Question 1 (2 points)

Which of the following is true of limited liability companies?

Question 1 options:

A)

An LLC can be sued by third-parties as a separate entity.

B)

An LLC cannot enter into contracts under its own name.

C)

An LLC is a legal entity indistinct from its members.

D)

An LLC cannot be a manager-managed business entity.

Question 2 (2 points)

Which of the following best describes a probate?

Question 2 options:

A)

It is a witness based procedure used to terminate a will.

B)

It is the legal transfer of real estate to a legatee.

C)

It is a court procedure that determines the validity of a will and distribution of estate.

D)

It is a procedure used by a legatee to speed up the execution of a will.

Question 3 (2 points)

The power to make bylaws and regulations is an incidental power that a corporation possesses.

Question 3 options:

A) TrueB) False

Question 4 (2 points)

What are the distinguishing features of a Chapter 13 plan?

Question 4 options:

A)

Each unsecured creditor must receive the same percentage of debt payments as the secured creditors.

B)

In exchange for a longer bankruptcy term the debtor may keep more personal assets.

C)

The debtor's assets are not liquidated, but disposable income is used to pay creditors for up to five years.

D)

Chapter 13 plans may be filed every year, as necessary.

Question 5 (2 points)

A not-for-profit corporation usually issues stock.

Question 5 options:

A) TrueB) False

Question 6 (2 points)

A tenant has the duty to pay property taxes to the landlord.

Question 6 options:

A) TrueB) False

Question 7 (2 points)

Ownership of an estate for the duration of one's life is called a term for years.

Question 7 options:

A) TrueB) False

Question 8 (2 points)

A _____ exists when a tenant has possession of a property for a definite period of time.

Question 8 options:

A)

tenancy from year to year

B)

tenancy for years

C)

tenancy at sufferance

D)

tenancy at will

Question 9 (2 points)

A color of title arises from some defective document purporting to be a deed or a will.

Question 9 options:

A) TrueB) False

Question 10 (2 points)

Which claims have the lowest priority in payment?

Question 10 options:

A)

tax claims

B)

administrative claims

C)

unsecured claims

D)

wage claims

Question 11 (2 points)

Which of the following best defines concealment?

Question 11 options:

A)

It is a willful failure to disclose any information pertinent to the insurance contract by the insured.

B)

It is an unintentional failure to disclose any information pertinent to the insurance contract by the insurer.

C)

It is an unintentional failure to disclose any information pertinent to the insurance contract by the underwriter.

D)

The mortgagee has an insurable interest towards half the loan amountIt is a willful failure to disclose any information irrelevant to the insurance contract by the insurer.

Question 12 (2 points)

The tenant has a right to assign the lease to a third party unless otherwise prohibited in the lease.

Question 12 options:

A) TrueB) False

Question 13 (2 points)

Which of the following best describes a prospectus?

Question 13 options:

A)

It is a document relating to purchase and subsequent resale of company assets and intellectual property.

B)

It is a document containing specified information about a stock offering and the corporation.

C)

It is a document pertaining to the conduct regulations of the company.

D)

It is a document containing information relating to the bylaws of the company.

Question 14 (2 points)

Partially secured creditors have a lien on some assets, but not enough to satisfy the full amount of their claim.

Question 14 options:

A) TrueB) False

Question 15 (2 points)

The default tax classification of a limited liability company having two or more members, is that of a sole proprietorship.

Question 15 options:

A) TrueB) False

Question 16 (2 points)

Minerals under the soil and the waters on it are not considered real property.

Question 16 options:

A) TrueB) False

Question 17 (2 points)

A person may obtain shares of stock by subscription only after a corporation is organized.

Question 17 options:

A) TrueB) False

Question 18 (2 points)

_____ wills are written entirely in longhand by the testator.

Question 18 options:

A)

Holographic

B)

Nuncupative

C)

Codicil

D)

Oral

Question 19 (2 points)

The powers of public corporations may be much greater than those of private corporations.

Question 19 options:

A) TrueB) False

Question 20 (2 points)

A trust is created when a testator makes a bequest of specific property and the estate does not have the property at death.

Question 20 options:

A) TrueB) False

Question 21 (2 points)

Which of the following best defines insurance?

Question 21 options:

A)

It is a contract whereby a party transfers his right to receive interest to a third-party such as an agent.

B)

It is a contract whereby a party transfers a risk of physical injury to the risk bearer for a fee.

C)

It is a contract whereby a party transfers his right to a claim for a particular fee.

D)

It is a contract whereby a party transfers a risk of financial loss to a risk bearer for a fee.

Question 22 (2 points)

A "binder" on an insurance policy is a clause added to another contract to limit the base contract.

Question 22 options:

A) TrueB) False

Question 23 (2 points)

Cumulative preferred stock is preferred stock on which dividends have to be paid only for the current year before common stock dividends are paid.

Question 23 options:

A) TrueB) False

Question 24 (2 points)

Which of the following is an incidental power of a corporation?

Question 24 options:

A)

Power to do all acts reasonably necessary for carrying out its purpose

B)

Power to indorse and accept negotiable instruments

C)

Power to borrow money and contract debts

D)

Power to have a continuous existence

Question 25 (2 points)

An easement gives an exclusive right to possession.

Question 25 options:

A) TrueB) False

Question 26 (2 points)

The danger of a loss of, or injury to, property, life, or anything else, is called a _____.

Question 26 options:

A)

rider

B)

face

C)

peril

D)

hazard

Question 27 (2 points)

A general partner has limited liability with respect to the partnership debts.

Question 27 options:

A) TrueB) False

Question 28 (2 points)

A withdrawing partner is entitled to:

Question 28 options:

A)

Receive exemption from liability for company losses.

B)

Receive undistributed profits.

C)

Be exempt from personal taxes.

D)

Be exempt from outstanding debts.

Question 29 (2 points)

A(n) _____ occurs when a testator makes bequests of money in the will and the estate does not have enough money to pay all the bequests so they are paid proportionally.

Question 29 options:

A)

redemption

B)

ademption

C)

abatement

D)

probate

Question 30 (2 points)

An individual need only begin doing business to start a sole proprietorship.

Question 30 options:

A) TrueB) False

Question 31 (2 points)

Which of the following is true about par-value stock?

Question 31 options:

A)

The par value of the stock must equal the value of money, property, or services received by the corporation.

B)

The par value of the stock must equal the value of money, property, or services received by the stockholder who sells it.

C)

Common stock usually has a par value.

D)

When sold by a corporation at a discount the corporation is liable to make up the discount.

Question 32 (2 points)

James mortgaged his house and received a certain amount of money in return as a loan. However, he repaid half the loan in six months. Which of the following is likely to be true in this scenario, at the present moment?

Question 32 options:

A)

The mortgagee has an insurable interest towards 25 percent of the loan amount.

B)

The mortgagee does not have an insurable interest in the loan amount.

C)

The mortgagee has an insurable interest towards the entire loan amount.

D)

The mortgagee has an insurable interest towards half the loan amount.

Question 33 (2 points)

The person giving possession of a leased property is known as a _____.

Question 33 options:

A)

lessee

B)

testatrix

C)

lessor

D)

tenant

Question 34 (2 points)

Which of the following best describes cram down?

Question 34 options:

A)

It is a duty that the debtor must perform during bankruptcy as assigned by court.

B)

It is a past money transfer to a debtor's relative disallowed by court.

C)

It is an involuntary bankruptcy suit filed against a debtor.

D)

It is a reorganization plan imposed by court in spite of creditors' objections.

Question 35 (2 points)

The maximum amount that the insurer agrees to pay in case of a loss is known as the _____.

Question 35 options:

A)

face

B)

insurable risk

C)

premium

D)

policy

Question 36 (2 points)

A willful failure to disclose pertinent information by the insured is known as subrogation.

Question 36 options:

A) TrueB) False

Question 37 (2 points)

Which of the following best describes a legatee?

Question 37 options:

A)

An attorney executing a will

B)

A person receiving a gift of real estate

C)

A third-party who signs and witnesses a will

D)

A person receiving a gift of personal property

Question 38 (2 points)

A stock insurance company is a corporation for which the original investment was made by stockholders.

Question 38 options:

A) TrueB) False

Question 39 (2 points)

Which of the following is true of a quorum?

Question 39 options:

A)

It is the maximum number of proxies that are allowed

B)

Statutes, bylaws, or the articles of incorporation ordinarily require a majority of outstanding stock to constitute a quorum.

C)

A stockholder's proxy cannot be counted in reaching a quorum in a convened meeting.

D)

At common law, a quorum consisted of the number of proxies at a properly convened meeting.

Question 40 (2 points)

The articles of incorporation constitutes a contract between the corporation and the state.

Question 40 options:

A) TrueB) False

Question 41 (2 points)

Which of the following is true of restrictions on the sale of a private corporation's stock?

Question 41 options:

A)

Such restrictions are not common.

B)

Restrictions on the sale of stock are not binding on stockholders.

C)

They frequently require a stockholder to offer to sell the stock to the corporation or other shareholders.

D)

They mean the holder has no right to any distribution that represents a share of the profits.

Question 42 (2 points)

A cram down can be imposed even if dissenting unsecured creditors are not paid in full.

Question 42 options:

A) TrueB) False

Question 43 (2 points)

A lease agreement may be oral or written if the lease is for less than one year.

Question 43 options:

A) TrueB) False

Question 44 (2 points)

A(n) _____ is most commonly used when a grantor, for some reason, does not want to know exactly what is in the trust, but wants to retain the benefit of the property.

Question 44 options:

A)

blind trust

B)

purchase money trust

C)

resulting trust

D)

testamentary trust

Question 45 (2 points)

The dissolution of a corporation:

Question 45 options:

A)

Can never be voluntary on the part of stockholders.

B)

May be sought by the state for failure to pay specified taxes for a given number of years

C)

Allows it to make contracts to carry on business for six months.

D)

May require the stockholders to pay debts the corporation's assets cannot cover.

Question 46 (2 points)

In order to obtain a discharge, debtors must either attend prefiling credit counseling.

Question 46 options:

A) TrueB) False

Question 47 (2 points)

Insurance contracts must specify the particular risks being transferred from one party to another.

Question 47 options:

A) TrueB) False

Question 48 (2 points)

A minor may disaffirm an insurance contract, but may only be able to demand the unearned premium for the unexpired portion of the policy.

Question 48 options:

A) TrueB) False

Question 49 (2 points)

Which of the following should be contained in the articles of partnership?

Question 49 options:

A)

Biographical details of each partner

B)

Each partner's personal address

C)

Allowance of withdrawals of profits.

D)

Names of every partner's guarantor

Question 50 (2 points)

Which of the following best describes bylaws?

A)

They are rules enacted by directors to govern a corporation's conduct.

B)

They are rules of conduct adopted by the shareholders.

C)

They may contain any provision, even against public policy if agreed upon by all shareholders.

D)

They are rules enacted by officers to govern their conduct.

Question 50 options: