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CLEP Introductory Business Law

Subjects : clep, 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. This refers to the legal ability to forma contract (proof of lack of contract makes a contract voidable)






2. Also known as 'gap fillers' - the courts will imply certain terms in order to clarify a contract's meaning. These include: 'implied obligation of good faith' and 'obligation to use reasonable efforts'






3. The concept that the corporation only owes a duty to their shareholders and their financial concerns. 'Dodge v. Ford motor Company' reflects this concept






4. An offeror undertakes 'joint obligation' when he has made an offer to more than one person - which was then accepted.






5. The property that is the subject of a security interest






6. The first court to consider an action






7. A person is an intended beneficiary if recognition of a right to performance is appropriate to effectuate the intention of the parties - or either the performance of the promise will satisfy the promisee's obligation to pay money to the beneficiary -






8. If the promisor substantially performs under teh contract






9. It regulates chemical substances






10. It is a duty that a person is already obligated to perform. The promise to perform a pre-existing duty is not a legal detriment. However - a legal detriment will exist if one promises to a performance that is different from the pre-existing duty - o






11. Consideration means that there must be a bargained-for-exchange - and the promisee must incur some legal detriment. Consideration is necessary for a person seeking to enforce a contract. Courts generally do not evaluate the adequacy of the considerat






12. The difference between the value of the performance a party should have received and the value of the performance the party actually received.






13. An exemption for offers: no limitation on dollars - but less than 35 people (sophisticated) - excluding accredited investors.






14. 1) By lapse of time: When an 'invitation to make an offer' is made but not accepted - the offer will terminate once a reasonable period of time has passed (whether agreed upon time or not) 2) Death of the offeror 3) If the offeror proves to be mental






15. Exceptions to the writing contract in the Statute of Frauds. This is when: (a) a party admits in a pleading/testimony in court - that a contract was made - the contract is enforceable against the party to the extent of the admission - (b) performance

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16. An exemption for securities sold outside of the U.S.






17. When there is no bargained-for exchange - because there is no exchange.






18. Section 1 of the Restatement defines it as 'a promise or a set of promises for the breach of which the law gives a remedy - or the performance of which the law in some way recognizes a duty'.






19. It is a document containing information that must be delivered to investors prior to their securities' purchase. It is designed to contain all the information that an investor needs to evaluate the security and risk associated with purchasing the sec






20. Prohibit mergers and acquisitions that may reduce competition or create a monopoly






21. A classification that includes gender and legitimacy. If the regulation involves quasi-suspect classification - then the courts may apply intermediate scrutiny. Thus - the regulation will be valid so long as it is substantially tailored to meet an im






22. When a person misappropriates information learned in the context of a fiduciary relationship or a relationship of special trust. It is considered as insider trading






23. Liability imposed on sellers and other for compensating people who have been injured as the result of defective product. Liability actions can be brought as tort or contract claims (breach of warranty).






24. The principle that judges must make decisions consistent with precedent (previous decisions) of their own and higher courts. (Although judges have discretion to overturn their court's previous decisions - the principle of 'stare decisis' encourages t






25. Prohibits institutions from discrimination related to credit applications






26. An offer is not viewed as accepted unless the acceptance corresponded exactly with the terms of the offer. Therefore - any response by the offeree that changed the terms of the agreement would be treated as a rejection.

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27. A contract entered into by a person who is intoxicated (by alcohol or drugs) is also voidable by the intoxicated person. This can be done by proving that he did not understand the nature and significance of her actions - or the other party had reason






28. Treaties among several parties that seek to allocate rights and responsibilities among the parties






29. An order from the court to perform the contract pursuant of its terms. This is only does when the damage remedy is inadequate and the equitable need for such performance outweighs the burden of supervision and harm to the defendant.






30. In order for a contract to be enforceable - the terms of the contract must be definite and certain. In order for a contract to be 'definite and certain' - it must contain all the essential terms (names of parties - prince - subject matter - and time

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31. A promise that is inferred from a person's conduct or the circumstances of the transaction






32. Constitutes conduct that improper or unethical. A tort action of negligence against lawyers for failing to satisfy their professional duty of care owed to their clients.






33. Represents a motion to dismiss the case because the plaintiff's complaint does not establish a legal basis for any remedy against the defendant. It can be filed by the defendant.






34. Provides specific (3) categories for exemption: Rule 504 - 505 - 506






35. When a court examine the 'four corners' of a contract - this means that they will only examine the document itself.

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36. An exemption for offerings that occur primarily within one state.






37. Ethical behavior in terms of its consequences ('the end justifies the means')






38. Motions that can be made by the loosing party after a trial. This includes a motion for a new trial or a motion for a judgment notwithstanding the verdict (judgment n.o.v.).






39. When a contract is delegated - the obligee must accept the performance of the delegate. Unless the obligee agrees to release him from liability - the delegator remains liable under the contract until the delegate has performed. Once a delegate perfor






40. He has the enforceable right against the obligor because he is considered the real party interest.

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41. Prohibit agreements among corporations that would unreasonably restrain trade or create monopolization in an industry






42. The Hart-Scot-Rodino Act - which requires corporations to notify FTC and the U.S. Justice Department when they engage in a merger. Mergers are prohibited under the Act if the market related to the merger is substantially concentrated and if - after t






43. Negative causation - due diligence defense - ...






44. An assertion that is not in accord with the facts. A contract becomes voidable when it is shown that a misrepresentation was made - it was material - and the party seeking avoidance reasonably relied on it.






45. When an offeror terminates his offer before an agreement has been made (can be done through words). It can also be revoked when the offeror takes actions that are inconsistent with the intent to be bound (unless the offeree has paid to keep the offer






46. A uniform law that provides legislation for various aspects of commercial law. It has been accepted by all states except Louisiana.

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47. Regulates consumer credit reporting agencies and provides procedure for regulating the proper use and release of credit reports.






48. An exemption for certain small offerings






49. It literally means 'new'. Here it means an entirely new interpretation of legal rules - without deference to the lower court's judgment.

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50. Claims that the defendant has against the plaintiff