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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. An interest in property or collateral granted in order to ensure payment of a debt or obligation






2. It is an act - forbearance - or the creation - modification - or destruction of a legal relationship






3. Inadequate warning of danger - which can be construed as a design defect






4. Latin for 'the thing speaks for itself' - when a plaintiff establishes the harm would not ordinarily occur without someone's negligence - the instrument creating the harm was under the sole and complete control of the defendant at the time the harm o






5. The test of government regulations - of whether it is rationally related to a legitimate government interests. All classifications are subject to a rational basis test.






6. Only one of the party wants to rescind the contract - which requires legal grounds to do so.






7. The person being sued






8. The creditor's security interest in real property






9. A transaction that does not involve a public offering is also referred to as a private placement. In 'SEC v. Ralston Purina Co.' the Supreme Court defined a private placement as a sale to persons who do not need the protection of securities laws.






10. When a product is incorrectly manufactured that is unreasonably dangerous to consumers. To prove that 'unreasonably dangerous' - the show that an ordinary consumer would see it that way (consumer expectation test).






11. The amount of benefit one party conferred on the other - designed to prevent unjust enrichment - as though no contract had been formed.






12. He can raise any defense against the assignee that she would have been able to raise against the assignor. This is the right to offset the assignee's claim - and thus the assignee cannot be held directly liable to the assignor for the improper action

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13. Responsibility of a seller or manufacturer for any defective product unduly threatening personal safety






14. The obligation to establish his claims first






15. Liability extends to ___________ - without the plaintiff needing to proof of reliance or causation. The seller can avoid liability by showing negative causation - the plaintiff knew that the statements in the prospectus at the time of her purchase -






16. A security interest is perfected by filing a financing statement - which describes the collateral and the creditor's security interests in the collateral. This serves as a notice to third parties. Perfection can also occur by taking possession or con






17. Section 24 of the Restatement defines an offer as a 'manifestation of willingness to enter into a bargain - so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it.'






18. Prohibit discrimination based on pregnancy or childbirth






19. Researches health and safety issues and recommends regulations. Created through the Occupational Safety and Health Act






20. Agreements to restrict the supply of products in order to drive up the prices of such products (a horizontal agreement)






21. All total breaches are material breaches. However - a total breach have factors including whether there is a likelihood of a cure - further delay will prevent the promisee from making alternative arrangements - or prompt performance is a critical ele






22. If a performance has already occurred - or a promise has already been made - then it generally cannot serve as the basis for consideration because it cannot be considered to have induced a bargain. Therefore - 'past consideration' is insufficient.

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23. Treaties entered into between two nations






24. Regulates radio - television - and other forms of interstate communications






25. Under Section11 - the issuer - its directors - the chief executive officer - the chief financial officer - the underwriter - and any expert is liable. The issuer can avoid liability if he can show negative causation.






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

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27. He is someone who is either the person who directly sold securities to the purchaser - or someone who solicited the purchaser for a financial gain or for the seller's interests. Only a statutory seller is strictly liable for such violation of Section






28. An annual report required by the Exchange Act






29. Grants employees the right to bargain as a group and to establish - join - or assist labor organizations or unions. It requires the employers to bargain directly with the employees' representative. It establishes guidelines for the kinds of activitie






30. 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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31. Government's 'time - place - and manner' restrictions of content are subject to intermediate scrutiny.






32. When the court finds that the terms of the agreement are grossly unfair or unduly favorable to one side - particularly when the term are incomprehensible to a party. A contract becomes voidable






33. It focuses on the clean up of abandoned or historical hazardous waste sites - for which it established a 'Superfund'. The EPA (Environmental Protection Agency) identifies particularly egregious sites and places them on a National Priorities List. The






34. It is when a promisee is doing an act one is not legally obligated to do or not doing an act that one has a legal right to do






35. An exemption for certain small offerings






36. A group of between 16 and 23 jurors who decide whether there is sufficient evidence to charge the defendant with a crime. A grand jury is required in the 5th Amendment for all criminal cases. The grand jury has the power to subpoena witnesses and doc






37. They represent losses that result from other transactions that are dependent upon the breached contract






38. 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






39. The standards designed to reduce the presence of pollutants int eh air to levels that are consistent with promoting good health and preserving the environment. States must ensure that they are in compliance with such standards






40. A government's taking of a foreign citizen's business and assets located in its country - generally without proper compensation.






41. A written request for reasonable assurances regarding a party's intention to perform. Until such assurance is received - the demanding party can suspend his performance. Failure to receive adequate assurance demanded within a reasonable time can be c






42. This refers to the legal ability to forma contract (proof of lack of contract makes a contract voidable)






43. It represents a request for the court to take some action. A motion can be filed by a defendant.






44. The person who assigns her rights






45. If a person made a contract when he was a minor - once he is of age - he can affirm or disaffirm the contract (making it void or not) within a reasonable time after reaching majority (of age).






46. Provides that securities cannot be offered or sold unless they have registered with the SEC (Securities Exchange Commission).






47. Establishes a minimum wage and policies for overtime and prohibits children under 14 from being hired






48. An assignment becomes void when it conflicts with a statute or public policy - materially changes teh obligor's duty - increases the burden or risk imposed by the contract - impairs the obligor's prospects of getting a return performance - or substan






49. 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.






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







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