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Business Law Fundamentals

Subjects : law, business-law
  • Answer 50 questions in 15 minutes.
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  • Match each statement with the correct term.
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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. One who makes and executes a will.

2. 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

3. An approach to ethical reasoning that evaluates behavior in light of the consequences of that behavior for those who will be affected by it - rather than on the basis of any absolute ethical or moral values. In utilitarian reasoning - a 'good' decisi

4. Prepaid funds recorded on a computer or a card (such as a smart card or a stored-value card).

5. In partnership law - a doctrine under which a plaintiff may sue - and collect a judgment from - all of the partners together (jointly) or one or more of the partners separately (severally - or individually). This is true even if one of the partners s

6. A doctrine that applies when a promisor makes a clear and definite promise on which the promisee justifiably relies. Such a promise is binding if justice will be better served by the enforcement of the promise.

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

8. 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.

9. A document by which title to property (usually real property) is passed.

10. The act of presenting an instrument to the party liable on the instrument to collect payment. Presentment also occurs when a person presents an instrument to a drawee for a required acceptance.

11. A common law rule that requires that the terms of the offeree's acceptance adhere exactly to the terms of the offeror's offer for a valid contract to be formed.

12. A business entity that has no tax liability. The entity's income is passed through to the owners - and the owners pay taxes on the income.

13. The acquisition of control over a corporation through the purchase of a substantial number of the voting shares of the corporation.

14. A mark used by one or more persons - other than the owner - to certify the region - materials - mode of manufacture - quality - or other characteristic of specific goods or services.

15. Procedurally - a defendant's response to the plaintiff's complaint.

16. A rule of the Securities and Exchange Commission that makes it unlawful - in connection with the purchase or sale of any security - to make any untrue statement of a material fact or to omit a material fact if such omission causes the statement to be

17. A contract in which - for a stipulated consideration - one party agrees to compensate the other for loss on a specific subject by a specified peril.

18. A contractual clause that states that a certain amount of monetary damages will be paid in the event of a future default or breach of contract. The damages are a punishment for a default and not a measure of compensation for the contract's breach. Th

19. An employee's disclosure to government authorities - upper-level managers - or the press that the employer is engaged in unsafe or illegal activities.

20. A statement that - if filed within six months prior to the expiration date of the original financing statement - continues the perfection of the original security interest for another five years. The perfection of a security interest can be continued

21. A government official who performs certain administrative tasks that a bankruptcy judge would otherwise have to perform.

22. An estate in realty held by a tenant under a lease. In every leasehold estate - the tenant has a qualified right to possess and/or use the land.

23. The joint ownership of property by two or more co-owners in which each co-owner owns an undivided portion of the property. On the death of one of the joint tenants - his or her interest automatically passes to the surviving joint tenant(s).

24. A method of settling disputes - used in many federal courts - in which a trial is held - but the jury's verdict is not binding. The verdict acts only as a guide to both sides in reaching an agreement during the mandatory negotiations that immediately

25. In most states - a rule stating that express authority given to an agent must be in writing if the contract to be made on behalf of the principal is required to be in writing.

26. In contract law - a voluntary act by the offeree that shows assent - or agreement - to the terms of an offer; may consist of words or conduct. In negotiable instruments law - the drawee's signed agreement to pay a draft when it is presented.

27. A guilty (prohibited) act. The commission of a prohibited act is one of the two essential elements required for criminal liability - the other element being the intent to commit a crime.

28. The wrongful taking and carrying away of another person's personal property with the intent to permanently deprive the owner of the property. Some states classify larceny as either grand or petit - depending on the property's value.

29. A person to whom an offer is made.

30. As a noun - one who has died without having created a valid will; as an adjective - the state of having died without a will.

31. A network of twelve district banks and related branches located around the country and headed by the Federal Reserve Board of Governors. Most banks in the United States have Federal Reserve accounts.

32. 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

33. 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

34. In the employment context - the demanding of sexual favors in return for job promotions or other benefits - or language or conduct that is so sexually offensive that it creates a hostile working environment.

35. A contract that has been completely performed by both parties.

36. In criminal law - a defense in which the defendant claims that he or she was induced by a public official

37. A possessory lien given to a person who has made improvements and added value to another person's personal property as security for payment for services performed.

38. A contract for the sale of goods under which the ownership of goods is transferred from a seller to a buyer for a price.

39. A doctrine under which a party to a contract is relieved of her or his duty to perform when performance becomes objectively impossible or totally impracticable (through no fault of either party).

40. The legal avoidance - or setting aside - of a contractual obligation.

41. 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

42. A trust created to protect the beneficiary from spending all the funds to which she or he is entitled. Only a certain portion of the total amount is given to the beneficiary at any one time - and most states prohibit creditors from attaching assets o

43. A reasoning process in which an individual links his or her moral convictions or ethical standards to the particular situation at hand.

44. In insurance law - a contract between the insurer and the insured in which - for a stipulated consideration - the insurer agrees to compensate the insured for loss on a specific subject by a specified peril.

45. The process of transferring land out of one's possession (thus 'alienating' the land from oneself).

46. A court's order - issued prior to a trial to collect a debt - directing the sheriff or other public officer to seize nonexempt property of the debtor. If the creditor prevails at trial - the seized property can be sold to satisfy the judgment.

47. A document prepared by a secured creditor and filed with the appropriate state or local official - to give notice to the public that the creditor has a security interest in collateral belonging to the debtor named in the statement. Financing statemen

48. A type of tenancy under which property is leased for a specified period of time - such as a month - a year - or a period of years; also called a tenancy for years.

49. A motion by either party to a lawsuit at the close of the pleadings requesting the court to decide the issue solely on the pleadings without proceeding to trial. The motion will be granted only if no facts are in dispute.

50. A group of persons protected by specific laws because of the group's defining characteristics. Under laws prohibiting employment discrimination - these characteristics include race - color - religion - national origin - gender - age - and disability.