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Friday, February 11, 2011

Business Law Questions 51-100

Solution is available here for U$45

51. Preemptive rights entitle shareholders to bring a derivative suit against the corporation. (Points: 2)
        True
       False

52. Damages awarded in a shareholder's derivative suit go to the shareholder personally. (Points: 2)
        True
        False

53. Before filing a registration statement, an issuer must attempt to sell, or at least offer to sell, the securities. (Points: 2)
        True
        False

54. A corporation whose security does not qualify for an exemption can dispense with the requirement of a registration statement. (Points: 2)
        True
        False

55. State securities laws apply only to interstate transactions. (Points: 2)
        True
        False

56. The U.S. Congress enacts a new federal statute that sets different standards for the liability of businesses selling defective products. This statute applies (Points: 2)
        only to matters not covered by state law.
        only to those states that adopt the statute.
        to all of the states.
       to none of the states.

57. A Massachusetts state statute imposes a prison term, without a trial, on all street vendors who operate in certain areas. A court would likely hold this statute to be (Points: 2)
        constitutional.
        unconstitutional under the commerce clause.
        unconstitutional under the due process clause.
        unconstitutional under the free exercise clause.

58. Inferior Company sells products that are poorly made. Jack, who has never bought an Inferior product, files a suit against Inferior, alleging that its products are defective. The firm's best ground for dismissal of the suit is that Jack does not have (Points: 2)
        certiorari.
        jurisdiction.
        standing.
        sufficient minimum contacts.

59. In studying the legal environment of business, Professor Dooley’s students also review ethics in a business context. Ethics includes the study of what constitutes (Points: 2)
        fair or just behavior.
        financially rewarding behavior.
        legal behavior.
        religious behavior.

60. In making business decisions, Brian, personnel manager for Conservative Investments, Inc., applies his belief that all persons have fundamental rights. This is (Points: 2)
        a religious rule.
        the categorical imperative.
        the principle of rights.
        utilitarianism.

61. Kelly is an appliance salesperson. Kelly commits fraud if, to make a sale, she (Points: 2)
        discloses the truth.
        represents as a fact something that she knows is untrue.
        states an opinion concerning something that she knows nothing about.
        uses puffery.

62. Molly shoots Norm with Opal’s pistol. The proximate cause of Norm being shot is most likely attributable to (Points: 2)
        Molly and Opal.
        Molly only.
        Opal only.
        neither Molly nor Opal.

63. Amber pushes Brad into the path of an oncoming car driven by Carol. Don tries to rescue Brad, but the car hits both of them. Amber is liable for the injuries of (Points: 2)
        Brad and Don.
        Brad only.
        Don only.
        neither Brad nor Don.

64. Rory designs a new computer hard drive, which he names "Sci Phi." He also writes the operating manual to be included with each final product. Rory could obtain patent protection for (Points: 2)
        the hard drive only.
        the name only.
        the operating manual only.
        the hard drive, the name, and the operating manual.

65. In 2009, Sara writes Terror at the Track, a novel about racecar driving. Sara does not register the work with the appropriate government office. Under federal copyright law, Sara’s work is protected (Points: 2)
        for ten years.
        for twenty years.
        for the life of the author plus seventy years.
        forever.

66. Barb allows Candy to enter Barb's warehouse and take a DVD player. Charged with theft, Candy can successfully claim, as a defense, (Points: 2)
        consent.
        duress.
        entrapment.
        self-defense.

67. Lara is indicted for a crime. Mac, the arresting officer, advises Lara of her right to counsel. Lara waives the right and confesses to the crime. Later, Lara claims that her confession should be excluded as evidence from her trial. The statement will most likely be (Points: 2)
        admitted because Lara knew she did the crime and confessed.
        admitted because Lara made it after being advised of her rights.
        excluded because a confession is not admissible in a criminal trial.
        excluded because it was elicited before Lara was advised of her rights.

68. Mona asserts that a contract she entered into with Nate is unenforceable. Defenses to the enforcement of a contract include (Points: 2)
        a desire not to perform.
        adverse economic consequences.
        results that do not match expectations.
        the lack of a party's genuine assent.

69. Jay tells Kim that he will buy her textbook from the last semester for $80. Kim agrees. Jay and Kim have (Points: 2)
        an express contract.
        an implied-in-fact contract.
        an implied-in-law contract.
        a quasi contract.

70. Cory enters into a contract with Dian to act as her personal sports trainer. If they later dispute the meaning, and the contract contains unclear terms, the rules of contract interpretation will give effect to (Points: 2)
        the parties' intent as expressed in their contract.
        what the defendant claims was the parties' intent.
        what the plaintiff claims was the parties' intent.
        what the parties now agree they intended.

71. Retail Investment Company offers to sell a certain mall to Shopping Stores, Inc., if it accepts before 10 A.M. Monday. A contract is formed if Shopping Stores' acceptance is received (Points: 2)
        any time on Monday.
        before 10 A.M. Monday.
        before 11 A.M. Monday.
        within twenty-four hours of 10 A.M. Monday.

72. Quix Fix-It, Inc., offers Polly a job as a plumber. No time for acceptance is specified in the offer. The offer will terminate (Points: 2)
        after a reasonable period of time.
        after a typical work week (five business days).
        after a usual month (thirty calendar days).
        never.

73. While a minor, Jason buys a car that he continues to use and keep in repair after reaching the age of majority. Jason has (Points: 2)
        disaffirmed the contract.
        ratified the contract.
        rejected the contract.
        rescinded the contract.

74. National Insurance Company violates a statute when selling an insurance policy to Opal. The policy may be enforced by (Points: 2)
        National Insurance only.
        National Insurance or Opal.
        no one.
        Opal only.

75. Roc buys a farm from Steve, who claims that it would be a prime site for a housing subdivision. Roc later learns that the law does not permit the land to be used for housing. Roc may (Points: 2)
        not rescind the contract.
        rescind the contract only if Roc did not know the law before the deal.
        rescind the contract only if Steve knew about the law before the deal.
        rescind the contract only if the law is not common knowledge.

76. Clay buys an MP3 player for $200 and a pair of stereo speakers for $600 from a Discount City store, and downloads $300 worth of digital music from E-Music.com. To be enforceable, the contract that must be in writing is the purchase of (Points: 2)
        the digital music, the MP3 player, and the speakers.
        the MP3 player and the speakers only.
        the MP3 player only.
        the speakers only.

77. Musical Production Company and Nora enter into a contract that calls for Nora to write six songs for which Musical agrees to pay her. Nora transfers her right to payment under the contract to Omni Entertainment Agency. Nora is (Points: 2)
        a delegator.
        an assignor.
        a payor.
        a righter.

78. Rural Development Corporation (RDC) and Sid enter into a contract for the clear-cutting of RDC’s 50-acre tract for which RDC agrees to pay Sid. Sid transfers his duty to log the tract under the contract to Timber Logging Company. Timber is (Points: 2)
        a delegatee.
        an assignee.
        an obligee.
        a prohibitee.

79. A zoning law that affects the lease will cause its termination. Union City's zoning board adopts a new zoning classification that affects the lease. This adoption satisfies (Points: 2)
        no condition.
        the condition precedent.
        the concurrent condition.
        the condition subsequent.

80. Rite-Bilt Contractors, Inc., agrees to build a motel for Slumber Motels Corporation. The project proceeds according to plan, but before it is done, Slumber tells Rite-Bilt to quit. Rite-Bilt may recover (Points: 2)
        the contract price less costs of materials and labor.
        the contract price.
        the costs needed to complete construction.
        profits plus the costs incurred up to the time of the breach.

81. Recreational Pools, Inc., agrees to build a swimming pool for Sandy, but fails to build it according to the contract specifications. Sandy hires Total Fix-It Company to finish the project. Sandy may recover from Recreational Pools (Points: 2)
        the contract price less costs of materials and labor.
        the contract price.
        the costs needed to complete construction.
        profits plus the costs incurred up to the time of the breach.

82. Vista Properties, Inc., leases an office building to World Corporation. At the time, the amount of damages on World's default is difficult to determine, so the parties reasonably estimate, and the lease provides, that if World defaults, Vista is entitled to $50,000 as "liquidated damages." This amount is (Points: 2)
        an unenforceable limitation of liability.
        an unenforceable penalty.
        liquidated damages.
        punitive damages.

83. High-Tech Services, Inc., and Internet Investments Corporation enter into a con¬tract that would otherwise be subject to the UETA but purports to "opt out." The UETA covers (Points: 2)
        none of the contract.
        only the part of the contract that concerns computer information.
        only the part of the contract that does not concern computer information.
        the entire contract.

84. Omni Products, Inc., and Plenty Sales Corporation transact a deal over the Internet. Their contract does not mention the UETA. The UETA covers (Points: 2)
        none of the contract.
        only the part of the contract that does not involve e-commerce.
        only the part of the contract that involves e-signatures.
        the entire contract.

85. Precision Applications Corporation (PAC) sends an electronic record to Quotient Systems, Inc., a PAC customer. Under the UETA, the record will be considered received when it (Points: 2)
        enters Quotient's processing system in a readable form, even if no person is aware of its receipt.
        enters Quotient’s processing system in a readable form, only if a person is aware of its receipt.
        is midway between the parties' processing systems.
        passes out of PAC's control.

86. Genetic Seed Company hires Howie to work in its shipping office, accepting deliveries and dealing with other companies' drivers. With respect to Genetic, Howie is most likely (Points: 2)
        an agent.
        an independent contractor.
        a principal.
        a work for hire.

87. Sunny is a salesperson for Tech Instruments, Inc. (TI). She misrepresents to Universal Piping Company, a customer, that a certain device has a certain capability. In reliance, Universal buys the device. Liable for this misrepresentation is (Points: 2)
        Sunny and TI.
        Sunny only.
        TI only.
        Universal but neither Sunny nor TI.

88. Ida hires Jim, a real estate broker, to act as her agent to sell her land for $100,000. Oil is discovered beneath the land, causing its market value to increase 100-fold. The agency agreement is likely (Points: 2)
        still in force if Ida gives Jim additional consideration.
        still in force if Jim does not mention the oil to prospective customers.
        terminated by mutual consent of the parties.
        terminated by operation of law.

89. Gus is an employee of Harden Steel Company. Under federal labor law, Gus and other employees have the right to (Points: 2)
        bargain collectively with Harden through their representatives.
        insist that Harden require union membership as a condition of work.
        interfere with the efforts of others to form labor organizations.
        refuse to bargain with Harden through their representatives.

90. Fruits & Vegetables, Inc., employs hundreds of seasonal and permanent workers, both skilled and unskilled, in seven states. Fruits & Vegetables can hire illegal immigrants (Points: 2)
        if either the employer or the immigrants file special forms.
        only if the employer files a special form.
        only if the immigrants file special forms.
        under no circumstances.

91. Seafood Canning Corporation keeps a file of I-9 verifications forms. To inspect this file, the appropriate government officer must obtain (Points: 2)
        a subpoena and a warrant.
        a subpoena or a warrant, but not both.
        not a subpoena, a warrant, or the employer's consent.
        the employer's consent.

92. B2B, LLC, is a limited liability company. Among its members, a dispute arises that the operating agreement does not cover. The dispute is governed by (Points: 2)
        the applicable state LLC statute.
        a federal Uniform LLC Law.
        the principles of partnership law.
        a state corporation statute.

93. Pola and Quint want to form and do business as River Tours Corporation. A corporation can consist of (Points: 2)
        no natural persons.
        one natural person but not more.
        one or more natural persons.
        only more than one natural person.

94. Giant Lift Corporation purchases all of the assets of Heavy Hydraulics Corporation. With respect to Heavy Hydraulics’s liabilities, Giant Lift is (Points: 2)
        automatically responsible.
        not responsible under any circumstances.
        responsible if Heavy Hydraulics is a competitor of Giant Lift.
        responsible if the sale is actually a merger or consolidation.

95. Salt Corporation wants to acquire or merge with Pepper Corporation. The board and the shareholders of Pepper are resisting. Salt should (Points: 2)
        file a plan of merger with the secretary of state.
        file an article of merger with Pepper.
        make a tender offer to the shareholders of Pepper.
        make a tender offer to the shareholders of Salt.

96. Nina is a director of Omega, Inc. Under the standard of due care owed by directors of a corporation, Nina's decisions must be (Points: 2)
        ambiguous and questionable.
        arguable and defensible.
        informed and reasonable.
        perfect and unassailable.

97. Odell, Prince, and Quinn are shareholders of Rite Corporation. Before a shareholders' meeting, they agree in writing to vote their shares together in a certain manner. Usually, such agreements are held to be (Points: 2)
        invalid and unenforceable.
        oppressive and irresponsible.
        suspect and voidable.
        valid and enforceable.

98. Cole is a shareholder of Donut Holes, Inc. Cole will be deemed to have a fiduciary duty to Donut Holes and its minority shareholders if he has (Points: 2)
        a restriction on the transferability of his shares.
        a right of first refusal.
        a sufficient number of shares to exercise de facto control.
        watered stock.

99. Hobie, the chief executive officer of Ideal Gamers, Inc. (IGI), intentionally understates the amount of IGI’s debts in information provided to investors as part of an issue of IGI stock. Jaq buys the stock and suffers a loss. Hobie may be subject to (Points: 2)
        government prosecution and Jaq's suit.
        neither government prosecution nor Jaq's suit.
        only government prosecution.
        only Jaq's suit.

100. Bess, an agent for Calm Harbor Marina, Inc., enters into an unauthorized contract with Dropt Anchor Worx, Inc., purportedly on behalf of Calm Harbor, which refuses to perform. Bess is liable to (Points: 2)
        Calm Harbor and Dropt Anchor for breach of contract.
        Calm Harbor for misrepresentation.
        Dropt Anchor for misrepresentation.
        no one. 

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