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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. Classes of stock that have priority over common stock as to both payment of dividends and distribution of assets on the corporation's dissolution.






2. A type of limited partnership in which the liability of all of the partners - including general partners - is limited to the amount of their investments.






3. A contract between the issuer of a bond and the bondholder.






4. The legal liability of manufacturers - sellers - and lessors of goods to consumers - users - and bystanders for injuries or damages that are caused by the goods.






5. A contract between a seller and a distributor of the seller's products setting out the terms and conditions of the distributorship.






6. A person to whom a promise is made.






7. Property with which the owner has voluntarily parted and then cannot find or recover.






8. A law permitting a debtor to retain the family home - either in its entirety or up to a specified dollar amount - free from the claims of unsecured creditors or trustees in bankruptcy.






9. Generally - a stock certificate - bond - note - debenture - warrant - or other document or record evidencing an ownership interest in a corporation or a promise to repay a corporation's debt.






10. The joint ownership of property by a husband and wife. Neither party can transfer her or his interest in the property without the consent of the other.






11. Failure to observe a promise or discharge an obligation; commonly used to refer to failure to pay a debt when it is due.






12. The act of accepting and giving legal force to an obligation that previously was not enforceable.






13. The seizure by a government of a privately owned business or personal property for a proper public purpose and with just compensation.






14. A person on the board of directors who is also an officer of the corporation.






15. A hacker whose purpose is to exploit a target computer for a serious impact - such as corrupting a program to sabotage a business.






16. A secondary promise that is ancillary (subsidiary) to a principal transaction or primary contractual relationship - such as a promise made by one person to pay the debts of another if the latter fails to perform. A collateral promise normally must be






17. 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.






18. 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






19. 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






20. A check - other than a certified check - that is presented for payment more than six months after its date.






21. The various documents used and developed by an accountant during an audit - such as notes and computations - that make up the work product of an accountant's services to a client.






22. 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.






23. The basic document filed with a designated state official by which a limited partnership is formed.






24. 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.






25. A term that is used to indicate part or all of a business's name and that is directly related to the business's reputation and goodwill. Trade names are protected under the common law (and under trademark law - if the name is the same as the firm's t






26. The image and overall appearance of a product






27. Private equity capital is a financing method by which a company sells equity in an existing business to a private or institutional investor.






28. 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.






29. A 'standard-form' contract - such as that between a large retailer and a consumer - in which the stronger party dictates the terms.






30. A significant change in employment status - such as a change brought about by firing or failing to promote an employee - reassigning the employee to a position with significantly different responsibilities - or effecting a significant change in emplo






31. 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.






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






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






34. Any person in possession of an instrument drawn - issued - or indorsed to him or her - to his or her order - to bearer - or in blank.






35. A party to whom contractual obligations are transferred - or delegated.






36. In regard to the lease of goods - an agreement in which one person (the lessor) agrees to transfer the right to the possession and use of property to another person (the lessee) in exchange for rental payments.






37. 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.






38. An agreement between a debtor and a creditor in which the debtor voluntarily agrees to pay - or reaffirm - a debt dischargeable in bankruptcy. To be enforceable - the agreement must be made before the debtor is granted a discharge.






39. 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.






40. A small monetary award (often one dollar) granted to a plaintiff when no actual damage was suffered.






41. A written agreement that sets forth each partner's rights and obligations with respect to the partnership.






42. Information or processes that give a business an advantage over competitors that do not know the information or processes.






43. A corporation whose shareholders are limited to a small group of persons - often including only family members.






44. 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






45. Having left a will at death.






46. Under the UCC - a contract that requires or authorizes delivery in two or more separate lots to be accepted and paid for separately.






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






48. In the context of securities offerings - 'sophisticated' investors - such as banks - insurance companies - investment companies - the issuer's executive officers and directors - and persons whose income or net worth exceeds certain limits.






49. A trust created by the grantor (settlor) and effective during the grantor's lifetime; a trust not established by a will.






50. In regard to minors - the act of being freed from parental control; occurs when a child's parent or legal guardian relinquishes the legal right to exercise control over the child or when a minor who leaves home to support himself or herself.