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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. Required to establish a security interest. Attachment occurs when the parties agree to create a security interest (security agreement) - put it in writing and signed by the debtor - the creditor provides money or some other form of consideration for






2. They represent the amount of money a party has spent in justifiable reliance on a contract.






3. Impossibility - impracticability - or frustration of purpose. The event that caused the change in circumstances must be proved to have been unforeseen.






4. 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.






5. When an adult has a mental disability and thereby can disaffirm a contract and contract with him is voidable. Any bargained-for exchange must be returned or there must be restitution.






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






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






8. One of the primary federal statutes - and it created the Securities and Exchange Commission (SEC).






9. Congress may prohibit speech that has a 'clear and present' danger of inciting violence or other 'substantive evil'.


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






11. Whether or not the promisee can bring an action against the promisor depends upon the status of the beneficiary. If the promisor fails to perform his obligations owed to a creditor beneficiary - the promisee can either compel the promisor to render s


12. Regulates trusts and monopolies






13. 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.






14. When the plaintiff's damages were caused by something other than the misrepresentation or omission






15. Ensures fair disclosure of credit terms - thereby protecting consumers from inaccurate and unfair billing and credit card practices






16. 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






17. Regulates private pension plans. It creates standards for their plans. It also requires employers to provide adequate funds for their plans - and to appoint an administrator for the plan who has fiduciary responsibility to administer the plan in the






18. Speech regarding commercial or economic activities. Congress has a broad ability to regulate commercial speech. (However - government regulations based on content are subject to strict scrutiny - meaning that they will be sustained only if they are n






19. States allow corporations to make donations - and courts uphold those donations as long as they are reasonable






20. Agreements that grant an entity an exclusive right to manufacture a product within a given area. The Clayton Act prohibits such agreements. (vertical agreement)






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


22. Created by the Securities Exchange Act (SEC). Oversees the regulation of these federal security laws






23. Negotiations between employers and groups of employees to create a collective agreement regarding employment compensation and other benefits.






24. A supervening stature makes a contract illegal - and thereby makes performance impossible






25. Manages the nation's social security system






26. This when the evidence favoring the plaintiff's allegations is stronger than the evidence presented against her position. In a civil case - the jury must decide that the plaintiff proved her case by 'preponderance of evidence'.






27. Corporations should be concerned with the impact of their policies on the broad range of stakeholders or constituents that are affected by those policies. This also includes the idea of preserving the environment and corporate charitable giving.






28. When the court finds that one party lacks choice or there are gross inequities in the bargaining positions between the two parties (use of adhesion qualifies) A contract becomes voidable.






29. It is when a jury cannot reach a consensus. As a result - there must be a new trial with a different jury.






30. This involves filing a registration statement with the SEC - which contains information about the securities to be registered as well as the company that is issuing the security. Included within the registration statement is a prospectus






31. Portions of a registration statement that are not certified by an expert such as financial statements or legal opinions






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


33. A situation where one person unfairly benefits from a transaction






34. An exemption for certain small offerings






35. It regulates chemical substances






36. Actual performance of an obligation






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






38. When the courts' power to hear cases arising under the Constitution - federal laws - or U.S. treatises. Federal question jurisdiction is exclusive.






39. A set of statements reflecting generally agreed upon pronouncements of common law contract rules.






40. Agreements requiring a buyer to resell products to a specific manufacturer. The Clayton Act prohibits such agreements (vertical agreement)






41. 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).






42. Agreements to refrain from doing business with a particular person/persons/entity in order to force such a person/entity to pay higher prices (a horizontal agreement)






43. Protection of communications between an attorney and her client. Neither party is compelled to disclose such communications to the court. Only the client can waive the privilege.






44. 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






45. 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






46. 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).






47. The proceeding for a supervised reorganization of the debtor's business. The debtor must present a plan of reorganization to the bankruptcy court. After 120 days - creditors have the right to present competing plans. The court makes the final determi






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






49. This regulate the discharge of pollutants into the water. It authorizes the EPA (Environmental Protection Agency) to determine the permissible levels of contaminants in the water to ensure a safe water supply - and to set standards aimed at meeting t






50. An improper threat that leaves the victim no reasonable alternative but to comply with an agreement