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Test your basic knowledge |
Business Law Fundamentals
Start Test
Study First
Subjects
:
law
,
business-law
Instructions:
Answer 50 questions in 15 minutes.
If you are not ready to take this test, you can
study here
.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.
This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. The party that is ordered to pay a draft or check. With a check - a bank or a financial institution is always the drawee.
principle of rights
drawee
bailor
conforming goods
2. A person to whom a promise is made.
will substitutes
promisee
charitable trust
revocation
3. A form of concurrent ownership of property in which each spouse technically owns an undivided one-half interest in property acquired during the marriage.
community property
adhesion contract
incidental damages
joint and several liability
4. Occurs when an individual adds value to personal property by the use of either labor or materials. In some situations - a person may acquire ownership rights in another's property through accession.
implied warranty
treaty
accession
wrongful discharge
5. Under the UCC - a term describing a person who ceases to pay "his [or her] debts in the ordinary course of business or cannot pay his [or her] debts as they become due or is insolvent within the meaning of federal bankruptcy law" [UCC 1-201
fiduciary
spendthrift trust
insolvent
requirements contract
6. A trust that is created by will and therefore does not take effect until the death of the testator.
universal defenses
business necessity
testamentary trust
delegator
7. A warranty that goods being sold or leased are reasonably fit for the general purpose for which they are sold or leased - are properly packaged and labeled - and are of proper quality. The warranty automatically arises in every sale or lease of goods
implied warranty of merchantability
devisee
delegation of duties
executory contract
8. An encumbrance on a property to satisfy a debt or protect a claim for payment of a debt.
dissociation
inside director
lien
conforming goods
9. The standard of proof used in criminal cases. If there is any reasonable doubt that a criminal defendant committed the crime with which she or he has been charged - then the verdict must be 'not guilty.'
answer
inter vivos trust
award
beyond a reasonable doubt
10. A warranty that goods sold or leased are fit for a particular purpose. The warranty arises when any seller or lessor knows the particular purpose for which a buyer or lessee will use the goods and knows that the buyer or lessee is relying on the skil
implied warranty of fitness for a particular purpose
Statute of Frauds
floating lien
limited partnership
11. A draft drawn by a drawer ordering the drawee bank or financial institution to pay a certain amount of money to the holder on demand.
check
community property
bond
free-writing prospectus
12. One who owes an obligation to another.
takeover
cyber mark
obligor
offer
13. An act that takes place before the contract is made and that ordinarily - by itself - cannot be consideration for a later promise to pay for the act.
past consideration
tangible property
letter of credit
bequest
14. A process in which parties attempt to settle their dispute informally - with or without attorneys to represent them. In the context of negotiable instruments - the transfer of an instrument in such form that the transferee (the person to whom the ins
fungible goods
negotiation
special warranty deed
corporate governance
15. A warranty that arises by law because of the circumstances of a sale - rather than by the seller's express promise.
right of subrogation
quitclaim deed
co-surety
implied warranty
16. Any type of written - electronic - or graphic offer that describes the issuing corporation or its securities and includes a legend indicating that the investor can obtain the prospectus at the SEC's Web site.
dividend
parol evidence rule
sale on approval
free-writing prospectus
17. An agreement in which a buyer agrees to purchase and the seller agrees to sell all or up to a stated amount of what the buyer needs or requires.
life estate
requirements contract
floating lien
informal contract
18. A set of policies or procedures affecting the way a corporation is directed or controlled.
agency
hacker
corporate governance
identification
19. An employer's termination of an employee's employment in violation of the law.
forgery
after-acquired property
malpractice
wrongful discharge
20. The resolution of disputes in ways other than those involved in the traditional judicial process. Negotiation - mediation - and arbitration are forms of ADR.
alternative dispute resolution (ADR)
burglary
liquidated damages
secured party
21. A qualification - provision - or clause in a contractual agreement - the occurrence or nonoccurrence of which creates - suspends - or terminates the obligations of the contracting parties.
scienter
certification mark
condition
double jeopardy
22. An unconditional offer to perform an obligation by a person who is ready - willing - and able to do so.
tender
certification mark
trademark
conveyance
23. An action in which a court disregards the corporate entity and holds the shareholders personally liable for corporate debts and obligations.
piercing the corporate veil
alternative dispute resolution (ADR)
release
entrapment
24. A seller's or lessor's oral or written promise or affirmation of fact - ancillary to an underlying sales or lease agreement - as to the quality - description - or performance of the goods being sold or leased.
express warranty
bounty payment
principle of rights
draft
25. In a limited liability company - an agreement in which the members set forth the details of how the business will be managed and operated. State statutes typically give the members wide latitude in deciding for themselves the rules that will govern t
cost-benefit analysis
trust
operating agreement
general partner
26. A theory of sharing liability among all firms that manufactured and distributed a particular product during a certain period of time. This form of liability sharing is used only in some jurisdictions and only when the true source of the harmful produ
franchisee
ratification
workout
market-share liability
27. Property that has physical existence and can be distinguished by the senses of touch or sight. A car is tangible property; a patent right is intangible property.
personal defenses
tangible property
recording statutes
nuncupative will
28. A landlord's act of depriving a tenant of possession of the leased premises.
winding up
entrapment
eviction
employment discrimination
29. The threshold mental capacity required by law for a party who enters into a contract to be bound by that contract.
contractual capacity
predominant-factor test
e-contract
implied-in-fact contract
30. A deed in which the grantor warrants only that the grantor or seller held good title during his or her ownership of the property and does not warrant that there were no defects of title when the property was held by previous owners.
sovereign immunity
will substitutes
special warranty deed
secured transaction
31. A third party who incidentally benefits from a contract but whose benefit was not the reason the contract was formed. An incidental beneficiary has no rights in a contract and cannot sue to have the contract enforced.
incidental beneficiary
surety
option contract
preference
32. An ownership interest in land in which the owner has the greatest possible aggregation of rights - privileges - and power. Ownership in fee simple absolute is limited absolutely to a person and her or his heirs.
administrator
course of performance
nuncupative will
fee simple absolute
33. The purchase or sale of securities on the basis of information that has not been made available to the public.
whistleblowing
insider trading
express contract
constructive delivery
34. The legal avoidance - or setting aside - of a contractual obligation.
seasonably
disaffirmance
penalty
larceny
35. The purchase or sale of securities on the basis of inside information (information that has not been made available to the public).
mechanic's lien
insider trading
security
after-acquired property
36. A motion requesting the court to enter a judgment without proceeding to trial. The motion can be based on evidence outside the pleadings and will be granted only if no facts are in dispute.
retained earnings
generally accepted accounting principles (GAAP)
motion for summary judgment
clearinghouse
37. The conventions - rules - and procedures that define accepted accounting practices at a particular time. The source of the principles is the Financial Accounting Standards Board.
securities
answer
generally accepted accounting principles (GAAP)
eminent domain
38. Barred - impeded - or precluded.
electronic fund transfer (EFT)
insider trading
estopped
pleadings
39. The process by which a court decides on the constitutionality of legislative enactments and actions of the executive branch.
protected class
trademark
consequential damages
judicial review
40. A system or place where banks exchange checks and drafts drawn on each other and settle daily balances.
respondeat superior
writ of execution
clearinghouse
accession
41. Jurisdiction that exists when two different courts have the power to hear a case. For example - some cases can be heard in a federal or a state court.
performance
concurrent jurisdiction
employment at will
entrapment
42. A court's order - issued after a judgment has been entered against a debtor - directing the sheriff to seize (levy) and sell any of the debtor's nonexempt real or personal property. The proceeds of the sale are used to pay off the judgment - accrued
lessor
writ of execution
disaffirmance
export
43. Under the UCC - 'any symbol executed or adopted by a party with a present intention to authenticate a writing.'
insurance
signature
dishonor
short-form merger
44. Any bank to which an item is transferred in the course of collection - except the depositary or payor bank.
intermediary bank
judicial review
destination contract
perfection
45. An interest either in a person's life or well-being or in property that is sufficiently substantial that insuring against injury to (or the death of) the person or against damage to the property does not amount to a mere wagering (betting) contract.
dishonor
insurable interest
protected class
release
46. A firm that requires union membership by its workers as a condition of employment. The closed shop was made illegal by the Labor-Management Relations Act of 1947.
closed shop
condition subsequent
franchisee
ratification
47. A contract under which the offeror cannot revoke the offer for a stipulated time period. During this period - the offeree can accept or reject the offer without fear that the offer will be made to another person. The offeree must give consideration f
electronic fund transfer (EFT)
disparate-treatment discrimination
option contract
writ of execution
48. Implied warranties - made by any person who transfers an instrument for consideration to subsequent transferees and holders who take the instrument in good faith - that (1) the transferor is entitled to enforce the instrument; (2) all signatures are
transfer warranties
floating lien
I-9 verification
union shop
49. A concept developed by the philosopher Immanuel Kant as an ethical guideline for behavior. In deciding whether an action is right or wrong - or desirable or undesirable - a person should evaluate the action in terms of what would happen if everybody
security agreement
piercing the corporate veil
incidental damages
categorical imperative
50. A party to whom the rights under a contract are transferred - or assigned.
assignee
impossibility of performance
venue
patent