QUESTION 21 Micah promises to pay Gretl, his niece, $8,000 if she finishes her college degree at Flagstaff College, where she is in her third year. Gretl finishes her degree. Micah must pay because O a. Gretl was enrolled at Flagtaff College when the promise was made. O b. a job can be hard to find after college. O c. Gretl obtained a degree at Flagstaff College. O d. obtaining a degree benefits Gretl. QUESTION 22 Sam posts several bar stools for sale on an online auction site. This is O a. a request, not an offer. O b. an invitation to negotiate, not an offer. O c. a price list, not an offer. O d. an offer.QUESTION 23 Carolina offers to develop a marketing campaign to help Robert's landscaping business. Robert agrees to pay for the service. These parties have C) a. an implied contract. 0 b. an express contract. 0 c. a formal contract. 0 d. no contract. QUESTION 24 Ginny's Table offers to pay Dillon's Distillery to convert their local grains into whiskey. Dillon responds that the price is too low and thereby rejects the offer. The offer is O a. valid until Ginny's Table revokes the offer. 0 b. valid for the period of time prescribed by a state statute. O c. terminated. Q d. valid for a reasonable time. QUESTION 25 When deciding which form of business organization would be most appropriate, an entrepreneur would normally take into account all of the following except 0 a. the need for capital. 0 b. the liability ofthe owners. 0 c. tax considerations. 0 d. the forms of competitors' business organizations. QUESTION 26 The risk of a court piercing the corporate veil is most likely with O a. a close corporation. 0 b. a publicly held corporation. 0 c. a benet corporation. 0 d. no corporationcorporate shareholders' liability is limited. QUESTION 27 To avoid sharing control with someone they do not know or like, many close corporations 0 a. restrict the transferability of shares to outside persons. 0 b. require more than a majority of directors approve any board action. 0 c. hold special shareholders' or directors' meetings on an annual basis. 0 d. reorganize into a sole proprietorship or partnership. QUESTION 28 Fees and government lings are required to form all of the following business organizations except 0 a. a limited liability company. 0 b. a corporation. 0 c. a sole proprietorship. 0 d. a limited partnership. QUESTION 29 Dora and Manny are shareholders of LotsaLatte. Dora's written authorization to Manny to vote Dora's shares for her at a shareholders' meeting is O a. a cumulative vote. O b. a proxy. O c. a quorum requirement. O d. a corporate resolution. QUESTION 30 With respect to a corporation, an officer's rights are defined by O a. employment contracts. O b. court review. O c. shareholder votes. O d. state statutes.QUESTION 31 Priscilla leases space to Kwame, a painter. Kwame moves out an leaves when he still owes $15,000 on the lease. Priscilla nds a new tenant,_]acqueline, a sculptor. Jacqueline agrees to pay $10,000 for the space for the remainder of Kwame's lease term. Priscilla's damages will be 0 a. $15,000, minus any expenses reduced by mitigating the damages. 0 b. $15,000. 0 c. $10,000. 0 d. $5,000, plus any additional expenses to find the new tenant. QUESTION 32 Mitigation of damages means that the innocent party in a contract breach situation must 0 a. perform their promises. O b. sue within six months of the breach. 0 c. set an example to deter similar misconduct in the future. 0 d. take reasonable steps to minimize their losses. QUESTION 33 Corben agrees to work for Logan Photos during summer break for $6,000. On April 30, Logan cancels the contract. Corben gets an offer to do a similar job with Allie Pics, which would have paid $4,500. Corben files a suit against Logan. As compensatory damages, Corben can recover O a. $6,000. O b. $4,500. O c. $0. O d. $1,500. QUESTION 34 Beacon Tiling has a contract to retile the floors of the restaurant in the Plaza Ho Hotel by June 1. Beacon knows that if the tiling is not done on time, Plaza Ho will have to delay the opening of the restaurant. Beacon finishes the job on June 15. In a suit for breach of contract, Plaza Ho can recover O a. the difference between the contract and market price for the work. O b. the cost of new flooring. O c. the loss of profit from the delayed opening. O d. nothing because the tiling work is done.QUESTION 35 Julius is an stamp collector and hires a Micah to buy and sell stamps on his behalf. Under the UCC, in those transactions,Julius has the status of O a. a consumer. O b. an agent or other intermediary. O c. a merchant. 0 d. an employer and manager. QUESTION 36 Leslie offers to sell a used sofa, chair, coffee table, end table, and lamp to Eric for $1000. Eric responds that he will pay that price if Leslie's TV set is included. Neither party is a merchant. Under the UCC, if Leslie objects to the new terms, a contract 0 a. is formed with the new terms of the acceptance. 0 b. is formed with reasonable terms. 0 c. is notformed. 0 d. is formed with the terms of the original offer. QUESTION 37 Lydia sells a bike to Elise for $5,000, a moped to Mark for $600, a video game console to Richard for $200, and three shares of stock to Gary for $100. Article 2 of the UCC does not apply to the sale of O a. the stock. O b. the moped. O c. the bike. O d. the video game console. QUESTION 38 For a UCC contract for the sale of goods, the only required provision is O dateof contract completion O delivery terms O quantity O priceQUESTION 39 Publicly traded companiesare required to O a. buy or sell securities only on a national security exchange. 0 b. register securities transactions unless they qualify for an exemption. O c. issue instruments representing corporate ownership or debt. 0 d. invest in their own managerial or entrepreneurial efforts. QUESTION 40 TyPo is a publicly-traded company that is going to issue securities that do not qualify for an exemption from registration. This means that the company must 0 a. register the securities with a national securities exchange. 0 b. file a registration statement with the SEC. 0 c. issue the securities through an online registration site. 0 d. refrain from issuing the securities to unregistered investors. QUESTION 41 Section 16(b) of the Securities Exchange Act of 1934 covers purchases and sales of securities involving O a. misappropriation of material, nonpublic information. O b. short-swing profits. O c. corporate insiders, such as officers, directors, and employees. O d. tippers and tippees. QUESTION 42 If an LLC does NOT have a written operating agreement, under most LLC statutes, the profits will be O a. distributed according to members' proportionate ownership in the firm. O b. forfeited to the state. O c. divided equally among the members. O d. reinvested in the business until the dispute is resolved.QUESTION 43 Unless an LLC's articles of organization specify othenNise, it will most likely be assumed that the firm is O a. an aggregate of member and nonmember managers. 0 b. run by an outside professional management group. O c. membermanaged. Q d. manager-managed. QUESTION 44 Even after an LLC member ceases to be associated in the carrying on of the business of the firm, 0 a. the member does not lose the right to act as an agent for the rm. 0 b. the member's duty of care continues with respect to prior events. 0 c. the member does not lose the right to participate in management. 0 d. the member's duty of loyalty continues until the rm dissolves. QUESTION 45 Judy, the sales representative forJetson Winery wants to sell four cases of specialty wine for $2,400. In email, however, Judy mistakenly offers to sell the wine to Elroy's Fine Dining for $2,0, a reasonable price. Elroy accepts the offer by e-mail.Jetson's O a. can rescind the deal. 0 b. can rescind the deal and recover damages for the mistake. O c. is bound to the deal but can charge the intended price. 0 d. is bound to the deal at the offered price. QUESTION 46 Clark enters into a contract with Lois to design several different flower arrangements for a party at Lois's home. Clark provides 35% of the designs by the time specified in the contract because he is busy with other projects. Clark's performance is most likely O a. a reasonable breach. 0 b. no breach. 0 c. a material breach. 0 d. a minor breach. QUESTION 47 Sawyer signs a contract to buyJin Soo's apartment building for a certain price subject to a real estate appraisers evaluation of the building's condition. If the appraiser determines that the building has significant structural issues, the parties' obligations will be 0 a. discharged. 0 b. altered. O c. performed. 0 d. breached. QUESTION 48 Northern Arizona Univesity provides housing in some apartment complexes offcampus. To lease a space in those buildings, a person must be a student at NAU. This requirement is O a. an operation of law. 0 b. a breach of contract. 0 c. a condition. 0 d. a novation. QUESTION 49 Mary contracts to sell Edith herjewelry collection for $14,000. This contract will be fully discharged when Mary and Edith O a. exchange thejewelry for the money. 0 b. agree that the deal is fair. 0 c. sign a receipt. 0 d. execute a bill of sale. QUESTION 50 Carter enters into a contract with Reagan where Reagan will provide music lessons to Carter. Reagan told Carter that he is an experienced, wellregarded musician, when in reality he is a terrible musician with almost no training. Most likely, Carter 0 a. can rescind the deal based on fraudulent misrepresentation. O b. must pay Reagan for the lessons. 0 c. can refuse to comply with the contract because of undue influence. 0 d. can recover money damages for the difference between good music lessons and Reagan's lessons