1. Which of the following is true of criminal law?

a.)Its purpose is to settle individual disputes peacefully.

b.)Possible remedies include jail time.

c.)Cases typically occur between private parties.

d.)A preponderance of evidence is necessary for conviction.

2. In which area of law are state and federal jurisdiction most likely to overlap?

a.)Domestic matters

b.)Contracts

c.)Torts

d.)Environmental regulations

3. Common law is created __________.

a.)by the House of Representatives

b.)by the judiciary

c.)by government agencies

d.)by the executive branch

4. Statutory law is created by __________.

a.)the legislative branch

b.)the executive branch

c.)all three branches of government

d.)the judicial branch

5. Which of the following describes a limited partnership?

a.)A small business with a single owner

b.)A business in which two or more persons have agreed to participate in the day-to-day management of the business

c.)A business with a partner who shares in the profits, but is not liable for debts outside of his or her initial financial contribution

d.)A business in which at least one partner shares profits and losses equally, but only for a limited time

6. Which of the following is true of the limited liability of corporations?

a.)It is weaker than that of sole proprietorships.

b.)It is absolute.

c.)It is only applicable to the founding shareholders.

d.)It can be revoked in certain circumstances.

7. Which of the following individuals would benefit most from an LLC?

a.)Jen has a thriving business that she envisions taking public within a year. She is eager to begin selling stock and raising more funds that she can reinvest in her company.

b.)Colin wants to start a business with five of his friends, but they want their business to be a separate entity that protects them from personal liability. They also do not want to deal with burdensome obligations like annual meetings.

c.)Sheri is one of the founders of what is expected to be a large business operation. When it comes to choosing a form of business organization, she values limited liability, but she also wants a board of directors who can make major decisions.

d.)Dave has a great idea for a business, but he hopes that once it gets up and running, he can be a "silent" partner and not have to participate in any day-to-day management.

8. Which of the following cases falls under the subject matter jurisdiction of a state court?

a.)A patent claim

b.)A robbery

c.)An IRS tax dispute

d.)A counterfeiting case

9. Unlike the results of a mediation, an arbitration award __________.

a.)is more likely to preserve harmonious business relationships

b.)is not a final adjudication or decision resolving a dispute

c.)is generally final and cannot be appealed by either party

d.)can generally be appealed and reheard before a court

10. Select the true statement about Josephson's Core Values Model for ethical decision-making.

a.)Profitability is a core value that lies at the heart of the model.

b.)Profitability is one consideration of the model, especially as it relates to stakeholders, but it is not the most important consideration.

c.)The profitability of a company has no place in ethical decision-making.

d.)Considering profitability ensures that the most ethical decision will be made.

11. Contracts allow a free society to __________.

a.)create order out of disorder

b.)assert control over its members

c.)do away with capitalism

d.)achieve total equality

12. Select the true statement about the Convention on Contracts for the International Sale of Goods (CISG).

a.)The Convention is consistent with the Uniform Commercial Code (UCC) in every way.

b.)The Convention is only applicable to countries in the Western Hemisphere.

c.)The United States has not formally adopted the CISG.

d.)Parties to a contract may mutually agree to follow the CISG rather than the Uniform Commercial Code (UCC).

13. Riya writes an email promising to sell her car to Manish for $500, and Manish replies that he will pay Riya on the 24th of the month. On the 24th, Manish pays Riya and she gives him the title to the car.

Manish and Riya have a(n) __________.

a.)unilateral contract

b.)executed contract

c.)executory contract

d.)implied contract

14. A contract with consideration from only one party __________.

a.)may be enforceable under promissory estoppel

b.)is always void and never enforceable

c.)is enforceable only if mutual assent existed

d.)is always enforceable, if the consideration is reasonable

15. A contract is always rendered unenforceable when __________.

a.)a party to the contract returns the consideration

b.)a party to the contract cannot meet the financial obligations of the contract

c.)the contract was formed under emotional strain

d.)the subject or purpose of the contract is illegal

16. A purpose of the Statute of Frauds is to __________.

a.)determine whether a contract has been partially or fully executed

b.)make certain contracts unenforceable if they are only in oral form

c.)ensure that all contracts that have been reviewed by a lawyer are enforceable

d.)warn consumers about the areas of exchange in which they are likely to encounter fraud

17. Lisa promises Ophelia a 5% return on her investment if Ophelia gives her $1,000 to invest. Little does Ophelia know, Lisa has no intention of investing the money. Instead, Lisa spends the money to pay off a prior gambling debt. A court requires Lisa to return the $1,000 to Ophelia.

This is an example of which type of monetary award?

a.)Punitive damages

b.)Restitution

c.)Specific performance

d.)Incidental damages

18. Which of the following people would likely be issued an order for specific performance or an injunction, rather than a monetary award?

a.)Louisa's screenprinting company orders a new batch of t-shirts from their supplier for delivery on Monday. The order is delayed and doesn't arrive until Wednesday. Louisa's company sues for breach of contract.

b.)Jonah orders and pays for some wood from a local lumber company to build a custom desk for his home office. When the wood arrives, part of it is rotting. When Jonah can't get the lumber company to return his phone call, he sues them for breach of contract.

c.)Lee signs a contract to purchase the last remaining beachfront plot of land in his town from Ursula. Ursula then decides she will keep the land and build a house for herself on it. Lee files suit against Ursula for breach of contract.

d.)Fallon's moving company accidentally breaks three dining chairs when they transport Aliyah's furniture to her new home. The chairs are expensive, but not irreplaceable. Aliyah sues Fallon's moving company for breach of contract when they refuse to replace the chairs.

19. Select the example that is inconsistent with the provisions of the UCC for contract remedies for a seller's breach of contract.

a.)A toy company sells a defective rocket launcher that injures a young boy. The sales contract excludes responsibility for all consequential damages related to the sale of its products, so the company only agrees to refund the cost of the defective toy.

b.)A sporting goods store allows for a single remedy for any contract breaches in its sales contract.

c.)In its sales contract, a bookseller imposes a one-year limit on charges of breach of contract.

d.)The sales contract for a company that sells art includes a liquidated damages clause in the event of a breach of contract that the courts have deemed reasonable.

20. Jackson signs a written contract to purchase a custom sofa for his new home. The custom sofa is designed to fit perfectly in his living room. While the sofa is being built, Jackson notifies the manufacturer that he is insolvent and can no longer fulfill his end of the contract.

What remedy does the manufacturer have in this scenario?

a.)Assuming that the sofa would be of little or no value on resale to another buyer, the manufacturer should immediately cease production and sue Jackson for the contract price, less any expenses saved by stopping production.

b.)The manufacturer has no recourse in this scenario, since the buyer is insolvent.

c.)The manufacturer must put the sofa up for sale at auction, and he must share the additional profits with Jackson if the sofa sells for more than the originally-contracted price.

d.)The manufacturer is obligated to complete production of the sofa and attempt to resell it, but he is entitled to recover any difference between the resale price and the price he contracted with Jackson.

21. Cynthia orders 100 shirts priced at $4.99 each for her screenprinting business from Juan, a shirt supplier. The shirts are supposed to be delivered within three days, but they do not arrive, so Cynthia runs down to a local store during her lunch break and buys another 100 shirts so that she can fill her customers' orders on time.

What remedy does Cynthia have in this scenario?

a.)Cynthia can cancel her contract with Juan and recover the price she paid for his shirts. Additionally, she can recover from Juan any money she paid for shirts from the local store that exceeded her original contracted cost.

b.)Cynthia may either cancel her contract with Juan and recover the price she paid for his shirts, or she can replevy the shirts.

c.)Cynthia can recover the price she paid for Juan's shirts, and she is entitled to a refund from the local store for the difference between the cost of its shirts and Juan's shirts.

d.)Cynthia may recover the money she paid to Juan for the undelivered shirts, but only if she notifies him that they are non-conforming.

22. The test of whether damages claimed for breach of contract are "foreseeable" is whether __________.

a.)it was reasonably conceivable to the breaching party that a breach of contract might occur

b.)the amount claimed by the injured party was reasonably fair

c.)it was reasonably imaginable to the breaching party that a breach of contract would cause the damages claimed

d.)the breaching party repudiated a contract in the past and was reasonably likely to do so again

23. Unlike a crime, a tort __________.

a.)is a wrong which is punishable by incarceration

b.)is an immoral act that can cause mental or physical injury

c.)is a wrong which has a legal remedy of damages

d.)is an act which, by definition, lacks intention

24. A young women is walking home at night when a large man jumps out from behind some bushes and verbally threatens her.

Which type of intentional tort does this represent?

a.)Battery only

b.)This action does not rise to the level of an intentional tort.

c.)Assault only

d.)Assault and battery

25. A woman is driving down the road and sees two bicyclists crash into one another. They are clearly hurt and in need of help, but because she is late for work, she doesn't stop.

Is the woman liable for negligence if one of the bicyclists later sues?

a.)Yes, because the woman acted unreasonably by prioritizing her job over offering aid to others.

b.)No, because no duty of care existed between the woman and the bicyclists.

c.)Yes, because the woman breached her duty when she decided not to stop.

d.)No, because no proximate cause can be established between the crash and her driving.

26. A pedestrian walks into a crosswalk and is hit by a bicyclist and injured. The pedestrian sues the bicyclist for negligence.

Assuming it is true, which of the following would represent at least a partial defense against the negligence claim?

a.)The bicyclist was riding to the scene of another accident in order to provide first aid.

b.)The pedestrian had headphones on, was busily engaged in texting, and did not look up before entering the crosswalk.

c.)The pedestrian sees many bicyclists on the road every day, and assumed the risk of walking anyway.

d.)The pedestrian had been involved in other crashes with bicyclists in the past.

27. A truck carrying hazardous materials rolls over and spills chemicals, temporarily polluting a town's water supply.

To successfully sue the company for strict liability, what would the town need to prove?

a.)There is no way for strict liability to apply, because transporting hazardous materials is a commonly known danger.

b.)That the truck carrying the hazardous materials had a design defect or a manufacturing flaw

c.)Nothing, because transporting hazardous materials is extremely dangerous

d.)That the company failed to take reasonable precautions to prevent the spill

28. Select the statement that is true of current products liability law.

a.)It is less necessary now than in the pre-industrial era.

b.)It arose as consumers had much less direct contact with manufacturers than in the past.

c.)It relies primarily on local reputation to ensure product safety.

d.)Its central tenet is "caveat emptor."

29. A laundry detergent company releases new, single use laundry detergent pods that are brightly colored, wrapped in plastic, and look like small candies. After several children ingest these laundry pods and require hospital care as a result, the parents sue for negligence, alleging that the product is defective.

How strong is the negligence case against the product manufacturer?

a.)Weak, because the dangers of ingesting laundry detergent are obvious.

b.)Weak, because proximate cause is difficult to establish.

c.)Strong, because the detergent pods are designed in a way that make them unreasonably unsafe.

d.)Strong, because the detergent company should be manufacturing laundry detergent that is safe for ingestion.

30. A cologne manufacturer sold an alcohol-based cologne for men with a warning limited to the potential for the cologne to catch fire if poured onto a source of ignition. John purchased the cologne, applied it to his skin, and then immediately lit a cigarette. The cigarette ignited the cologne on his skin, resulting in significant burn injuries to his neck and shoulders.

How strong of a case does John have against the manufacturer for strict product liability?

a.)Strong, but only if John can prove that the container of cologne he purchased was defective because that particular bottle was more inflammable than normal.

b.)Weak, because John assumed the risk of injury when he selected an alcohol-based cologne versus an oil-based one.

c.)Weak, because the company's warning was adequate to caution consumers about the dangers posed by exposing the cologne to any heat source.

d.)Strong, because the company's warning did not include the potential to start a fire on the consumer's skin from a cigarette, and it would be foreseeable that a consumer would light a cigarette after applying the cologne to his skin.

31. A scaffold manufacturer was sued for strict product liability by Joe who, while working on a construction project, had his scaffold collapse and cause severe back injuries. The manufacturer defended on the basis of assumption of risk and was able to prove that Joe knew that the scaffold was mis-rigged and decided to use it despite this known fact.

How strong is the manufacturer's defense against Joe's claim?

a.)Weak, because the use of an improperly rigged scaffold is foreseeable and the manufacturer should have warned against it.

b.)Strong, as Joe was quite aware that the scaffold was mis-rigged with a potential to collapse as a result and decided to use the mis-rigged scaffold with this knowledge.

c.)Strong, because the risk of the manufacturer's scaffolding does not outweigh its utility.

d.)Weak, because assumption of risk is rarely accepted as a defense to strict products liability claims, even if Joe knew the scaffold was mis-rigged and elected to use it anyway.