BLAW 3100 Business Law Final exam MC questions PDF

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BLAW 3100 Business Law Final exam MC questions...

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To form an LLC, both a charter and an operating agreement must be filed with the secretary of state in the jurisdiction where the business will operate. - FALSE Social enterprises are organizations that pledge to behave in a socially responsible manner, even as they pursue profits. - true No formal steps are necessary to create a sole proprietorship. - true "The term ""S Corporation"" comes from - the internal revenue code Most franchisors and franchisees are - corporations or LLC's A social enterprise must do all of the following EXCEPT - register with the state as a non profit A court may pierce an LLC's veil if - members fail to provide attequate capital Corporations have a distinct advantage over other forms of business organization in the area of taxation. - FALSE Debra wanted to form a partnership with Lawrence. He agreed and they became co-owners in an equal partnership. This year, after expenses, the partnership had a profit of $200,000. How will the taxation of this profit be handled? - Debra and Lawrence must both pay tax on the business's profit. An organization that does not pay income tax on its profits but passes it through to its owners who pay the tax at their individual rates is called a - "flow-through tax entity." Carey decided to incorporate her business under the name yStar Inc. Before yStar was incorporated, Carey signed a contract in the name of yStar, Inc. to have some office space remodeled. Which statement is correct? - yStar will be liable on the contract only if the corporation adopts the contract. Laurie is incorporating her business. Laurie's home state is Wisconsin. Business will be conducted in California, Michigan, Pennsylvania, and Virginia. Laurie - can incorporate the business in any state. A corporation must have a registered agent within the state of incorporation only if the corporation maintains an office in that state. - FALSE Fashions, Inc. has 12 shareholders. There is no shareholder agreement concerning the board of directors. The company is subject to the Model Act. How many directors is Fashions, Inc. required to have? - None "A fundamental problem of the modern corporation is the conflict of interests between managers, shareholders, and stakeholders. - true If a court determines that a manager's corporate decision amounted to self-dealing, - the business judgment rule will not apply. A corporation must obtain shareholder approval before the company - sells off a major portion of its business to another company.

Sara decided to incorporate her business under the name Gomo, Inc. Before Gomo was incorporated, Sara signed a contract in the name of Gomo, Inc. to lease a store front. Sara did not tell the other party that Gomo was not yet formed. Sara is personally liable on the lease. - true Amy is on the board of directors of Computers Plus. Computers Plus is looking for a warehouse to purchase. Amy owns a warehouse. In order for Amy to sell her warehouse to Computers Plus, - the disinterested members of the board of directors must approve the transaction. Which state does your textbook cite as being particularly attractive to companies looking to incorporate? - Deleware After the SEC completes its review of a preliminary registration statement, it sends the issuer a comment letter setting forth changes that must be made. - true Which of the following is reported on Form 8-K? - the resignation of a director over a policy dispute As a result of Standard Oil Trust's control of the oil industry, which of the following statutes was enacted? - sherman act Under which circumstance is it legal to charge a lower price to a particular buyer? - if the costs of serving that particular buyer are lower Both per se and rule of reason violations of the Sherman Act are automatically illegal. - FALSE The 1933 Act prohibits fraud only in transactions involving registered securities. - FALSE "What type of collusion does the Supreme Court refer to as ""the supreme evil of antitrust""? - price fixing Officials from Vital Corporation are traveling around the country making presentations to prospective investors. The officials are conducting a - private offering Under Regulation D, institutions such as banks and insurance companies are considered to be what type of investors? - acrettited The Clayton Act prohibits anti-competitive mergers. - true Under the Fair Debt Collection Practices Act, a collection company is legally permitted to - visit the debtor at work if the consumer's employer permits such contact. Under the Truth in Lending Act, a lender must disclose all of the following EXCEPT - the average percentage rate charged by competitors. Prime Products, Inc. found out that it was going to take 3 weeks to ship the comforter Margaret ordered instead of the 7 days it had originally promised her. Prime Products must cancel Margaret's order and notify her that it can deliver within 3 weeks if she wants to reorder. - FALSE

"Bait-and-switch" tactics are not a violation of FTC rules if the merchant does not have enough stock on hand to meet reasonable demand for the advertised product. - FALSE MoneyMaker Toy Company violated the safety standards set forth by the Consumer Product Safety Commission when it produced a toy gun that caused injury to hundreds of children. Because of MoneyMaker's actions - cpsc can impose civil and criminal penatlies as well as users can sue for damages, including attorney's fees, if MoneyMaker knew it was violating a consumer product safety rule when it produced the guns. " Company policy of PushOne, Inc. is to block the company name and telephone number on potential customers' Caller ID systems so they won't know the call is from a telemarketer. This policy violates FTC rules. - true Mabel is a single 40-year-old who has borrowed money on numerous occasions. Her payment record has been good, except she has been delinquent in paying a few bills. Which of the following is true regarding credit information gathered on Mabel? - If Mabel is rejected for a loan because of the consumer report, the lender must tell her the name of the agency that supplied the report. The Fair Debt Collection Practices Act prohibits which of the following practices by a debt collector? falsely representing himself as a lawyer Blogs and social media ads must clearly indicate that they are, in fact, ads by including some equivalent of "ad" or "sponsored." - true The Fun Tyme Toy Company discovers that one of its products can easily break, exposing children to potential injury from the sharp parts. Under the Consumer Product Safety Act of 1972, how long does Fun Tyme have to report this defect to the Consumer Product Safety Commission? - 24 hours " A copyright is valid for 28 years after it is obtained and can be renewed for another 28 years. - False " A design patent protects the appearance of an item and is valid for 14 years. - true Which is NOT a provision of the Digital Millennium Copyright Act? - It is illegal to use copyrighted material under any circumstances without permission of the creator. "A company's trade secret lasts for - as long as it is kept confidential "Martina developed a new type of apple tree which could be reproduced through grafting. She cannot protect her rights in this tree by obtaining a plant patent since the tree cannot be reproduced by planting its seeds. - False What is the name of the treaty that allows American patents to be recognized and enforced in member countries? - the Paris Convention for the Protection of Industrial Property "The vast majority of patents that are issued are - utility patents Intellectual property is - expensive to produce but cheap to reproduce and transmit.

Monic, a college professor, makes 30 photocopies of a magazine article and passes the article out to her students. The students are assigned to read the article and write an opinion paper about it. Has Monic violated copyright law? - No. Monic has acted within the fair use doctrine. Richard wrote a song called "College Days." He copyrighted the composition and had it professionally printed. A couple years later, he was attending a business meeting about 1,500 miles from his home. While sitting in a nightclub, he heard a small local band perform a song called "College Memories." The music and words were extremely similar to his song. The composer of "College Memories" claims he never heard of Richard's song and that she is offended he would accuse her of stealing his work. If Richard wishes to sue for copyright infringement, he must prove - that his work was original and the infringer actually copied his work, or that the infringer had access to his song and that the two works are substantially the same. "The landlord's duty to provide quiet enjoyment of the premises and the landlord's duty to deliver and maintain the premises in a habitable condition are one and the same. - False The landlord's first important duty to a tenant is to - deliver possesion What is an abatement? - an order requiring a homeowner to eliminate a nuisance The Solomans own a cabin on the south side of Mount Henry. The Solomans told Bennie and Claudia they could live in the cabin and use it as they wished until the Solomans wanted to use it again. Twelve years later, the Solomans informed Bennie and Claudia that they were going to spend the summer at the cabin and that Bennie and Claudia would have to make other arrangements for the summer. Bennie and Claudia claimed that they had acquired title by adverse possession, because they had occupied the property for the period of time required for adverse possession under state law (10 years in that state). Are Bennie and Claudia correct? - No, Bennie and Claudia's possession was with the Solomans' permission, and therefore the claim was not adverse to the Solomans. "Tom rented an apartment from Margaret on a month-to-month basis, with rent due on the first of the month. This type of tenancy is known as a ""tenancy at will."" - False "Professor McDonald owns the following property. Which of these is NOT real property? - the books that line the shelf In many states today, a landlord must use reasonable care to maintain safe premises and is liable for foreseeable harm. - true "Mrs. Larkin rents an apartment to a couple who argue continually, disturbing other tenants. Without going through the lawful eviction procedure in court, one day she waits until the couple is out of town and changes all the locks. What has occurred? - an actual eviction "Gerard owned an apartment building that was fully leased. He sold it to Thomas. What happens to the leases of the building's tenants? - the lease will remain valid

"Daisy's Donuts rents retail space in the Crestwood Mall beginning January 1, 2018, and ending December 31, 2025. This is an example of a - tenancy for years Myron had two children, Cheryl and Pete, who predeceased him. Cheryl had three children and Pete had one child. Myron had a will. Which of the following is true? - If Myron's will indicates that the issue are to inherit per stirpes, Pete's child will receive one half of Myron's estate. Dr. Gavornne advises his very ill patients to prepare a living will. The purpose of a living will is to - express a desire not to have extreme medical treatment that would prolong their lives. How many witnesses are required for a nuncupative will to be valid? - two A child who is left nothing under the parent's will is called a - pretermitted child. Estate planning has two primary goals: to ensure property is distributed as the owner desires and to minimize estate taxes. - true Which of the following is true about wills? - A will can be amended to change specific terms by execution of a codicil. Experts estimate that more than _______ percent of the population will not be capable of making their own medical decisions at the end of their lives. - 75 Which of the following is NOT required to create a valid trust? - witnesses " The only function of a will is to dispose of a person's property upon death. - false "Reva prepares and signs a document that she intends to be her will. If she has not followed the legal technicalities of her state regarding executing a will, the court may not enforce the will. - true The person who issues the insurance policy and serves as guarantor is known as the owner. - FALSE When Sue bought a new car, she stopped by the insurance company and completed an application and made a payment. The agent accepted the offer orally. If Sue has an accident on the way home, she is covered by the new policy. - true " April purchased a life insurance policy on herself. On her death, the proceeds of the insurance were to be paid to her minor child, Ryan. Ryan is the beneficiary. - true The cheapest life insurance option is - term life insurance " Victor purchased $1 million of insurance on his home even though the house was only worth $500,000. Victor's house was destroyed by lightning. Under the insurance policy, Victor will be able to recover $1 million. - false "The person who receives the proceeds from an insurance policy is the - beneficiary

When Alberta pays her life insurance premium, a portion of the premium pays for insurance and the rest goes into savings. The company pays dividends on the savings. Alberta has a whole life insurance policy. true Bonnie's insurance policy allows her to adjust the premiums over the life of the policy and adjust the allocation of the premiums between insurance and savings. What kind of policy does Bonnie have? universal life insurance Liability policies, such as personal liability, professional malpractice, or business liability insurance, do NOT protect the insured against - intentional harm caused by the insured Everyone should have disability insurance to replace ________ of their income. - 60-70%...