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Test your basic knowledge |
Business Law Fundamentals
Start Test
Study First
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. Mistake that occurs when one party to a contract is mistaken as to a material fact; the contract normally is enforceable.
testate
fiduciary
unilateral mistake
discharge
2. A person who is engaged in the purchase and sale of goods. Under the UCC - a person who deals in goods of the kind involved in the sales contract or who holds herself or himself out as having skill or knowledge peculiar to the practices or goods bein
course of performance
protected class
option contract
merchant
3. Any bank handling an item for collection - except the payor bank.
fixture
stock warrant
collecting bank
corporate governance
4. A person who acquires the right to the possession and use of another's goods in exchange for rental payments.
intermediary bank
taking
lessee
peer-to-peer (P2P) networking
5. 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.
protected class
life estate
perfection
security
6. Under Article 2A of the UCC - a transfer of the right to possess and use goods for a period of time in exchange for payment.
proceeds
corporate social responsibility
lease
mechanic's lien
7. A lease executed by the lessee of real estate to a third person - conveying the same interest that the lessee enjoys but for a shorter term than that held by the lessee.
cybernotary
sublease
overdraft
consolidation
8. A rule of the United States Supreme Court under which the Court will not issue a writ of certiorari unless at least four justices approve of the decision to issue the writ.
cybernotary
rule of four
quota
utilitarianism
9. A test courts use to determine whether a contract is primarily for the sale of goods or for the sale of services.
rule of four
predominant-factor test
easement
assignor
10. A nonpossessory right to use another's property in a manner established by either express or implied agreement.
secured party
computer crime
holder
easement
11. Property that is acquired by the debtor after the execution of a security agreement.
working papers
tenancy at will
after-acquired property
foreign corporation
12. A reasoning process in which an individual links his or her moral convictions or ethical standards to the particular situation at hand.
inter vivos trust
partially disclosed principal
ethical reasoning
indorsement
13. An offer (by a merchant) that is irrevocable without the necessity of consideration for a stated period of time or - if no definite period is stated - for a reasonable time (neither period to exceed three months). A firm offer by a merchant must be i
writ of certiorari
firm offer
bailment
proceeds
14. A state statute that permits a state to obtain personal jurisdiction over nonresident defendants. A defendant must have certain 'minimum contacts' with that state for the statute to apply.
lease
secured party
long arm statute
deposition
15. 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
continuation statement
necessaries
security
entrustment rule
16. 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
duress
consent
acceptance
warranty deed
17. The minimum degree of ethical behavior expected of a business firm - which is usually defined as compliance with the law.
sale
insider trading
I-551 Alien Registration Receipt
moral minimum
18. 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.
lessor
alternative dispute resolution (ADR)
incidental beneficiary
self-defense
19. Identifiable characteristics reasonably necessary to the normal operation of a particular business. These characteristics can include gender - national origin - and religion - but not race.
confusion
bona fide occupational qualification (BFOQ)
charitable trust
alternative dispute resolution (ADR)
20. The giving of testimony that may subject the testifier to criminal prosecution. The Fifth Amendment to the Constitution protects against self-incrimination by providing that no person 'shall be compelled in any criminal case to be a witness against h
obligor
intended beneficiary
self-incrimination
bilateral mistake
21. Any bank to which an item is transferred in the course of collection - except the depositary or payor bank.
intermediary bank
voir dire
dumping
maker
22. In insurance law - the insurer - or the one assuming a risk in return for the payment of a premium.
underwriter
disaffirmance
business judgment rule
digital cash
23. The act of accepting and giving legal force to an obligation that previously was not enforceable.
exclusive jurisdiction
ratification
partnership
Totten trust
24. 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
counteroffer
spendthrift trust
special warranty deed
utilitarianism
25. A wrong against society proclaimed in a statute and - if committed - punishable by society through fines and/or imprisonment
crime
levy
employment contract
shelter principle
26. Terms and conditions of use that are presented to an Internet user at the time certain products - such as software - are being downloaded but that need not be agreed to (by clicking 'I agree -' for example) before the user is able to install or use t
computer crime
stale check
e-contract
browse-wrap terms
27. A clause in a time instrument that allows the instrument's date of maturity to be extended into the future.
certificate of deposit (CD)
family limited liability partnership (FLLP)
accredited investors
extension clause
28. An implied trust arising from the conduct of the parties. A trust in which a party holds the actual legal title to another's property but only for that person's benefit.
quasi contract
resulting trust
extension clause
pass-through entity
29. A company whose business activity is holding shares in another company.
exclusive distributorship
mens rea
holding company
drawer
30. The practice of marking a document with a date that precedes the actual date. Persons who backdate stock options are picking a date when the stock was trading at a lower price than the date of the options grant.
backdating
bond
warranty deed
act of state doctrine
31. A federal court of limited jurisdiction that handles only bankruptcy proceedings - which are governed by federal bankruptcy law.
requirements contract
intangible property
bankruptcy court
bond indenture
32. A trust in which the property held by the trustee must be used for a charitable purpose - such as the advancement of health - education - or religion.
charitable trust
personal defenses
cure
installment contract
33. A formal legal document prepared by a party's attorney and submitted to an appellate court when a case is appealed - which outlines the facts and issues of the case that are in dispute.
cashier's check
profit
brief
executed contract
34. An agreement whose terms are expressed in a document located inside a box in which goods (usually software) are packaged; sometimes called a shrink-wrap license.
presentment
shrink-wrap agreement
apparent authority
preferred stock
35. A contract that may be legally avoided (canceled - or annulled) at the option of one or both of the parties.
articles of organization
nuncupative will
cashier's check
voidable contract
36. A group of citizens called to decide - after hearing the state's evidence - whether a reasonable basis (probable cause) exists for believing that a crime has been committed and that a trial ought to be held.
limited liability partnership (LLP)
grand jury
formal contract
sale or return
37. The portion of a corporation's profits that has not been paid out as dividends to shareholders.
obligee
retained earnings
deed
arson
38. Any transaction in which the payment of a debt is guaranteed - or secured - by personal property owned by the debtor or in which the debtor has a legal interest.
secured transaction
common stock
partially disclosed principal
artisan's lien
39. Voluntary agreement to a proposition or an act of another; a concurrence of wills.
consent
lien
recording statutes
ethics
40. 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).
impossibility of performance
negotiable instrument
complaint
information
41. 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
cashier's check
counterclaim
trade name
mutual fund
42. An employer's termination of an employee's employment in violation of the law.
promisor
wrongful discharge
frustration of purpose
target corporation
43. A warranty that goods being sold or leased are reasonably fit for the general purpose for which they are sold or leased - are properly packaged and labeled - and are of proper quality. The warranty automatically arises in every sale or lease of goods
charitable trust
implied warranty of merchantability
attachment
collateral promise
44. An administrative or judicial order prohibiting a person or business firm from conducting activities that an agency or court has deemed illegal.
alien corporation
Totten trust
cease-and-desist order
concurrent ownership
45. 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.
delegator
spendthrift trust
accredited investors
winding up
46. One who owes an obligation to another.
anticipatory repudiation
obligor
lessee
beyond a reasonable doubt
47. An action in which a court disregards the corporate entity and holds the shareholders personally liable for corporate debts and obligations.
discharge
piercing the corporate veil
employment discrimination
tombstone ad
48. The law that governs relations among nations. National laws - customs - treaties - and international conferences and organizations are generally considered to be the most important sources of international law.
chattel
accession
treaty
international law
49. Any type of written - electronic - or graphic offer that describes the issuing corporation or its securities and includes a legend indicating that the investor can obtain the prospectus at the SEC's Web site.
deed
seasonably
free-writing prospectus
voidable contract
50. A signed writing (record) that contains an unconditional promise or order to pay an exact sum on demand or at an exact future time to a specific person or order - or to bearer.
sale or return
incidental beneficiary
insurable interest
negotiable instrument