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Business Law Fundamentals

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. 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.






2. The principle that the holder of a negotiable instrument who cannot qualify as a holder in due course (HDC) - but who derives his or her title through an HDC - acquires the rights of an HDC.






3. A transaction in which an owner of goods (the consignor) delivers the goods to another (the consignee) for the consignee to sell. The consignee pays the consignor only for the goods that are sold by the consignee.






4. A firm that requires all workers - once employed - to become union members within a specified period of time as a condition of their continued employment.






5. A relationship between two parties in which one party (the agent) agrees to represent or act for the other (the principal).






6. A person who receives inside information.






7. The mixing together of goods belonging to two or more owners so that the separately owned goods cannot be identified.






8. A negotiable instrument that is payable 'to the order of an identified person' or 'to an identified person or order.'






9. A person in possession of an instrument payable to bearer or indorsed in blank.






10. A decision-making technique that involves weighing the costs of a given action against the benefits of that action.






11. Ownership rights in property - including the right to possess and control the property.






12. The process by which a criminal defendant and the prosecutor in a criminal case work out a mutually satisfactory disposition of the case - subject to court approval; usually involves the defendant's pleading guilty to a lesser offense in return for a






13. The formal disbanding of a partnership or a corporation. It can take place by (1) acts of the partners or - in a corporation - acts of the shareholders and board of directors; (2) the subsequent illegality of the firm's business; (3) the expiration o






14. A negotiable instrument is dishonored when payment or acceptance of the instrument - whichever is required - is refused even though the instrument is presented in a timely and proper manner.






15. A contractual promise of one party to refrain from conducting business similar to that of another party for a certain period of time and within a specified geographic area. Courts commonly enforce such covenants if they are reasonable in terms of tim






16. Generally - stock certificates - bonds - notes - debentures - warrants - or other documents given as evidence of an ownership interest in a corporation or as a promise of repayment by a corporation.






17. 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.






18. A deed in which the grantor assures (warrants to) the grantee that the grantor has title to the property conveyed in the deed - that there are no encumbrances on the property other than what the grantor has represented - and that the grantee will enj






19. A contract that is formed electronically.






20. In a given state - a corporation that does business in the state without being incorporated therein.






21. An agreement to substitute a contractual obligation for some other type of legal action based on a valid claim.






22. The purchase or sale of securities on the basis of inside information (information that has not been made available to the public).






23. The term used to designate a person who has an ownership interest in a limited liability company.






24. An agreement that grants the owner the option to buy a given number of shares of stock - usually within a set time period.






25. The substitution - by agreement - of a new contract for an old one - with the rights under the old one being terminated. Typically - novation involves the substitution of a new person who is responsible for the contract and the removal of the origina






26. Any interest in personal property or fixtures that secures payment or performance of an obligation.






27. A provision in a contract stipulating that certain unforeseen events






28. A network that can be used by persons located (distributed) around the country or the globe to share computer files.






29. A written document - which is usually notarized - authorizing another to act as one's agent; can be special (permitting the agent to do specified acts only) or general (permitting the agent to transact all business for the principal).






30. A designation in the United States for a corporation formed in another country but doing business in the United States.






31. 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.






32. The image and overall appearance of a product






33. A worldwide system in which foreign currencies are bought and sold.






34. 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






35. One to whom goods are entrusted by a bailor.






36. The right of a co-surety who pays more than her or his proportionate share on a debtor's default to recover the excess paid from other co-sureties.






37. A clause that releases a contractual party from liability in the event of monetary or physical injury - no matter who is at fault.






38. The minimum degree of ethical behavior expected of a business firm - which is usually defined as compliance with the law.






39. Reasonable grounds for believing that a person should be arrested or searched.






40. A merger between a subsidiary corporation and a parent corporation that owns at least 90 percent of the outstanding shares of each class of stock issued by the subsidiary corporation. Short-form mergers can be accomplished without the approval of the






41. Nonviolent crime committed by individuals or corporations to obtain a personal or business advantage.






42. A statutory lien on the real property of another - created to ensure payment for work performed and materials furnished in the repair or improvement of real property - such as a building.


43. The second of two stages in the termination of a partnership or corporation. Once the firm is dissolved - it continues to exist legally until the process of winding up all business affairs (collecting and distributing the firm's assets) is complete.






44. Under Article 9 of the UCC - the property subject to a security interest - including accounts and chattel paper that have been sold.






45. A method of settling disputes outside of court by using the services of a neutral third party - who acts as a communicating agent between the parties and assists them in negotiating a settlement.






46. Mistake that occurs when one party to a contract is mistaken as to a material fact; the contract normally is enforceable.






47. A person who makes an offer.






48. A security interest that arises when a seller or lender extends credit for part or all of the purchase price of goods purchased by a buyer.






49. In a lawsuit - an issue involving the application or interpretation of a law. Only a judge - not a jury - can rule on questions of law.






50. Under Article 9 of the UCC - whatever is received when collateral is sold or otherwise disposed of - such as by exchange.