotiated as soon as it is indorsed by the person to whom it is then payable? ANS: N
PTS: 1
8. May an instrument be signed by an agent? ANS: Y
PTS: 1
9. Does a reference to a consideration in a note condition the promise and destroy negotiability? ANS: N
PTS: 1
10. Must a negotiable instrument be issued to be effective? ANS: Y
PTS: 1
TRUE/FALSE 11. While a negotiable instrument needs to be in writing, it does not need to be printed or even written out in ink. ANS: T
PTS: 1
12. A note must contain the word "promise." ANS: F
PTS: 1
13. It an instrument does not specify a time for payment, it is payable on demand. ANS: T
PTS: 1
14. A variable rate of interest called for in a note destroys negotiability. ANS: F
PTS: 1
15. A note payable to "Jensen and assigns" can be negotiable. ANS: F
PTS: 1
16. An instrument must be dated to be negotiable. ANS: F
PTS: 1
17. An instrument that states it is subject to or governed by another agreement is negotiable. ANS: F
PTS: 1
18. An instrument need not indicate the place where it is payable to be negotiable. ANS: T
PTS: 1
19. A drawer is liable if a draft is only partially filled out and signed before delivery and the blanks are filled in according to instructions. ANS: T
PTS: 1
COMPLETION 20. The sum payable in a negotiable instrument must be a(n) ____________________ amount. ANS: fixed PTS: 1 21. A promissory note must contain a(n) ____________________ to pay. ANS: promise PTS: 1 22. The transferability of a negotiable instrument is referred to as its ____________________.
ANS: negotiability PTS: 1 23. The intentional transfer of possession and control of something is ____________________. ANS: delivery PTS: 1 24. A negotiable instrument is payable to ____________________ when some person is made the payee. ANS: order PTS: 1 25. When an instrument is payable to ____________________, it indicates that the maker or the acceptor of a draft is willing to pay the person who possesses the instrument at maturity. ANS: bearer PTS: 1 26. The first delivery of an instrument by the maker or drawer for the purpose of giving rights on the instrument to any person is called ____________________. ANS: issue PTS: 1 ESSAY 27. Zavadil was filling out a check. She had gotten so far as to write Prussing's name as payee and sign it. Just then the doorbell rang, so Zavadil stuck the form in her desk drawer and answered the bell. Later Prussing visited Zavadil and found the incomplete check in the desk. Prussing secretly took it, inserted the amount of $5,000 and took it to Prussing's bank to cash it. Assuming Zavadil has more than $5,000 in her checking account, should the check be effective so that Prussing can demand payment of it for $5,000? ANS: No, the check was not issued or filled in according to any instructions by the drawer. A negotiable instrument does not have any effect until, in this case, the drawer delivers it for the purpose of giving rights on it to a person. Zavadil did not deliver the check to a person, but put it in her desk drawer. Also, the check was only partially filled in and signed by Zavadil and Prussing had no authority to fill it in for $5,000. Zavadil is liable to Prussing only for an amount authorized and that was $0. PTS: 1
CHAPTER 22—PROMISSORY NOTES AND DRAFTS MULTIPLE CHOICE
1. A valid stop payment order on a check: a. Binds a bank for six months if the order is oral. b. Does not subject a bank to liability to the depositor if it pays the check. c. Can be made on a certified or cashier's check. d. Can be renewed if it is a written order. ANS: D
PTS: 1
2. A draft: a. Is executed in favor of the maker. b. Must clearly show that the signature is intended to be that of a drawer. c. Cannot be paid to anyone not named on the draft. d. Must be payable in the United States. ANS: B
PTS: 1
3. A coupon bond: a. Requires registration of the original purchaser. b. Normally can only be negotiated by indorsement. c. Has detachable individual coupons for the interest payments that will become due. d. When sold requires a record of the transfer to the new bondholder be made. ANS: C
PTS: 1
4. A check is a special type of draft which: a. Is drawn on a bank and payable on demand. b. Must have magnetic numbers on the bottom. c. Is a bearer instrument. d. Must be in a specified form. ANS: A
PTS: 1
5. A postdated check: a. Is also known as a bad check. b. Is unlawful. c. May be paid by the bank before its date. d. Subjects the drawer to civil liability. ANS: C
PTS: 1
6. Among the duties a bank owes its customer, the depositor-drawer, are to: a. Maintain secrecy regarding information acquired by it in connection with the depositorbank relationship. b. Refuse to pay a check from the account if the bank has the depositor's oral stop payment order, received six weeks earlier. c. Honor checks written only on the normal printed form supplied by the bank. d. Pay all checks no matter when they were written, as long as there are funds in the account to cover them. ANS: A
PTS: 1
TRUE/FALSE 7. A time draft payable a certain length of time after its date must be presented for acceptance. ANS: F
PTS: 1
8. A bank draft is a check drawn by a bank on its own funds. ANS: F
PTS: 1
9. If a drawee refuses to accept a draft, the holder has a claim against the drawee. ANS: F
PTS: 1
10. A time draft has a very different form than a sight draft because it is payable immediately. ANS: F
PTS: 1
11. A traveler's check is payable on demand. ANS: T
PTS: 1
12. The maker of a promissory note makes no warranty that the payee is competent to transfer the instrument by indorsement. ANS: F
PTS: 1
MATCHING
a. b. c. d. e. f. g. h.
Bond Collateral note Debenture Inland draft Money order Sight draft Stale check Trade acceptance
13. A draft payable upon presentation by the holder. 14. A sealed, written contract obligation generally issued by a corporation, municipality, or government with the essentials of a note. 15. An unsecured note issued by a business firm. 16. A draft drawn by the seller of goods on the purchaser who has accepted the draft. 17. An instrument issued by a business indicating the payee may request and receive the amount indicated on the instrument. 18. A note secured by personal property. 19. A draft that shows on its face it is both drawn and payable within the United States. 20. A check presented more than six months after its date.
13. 14. 15. 16. 17. 18. 19. 20.
ANS: ANS: ANS: ANS: ANS: ANS: ANS: ANS:
F A C H E B D G
PTS: PTS: PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1 1 1
ESSAY 21. Explain when a draft must be presented for acceptance and how an acceptance is made. ANS: All trade acceptances and all time drafts payable a specified time after sight must be presented for acceptance by the payee to the drawee. The drawee's signature alone on a draft is sufficient to constitute a valid acceptance; however, adding the word "accepted" is advisable to make clear that an acceptance is intended. The drawee may use other words of acceptance, but the words used must indicate an intention to be bound by the terms of the instrument and must be written on it. PTS: 1
CHAPTER 23—NEGOTIATION AND DISCHARGE YES/NO 1. Does a restrictive indorsement prohibit further negotiation of an instrument? ANS: N
PTS: 1
2. Can an instrument payable to "order" be negotiated only by authorized indorsement and delivery? ANS: Y
PTS: 1
3. If an instrument is payable to "Betty or Bob Jones" must both Betty and Bob indorse it in order to negotiate it? ANS: N
PTS: 1
4. Whenever a negotiable instrument has multiple payees must all of them indorse it if the word "and" is not between them all? ANS: N
PTS: 1
5. Are conditional indorsements ineffective with respect to anyone other than the indorser and indorsee? ANS: Y
PTS: 1
6. Does cancellation by mistake effectively destroy the validity of an instrument?
ANS: N
PTS: 1
7. Does the law require that an indorsement on a check be on the back and within one and a half inches of the trailing edge? ANS: N
PTS: 1
8. Is it improper for the transferor of bearer paper to indorse the instrument? ANS: N
PTS: 1
TRUE/FALSE 9. The person primarily liable on an instrument must pay only an authorized holder. ANS: F
PTS: 1
10. All indorsements must be on the instrument. ANS: F
PTS: 1
11. A qualified indorser warrants that the signatures on the instrument are genuine. ANS: T
PTS: 1
12. An indorsee may convert a blank indorsement to a special indorsement. ANS: T
PTS: 1
13. It is not always necessary to correct an irregularity in the name of a party to an instrument. ANS: T
PTS: 1
14. One who negotiates an instrument by delivery alone makes warranties only to the immediate transferee. ANS: T
PTS: 1
15. When a negotiable instrument cannot be returned, the payor has a right to demand security from the holder adequate to protect the payor from having to pay the instrument a second time. ANS: T
PTS: 1
16. A blank indorsement converts order paper to bearer paper. ANS: T
PTS: 1
17. The holder of order paper may indorse it only by special indorsement. ANS: F
PTS: 1
MATCHING
a. b. c. d. e. f.
Allonge Qualified indorsement Restrictive indorsement Trailing edge Without recourse Without warranties
18. 19. 20. 21. 22. 23.
A paper securely attached to an instrument as to be part of it. An indorsement that attempts to prevent the use of the instrument for anything except the stated use. Words used to excuse an indorser from liability for payment if an instrument is unpaid because of insolvency. The left side of a check when looking at it from the front. Words used by an indorser that do not relieve the indorser from liability for the transfer of the instrument. An indorsement that limits the liability of the indorser.
18. 19. 20. 21. 22. 23.
ANS: ANS: ANS: ANS: ANS: ANS:
A C E D F B
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
ESSAY 24. Lorenzo executed a note to Haring in payment for a boat. Lorenzo made a payment on the note and asked Haring to produce the note and write on it to show that partial payment had been made. Haring could not find the note. Is the note discharged? ANS: No. The loss of a negotiable instrument does not discharge the underlying obligation for payment. Since the note cannot be found, Lorenzo can require that Haring post a bond. If someone later compels Lorenzo to repay the note, the bonding company will indemnify him. PTS: 1
CHAPTER 24—LIABILITIES OF PARTIES AND HOLDERS IN DUE COURSE YES/NO 1. Must a person always be a holder in due course in order to bring into operation all the protections that the law has placed around negotiable instruments? ANS: N
PTS: 1
2. When a transferor indorses an instrument with the words, "collection guaranteed," is the transferor liable after proper presentment, dishonor and notice of dishonor?
ANS: N
PTS: 1
3. Does return of a check lacking a proper indorsment constitute dishonor? ANS: N
PTS: 1
4. May notice of dishonor be given by any commercially reasonable means? ANS: Y
PTS: 1
5. Must the actual instrument be physically presented to have a proper presentment? ANS: N
PTS: 1
6. Is notice of dishonor excused in most cases where timely presentment would not have been required? ANS: Y
PTS: 1
TRUE/FALSE 7. A person can have two categories of liability for a negotiable instrument: liability by what is written on it and warranty liability. ANS: T
PTS: 1
8. An agent who signs an instrument indicating a representative capacity will not have personal liability on the instrument. ANS: F
PTS: 1
9. Presentment is not necessary if the drawee of a draft has died. ANS: T
PTS: 1
10. Indorsers can escalate their liability to primary status by indorsing an instrument "Payment guaranteed." ANS: T
PTS: 1
11. Each bank in a clearinghouse system must give notice of dishonor by midnight of the next banking day following the day on which the check is received. ANS: T
PTS: 1
12. An unauthorized signature never binds the person whose name is used. ANS: F
PTS: 1
13. Parties whose signatures do not appear on negotiable instruments are not normally liable for their payment.
ANS: T
PTS: 1
14. A promise constitutes value for purposes of attaining holder in due course status. ANS: F
PTS: 1
15. A signature must be a person's or company's name; it cannot be a logo. ANS: F
PTS: 1
16. A check is considered dishonored if it is returned to the holder stamped "insufficient funds." ANS: T
PTS: 1
17. Notice of dishonor must be in a form approved by the UCC. ANS: F
PTS: 1
COMPLETION 18. The liability indorsers and drawers normally have on an instrument is ____________________. ANS: secondary PTS: 1 19. A person in a relationship of trust and confidence is called a(n) ____________________. ANS: fiduciary PTS: 1 20. Makers of notes and acceptors of drafts ordinarily have the potential of ____________________ liability on negotiable instruments. ANS: primary PTS: 1 21. Items used primarily for personal, family or household purposes are ____________________. ANS: consumer goods PTS: 1 22. The ____________________ is the person who is primarily liable on a note. ANS: maker PTS: 1
23. The demand for acceptance or payment of a negotiable instrument is called ____________________. ANS: presentment PTS: 1 ESSAY 24. Connick was the payee of a note issued by Sisco for $3,000 that Sisco had postdated by two weeks. The due date of the note arrived and Connick offered to transfer it on that date to Horta for $2,890. If Horta buys the note for that price knowing of its irregularity, can he be a holder in due course of the note? ANS: Yes, Horta can be a holder in due course because knowledge that an instrument has been postdated does not give a holder notice of a defense or claim. Since an instrument transferred on the date of maturity is not past due Horta would take the note with no knowledge it was past due or dishonored. Finally, Horta would be giving value for the note and a reduction of less than 4% of the face of the note would not be such a discount to show Horta lacked good faith in buying it. PTS: 1
CHAPTER 25—DEFENSES YES/NO 1. May ordinary contract defenses be raised against a holder in due course? ANS: N
PTS: 1
2. Is a receipt adequate proof of payment of a negotiable instrument? ANS: N
PTS: 1
3. If a competent person negligently fails to read a document, may that person successfully raise the defense of fraud as to the nature of the instrument against a holder in due course? ANS: N
PTS: 1
4. Is the chief advantage of being a holder in due course that certain defenses are not effective against such a holder? ANS: Y
PTS: 1
5. Is a negotiable instrument fully completed but not delivered to the payee uncollectible by all payees? ANS: N
PTS: 1
6. To prevent further negotiation should a party paying a negotiable instrument demand surrender of the instrument?
ANS: Y
PTS: 1
TRUE/FALSE 7. Limited defenses are also called personal defenses. ANS: T
PTS: 1
8. Forgery can never be raised successfully against a holder. ANS: F
PTS: 1
9. Duress is always a defense against a holder in due course. ANS: F
PTS: 1
10. Any defendant in a suit on a negotiable instrument can claim that the instrument is not negotiable. ANS: T
PTS: 1
11. When a person knowingly executes a negotiable instrument but is persuaded to do so because of false statements, the defense is a limited one. ANS: T
PTS: 1
12. Holders in due course are not subject to the defense that a discharge in bankruptcy has been granted. ANS: F
PTS: 1
13. All holders are subject to the defense that a discharge in bankruptcy has been granted. ANS: T
PTS: 1
14. A holder in due course may enforce a fraudulently altered according to its original terms or to its terms as completed. ANS: T
PTS: 1
15. The defense of failure of consideration is not effective against a holder in due course. ANS: T
PTS: 1
16. A thief can pass good title of an instrument to a holder in due course. ANS: T
PTS: 1
17. Incapacity is a universal defense. ANS: F
PTS: 1
COMPLETION 18. Defenses that cannot be used against holders in due course are called ____________________. ANS: limited PTS: 1 19. If an instrument is completed and taken without authority by the payee, the defense of ____________________ can be raised. ANS: nondelivery PTS: 1 20. A defense that may be successfully raised against any holder is a(n) ____________________ defense. ANS: universal PTS: 1 21. When a term in a negotiable instrument is left blank and the drawer delivers the instrument to another to fill it out, if it is filled out incorrectly, the defense of ____________________ might be raised. ANS: improper completion PTS: 1 22. When it can be shown that an instrument was handed over for a specific purpose but was not used for it, the defense of ____________________ could be raised. ANS: conditional delivery PTS: 1 23. A holder who does not have the rights of a holder in due course is called a(n) ____________________. ANS: ordinary holder PTS: 1 24. An unauthorized change in an instrument that modifies an obligation of a party is called ____________________. ANS: alteration PTS: 1
ESSAY 25. Tabler was the payee on a negotiable note for $5,000 executed by Molitor. Tabler indorsed the note to Diaz in payment of $4,900. Diaz gave the note to her niece, Sally, as a birthday gift. When the note came due, the niece sought $5,000 from Molitor. Molitor said that since Sally had not paid value for the note, she was not a holder in due course and Molitor could raise a limited defense he had against Tabler against Sally. May he? ANS: No. While it is true that Sally is not a holder in due course, having received the note as a gift, she is a holder through a holder in due course. Since Diaz had paid for the note, she was a holder in due course. Having received the note from a holder in due course, Sally is a holder through a holder in due course. Molitor can only raise a universal defense against Sally. PTS: 1
CHAPTER 26—NATURE AND CREATION OF AN AGENCY YES/NO 1. May all persons appoint agents to act for them? ANS: N
PTS: 1
2. Do limitations upon an agent's authority bind a third party who does not know of them? ANS: N
PTS: 1
3. Do all contracts of agency involve at least three parties? ANS: Y
PTS: 1
4. Is the burden of proving the existence of agency authority on the person who would benefit by the existence of the authority? ANS: Y
PTS: 1
5. Is one who contracts with an independent contractor liable for injuries the independent contractor negligently causes to third parties? ANS: N
PTS: 1
6. Does a general agent ever have the authority to transact business that is outside the scope of the agent's express authority? ANS: Y MATCHING
a. Apparent
PTS: 1
b. c. d. e. f.
Appointment Attorney in fact Broker Express Necessity
7. 8. 9. 10. 11. 12.
The authority an agent has because of the way the principal has behaved. An agent whose task is to bring two contracting parties together. The usual way of creating an agency by the statement of the principal to the agent. The authority an agent has stated in the agreement creating the agency. A general agent appointed by a written authorization. Method of creating an agency when parents do not support their minor children.
7. 8. 9. 10. 11. 12.
ANS: ANS: ANS: ANS: ANS: ANS:
A D B E C F
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
COMPLETION 13. A written instrument indicating the appointment of an agent is a(n) ____________________. ANS: power of attorney PTS: 1 14. A bailee who takes possession of property for the purpose of sale on commission is called a(n) ____________________. ANS: factor PTS: 1 15. A person authorized to carry out another's business of a particular kind is called a(n) ____________________ agent. ANS: general PTS: 1 16. The approval by a person of the unauthorized act of another done in the former's name is ____________________. ANS: ratification PTS: 1
17. The authority an agent has to do things not specifically enumerated in the agency agreement is ____________________ authority. ANS: implied PTS: 1 18. A person authorized by another to transact some specific act or acts is called a(n) ____________________ agent. ANS: special PTS: 1 19. An agency that arises when a person leads another to believe a third party is an agent is an agency by ____________________. ANS: estoppel PTS: 1 20. A person who performs work for another when the other person controls the work to be done and the manner in which it is done is called a(n) ____________________. ANS: employee PTS: 1 ESSAY 21. When Lloyd appointed Turlock to manage her gas station-convenience store, she instructed him to require payment for purchases in case or by credit card only. Turlock stopped buying the groceries the store sold from the previous supplier and bought them at a lower price through a corporation he owned. Wiggington, a regular customer, filled her car with gas one day and found she had forgotten her purse. Since she was a weekly customer, Turlock allowed her to give him a signed piece of paper agreeing to pay for the gas the next time she filled-up. Two days later Lloyd stopped at the station to confront Turlock about the purchases from his corporation and discovered the paper signed by Wiggington. Explain Turlock's potential liabilities. ANS: Since Turlock disobeyed his principal's routine instruction to take payment only in cash or by credit card, he is liable for any loss from Wiggington failing to make immediate payment by either of those methods. Because Turlock owed Lloyd the duty of loyalty and good faith, Lloyd may recover any profits Turlock made by his corporation selling groceries to the store even though the price was lower. PTS: 1
CHAPTER 27—OPERATION AND TERMINATION OF AN AGENCY YES/NO 1. Does the law impose upon agents duties not set out in the agency contracts?
ANS: Y
PTS: 1
2. May agents generally appoint subagents? ANS: N
PTS: 1
3. Does the dissolution of a corporation terminate an agency in which the corporation is a party? ANS: Y
PTS: 1
4. Must the interests of the principal be promoted by agents to the utmost of their ability? ANS: Y
PTS: 1
5. When an agency agreement does not specify the agent's compensation may no compensation be paid? ANS: N
PTS: 1
6. Does an agent incur liability for losses caused by disobeying routine instructions? ANS: Y
PTS: 1
7. Must a principal cooperate in order to enable the agent to perform duties under the agency agreement? ANS: Y
PTS: 1
8. Does notice of termination of an agency given to an agent constitute notice to the principal? ANS: Y
PTS: 1
TRUE/FALSE 9. Lucy is an agent of Lupco, Inc. Lupco is negotiating to sell property to ABC Co., a company that is owned by Lucy. In this case, Lucy must disclose to Lupco that she owns ABC Co. ANS: T
PTS: 1
10. An agent cannot delegate to subagents the duties that merely involve clerical work. ANS: T
PTS: 1
11. Death of a principal or agent automatically terminates an agency. ANS: T
PTS: 1
12. There is an implied warranty that the agent has the skill required to perform the agency duties. ANS: T
PTS: 1
13. An agent can enforce a principal's promise to pay a bonus to the agent for information secured by the agent in the performance of agency duties. ANS: F
PTS: 1
14. Clerical work may be delegated to a subagent. ANS: T
PTS: 1
15. When agents sign contracts in their own names only their principals are liable. ANS: F
PTS: 1
16. A principal can be bound on a contract even when the agent enters into an unauthorized contract not within the apparent scope of authority. ANS: T
PTS: 1
17. An agency may only be terminated by action of the principal or agent. ANS: F
PTS: 1
MATCHING
a. b. c. d. e. f.
Accounting Bankruptcy Compensation Indemnification Original agreement Reimbursement
18. 19. 20. 21.
The requirement that the principal pay the agent for any loss or damage due to an accident. A method of terminating an agency by acts of the parties. The duty of a principal to pay the agent for services provided. The requirement that the principal pay an agent for any expenses incurred from personal funds as a necessary part of the agency. 22. A method of terminating an agency by operation of law. 23. The duty of an agent to keep a record of all money transactions. 18. 19. 20. 21. 22. 23.
ANS: ANS: ANS: ANS: ANS: ANS:
ESSAY
D E C F B A
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
24. For ten years Grubbs was Cundy's general agent for the purpose of running a travel agency. Cundy found out that Grubbs had not been keeping proper records of receipts, so Cundy revoked Grubbs authority and had her niece run the travel agency. Explain the consequences of the revocation of Grubbs' agency. ANS: Cundy had the right to terminate the agency because of Grubbs' breach of his responsibilities under the agency agreement. However, Cundy must give notice to third parties with whom Grubbs has previously transacted business and who would be likely to deal with Grubbs as an agent. Otherwise Cundy might be bound on a future contract Grubbs negotiated. PTS: 1
CHAPTER 28—EMPLOYER AND EMPLOYEE RELATIONS YES/NO 1. Do all employees have their rights and duties determined by statutes? ANS: N
PTS: 1
2. Where a union represents employees, does the union speak and contract for all the employees collectively? ANS: Y
PTS: 1
3. Is an employer always bound by the employment contract terms found in a handbook published by the employer? ANS: N
PTS: 1
4. Have employers exercised proper care when they do what a reasonable person would have done under the circumstances to avoid harm to their employees? ANS: Y
PTS: 1
5. Does the theory of assumption-of-risk excuse the employer from liability for all risks that an employee experiences in a job? ANS: N
PTS: 1
6. Does the federal Social Security Act provide benefits for the family of an insured worker? ANS: Y
PTS: 1
7. Do states rather than the federal government make payments of unemployment compensation? ANS: Y
PTS: 1
8. Is a self-employed person eligible for unemployment compensation? ANS: N
PTS: 1
TRUE/FALSE 9. The terms of compensation cannot determine the employment contract period. ANS: F
PTS: 1
10. An employer is liable for all injuries to employees directly caused by an insufficient number of workers or the lack of skill of some of the workers. ANS: T
PTS: 1
11. Normally an employee cannot recover workers' compensation for injuries sustained while intoxicated. ANS: T
PTS: 1
12. An employer has liability for the torts of employees caused by the employer's negligence in not enforcing safe working procedures. ANS: T
PTS: 1
13. Normally, unless an employee was employed for the express purpose of inventing items, the employee's inventions belong to the employee. ANS: T
PTS: 1
14. In most states, both the employer and employee pay the tax that finances the unemployment compensation part of the Social Security Act. ANS: F
PTS: 1
15. Medicare covers all hospital and medical services. ANS: F
PTS: 1
16. The Social Security Act covers employment of a spouse by the other spouse. ANS: F
PTS: 1
COMPLETION 17. The relationship of employer and employee arises from a(n) ____________________. ANS: contract of employment PTS: 1 18. The theory that imposes liability on employers for the torts of their employees is called ____________________.
ANS: respondeat superior PTS: 1 19. The insurance designed to cover health care costs for persons age 65 and over is called ____________________. ANS: Medicare PTS: 1 20. The law that requires employers to maintain detailed records of work-related deaths, injuries, and illnesses is called ____________________. ANS: OSHA Occupational Safety and Health Act PTS: 1 21. The employer's defense to injury claims by employees that has been modified so that an employee may recover even when the employee has been careless is called ____________________. ANS: contributory negligence PTS: 1 22. Laws allowing an employee to recover damages for injury whenever the injury arose within the course of the employee's work from a risk involved in that work are ____________________ laws. ANS: workers' compensation PTS: 1 ESSAY 23. Explain how the benefits paid out under the Social Security Act are paid for. ANS: The life insurance and annuity insurance benefits of the Social Security Act are paid for by a payroll tax paid by employers and employees. A payroll tax also finances the unemployment compensation part of the act; however in most states the employer pays the entire tax. Assistance to persons in need is paid for by general taxation. Disability and Medicare benefits are funded from a combination of FICA, a Medicare tax, premiums paid by the people covered, and the general federal revenue. PTS: 1
CHAPTER 29—EMPLOYEES' RIGHTS YES/NO
1. Is the entire federal government subject to Title VII? ANS: N
PTS: 1
2. Employer refused to hire Carl because he is Hispanic. Is this an example of disparate treatment? ANS: Y
PTS: 1
3. Does the Equal Employment Opportunity Commission hear complaints alleging violations of the civil Rights Act of 1964? ANS: Y
PTS: 1
4. Is a blood test for AIDS a "search and seizure" that must be reasonable? ANS: Y
PTS: 1
5. Does state law prohibit smoking at all job sites? ANS: N
PTS: 1
6. Is the leave provided by the FMLA unpaid leave? ANS: Y
PTS: 1
7. Do all laws granting rights to employees apply to all employees? ANS: N
PTS: 1
8. Does the Civil Rights Act of 1964 apply to actions of employment agencies and labor organizations as well as employers? ANS: Y
PTS: 1
TRUE/FALSE 9. Any impairment that makes a person unable to perform a specific job makes the person eligible for the protections of federal law. ANS: F
PTS: 1
10. In order to prove a hostile work environment an employee need only show that the employee found the environment hostile. ANS: F
PTS: 1
11. Under the Equal Pay Act, an employer is not required to pay employees at the same rate if the payments are made on the basis of a merit system. ANS: T
PTS: 1
12. Successful plaintiffs in WARN lawsuits might be able to recover their reasonable attorneys' fees. ANS: T
PTS: 1
13. Federal law allows an employer to discriminate on the basis of age when age is a true occupational qualification. ANS: T
PTS: 1
14. States are not permitted to require DNA samples from felons. ANS: F
PTS: 1
15. A very large percentage of employers have some kind of smoking restrictions in effect. ANS: T
PTS: 1
16. Employers of at-will employees may terminate any employees who refuse drug testing. ANS: T
PTS: 1
17. The ADA requires employers to provide reasonable accommodation such as raising the height of desks to accommodate wheelchairs. ANS: T
PTS: 1
MATCHING
a. b. c. d. e. f.
ADA ADEA Disparate impact Disparate treatment Genetic discrimination Protected class
18. 19. 20. 21. 22. 23.
The law that protects persons age 40 or over from employment discrimination. A group given protection by antidiscrimination laws. A fair policy that disproportionately and negatively affects a specially treated group of employees. Intentional discrimination against a particular person. The law that prohibits employment discrimination against qualified people with disabilities. Using DNA test results when making hiring, promotion or salary decisions.
18. 19. 20. 21. 22. 23.
ANS: ANS: ANS: ANS: ANS: ANS:
B F C D A E
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
ESSAY 24. Moallim was employed as a salesperson in a nationwide department store. For several weeks the store had suffered shortages in cash receipts in the cash register used by Moallim and five other employees. The losses got larger each week, so the department manager announced that all six employees who used the register were going to be required to take lie detector tests. Discuss Moallim's rights and duties with respect to taking a lie detector test. ANS: Because Moallim worked for a nationwide store that would therefore be involved in interstate commerce, the Employee Polygraph Protection Act's protections would apply to Moallim. Under the EPPA, the tests can be used in investigating the thefts from the cash register. Moallim would have to be given written notice stating the loss the store had suffered and that he had access to the money in the register. Before the store could administer the test to Moallim, however, it would have to also give him a description of its reasonable suspicion as to Moallim's involvement. If the store does not do this, Moallim may sue the store and recover damages. PTS: 1
CHAPTER 30—LABOR LEGISLATION MULTIPLE CHOICE 1. The FLSA covers: a. Executives and administrators. b. Employees working for firms engaged in intrastate commerce. c. Agricultural workers. d. Employees working for firms engaged in interstate commerce. ANS: D
PTS: 1
2. Employers have the right to: a. Contribute financial support to a labor organization. b. Hire an employee because of membership in a union. c. Refuse to bargain collectively with supervisory employees. d. Fire an employee because the employee has filed charges against the employer under the LMRA. ANS: C
PTS: 1
3. Federal labor legislation applies to: a. Independent contractors. b. Most employers engaged in interstate commerce. c. Individuals employed by a parent or spouse. d. Supervisory employees. ANS: B
PTS: 1
4. It is an unfair labor practice for a union to: a. Bar a worker from the union for any reason. b. Engage in a secondary boycott.
c. Charge union members initiation fees. d. Picket an employer. ANS: B
PTS: 1
5. The National Labor Relations Board: a. Supervises elections to choose an employee bargaining representative. b. Hears complaints filed only by unions. c. Is composed of members appointed by the Congress. d. Investigates complaints only of employer unfair labor practices. ANS: A
PTS: 1
6. The LMRDA does NOT require: a. Unions to file a complete listing of assets, liabilities, receipts, and disbursements. b. Officials of unions to sign union reports. c. Unions to file monthly reports. d. Employers to report expenditures made to influence union organizational activity. ANS: C
PTS: 1
YES/NO 7. Must employers pay the minimum wage to all employees? ANS: N
PTS: 1
8. If employees paid on a commission basis do not earn commissions in any week less than the minimum wages for the hours worked must the employer add enough to bring the total earnings to the minimum wage? ANS: Y
PTS: 1
9. Do employees under the LMRA have the right to exact payment for services not rendered? ANS: N
PTS: 1
10. Does the NLRA exclude agricultural laborers and domestic servants? ANS: Y
PTS: 1
11. May a union bar a worker from the union for nonpayment of dues? ANS: Y
PTS: 1
12. May an employer ask workers not to join a union if no threats of reprisal or promises of benefits are made? ANS: Y
PTS: 1
13. May an employer who pays employees on commission pay less than the minimum wage if the commission earned is less that the minimum wage?
ANS: N
PTS: 1
14. May unions picket employers to force bargaining with an uncertified union? ANS: N
PTS: 1
COMPLETION 15. The employment of children less than 16 years of age is called ____________________. ANS: child labor PTS: 1 16. The process by which employers and unions negotiate and agree on the terms of employment is called ____________________. ANS: collective bargaining PTS: 1 17. A work setting in which all employees must be union members is known as a(n) ____________________. ANS: union shop PTS: 1 18. The floor under wages of employees engaged in interstate commerce is called the ____________________. ANS: minimum wage PTS: 1 ESSAY 19. Gonzales was a member of a union. He thought the union officials were paid a lot and thought his dues were excessive, but did not know anyone with authority in the union well. He really wanted to find out how the union was spending all the dues the members sent in. Is there any way he can find out about the financial activity of his union? ANS: Yes. As a result of the Labor-Management Reporting and Disclosure Act, unions must file extensive financial disclosures for both the union and union officials. These disclosures must include a complete listing of assets and liabilities, receipts, and disbursements. The information in these reports must be made available to the union members like Gonzales. PTS: 1
CHAPTER 31—INTRODUCTION TO BUSINESS ORGANIZATION
TRUE/FALSE 1. There are no formalities to being and operating a sole proprietorship. ANS: T
PTS: 1
2. The purpose of Fictitious Name Registration Statutes is to collect tax. ANS: F
PTS: 1
3. The biggest disadvantage of a sole proprietorship is that it may not continue after the owner's death. ANS: F
PTS: 1
4. Any person competent to make a contract has the competence to be a partner. ANS: T
PTS: 1
5. A partnership can only be formed to run a lawful business. ANS: T
PTS: 1
6. The main disadvantage of a corporation is that the people who own or control a majority of the voting stock have the sole voice in management. ANS: T
PTS: 1
7. A corporation does not have an existence separate and apart from the existence of its individual members. ANS: F
PTS: 1
8. A corporate investor can never be held personally liable. ANS: F
PTS: 1
MATCHING
a. b. c. d. e. f.
Dormant partner Limited partnership General partner Secret partner Silent partner Trading partnership
9. A partnership in which one or more partners' maximum liability for the firm's debts is the amount of their investment. 10. A partner who is unknown to the public as a partner and takes no part in the management of the business. 11. A partnership engaged in buying and selling merchandise.
12. A partner who takes no active part in the management of the business, but might be known to the public as a partner. 13. A partner actively and openly engaged in the business and held out to everyone as a partner. 14. A person who is an active partner but is unknown to the public as a partner. 9. 10. 11. 12. 13. 14.
ANS: ANS: ANS: ANS: ANS: ANS:
B A F E C D
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
COMPLETION 15. The owner of a sole proprietorship is a(n) ____________________. ANS: proprietor PTS: 1 16. When business debts are payable from personal, as well as business assets, there is ____________________. ANS: unlimited liability PTS: 1 17. A business relationship in which two or more persons combine their labor or property for a single undertaking only is called a(n) ____________________. ANS: joint venture PTS: 1 18. A partnership with no limitation on a partner's rights, duties, or liabilities is called a(n) ____________________ partnership. ANS: general PTS: 1 19. An association of people created by law into an entity is called a(n) ____________________. ANS: corporation PTS: 1 20. Persons who hold themselves out as partners when they are in fact not partners are known as ____________________ partners.
ANS: nominal PTS: 1 ESSAY 21. What are the advantages of a sole proprietorship, a partnership and a corporation? ANS: A sole proprietorship has the advantages of being very easy to begin and operate and also very easy to end. It additionally has the advantage of significant flexibility in managing the business. A partnership can have greater capital and skill, labor may be made more efficient, the ratio of expenses per dollar of business may be reduced, and management may be improved. A corporation has the advantages of pooling capital from many investors and having limited liability. PTS: 1
CHAPTER 32—CREATION AND OPERATION OF A PARTNERSHIP YES/NO 1. Can a partnership exist only if the parties have a written agreement? ANS: N
PTS: 1
2. Can three persons who agree to contribute property to the running of a business as co-owners for the purpose of making a profit have formed a partnership even though they do not call themselves partners? ANS: Y
PTS: 1
3. May a partnership sue only in the name of the partners? ANS: N
PTS: 1
4. Can an individual partner who had not agreed to or had participated in a crime be liable for it? ANS: N
PTS: 1
5. Does a partner have a duty to put the firm's interest above personal advantage? ANS: Y
PTS: 1
6. Does a partnership have liability for the torts committed by a partner in the course of partnership business and in furtherance of partnership interests? ANS: Y
PTS: 1
7. Is a general partnership liable for illegal contracts made by a member of the firm? ANS: N
PTS: 1
8. Are new partners liable for all debts as fully as if they had been partners when the debt was incurred? ANS: N
PTS: 1
TRUE/FALSE 9. The law requires a partnership to have a firm name. ANS: F
PTS: 1
10. If requested, true and full information of all things affecting the partnership must be rendered to the legal representative of any deceased partner. ANS: T
PTS: 1
11. The basis on which profits and losses are to be shared cannot be changed by a majority of the partners. ANS: T
PTS: 1
12. A partner has a right to withdraw half of the original investment without the consent of the other partners. ANS: F
PTS: 1
13. The partnership is not liable for unauthorized acts beyond both the actual and apparent authority of one partner. ANS: T
PTS: 1
14. A withdrawing partner has liability for all partnership debts incurred up to the time of withdrawal unless the creditors have expressly released the partner. ANS: T
PTS: 1
15. The majority of the partners bind the firm on all matters in the scope of the partnership business. ANS: F
PTS: 1
16. Each partner has customary or implied authority to assign the assets of the firm for the benefit of creditors. ANS: F
PTS: 1
COMPLETION 17. In addition to authority expressly given by the partnership agreement, the partnership and by law, each partner has ____________________ authority. ANS: customary implied
PTS: 1 18. In the absence of other evidence, ____________________ evidence holds that a partnership exists. ANS: prima facie PTS: 1 19. The type of ownership a partner has in partnership property is called a(n) ____________________. ANS: tenancy in partnership PTS: 1 20. Unless the partnership agreement stipulates otherwise, partners have ____________________ liability on all partnership contractual liabilities. ANS: joint PTS: 1 21. As agents to a partnership firm, partners have a(n) ____________________ duty to the firm. ANS: fiduciary PTS: 1 22. When the conduct of people who are not partners is such that it misleads others into thinking they are partners, this is frequently held to be a partnership by ____________________. ANS: estoppel PTS: 1 ESSAY 23. Hidalgo and Inzar were general partners in a business that owned apartment buildings. Inzar was responsible for obtaining insurance on the buildings. He also had an insurance agency of his own. His only daughter was getting married, and Inzar devoted three months to working only on the wedding. As a result he failed to pay the insurance premium on one building owned by the partnership and the insurance lapsed. Inzar discovered this late one evening. To get the building insured immediately he wrote an insurance policy from his own agency and the partnership paid the normal premium. Has Inzar conducted himself appropriately as a partner? ANS: No, Inzar has breached two duties he owed as a partner. First, he had a duty to work for the partnership. He was required to use reasonable care and skill in conducting the firm's business. Allowing the insurance to lapse when it was his responsibility to keep the insurance in force just because he was involved in his daughter's wedding did not amount to the required care. Secondly, it was a breach of Inzar's duty of loyalty and good faith to write the insurance policy from his insurance agency since he would earn a profit from writing the policy.
PTS: 1
CHAPTER 33—DISSOLUTION OF A PARTNERSHIP YES/NO 1. Does a partner need to file a prescribed form before withdrawing from the partnership? ANS: N
PTS: 1
2. May the remaining partners decide whether a partner has the capacity to continue as a partner? ANS: N
PTS: 1
3. If a partnership agreement fixes a date for the dissolution of the partnership is it always dissolved on that date? ANS: N
PTS: 1
4. Is notice of dissolution unnecessary when a partnership is dissolved by judicial decree? ANS: Y
PTS: 1
5. If a partner wrongfully withdraws, can the other partners continue the business? ANS: Y
PTS: 1
6. In case a partner makes a voluntary sale of an interest in the firm, does the buyer become a partner by the purchase? ANS: N
PTS: 1
7. Must a withdrawing partner pay for damages caused to the partnership by withdrawing prior to the date stated in the articles of partnership? ANS: Y
PTS: 1
TRUE/FALSE 8. When a partnership sustains a loss, the loss will normally be shared equally by the partners. ANS: T
PTS: 1
9. A partner may withdraw from a partnership at any time without liability. ANS: F
PTS: 1
10. If a partnership is formed to conduct a lawful business that later becomes illegal, the partnership may continue the business.
ANS: F
PTS: 1
11. Dissolution relieves the partners of their duties to each other. ANS: F
PTS: 1
12. When a partner goes through bankruptcy, the trustee in bankruptcy becomes a partner in the partnership. ANS: F
PTS: 1
13. A partner may obtain a decree of dissolution when a court declares another partner of unsound mind. ANS: T
PTS: 1
14. Dissolution prevents the performance of existing contracts. ANS: F
PTS: 1
15. The name of a withdrawing partner should be removed from the firm name on all stationery. ANS: T
PTS: 1
16. Notice of dissolution of a partnership is not necessary to third persons who have done business with the firm. ANS: F
PTS: 1
17. The death of one member of a partnership automatically dissolves the partnership unless the agreement provides it shall not be dissolved. ANS: T
PTS: 1
MATCHING
a. b. c. d. e. f. 18. 19. 20. 21. 22. 23.
Alienation Dissolution Expulsion Futility Misconduct Winding up
The sale of a partner's interest in a partnership. Persistent violation of the partnership agreement. The inability of a partnership to make a profit. The process of taking care of the partnership's outstanding obligations and distributing any remaining assets. A partnership's ability to get rid of a partner. The change in the relation of the partners caused by the elimination of one of them.
18. ANS: A 19. ANS: E
PTS: 1 PTS: 1
20. 21. 22. 23.
ANS: ANS: ANS: ANS:
D F C B
PTS: PTS: PTS: PTS:
1 1 1 1
ESSAY 24. Rosaline and Olivine were partners and decided to dissolve their partnership. What does this mean regarding the continuation of the business and what steps should be taken to properly handle the dissolution? ANS: Dissolution terminates the right of the partnership to exist and must be followed by liquidation of the business. Existing contracts may be fulfilled, but new contracts cannot be made unless they are reasonably necessary to fulfill existing contracts. In addition to winding up existing contracts the partnership should give notice of the dissolution to creditors and other third parties who have done business with the firm. After all debts have been paid, any partner who has advanced money to the firm or incurred a liability in the firm's behalf is entitled to reimbursement. Next, Rosaline and Olivine are entitled to the return of the capital they have contributed to the partnership. Any remaining assets are distributed equally, or if there is a contrary provision in the agreement as the provision provides, to Rosaline and Olivine. PTS: 1
CHAPTER 34—NATURE OF A CORPORATION TRUE/FALSE 1. A corporation can only be used to run really large businesses. ANS: F
PTS: 1
2. Some corporations can have their profits taxed only once. ANS: T
PTS: 1
3. A corporation's powers are only limited by its bylaws. ANS: F
PTS: 1
4. A not-for-profit corporation has the right to buy and hold property. ANS: T
PTS: 1
5. As long as the corporation complies with the terms of the articles of incorporation, the state cannot alter the articles in any material way without consent of the stockholders. ANS: T
PTS: 1
6. The death of a stockholder does not dissolve a corporation.
ANS: T
PTS: 1
7. An ultra vires contract generally is binding on the parties to the contract. ANS: T
PTS: 1
8. A corporation can be sued in the corporate name. ANS: T
PTS: 1
9. A stock corporation is a private corporation, the ownership of which is represented by shares of stock. ANS: T
PTS: 1
10. Corporate document stating rules that govern the internal affairs of a corporation are called groundlaws. ANS: F
PTS: 1
11. Public corporations may have the power to impose taxes and condemn (take) private property. ANS: T
PTS: 1
12. A corporation can transact business only in the state in which it is incorporated (formed). ANS: F
PTS: 1
MATCHING
a. b. c. d. e. f.
Close corporation Domestic corporation Foreign corporation Private corporation Profit corporation Quasi public corporation
13. 14. 15. 16. 17. 18.
A corporation in the state where it received its charter. A corporation in all the states from which it did not receive its charter. A public body that is not a true corporation, but with powers similar to a corporation's. A corporation set up to perform a nongovernmental function. A corporation organized to run a business and earn money. A corporation with a very small number of shareholders.
13. 14. 15. 16. 17. 18.
ANS: ANS: ANS: ANS: ANS: ANS:
B C F C E A
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
COMPLETION 19. The characteristic of a corporation that it exists for the period for which the state grants a charter even though stockholders may die is called ____________________. ANS: perpetual succession continuous succession PTS: 1 20. The people who initially form the corporation are called ____________________. ANS: incorporators PTS: 1 21. One who agrees to buy stock in a proposed corporation is a(n) ____________________. ANS: subscriber PTS: 1 22. The document setting forth the facts prescribed by law for issuance of a certificate of a charter is the ____________________. ANS: articles of incorporation PTS: 1 23. Powers of a corporation which are essential to its existence as a corporation are ____________________ powers. ANS: incidental PTS: 1 24. One who takes the initial steps to form a corporation is a(n) ____________________. ANS: promoter PTS: 1 ESSAY 25. Discuss the three types of powers every corporation has, explaining the distinctions among them. ANS:
The three types of powers a corporation has include express, incidental, and implied powers. Express powers are determined by the law under which a corporation is formed and the corporation's articles of incorporation. A corporation's incidental powers are those that are incidental to its express powers or essential to its existence as a corporation. Implied powers are those that enable a corporation to do all acts reasonably necessary for carrying out the purpose for which the corporation was formed. PTS: 1
CHAPTER 35—OWNERSHIP OF A CORPORATION TRUE/FALSE 1. Ownership in a corporation is represented by bonds and promissory notes. ANS: F
PTS: 1
2. The certificate of incorporation governs the exact rights of preferred shareholders. ANS: T
PTS: 1
3. A corporation may declare a stock dividend even if the corporation has no surplus. ANS: F
PTS: 1
4. When a broker holds stock for which certificates have not been issued, the broker can transfer the stock at the written direction of the owner. ANS: T
PTS: 1
5. Not all the stock a corporation may issue need be subscribed and paid for before the corporation begins operation. ANS: T
PTS: 1
6. The Securities Act of 1933 does not apply to the issuance of securities under $5 million. ANS: T
PTS: 1
7. Common stockholders hire the individuals who manage and operate the corporation. ANS: F
PTS: 1
8. The Securities Investor Protection Act of 1970 prevents fraud through the sale of worthless stock. ANS: F
PTS: 1
9. A stock option is beneficial because the price at which stock may be bought is always less than the fair market value. ANS: F
PTS: 1
10. Dividends can be paid only with cash ANS: F
PTS: 1
MATCHING
a. b. c. d. e. f.
Cumulative preferred stock No-par-value stock Par-value stock Participating preferred stock Preferred stock Stock option
11. 12. 13. 14. 15. 16.
Stock to which a face value has been assigned and that has this value printed on the stock. Stock which is given a special advantage in return for not having voting rights. Stock that shares with common stock in any extra dividends. The right to purchase shares of stock at a set price. Stock on which all dividends must be paid before common stock receives any dividends. Stock to which no face value has been assigned.
11. 12. 13. 14. 15. 16.
ANS: ANS: ANS: ANS: ANS: ANS:
C E D F A B
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
COMPLETION 17. Stock paid for with property of inflated value is called ____________________ stock. ANS: watered PTS: 1 18. A unit of the capital stock of a corporation is divided into units called ____________________. ANS: shares PTS: 1 19. An officer, director, or owner of more than ten percent of a corporation's stock is a(n) ____________________. ANS: insider PTS: 1
20. Preferred stock on which dividends have to be paid only for the current year before common stock dividends are paid is called ____________________. ANS: noncumulative PTS: 1 21. Profits made by an officer buying and selling the corporation's stock within a period of six months are called ____________________ profits. ANS: short-swing PTS: 1 22. A corporation's stock that is reacquired by that corporation is ____________________ stock. ANS: treasury PTS: 1 ESSAY 23. Jaycor Corporation wanted to expand its business. To obtain the funds to do so, it decided to make a public offering of $10,000,000 of additional common stock. Explain what procedures Jaycor must follow in order to properly sell the stock. ANS: Since the value of the public stock issuance is more than $5 million, Jaycor must register this offering with the SEC. The registration statement must be signed by its principal officers and a majority of the board of directors. Jaycor must also issue a prospectus containing such information as the types of stock to be issued, the types of securities outstanding, if any, the terms of the sale, bonus and profit-sharing arrangements, and options to be created in regard to the stock. Jaycor must provide each purchaser of the stock with a copy of the prospectus. PTS: 1
CHAPTER 36—MANAGEMENT AND DISSOLUTION OF A CORPORATION YES/NO 1. Is the right to vote the most important right of a stockholder? ANS: Y
PTS: 1
2. Must stockholders be physically present at a stockholders' meeting before they can vote? ANS: N
PTS: 1
3. May directors be held liable for some acts even without evidence of negligence or bad faith? ANS: Y
PTS: 1
4. May a stockholder's authorization to another to vote the stockholder's stock be revoked at any time? ANS: Y
PTS: 1
5. Is a stockholder's right to inspect the corporate books absolute and unrestricted by the law? ANS: N
PTS: 1
6. Does state law require a corporation to have a president and vice president? ANS: Y
PTS: 1
TRUE/FALSE 7. In order to be valid, a stockholders' meeting requires the presence of a minimum number of shares that must be represented in order to lawfully transact business. ANS: T
PTS: 1
8. Directors can vote by proxy. ANS: F
PTS: 1
9. If a dissolved corporation's assets cannot cover its debts, stockholders incur personal liability. ANS: F
PTS: 1
10. The directors may not delegate ministerial and routine duties to subagents. ANS: F
PTS: 1
11. Directors do not incur liability for losses when they act with due diligence and reasonably sound judgment. ANS: T
PTS: 1
12. A corporate officer who commits a tort or crime is personally liable. ANS: T
PTS: 1
13. Cumulative voting enables a minority shareholder to elect a majority of the board of directors. ANS: T
PTS: 1
COMPLETION 14. A person who exposes wrongdoing in an organization is called a(n) ____________________. ANS: whistleblower
PTS: 1 15. A combination of two corporations to form a new one is called a(n) ____________________. ANS: consolidation PTS: 1 16. The law that puts the responsibility for greater financial disclosure on CEOs and CFOs of a corporation is the ____________________ Act. ANS: Sarbanes-Oxley PTS: 1 17. Allowing a stockholder in the election of directors to cast as many votes in the aggregate equal to the number of shares owned multiplied by the number of directors to be elected is called ____________________ voting. ANS: cumulative PTS: 1 18. A device whereby stockholders give up their voting privileges by transferring their stock to a trustee resulting in minority stockholders getting a voice on the board of directors is a(n) ____________________. ANS: voting trust PTS: 1 19. Combining two corporations so that one is absorbed by the other is called a(n) ____________________. ANS: merger PTS: 1 20. The most important right a stockholder has is the right to ____________________. ANS: vote PTS: 1 21. A director who dissents from action taken at a board meeting should have a record of the dissent entered in the ____________________. ANS: minutes PTS: 1 22. An attempt by competing stockholders to secure a majority of votes is a(n) ____________________.
ANS: proxy war PTS: 1 ESSAY 23. Moore, an attorney with the Rhoden Corporation, a widely held corporation, found out that the president of Rhoden had received a personal loan from the corporation with no collateral, and that the corporation owed $3 million listed on the corporate books as an asset rather than a liability. What would you advise Moore to do? ANS: A personal loan with no collateral given to the president of a corporation and a liability reported on the corporate books as an asset are certainly wrong and probably illegal. Moore should report these to Rhoden's chief in-house lawyer and the CEO. If they do not take proper action, Moore should report these to the board of directors or audit board. PTS: 1
CHAPTER 37—PRINCIPLES OF INSURANCE YES/NO 1. Are warranties and representations the same in contracts of insurance? ANS: N
PTS: 1
2. Does the willful concealment of a material fact render an insurance policy voidable in most states? ANS: Y
PTS: 1
3. Does a partner have an insurable interest in the property owned by the firm to the extent of the possible loss? ANS: Y
PTS: 1
4. Does the rule of concealment apply with equal stringency to all types of insurance contracts? ANS: N
PTS: 1
5. Is insurance a contract whereby a party transfers a risk of financial loss to the insurance company for a fee? ANS: Y
PTS: 1
6. Are warranties a part of the actual contract of insurance? ANS: Y
PTS: 1
7. May coverage actually provided by an insurance policy be somewhat different than that indicated by the company? ANS: Y
PTS: 1
8. Must individuals be competent to contract before they can contract for an insurance policy? ANS: Y
PTS: 1
9. Under subrogation, if an insurer pays a claim to the insured, does the insurer have a right to any claims that the insured had because of the loss? ANS: Y
PTS: 1
10. Does a mortgagee have insurable interest in a mortgagor beyond the amount of the mortgage? ANS: N
PTS: 1
MATCHING
a. b. c. d. e. f.
Binder Hazard Insurable interest Mutual insurance company Rider Stock insurance company
11. 12. 13. 14. 15.
A factor that contributes to the uncertainty of a risk. An interest in the nonoccurrence of the risk insured against. An addition to an insurance policy that modifies, extends or limits the base contract. An insurance company in which the policyholders are the members and owners. An insurance company for which the original investment was made by stockholders and whose business is conducted by a board of directors. 16. A temporary contract of insurance issued by an insurance agent. 11. 12. 13. 14. 15. 16.
ANS: ANS: ANS: ANS: ANS: ANS:
B C E D F A
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
COMPLETION 17. The person who receives the proceeds of an insurance policy is the ____________________. ANS: beneficiary PTS: 1 18. A(n) ____________________ life insurance policy is one that continues, assuming the premium is paid, until the insured is 100 years or death, whichever occurs first.
ANS: whole PTS: 1 19. The consideration paid for insurance coverage is the ____________________. ANS: premium PTS: 1 20. The maximum amount an insurer agrees to pay in case of a loss is the ____________________. ANS: face PTS: 1 21. The right of the underwriter to assume the rights of the policyholder is called ____________________. ANS: subrogation PTS: 1 22. The written contract of insurance is called the ____________________. ANS: policy PTS: 1 23. The person protected against the loss provided by an insurance policy is called the ____________________. ANS: insured PTS: 1 24. The danger of a loss of, or injury to, property, life, or anything else, is called a(n) ____________________. ANS: risk peril PTS: 1 25. The company agreeing to compensate a person for a certain loss is known as the ____________________. ANS: insurer underwriter PTS: 1
ESSAY 26. Explain what is required in order to have an insurable interest in property. ANS: In order to have an insurable interest in property the insured must have to suffer a monetary loss by the destruction of the property. Because insurable interest must exist at the time of the loss, a change in title or possession of the insured property may destroy the insurable interest. PTS: 1
CHAPTER 38—TYPES OF INSURANCE YES/NO 1. If an insurance company refuses to pay a life insurance policy claiming the death was from war activity, does the beneficiary have the burden of proving it was not? ANS: N
PTS: 1
2. Does the incontestability of life insurance policies mean the insurance company cannot refuse to pay a claim on any ground? ANS: N
PTS: 1
3. May a beneficiary assign life insurance only after the insured had died? ANS: N
PTS: 1
4. For a fire policy to cover damage to property, must an actual fire be a hostile fire? ANS: Y
PTS: 1
5. Does all fire insurance cover the insured property when it is moved to a different location? ANS: N
PTS: 1
6. When insured property that was damaged is repaired, must materials of like kind and quality be used? ANS: Y
PTS: 1
7. Does a defense clause in an insurance policy mean the company has to defend a lawsuit if the insured is sued? ANS: Y
PTS: 1
8. Does automobile theft insurance cover damage done to a car by theft or attempted theft? ANS: Y
PTS: 1
9. Is conversion the taking of property by force? ANS: N
PTS: 1
10. Fire insurance is normally included in comprehensive coverage. ANS: Y
PTS: 1
TRUE/FALSE 11. A policy of insurance may be assigned by the insured. ANS: T
PTS: 1
12. All term insurance is renewable. ANS: F
PTS: 1
13. Bodily injury insurance covers accidents occurring while anyone is driving the insured vehicle. ANS: F
PTS: 1
14. A collision occurs when hail hits an automobile. ANS: F
PTS: 1
15. A floating policy covers property no matter where it is located at the time of the loss. ANS: T
PTS: 1
16. States require all insurance companies to accept drivers under the "assigned risk" rule. ANS: T
PTS: 1
17. All states have adopted the no-fault insurance option. ANS: F
PTS: 1
18. In the last clear chance rule, a negligent driver can recover damages if the other driver had one last clear chance to avoid the accident. ANS: T
PTS: 1
MATCHING
a. Blanket policy b. Coinsurance c. Comprehensive policy
d. Defense clause e. Grace period f. Valued policy 19. 20. 21. 22.
A property insurance policy that covers a large number of miscellaneous risks. An insurance policy on many items in different places. A property insurance policy that fixes a value for insured items. A provision of an insurance policy by which the insurer agrees to supply a lawyer to represent an insured who is sued. 23. A 30 or 31-day period in which a late premium may be paid without the policy lapsing. 24. The principle by which the insured recovers on a loss in the same ratio as the insurance bears to the amount of insurance the company requires. 19. 20. 21. 22. 23. 24.
ANS: ANS: ANS: ANS: ANS: ANS:
C A F D E B
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
ESSAY 25. Explain the difference among the types of auto insurance that allow recovery even when an injured driver was negligent. ANS: The last clear chance rule allows a negligent driver to recover if the other driver had one last clear chance to avoid hitting the negligent driver and did not take it. Comparative negligence laws provide that the contributory negligence of a plaintiff reduces but does not completely bar recovery. The court balances the negligence of each party against that of the other. An injured driver can recover whatever percentage of damage the other party caused. In the case of no-fault insurance, the insured's insurance company pays for the insured's damages no matter who was negligent. No-fault is used only for a limited amount of damages. PTS: 1
CHAPTER 39—SECURITY DEVICES YES/NO 1. Must a suretyship contract be in writing? ANS: Y
PTS: 1
2. Is a guarantor's obligation always primary just like the primary debtor's? ANS: N
PTS: 1
3. When a guaranty is conditional, does the guarantor have liability only if the other party cannot pay?
ANS: Y
PTS: 1
4. Does the buyer have a right to redeem the property after repossession? ANS: Y
PTS: 1
5. For the most part does the law of suretyship apply with equal force to both paid sureties and accommodation sureties? ANS: Y
PTS: 1
6. Are guarantors who have paid more than their proportionate share of a debt entitled to recover from the other guarantors the amount in excess of their pro rata share of the loss? ANS: Y
PTS: 1
7. If the sale of collateral after default does not cover the entire amount owed does the buyer have liability for the deficiency? ANS: Y
PTS: 1
8. Does the debtor in a secured credit sale have the right to transfer the collateral? ANS: Y
PTS: 1
9. Is the filing of a financing statement effective until the debt is paid? ANS: N
PTS: 1
10. Must the seller in a secured sale always resell the goods within 90 days in the event of a default? ANS: N
PTS: 1
MATCHING
a. b. c. d. e. f.
Financing statement Guarantor Indemnity Security agreement Subrogation Surety
11. A writing containing the signatures and addresses of the debtor and secured party with a description of the collateral. 12. A written agreement signed by the buyer stating the creditor has an interest in the collateral. 13. The right of a party who pays the debt of another to be reimbursed by that other person. 14. A person responsible for the debt of another, and whose obligation is primary just like the primary debtor's. 15. A person responsible for the debt of another, but whose obligation is secondary. 16. The transfer of the creditor's claim to the guarantor after the guarantor pays the debt.
11. 12. 13. 14. 15. 16.
ANS: ANS: ANS: ANS: ANS: ANS:
A D C F B E
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
COMPLETION 17. A business which is a paid surety is called a(n) ____________________. ANS: bonding company PTS: 1 18. Items purchased for personal, family, or household purposes are called ____________________. ANS: consumer goods PTS: 1 19. The seller has a(n) ____________________ when the seller's right to collateral are superior to those of third persons. ANS: perfected security interest PTS: 1 20. The party to whom a guaranty is given is called the ____________________. ANS: creditor PTS: 1 21. The right of a secured party to take back collateral which is the subject of a secured sale is called ____________________. ANS: repossession PTS: 1 22. Goods used or purchased for use in a business, including farming or a profession are called ____________________. ANS: equipment PTS: 1
ESSAY 23. Martine bought a TV by means of a secured credit sale. She made the monthly payments for eight months and then defaulted. She still owed more than half the cash price of the set. The seller repossessed the goods and notified Martine that it planned to sell the TV set. Martine felt that she had put quite a bit of money into the purchase of the TV set and did not want to just lose the set and all she had paid. What might she do? ANS: Prior to the seller re-selling the TV set Martine may redeem it by paying the amount owed and the expenses reasonably incurred by the seller in retaking and holding the set and preparing for the sale. PTS: 1
CHAPTER 40—BANKRUPTCY YES/NO 1. Before filing for bankruptcy must debtors complete a credit counseling session done by a credit counselor approved by the U.S. trustee's office? ANS: Y
PTS: 1
2. May creditors file an involuntary petition under chapter 13? ANS: N
PTS: 1
3. Are debts for educational loans discharged by bankruptcy? ANS: N
PTS: 1
4. Must the owner of goods in the possession of a debtor in bankruptcy file a claim for the return of the property? ANS: Y
PTS: 1
5. Will a court use the same procedure in liquidating an estate for both voluntary and involuntary bankruptcy proceedings? ANS: N
PTS: 1
6. Is Chapter 11 a provision only for businesses? ANS: N
PTS: 1
7. Can a parent avoid paying child support by way of declaring bankruptcy? ANS: N
PTS: 1
8. Is a creditor required to file a petition in a Chapter 7 bankruptcy? ANS: Y
PTS: 1
TRUE/FALSE 9. If a debtor has fewer than 12 creditors just one of them may petition for involuntary bankruptcy. ANS: T
PTS: 1
10. All debts of debtors are fully paid under Chapter 13 plans. ANS: F
PTS: 1
11. No property acquired by the debtor after the bankruptcy proceedings have been instituted is included in the debtor's estate for the payment of creditors. ANS: F
PTS: 1
12. In order to file under Chapter 7, debtors must compare their "current monthly income" to the median income of families of their size in their state. ANS: T
PTS: 1
13. A holder of a certified check drawn by the debtor may assert a claim against the drawee bank rather than the debtor. ANS: T
PTS: 1
14. Reorganization proceedings under the bankruptcy code are always voluntary. ANS: F
PTS: 1
15. Debtors have to agree to repayment plans proposed by credit counselors. ANS: F
PTS: 1
16. The procedure in liquidating the estate of the debtor is the same whether the bankruptcy proceeding is voluntary or involuntary. ANS: T
PTS: 1
17. Banks and insurance companies cannot file a voluntary petition for Chapter 7 bankruptcy. ANS: T MATCHING
a. Chapter 9 b. Chapter 12 c. Preference
PTS: 1
d. Secured claim e. Stay f. Unsecured claim 18. 19. 20. 21. 22. 23.
The bankruptcy chapter that applies to farmers. A creditor's claim that can be satisfied from the proceeds of assets used as collateral. A transfer of property by a debtor that is disallowed. Preventing a creditor from suing the debtor to recover a debt. The bankruptcy chapter that applies to municipalities. A creditor's claim for which the creditor has no lien on specific assets.
18. 19. 20. 21. 22. 23.
ANS: ANS: ANS: ANS: ANS: ANS:
B D C E A F
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
ESSAY 24. Explain the effects of and how a bankruptcy case proceeds once a bankruptcy petition has been filed. ANS: The filing of a bankruptcy petition automatically prevents filing or pursuing debt collection actions against the debtor. The creditors are notified and elect a trustee to take over the assets of the debtor. The trustee collects debts due the debtor, preserves the debtor's assets and distributes the estate according to a definite priority. The debtor then must receive additional counseling on personal financial management. PTS: 1
CHAPTER 41—NATURE OF REAL PROPERTY TRUE/FALSE 1. All vegetation growing on land is classified as real property. ANS: F
PTS: 1
2. Trees and perennial crops are personal property. ANS: F
PTS: 1
3. When more than one person owns land, each has the right to use and possess it. ANS: T
PTS: 1
4. To determine whether personal property has become a fixture a court looks only to the intention of the person installing the personal property.
ANS: F
PTS: 1
5. In community property states, property owned by one spouse prior to marriage normally is that spouse's separate property. ANS: T
PTS: 1
6. Accretion is a process that occurs suddenly when property boundaries are shifted. ANS: F
PTS: 1
7. When more than one person takes title to property, the law presumes they hold the property in a joint tenancy. ANS: F
PTS: 1
8. Personal property becomes real property only if the one installing the personal property intended it to become real property. ANS: F
PTS: 1
9. A joint tenancy can be destroyed by one joint tenant selling or giving the interest to another. ANS: T
PTS: 1
10. All states except Louisiana, Alaska, and Hawaii have adopted community property laws. ANS: F
PTS: 1
MATCHING
a. b. c. d. e. f.
Color of title Easement Joint tenancy License Partition Tenancy by the entirety
11. Co-ownership by a husband and wife with right of survivorship. 12. A type of multiple ownership of property in which, at the death of one owner, that share passes to the remaining owners. 13. A person's apparent title to property. 14. A right to do certain acts on land, but not the right to stay in possession of the land. 15. A suit to divide a joint tenancy. Property acquired during marriage owned separately and equally by both spouses. 16. A right to nonexclusive or intermittent use of land. 11. ANS: F 12. ANS: C 13. ANS: A
PTS: 1 PTS: 1 PTS: 1
14. ANS: D 15. ANS: E 16. ANS: B
PTS: 1 PTS: 1 PTS: 1
COMPLETION 17. The largest, most complete estate in property that a person can have is a(n) ____________________. ANS: fee simple PTS: 1 18. The interest of a grantor in a life estate that returns to the grantor on the death of the life tenant is called a(n) ____________________. ANS: reversion PTS: 1 19. When two or more persons own property such that when one dies that owner's interest passes to that owner's heirs is called ____________________. ANS: tenancy in common PTS: 1 20. The interest of a grantor in a life estate that goes to someone other than the grantor on the death of the life tenant is a(n) ____________________. ANS: remainder PTS: 1 21. The nature and extent of interest which a person has in property is called a(n) ____________________. ANS: estate PTS: 1 22. Acquiring title to real property by occupying land owned by another for a time fixed by law is called ____________________. ANS: adverse possession PTS: 1 ESSAY
23. When Alexander and Deborah married, Alexander owned a duplex in a community property state. They lived in one side of the duplex; saved their money and bought a lake lot as tenants by the entirety. Deborah failed to pay the loans she took out from Savings Bank prior to her marriage to pay for college. The bank claimed the duplex, the lake lot and their savings. Discuss the likelihood of success of the bank's claims against the properties. ANS: Since Alexander and Deborah live in a community property state, the duplex is Alexander's separate property and the bank would probably not be successful in claiming it. Alexander's and Deborah's savings acquired during their marriage is community property so Deborah owns half of it. The bank would be likely to be successful in claiming that share. Since the lake lot is owned as a tenancy by the entirety, a creditor must be a creditor of both spouses to have a claim against it. The bank, as a creditor only of Deborah, would not have a successful claim against the lake lot. PTS: 1
CHAPTER 42—TRANSFER OF REAL PROPERTY YES/NO 1. Must all transfers of title to real property be by means of a deed? ANS: Y
PTS: 1
2. Is title to real property transferred when the parties sign a contract of sale? ANS: N
PTS: 1
3. May the seller of real property still transfer title to the property if the description in the deed is indefinite? ANS: N
PTS: 1
4. Must the grantee and grantor be identified in a deed? ANS: Y
PTS: 1
5. Do public records of land transactions give notice of title transfers to all? ANS: Y
PTS: 1
6. Does the preparation of an abstract of title protect the buyer of real estate from flaws in the title? ANS: N
PTS: 1
7. Is the married status of a grantor reflected in the deed? ANS: Y
PTS: 1
8. If the legal description is indefinite in a deed, does the grantor retain title? ANS: Y
PTS: 1
TRUE/FALSE 9. A deed usually includes a statement of the consideration, and it must match the actual price paid. ANS: F
PTS: 1
10. A covenant is a promise contained in a deed. ANS: T
PTS: 1
11. Even when the owner makes a gift of real property, the transfer must be evidenced by a deed. ANS: T
PTS: 1
12. A quitclaim deed transfers only a portion of the owner's interest in real property. ANS: F
PTS: 1
13. A deed does not need to state the actual price paid for real property. ANS: T
PTS: 1
14. Most new home buyers do not get a warranty of fitness from the builder. ANS: F
PTS: 1
15. Real property does not need to be paid for in money. ANS: T
PTS: 1
16. The new owner of real property has the option of filing the deed received with a public official in the county or giving notice of the property transfer by publication. ANS: F
PTS: 1
17. The insured pays one premium for title insurance coverage as long as the property is owned. ANS: T
PTS: 1
18. Some defects in the title to real estate cannot be detected by an abstract, so title insurance is used. ANS: T
PTS: 1
MATCHING
a. Affirmative covenant b. General warranty deed
c. d. e. f.
Grantee Grantor Negative covenant Special warranty deed
19. 20. 21. 22. 23.
The person who conveys real property. The person to whom real property is conveyed. A promise in a deed that obligates the grantee to do something. A deed that guarantees that the seller has good title and that the new owner shall have peaceable possession. A deed that guarantees that the seller has the right to sell the real property, without making a guarantee of the genuineness of any prior owner's title. 24. A promise by the grantee in a deed to refrain from doing something 19. 20. 21. 22. 23. 24.
ANS: ANS: ANS: ANS: ANS: ANS:
D C A B F E
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
ESSAY 25. Chieng agreed to buy a two-acre lot from Nejat and her husband. They come to you, a lawyer, and ask you to represent them both in the transaction. From what you have learned in chapter 42 explain what you would do. ANS: You either have an abstract of title examined to verify Nejat's ownership or obtain title insurance on the property. Since you represent Chieng as well as Nejat you prepare a warranty deed and have Nejat and her husband sign it. In the deed, you indicate a nominal amount as the consideration for the sale. You find out the description of the property used in the deed by which Nejat took title and use that to describe the lot in the deed. After the deed is signed you have the Nejats acknowledge it before a notary public. When Chieng delivers the purchase price you deliver the deed to him and then have it recorded. PTS: 1
CHAPTER 43—REAL ESTATE MORTGAGES MULTIPLE CHOICE 1. When a mortgage is assigned: a. The assignee attains greater rights than the assignor had. b. The assignor should require the assignee to produce an estoppel certificate. c. The assignee should have the assignment recorded. d. The last party to record an assignment has preference when there is more than one assignment. ANS: C
PTS: 1
2. A mortgage: a. Is interpreted according to the UCC.
b. Must be given to raise money to purchase the real estate. c. Does not attach to additions to the mortgaged property. d. May be assigned. ANS: D
PTS: 1
3. A sale of the mortgaged property: a. Releases the original mortgagor if the mortgagee extends the time of payment without the mortgagor's consent. b. Releases the original mortgagor under all circumstances. c. Makes the purchaser liable for the mortgage as fully as the original mortgagor. d. Requires the purchaser to assume the mortgage. ANS: A
PTS: 1
4. The mortgagee: a. Is entitled to rents and profits while the mortgage is in effect. b. Has the right to possession of the property. c. May sell the property at foreclosure without notice to the mortgagor. d. Must have the lien canceled by the recorder's office on final payment. ANS: D
PTS: 1
5. When a mortgage is foreclosed: a. The procedure is the same throughout the United States. b. The order of priority of claims is established. c. A first mortgage constitutes a first claim on the proceeds of the sale. d. The debt of the mortgagor is terminated. ANS: B
PTS: 1
6. Mortgage insurance: a. Lasts as long as the property is inhabited. b. Is available from the federal government for any loan amount. c. Costs a percentage of the loan amount when obtained from the Veterans Administration. d. Allows the purchaser to pay less for the property. ANS: C
PTS: 1
TRUE/FALSE 7. Mortgages are interpreted according to contract law rules. ANS: T
PTS: 1
8. The mortgagor but not the mortgagee has an insurable interest in the mortgaged property. ANS: F
PTS: 1
9. The mortgagee, not the mortgagor, can have the lien cancelled upon final payment. ANS: F
PTS: 1
10. Anyone who pays the amount due has the right to redeem property after foreclosure. ANS: F
PTS: 1
11. A buyer of mortgaged property who takes it "subject to the mortgage" becomes liable for the mortgage obligation as fully as the original mortgagor. ANS: F
PTS: 1
12. The mortgagor usually has the right to retain possession of the mortgaged property. ANS: T
PTS: 1
13. Only the mortgagor can have the mortgage lien cancelled by the recorder's office. ANS: F
PTS: 1
14. A mortgage generally provides that the lien attaches to subsequent additions to the mortgaged property. ANS: T
PTS: 1
15. A mechanic's lien takes precedence over any unrecorded mortgages. ANS: T
PTS: 1
COMPLETION 16. To excuse the mortgagor from liability under a mortgage, a(n) ____________________ must take place. ANS: novation PTS: 1 17. The person who gives a mortgage as security for a debt is called a(n) ____________________. ANS: mortgagor PTS: 1 18. A claim of people who have furnished materials or labor on real estate is called a(n) ____________________ lien. ANS: mechanics' PTS: 1 19. A deed of trust conveys title to real property to a disinterested person called a(n) ____________________. ANS: trustee
PTS: 1 20. The sale of mortgaged property in order to pay a mortgage debt is called ____________________. ANS: foreclosure PTS: 1 21. A judgment a mortgage may obtain when the sale of mortgaged property does not pay off the mortgage is called a(n) ____________________ judgment. ANS: deficiency PTS: 1 ESSAY 22. Ault wanted to buy a house and went to the bank to arrange for a loan. The loan officer told Ault the bank would not take a mortgage on the house, but wanted Ault to execute a deed of trust to secure payment of the loan amount. Ault had owned a house before on which there had been a mortgage and had never heard of executing a deed of trust. Explain the difference between these two methods of securing payment of a debt. ANS: While both a mortgage and a deed of trust can be used to secure payment of a debt, a mortgage involves two parties while a deed of trust involves three. Title to the property is actually conveyed to a disinterested party, called a trustee who holds the property for the benefit of the creditor. If a default in payment occurs, the trustee forecloses on the property and applies the proceeds to the payment of the debt. The right to redeem under a deed of trust, when it exists, is similar to the right of redemption under a mortgage. When a deed of trust is used and there is a default the trustee does not need to go to court and have a judicial foreclosure in order to sell the mortgaged property, so the property can be sold more quickly. PTS: 1
CHAPTER 44—LANDLORD AND TENANT YES/NO 1. Is a tenant the same as a lodger? ANS: N
PTS: 1
2. Must proper notice of termination be given when a lease fixes the termination date? ANS: N
PTS: 1
3. Is a landlord required to abate a nuisance that existed at the time the tenant leased the property and of which the tenant was aware? ANS: N
PTS: 1
4. Is an assignment the tenant's transfer of all interest in the entire leased premises to another party? ANS: Y
PTS: 1
5. If a tenant fails to pay the rent and the landlord forces the tenant to vacate, is the tenant relieved from the liability for the rent agreed upon? ANS: N
PTS: 1
6. When a tenant abandons leased property before the end of the lease term, does the landlord have a duty to mitigate the tenant's damages by trying to get a new tenant? ANS: Y
PTS: 1
7. Can a tenancy from month to month exist? ANS: Y
PTS: 1
8. Do leases for more than one year have to be in writing? ANS: Y
PTS: 1
TRUE/FALSE 9. A lease allows no damage of any kind to the leased property. ANS: F
PTS: 1
10. The primary duty of the tenant is to pay the rent. ANS: T
PTS: 1
11. Joint occupancy is the same as subleasing. ANS: F
PTS: 1
12. Unless prohibited by law, the parties may agree as to how to treat fixtures at the termination of a lease. ANS: T
PTS: 1
13. A tenant occupying a building must pay all taxes and special assessments. ANS: F
PTS: 1
14. The payment of rent may be by the month even when a tenancy for a specified number of years exists. ANS: T
PTS: 1
15. In a tenancy from year to year, the lease lasts for one year.
ANS: F
PTS: 1
16. All additions and improvements made by a tenant become the property of the landlord. ANS: F
PTS: 1
17. The amount paid a landlord for the possession of leased property is called rent. ANS: T
PTS: 1
MATCHING
a. b. c. d. e. f.
Ejectment Eviction Nuisance Possession Tenancy at sufferance Tenancy at will
18. 19. 20. 21. 22. 23.
The tenant's right to move into leased premises. A disturbance of the tenant's enjoyment of leased premises. A tenancy for an uncertain period. When a tenant holds over with the landlord's permission. The court action brought to remove a tenant upon termination of a lease. The expulsion of a tenant from leased property.
18. 19. 20. 21. 22. 23.
ANS: ANS: ANS: ANS: ANS: ANS:
D C F E A B
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
ESSAY 24. Hibbet leased a house for one year. Six months later, the house was totally destroyed by a tornado. Discuss the results of such an event under the common law and under newer statutes. ANS: Under the common law, Hibbet had to continue to pay rent even though the house was destroyed. Statutes in some states have modified this rule so that if the landlord refuses to restore the house, the lease terminates and Hibbet is relieved of the obligation to pay rent. PTS: 1
CHAPTER 45—WILLS, INHERITANCES, AND TRUSTS
TRUE/FALSE 1. Title to all property may be transferred by a will. ANS: T
PTS: 1
2. One can control the distribution of property for all time by the use of a will. ANS: F
PTS: 1
3. The spouse of a deceased person can always elect to take against the will. ANS: F
PTS: 1
4. A divorce of a testator never affects the will. ANS: F
PTS: 1
5. The law of contracts generally applies to trusts. ANS: T
PTS: 1
6. A resulting trust arises by operation of law to prevent a wrongdoer from continuing to take advantage of another. ANS: F
PTS: 1
MATCHING
a. b. c. d. e. f.
Blind trust Devisee Express trust Holographic will Legatee Nuncupative will
7. 8. 9. 10. 11. 12.
A trust that is clearly established as a trust. The person who receives a gift of real estate by will. A will written out in longhand by the testator. The person who receives a gift of personal property by will. A trust used when the assets are to be hidden from the grantor. An oral will made during the deceased's last illness.
7. 8. 9. 10. 11. 12.
ANS: ANS: ANS: ANS: ANS: ANS:
C B D E A F
PTS: PTS: PTS: PTS: PTS: PTS:
1 1 1 1 1 1
COMPLETION 13. The distribution of property equally to a decedent's children is distributed ____________________. ANS: per capita PTS: 1 14. The property left by a deceased is called a(n) ____________________. ANS: estate PTS: 1 15. The person entitled to the income or enjoyment of trust property is the ____________________. ANS: beneficiary PTS: 1 16. The act of a testator informing the witnesses to the will that the instrument being signed is the testator's will is called ____________________. ANS: publication PTS: 1 17. The failure of a bequest because the property bequeathed is no longer owned by the deceased is called a(n) ____________________. ANS: ademption PTS: 1 18. Personal property left to someone by a will is called a(n) ____________________. ANS: bequest PTS: 1 19. A person who dies without leaving a will is said to die ____________________. ANS: intestate PTS: 1 20. The person appointed by the court to handle the property of a person who dies without leaving a will is called a(n) ____________________.
ANS: administrator administratrix PTS: 1 ESSAY 21. Reller was 82 and owned property worth about $5 million. His health was not good, and he wanted to make sure that after his death his property could be managed by his accountant, Lohr, for the benefit of his three children. Explain how he could accomplish this purpose. ANS: Reller could put his property in a trust, which is a contract by which one person agrees to hold property for the benefit of another or others. He could make Lohr the legal owner of his property which would give him the authority to control the way in which the property was used. The beneficial owner of the trust, who would receive the income and benefits of the trust property, could be Reller while he is alive and his children after his death. PTS: 1 Rechercher Créer
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QN=1 The common law and equity law system in the United States was emerged from ( ). a. France b. Russia c. England d. Germany c QN=2 The law set the rules of conduct for many transactions so that we will know how to ( ) disputes. a. Avoid b. Terminate c. Carry d. Take a QN=3 Why was the Bill of Rights enacted? a. To protect the civil rights and liberties of the citizens and the states. b. To oppose the world war. c. To protect the citizens against the bad impact of nature. d. All of the choices "To protect the civil rights and liberties of the citizens and the states", "To oppose the world war", and "To protect the citizens against the bad impact of nature". a QN=4 Law is a rule of conduct that enacted and enforced by the Sovereign State. a. True b. False a QN=5 The basic relationship between the government and citizen is defined by ( ). a. Judicial decisions b. Constitutions c. Administrative agency orders d. Ordinances b QN=6 In the field of business law, ( ) is the most important statute. a. The Uniform Commercial Code b. CISG c. Incoterms 2010 d. Trade practice
a QN=7 In the United States of America, courts will mainly base on precedent to settle down the dispute. a. True b. False a QN=8 A Precedent means the court's decision for the previous case is applied to determine the decision for the later case if ( ) a. It is found similarities between them. b. It is found difference between them. c. No law is available. d. No court's rules are good enough. a QN=9 Law is issued by the chairman of a corporation. a. True b. False b QN=10 Common Law is English custom recognized by ( ) as binding a. Government b. National Assembly c. Courts d. Prosecution c QN=1 In order to try a case a court must have jurisdiction ( ). a. Only over the subject matter of the case b. Only over the persons involved in the case c. Over both the subject matter of the case and the persons involved d. Courts do not always have to have jurisdiction c QN=2 The Supreme Court of the United States ( ). a. Are review courts b. Belong to state courts system c. Are the highest courts in the United states. d. Belong to federal courts system. d
QN=3 ( ) is the authority of a court to hear a case. a. Jurisdiction b. Answer c. Interrogatory d. Summons a QN=4 ( ) are part of the federal government. a. County courts b. Federal courts c. District courts. d. State courts. b QN=5 The power or authority of a court to hear cases is called its ( ). a. Jurisdiction b. Illegal right c. None of all. d. Liberty right a QN=6 The chief functions of the court are to ( ). a. Interpret and apply the law from whatever source to a given situation. b. Resolve disputes even in the case those disputes were not brought before the court c. Punish the criminal only d. Award the injured party in civil suit only a QN=7 Taken an approach of governmental unit setting up the court, the court may be divided into federal court, state court and municipal courts. a. True b. False a QN=8 The Supreme Courts has original jurisdiction or trial jurisdiction over cases of ( ). a. Any kinds b. Ambassadors, public ministers, and consuls and in cases in which state is a party c. Special matters which will be decided late by Judges. d. Ambassadors, public ministers, and consuls b
QN=1 The duty of proving the amount of damage in a tort lawsuit belongs to ( ). a. Defendant b. Court c. All d. Plaintiff d QN=2 A trademark gives the owner the ( ) to use a word or device to distinguish a product or a service. a. Exclusive duty. b. Exclusive right. c. Inclusive duty d. Inclusive right. b QN=3 ( ) is the unauthorized use or confusingly similar imitation of another person's mark or name. a. Trade name infringement. b. Violation. c. Infringement. d. All of the choices "Trade name infringement", "Violation" and "Infringement". a QN=4 A tort ( ). a. Is always based on a negligent activity. b. Is prosecuted by a district attorney. c. Is a civil wrong for which damages may be recovered. d. Is the result of a failure to exercise reasonable care toward someone. c QN=5 The failure to exercise a duty of care is ( ). a. Constitution b. Equity c. Negligence d. Precedent c QN=6 Interference with a contract or economic advantage which causes a party to a contract to break off the contract is committed business tort. a. True b. False a
QN=7 The doctrine of strict liability makes a manufacturer liable without proof of negligence for dangerous product. a. True b. False a QN=8 A battery is the intentional harmful or offensive touching of another without consent or privilege. a. True b. False a QN=9 If a person is injured when he/she is using a product, the manufacturer of the product shall be held liability for such injury. a. True b. False b QN=1 A voidable contract ( ). a. Must be in writing. b. Must be rejected by both parties. c. Gives one party the choice to abide by it or reject it. d. Is never effective. c QN=2 A ( ) is one in which the terms are set forth in writing rather than expressed orally. a. Executed contract b. Executory contract c. Written contract d. Oral contract c QN=3 A ( ) must be in a special form or be created in a certain way. a. Executory contract b. Oral contract c. Formal contract d. None of the choices "Executory contract", "Oral contract" and "Formal contract" c QN=4 A (an) ( ) consists of a mutual exchange of promises to perform some future acts. a. Bilateral contract. b. Bilateral contract, Quasi contract and Executory contract.
c. Quasi contract. d. Executory contract. a QN=5 According to the contract law of the US, how many requirements that a contract must meet in order to be valid a. 5 b. 4 c. 3 d. 6 a QN=6 Failure to perform contractual duties is breach of contract. a. True b. False a QN=7 The King offers to pay $100,000 to anyone who kills the Monster and brings the Princess back to the Kingdom. Robin cuts the Monster' head off and brings the beautiful Princess back, the King gives such hero the bonus of $100,000. In this case, there is ( ). a. A bilateral contract existing b. A unilateral contract existing c. No contract existing b QN=8 Simple contracts may be ( ). a. Implied from the conduct of the parties b. Imposed by Law c. A quasi-contract d. Implied from the conduct of the third party a QN=1 Advertisements, window displays, catalogs, price lists, etc. are common types of ( ) to make an offer. a. Invitation. b. New offer. c. Disagreement. d. New acceptance. a QN=2 An offer that does not specify a ( ) of acceptance may be accepted in any manner reasonable under the circumstances.
a. Particular manner b. Participated manner c. Unparticipated manner d. Particular manner, Participated manner and Unparticipated manner are right. a QN=3 A manifestation must ( ) to be an offer. a. Be definite b. Show the manifesting person's intention to be legally bound c. Be communicated to a person who the manifesting person intents to be bound with d. Be definite, show the manifesting person's intention to be legally bound and be communicated to a person who the manifesting person intents to be bound with d QN=4 If the offer is communicated by means of facsimile without specifying any particular manner of acceptance, the acceptance could be ( ). a. Communicated by email b. Communicated by email or facsimile c. Communicated in an reasonable manner d. Communicated as required in the offer c QN=5 A revocation of an offer is valid if communicated to the offeree ( ). a. Prior to a counteroffer b. At any time before its acceptance c. At any time. d. Prior to inquiry b QN=6 An offer directed to a specific individual or firm cannot be accepted by anyone else. a. True b. False a QN=7 The offer must be communicated to the offeree. a. True b. False a QN=8 An option can be revoked at will.
a. False b. True a QN=1 Almost all of a minor's contracts are avoidable at the minor's option. a. True b. False a QN=2 A ( ) who contracts with an adult may avoid the contract or treat the contract as valid and then the adult is bound by it. a. Intoxicated person. b. Minor. c. Convict. d. None of Intoxicated person, Minor and Convict b QN=3 Who are not capable of making a legally enforceable contract a. Adults b. Minors c. Mentally incompetent people d. Minors and/ or mentally incompetent people d QN=4 After reaching majority, minors may treat the contract made by them during minority to extent which ( ). a. Rejects it at any time b. Ratifies it within reasonable time c. Keeps silence to reject it d. Accepts it at any time b QN=5 Does the term disaffirmance mean the repudiation of a contract? a. No b. Yes b QN=6 If an adult purchases personal property from a minor, the adult has only a voidable title to the property. a. False b. True
b QN=7 Minor is a person under the age of majority. a. False b. True b QN=1 A ( ) is one in which two or more people are bound both jointly and severally. a. Joint and several contract b. Joint contract c. Several contract d. None of the choices "Joint and several contract, Joint contract and Several contract" a QN=2 Third party can become involved in a contract by ( ). a. Novation b. Assignment c. Delegation d. Novation, assignment and delegation d QN=3 When a joint contract is not carried out may the aggrieved party must sue ( ). a. Either of joint- parties individually b. All of joint-parties together c. None of joint-parties d. Several-parties b QN=4 The third party beneficiary may claim for his/ her rights under the contract in the case of ( ). a. Donee beneficiary b. Creditor beneficiary c. Incident beneficiary d. Either of Donee beneficiary, Creditor beneficiary or Incident beneficiary b QN=5 When one assigns rights under a contract the assignee can receive ( ). a. Greater rights than the assignor held b. Less rights than the assignor held c. Equal rights that the assignors held d. The rights to extent which depends on the assignor's intention c
QN=6 Unless otherwise expressed, a promise made by two or more people is generally presumed to be ( ). a. Joint contract b. Several contract c. Joint and several contract d. Based on later consent of both parties a QN=1 If a contract states no time for performance, when must it be performed? a. Performance must ordinarily be rendered within a reasonable time b. Performance must ordinarily be rendered within a time agreed by contractual parties c. Performance will be rendered at any time d. None of the choices: "Performance must ordinarily be rendered within a reasonable time", "Performance must ordinarily be rendered within a time agreed by contractual parties" and "Performance will be rendered at any time" a QN=2 Bankruptcy leads to ( ). a. Terminate a contract by law b. Invalidate a contract c. Avoid a contract d. Invalidate the contract a QN=3 Liquidated damage is ( ). a. Agreed by both parties to a contract in advance in the event a breach of the contract b. Announced by the court to punish aggrieving party if needed c. Fixed equal to injuries to enforce fairness d. Punished when no damage occurs a QN=4 A person has the rights to sue based on ( ). a. Statue of limitation b. Time issued by court in case by case c. Time fixed by both party before hand d. Statue of timing-suit. a QN=5 After singing the contract, the obligation under contract is impossible to perform, both parties may treat the contract ( ). a. Invalid
b. Discharged c. Voidable d. Unenforcable b QN=1 ( ) are tangible personal property. a. Loans b. Bonds c. Copyrights d. Cars d QN=2 Title does not transfer by ( ) until the person who made the will dies and appropriate judicial proceedings have taken place. a. Will b. Purchase c. Descent d. Gift a QN=3 A gift is one way to obtain the title of personal property. a. True b. False a QN=4 Fungible goods are goods of homogeneous nature sold by weight or measure. a. True b. False a QN=5 The finder of lost property has a right of possession against everyone. a. False b. True a QN=6 One may acquire personal property by creation. a. True b. False a
QN=7 The laws of an intestate's state of residence determine how the heirs acquire title to personal property. a. True b. False a QN=1 Under UCC, the seller expects to acquire the goods in the future either by ( ) or by manufacture. a. Sell b. Purchase c. Borrow d. Lease b QN=2 The sale of bonds is a sale of goods under UCC. a. True b. False b QN=3 The reasonable price for the same goods in the market shall be implied, in case there is no express term on the price. a. True b. False a QN=4 Under UCC, ( ) is a sale of goods. a. A sale of furniture b. A sale of copyrights c. A sale of land d. A sale of shares a QN=5 In accordance with UCC, ( ) is not a sale contract. a. A purchase of a real estate b. A purchase of automobiles c. A purchase of potatoes d. A sale of computers a QN=6 Goods, in a sale of goods, mean ( ). a. Immovable property b. Intangible movable property
c. Tangible movable property d. Immovable property, intangible movable property and tangible movable property c QN=7 Under UCC, price in a sale of goods could be paid for by ( ). a. Money b. Goods c. Services d. Money, goods and services d QN=8 Under UCC, a Sale contract will not be valid even if it does not state the exact price. a. True b. False a QN=9 Under UCC, if the sale is divisible with a legal part and an illegal part, the court will ( ) a. Enforce the legal part only. b. Announce the whole contract invalid c. Recognize the whole contract valid d. Leave choice to avoid contract to both parties a QN=10 Under UCC, which property subjects to Sales? a. House b. Land c. Copyrights d. Horse d QN=11 Under UCC, if a party to a sale contract indicates that the price must be fixed by them or by third party at a later date, will the contract be binding? a. Yes b. No a QN=1 The ( ) is the one who makes the offer in the auction sales. a. Offeror b. Offeree c. All of the choices: "Offeror", "Offeree", and "Bidder" d. Bidder
d QN=2 Under UCC, an oral contract may be enforced if the buyer has made full ( ) on the contract. a. Agreement b. Termination c. All of the choices: "Agreement", "Termination" and "Payment" d. Payment d QN=3 ( ) is taking possession of the goods. a. Receipts b. Bill of sale c. Invoice d. None of the choices: "Receipts", "Bill of sale" and "Invoice" a QN=4 Under UCC, if the sale price of a contract for the sale of goods is equal to or more than $500, the contract will not be valid if it is not ( ). a. In writing b. In writing and the oral evidence is not permitted c. Under seal d. Under signature b QN=5 Under UCC, the contracts with equal to or more than 500 USD will not invalid if proof of oral contract is permitted. a. True b. False a QN=6 The bidder is the one who makes the offer in the auction sales. a. True b. False a QN=7 Under UCC, an oral contract cannot be enforced if the buyer has made full payment on the contract. a. False b. True a
QN=8 Under UCC, must all contracts for the sale of goods exist in writing when the sale price is $500 or more, unless otherwise provided by law? a. Yes b. No a QN=1 The title to existing goods, identified at the time of contracting and not to be transported, passes to the buyer ( ). a. At the time and place of delivery b. At the time of delivery and place of the seller c. At the time and place of contracting d. At the time the seller has completes the delivery d QN=2 In case existing goods require transporting, when does title to the goods pass to the buyer? a. Title to the goods passes to the buyer when the seller has completed delivery. b. Title to the goods passes to the buyer when delivery has just begun. c. Title to the goods passes to the buyer before the seller's manufacture finishes. d. All of the choices: "Title to the goods passes to the buyer when the seller has completed delivery"," Title to the goods passes to the buyer when delivery has just begun", and "Title to the goods passes to the buyer before the seller's manufacture finishes". a QN= 3 In case a contract for sale of goods is ( ), the seller shall be obliged to deliver the goods to the initial carrier. a. A shipment contract b. A destination contract c. A COD contract d. A F.O.B (UCC) contract a QN=4 Regarding international trade, Incoterms are widely used. a. True b. False a QN=5 Fungible goods are goods of a homogeneous or like nature that may be sold by weight or measure. a. True b. False a
QN=6 For future goods marking and shipment, title and risk of loss pass to the buyer when shipment or delivery occurs. a. True b. False a QN=7 After the risk of loss passes to the buyer, a seller has no liability for any damage to the goods. a. False b. True a QN=1 A statement "this is a good engine" is ( ). a. Merely the seller's opinion b. An express warranty c. An implied warranty a QN=2 An implied warranty differs from an express warranty in that ( ). a. It is made by the seller and is imposed by the law b. All of the choices: "It is made by the seller and is imposed by the law", "It is not made by the seller but is imposed by the law", and "It is made by the seller but is imposed by the law". c. It is not made by the seller but is imposed by the law d. It is made by the seller but is imposed by the law c QN=3 For food or drink, the sale carries the ( ) that the food is fit for its ordinary purpose of human consumption. a. Limited warranty b. Implied warranty c. Express warranty d. Full warranty b QN=4 Warranty implied by all sellers is ( ). a. Title b. Merchantability c. patent or trademark infringement d. Fitness for particular use of buyer a QN=5 Warranties of all sellers include ( ). a. Warranty of title
b. Warranty against encumbrances c. Warranty of conformity to description, sample and model d. Warranty of fitness for a particular purpose e. Warranty of title, warranty against encumbrances, warranty of conformity to description, sample and model and warranty of fitness for a particular purpose e QN=6 The seller says as "Our products are on the top of the World." His oral statement is ( ). a. An express warranty b. An implied warranty c. The seller's puffing c QN=7 The seller's statement shall be considered as a warranty if it contains the word "warranty" or "guarantee". a. True b. False b QN=8 A warranty of title cannot be excluded in any case. a. True b. False b QN=1 ( ) of the sole proprietorship has ultimate and unlimited liability for its debts. a. The employee b. The agent c. The owner d. The creditor c QN=2 Laura sets up a store in a form of a sole proprietorship, namely "Laura Fashion". Laura Fashion has unpaid debt. May the creditor require Laura to pay this unpaid debt? a. Yes b. No a QN=3 The ( ) shall have the limited liability. a. General partner b. Proprietor c. Shareholder d. Joint venture party
c QN=4 A corporation is ( ). a. An agreement of individuals b. An association created by law into an entity c. A person d. An agreement of individuals, an association created by law into an entity and a person b QN=5 A corporation must be register as a legal entity. a. True b. False a QN=6 The nature of Articles of Corporation is a/an ( ). a. Commitment b. Promise c. Contract d. Unilateral contract c QN=7 Members in joint-stock company have ( ). a. Limited liability b. Unlimited liability c. Either of limited liability or unlimited liability d. Both of limited liability and unlimited liability b QN=8 There are only three types of business organization. a. True b. False b QN=9 A general partnership is ( ). a. A partnership with no limitation on rights of partners b. A partnership with no limitation on duties of partners c. A partnership with no limitation on rights, duties and/or liabilities of partners c QN=10 A proprietor must be ( ). a. A person b. A legal entity
c. A corporation d. A household a QN=1 The right to have a corporate seal is ( ). a. Incidental power of corporation b. All of the choices: "Incidental power of corporation", "Express power of corporation", and "Implied power of corporation" c. Express power of corporation d. Implied power of corporation a QN=2 Knight Corporation signs a contract for purchase of land to build its factory. Its action is within ( ). a. Express power b. Implied power c. Incidental power c QN=3 Every corporation has three types of powers: express, incidental, and implied. a. True b. False a QN=4 A corporation shall not be held liable on contracts negotiated by its promoter on its behalf prior to incorporation unless ( ). a. Such contracts benefit it b. Such contracts do not harm it c. It ratifies or adopts such contracts d. Such promoter becomes its director c QN=1 Watered stock is ( ). a. Reacquired by a corporation b. With assigned face value c. Giving special advantage d. Issued as fully paid up, but paid with property of inflated values d QN=2 The common shareholder is an owner of ( ). a. Common share(s) b. Voting preference share(s)
c. Dividend preference share(s) d. Redeemable preference share(s) a QN=3 A stock option gives an individual an option to purchase shares at fixed price for a stated period of time. a. True b. False a QN=4 In case, ownership of shares is not evidenced by a stock certificate, ownership is shown on ( ). a. The corporation's corporate record book b. The corporation's bylaws c. The corporation's articles of incorporation a QN=5 A stock certificate presents the capital stock of a corporation. a. True b. False b QN=1 To be valid, a stockholders' meeting requires the presence of a minimum number of shares that must be represented in order that business may be lawfully transacted. This is called ( ). a. Requirement on quasi contract b. Requirement on quorum c. Requirement on voting trust d. Requirement on voting b QN=2 Who manages the corporation? a. Officers b. Both of the choices: "Directors" and "Officers" c. Directors d. None of the choices "Directors" and "Officers" b QN=3 Right to purchase new shares in proportion to shares owned is called ( ). a. Preemptive right b. Right of voting c. Right to stock option d. All of the choices: "Preemptive right", "Right of voting", and "Right to stock option"
a QN=4 A stockholder who holds 51% of shares of common stock has no the right to participate in direct management of a corporation. a. True b. False b QN=5 A director has a right to vote for issues falling within power of stockholders. a. True b. False a QN=6 Is voting the most important right of a stockholder? a. Yes b. No a QN=1 Personal property that securely attached to real estate in order to become part of the real estate is called ( ). a. Cars b. Fixture c. All of the choices: "Cars", "Fixture", and "Cups" d. Cups b QN=2 The most common ways real property can be owned by more than one person include ( ). a. Tenancy in common b. Joint tenancy c. Tenancy in entirety d. All of the choices: "Tenancy in common", "Joint tenancy" and "Tenancy in entirety" d QN=3 To see whether Personal Property is regarded as real property, it is essential to look at ( ). a. What is the purpose of attachment and who attached the personal property? b. Intention to install the personal property only c. Person installing the personal property needs to be true owner only d. Whether the personal property is tangible or intangible a
QN=4 When many persons own property in a way of tenancy in common, they cannot inherit the outsiders. a. True b. False b QN=5 Multiple ownership of husband and wife during marriage is ( ). a. Tenancy in common b. Joint tenancy c. Tenancy by entirety d. Common tenancy c
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law vn ÉTUDIER
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QN=1 In Vietnam, a court grants a decision based on ( ). a. Its higher court's decision for the previous similar case b. The supreme court's decision for the previous similar case c. Its own decision for the previous similar case d. Statutes d QN=2 ( ) is the most important source of law in both Vietnam and America. a. Constitution b. Statue Rules c. Judicial decisions d. Administrative orders
a QN=3 In Vietnam, the Constitution is enacted by ( ). a. The Government b. The Supreme People's Court c. The National Assembly d. The People c QN=4 According to Vietnamese law, judge's decision is one of the sources of law. a. True b. False b QN=5 According to Vietnamese law, hierarchy of applying legal documents sets out in ( ). a. The Commercial Law 2005 b. The Law on issuing the legal normative documents 2008 c. The Civil Code 2005 d. The Enterprise Law 2005 b QN=1 In Vietnam, the Supreme People's Court has all of trial, appeal and review jurisdiction. a. True b. False b QN=2 In Vietnam, according to Vietnamese law, the court system includes, the court can be divided into Vietnamese Supreme People's court, People's Courts of provinces and cities directly under central authority and People's Courts of districts, prefectures, towns or cities under the provinces. a. True b. False a QN=1 In Vietnam, liability to compensate for damage occurs when ( ). a. At Fault and Wrongdoing b. Wrongdoing c. Injury and Wrongdoing d. At Fault, Wrongdoing, Injury and Causality between Injury and Wrongdoing d QN=2 According to the law of Vietnam, a person who causes damage while acting within the requirement of emergency situation shall not be liable for such damage.
a. True b. False a QN=3 According to the law of Vietnam, causation means that ( ). a. The damage must occur b. The damage results from the violation of law c. The injured person must prove the amount of damage d. The injured person must prove the fault of the wrongdoer b QN=1 According to Vietnamese 2005 Civil Code, to be effective, a civil transaction must ( ). a. Be created by the persons having full civil act capacity b. Have the purposes and contents which do not violate prohibitory provisions of law and are not contrary to social ethics. c. Be created voluntarily by the persons participating in the civil transaction d. All of the choices: "Be created by the persons having full civil act capacity; "Have the purposes and contents which do not violate prohibitory provisions of law and are not contrary to social ethics"; and "be created voluntarily by the persons participating in the civil transaction" d QN=2 In Vietnam, a civil contract will be governed by ( ). a. 2005 Civil Code b. 2005 Enterprise Law c. Constitution d. Housing law a QN=3 Under Vietnamese 2005 Civil Code, civil transactions with purposes and contents violating prohibitory provisions of law or contravening social ethics will be ( ) a. Void b. Valid c. Voidable d. Legal a QN=4 According to Vietnamese law, lack of consideration makes a contract invalid. a. True b. False b
QN=1 According to Vietnamese law, offer can be revoked if ( ). a. Communicated to offerree before his/her acceptance b. Communicated to offerree at any time c. Communicated to offerree at reasonable time d. Communicated to offerree after his/her acceptance a QN=2 In Vietnam, offer and acceptance are governed by ( ) a. 2005 Civil Code b. 2005 Enterprise Law c. Constitution d. Land law a QN=3 Under Vietnamese 2005 Civil Code, the acceptance of an offer to enter into a contract is the offeree's reply to the offeror on the acceptance of the whole contents of the offer. a. True b. False a QN=1 In Vietnam, adult are full ( ) or older: a. 16 years old. b. 18 years old. c. 19 years old. d. 15 years old. b QN=2 In Vietnam, minor is under full ( ) years old. a. 18 b. 21 c. 25 d. None of 18, 21, and 25 a QN=3 In Viet Nam, contracts made by persons who are between full six years old and under full eighteen years old must have the consents of their representatives at law when establishing and performing civil transactions, except those transactions to meet their daily-life needs suitable to their age group or otherwise provided for by law. a. True b. False a
QN=1 Vietnamese law does not allow any of parties to a contract is replaced by the outsider even with the same terms. a. True b. False b QN=2 Under Vietnamese law, when one transfers rights under contract, a notice needs to be given to the non-assigning party in a form of ( ). a. Oral b. Written c. Conduct d. Any kinds b QN=1 According to Vietnamese law, when all the obligations under contract is carried out fully, the contract will be discharged. a. True b. False a QN=1 In Vietnam, either of parties to a contract dies, which cannot be replaced by a new party because of personal requirements, the contract will be ( ). a. Void b. Unenforceable c. Voidable d. Discharged d QN=1 In Vietnam, car is not personal property. a. False b. True a QN=2 Under Vietnamese 2005 Civil Code, intellectual property rights are personal property. a. True b. False a QN=1 In Vietnam, form of contract for purchase and sale of goods shall be expressed ( ). a. Orally b. In writing
c. By specific conduct d. Orally, or in writing, or by specific conduct d QN=2 In Vietnam, which particular law governs domestically commercial activities a. The Commercial Law 2005 b. The Enterprise Law 2005 c. The Constitution. d. The Investment Law 2005 a QN=3 Vietnam is a member of the United Nations Convention of Contracts for the International Goods (CISG) a. True b. False b QN=4 Under Vietnamese law, which property is subject to Sale contracts regulated by the Commercial Law 2005? a. House owned by an individual person (not a business person) sold to his neighbor for residence b. Land c. Pictures d. Forests c QN=5 According to Vietnamese law, a contract for sale of goods shall be governed by the Law on Commerce of 2005 if both parties are business men a. True b. False a QN=1 Under Vietnamese 2005 Commercial Law, international purchases and sales of goods must be implemented on the basis of an oral contract. a. False b. True a QN=2 According to Vietnamese 2005 Commercial Law, international purchase and sale of goods cannot be implemented in the form of import. a. False b. True
a QN=1 Under Vietnamese 2005 Commercial Law, if the purchase and sale contract states the time of delivery of goods, then ( ). a. The contractual parties are required to deliver goods at the time agreed in the contract b. The contractual parties are required to deliver goods at the time not to be agreed in the contract c. The contractual parties are required to deliver goods at the time agreed in another document d. All of The contractual parties are required to deliver goods at the time agreed in the contract, The contractual parties are required to deliver goods at the time not to be agreed in the contract and The contractual parties are required to deliver goods at the time agreed in another document a QN=2 Under Vietnamese 2005 Commercial Law, unless otherwise agreed, where the subject of the contract is goods currently in transit then the risk of loss or damage to the goods shall not pass to the purchaser as from the time of entering into the contract. a. False b. True a QN=3 According to Vietnamese 2005 Commercial Law, unless otherwise agreed, the risk of loss or damage to goods shall pass to the purchaser if the goods are not clearly identifiable by codes or signs on them or by transportation vouchers; if the goods have not been notified to the purchaser or; if the goods are not able to be verified by any other means. a. False b. True a QN=1 In Vietnam, the rights and interests of the consumers shall be protected by ( ). a. The Law on Protection of Consumer's Interests b. The Civil Code c. The Law on Protection of Consumer's Interests and Civil Code d. The Law on Protection of Consumer's Interests and Civil Code and other relevant legal instruments enacted by the State d QN=2 According to the law of Vietnam, a period of warranty for a sold object is calculated from the time the buyer actually receives the sold object. a. True b. False b
QN=1 According to Vietnamese law, a limited liability company must have three members at least. a. True b. False b QN=2 In Vietnam, state owned company is stated in detail in ( ). a. 2005 Civil Code b. 2005 Commercial Law c. 2009 Law on Personal Income Tax. d. None of the choices: "2005 Civil Code", "2005 Commercial Law" and " 2009 Law on Personal Income Tax". d QN=3 Which is the following sentence right? a. In Vietnam, private company is entitled to issue share. b. In Vietnam, private company is entitled to issue stock. c. In Vietnam, private company has unlimited liability. d. In Vietnam, private company has limited liability. c QN=4 According to the law of Vietnam, ( ) has an unlimited liability. a. A member of a limited liability company b. A shareholder c. A general partner d. An owner of an one-member limited liability company c QN=5 According to the law of Vietnam, ( ) is a legal entity. a. A sole proprietorship b. A branch of a corporation c. A representative office of a corporation d. A partnership d QN=6 According to the law of Vietnam, members in joint-stock company have ( ). a. Unlimited liability b. Limited liability c. Both of unlimited liability and limited liability d. Either of unlimited liability or limited liability b
QN=7 According to the law of Vietnam, a member of a limited liability company with two or more members must be an individual. a. True b. False b QN=8 According to the law of Vietnam, the number of members of a limited liability company shall not exceed ( ). a. 02 b. 05 c. 15 d. 50 d QN=1 Accordingly the Law on Enterprise of Socialist Republic of Vietnam, a corporation must have two shareholders at least. a. True b. False b QN=2 In 2005 Enterprise Law, the minimum number of shareholders in joint-stock company is ( ). a. 03 b. 06 c. 07 d. 08 a QN=3 According to the law of Vietnam, a founding shareholder means a shareholder involved in formulating, approving and signing the first charter of a shareholding company. a. True b. False a QN=4 According to the law of Vietnam, the scope of business must be indicated in the business registration certificate. a. True b. False a QN=1 In Vietnam, if dividend payment is made in cash, it must be made in ( ). a. Vietnam dong
b. USD c. Singapore dollar d. Any other currencies a QN=2 In Vietnam, The General Meeting of Shareholders shall be conducted where the number of attending shareholders represents at least ( ) per cent of the voting shares. a. 65 b. 55. c. 75 d. 50 a QN=3 According to the law of Vietnam, the charter capital of the corporation is ( ) a. The total money value of its assets b. The minimum capital required by law c. The amount of money registered in the business registration certificate d. The declared money value of its outstanding stock c QN=4 According to the law of Vietnam, the ordinary shares may not be converted into preference shares. a. True b. False a QN=1 According to the law of Vietnam, the number of members of the board of management ( ). a. Must be three at least b. Must be eleven at least c. Must be three at least but not more than eleven d. Must be three at least but not more than eleven unless otherwise provided by the charter d QN=2 According to the law of Vietnam, a member of the board of management must be a shareholder. a. True b. False b QN=1 According to Vietnamese Law, which below property is defined as real property a. Motorbike b. Chicken
c. Horse d. Property attached securely to land d QN=2 According to Vietnamese Law, husband and wife possess community property by common ownership by integration a. True b. False a
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