Legal and Social Environment - Finance Exam 1

To determine if a statement was an offer, the courts would use: a) Subjective standard b) An objective reasonable person standard c) A subjective offeree standard d) None of the above

b) An objective reasonable person standard

An easement by prescription: a) Creates ownership of the land in question b) Creates a right of use in the land in question c) Occurs when landlocked property is purchased d) Creates a leasehold estate

b) Creates a right of use in the land in question

A court may overturn an administrative agency hearing decision if the court thinks the agency made a bad decision. a) True b) False

b) False

Common law relies more on legislation than judicial decisions to determine what the law is. a) True b) False

b) False

Law and "rule of law" are synonymous terms. a) True b) False

b) False

Preemption applies only to federal statutes. a) True b) False

b) False

Public law encompasses those legal problems and relationships that exist between individuals. a) True b) False

b) False

The terms legal and ethical have the same meaning. a) True b) False

b) False

Those who argue that a system of property ownership is ethically moral do so by appealing the strict formalism, arguing that the morality of property rights should be determined on an individual basis. a) True b) False

b) False

To be enforceable, a contract must contain a written promise. a) True b) False

b) False

Upon the death of a tenant in common, her interest automatically transfers to the other tenants. a) True b) False

b) False

All of the following are contract interpretation rules except: a) Usual meaning for common words b) Interpreted against the richer party c) Interpretation against the drafter d) Handwritten over typed.

b) Interpreted against the richer party

Larry offers to sell his car to Moe for $10,000. Moe responds that he will pay $9,000 for the car. Larry refuses Moe's $9,000 offer. Moe then says that he will pay the $10,000. There is: a) A contract for $10,000. b) No contract because there is no offer to accept. c) A contract for $9,000. d) No contract due to a revocation by the offeror.

b) No contract because there is no offer to accept.

Specific performance can be a remedy in all of the following contracts except for which one: a) Sale of the Empire State Building. b) Sale of a 2008 Hyundai Sonata. c) Sale of Da Vinci's portrait; "Mona Lisa". d) Sale of Rodan's sculpture; "The Thinker".

b) Sale of a 2008 Hyundai Sonata.

You're lying in bed in your dorm room when a piece of a satellite from a country that no longer exists reenters the earth's atmosphere and flies through the window landing at your feet. a) Your school has a right to claim the property because it landed on their property. b) You may keep the property because of the rule of first possession. c) You and your school must share the property as equal co-owners. d) The government can exercise its right of eminent domain and claim the property for the good of the public.

b) You may keep the property because of the rule of first possession.

What type laws divide counties or municipalities into use districts designated as residential, commercial, or industrial? a) Nuisance. b) Zoning. c) Adverse possession. d) Eminent domain.

b) Zoning.

Danny has five pit bull dogs. They bark constantly and terrify the neighbor, Terry. When Terry tries to sell his house, no one will even look at it for fear of the dogs. If Terry takes Danny to court, what should he claim that Danny has established? a) A public nuisance b) A private nuisance c) An adverse possession d) An eminent domain e) An accession

b) a private nuisance

Federal law and business leaders alike favor ______ as a means of governing private business ethics. a) Creating uniform statutes of business ethics b) Self-regulation by companies c) Giving the federal government exclusive jurisdiction regarding ethics and ethics violation enforcement d) Establishment of federal regulators in all private companies to establish and enforce ethical standards. e) Case-by-case determinations of what constitutes a breach of business ethics.

b) self-regulation by companies

A deed promising only to give whatever interests the grantor has is called: a) A simple warranty deed. b) A trust deed. c) A quit claim deed. d) A special warranty deed.

c) A quit claim deed.

The legal requirement of honoring confidences reflects elements of: a) Formalist ethics. b) Consequentialist ethics. c) Both of the above. d) None of the above, this is common law and not based on ethics.

c) Both of the above.

Exceptions to the statute of frauds provision in the UCC include all but the following: a) specially manufactured goods b) Admissions in court c) Denials in Court d) Between merchants and the party being sued did not object to a written confirmation.

c) Denials in Court

Donald gives Tony a life estate in a home that Donald owns in 2008 specifying that upon the end of the life estate, the property is to go to his son, Mike. Tony dies in 2012. a) If Donald is still alive he may revoke the transfer to Mike and keep the property. b) Mike gets a reversion in 2012. c) Mike gets a remainder in 2012. d) In 2012, Mike and Donald become joint tenants until Donald's death when Mike becomes the sole owner.

c) Mike gets a remainder in 2012.

A _____ deed makes no guarantees other than that the grantor surrenders all claim against the land. a) Simple warranty b) Trust c) Quitclaim d) Special warranty e) Fiduciary

c) Quitclaim

Illinois may tax an out of State Corporation if: a) The out of the State Corporation has Illinois shareholders. b) The out of State Corporation sells products to consumers in Illinois c) The out of State Corporation has employees or property in Illinois and a result the corporation has Nexus with Illinois. d) Illinois cannot tax an out of State Corporation since it violates the commerce clause. e) The out of State Corporation sells Lincoln, Cubs and White Sox memorabilia.

c) The out of State Corporation has employees or property in Illinois and a result the corporation has Nexus with Illinois.

Which of the following is not a requirement for adverse possession to apply? a) The possession must be open and notorious. b) The possession must be continuous. c) The possession must be permitted. d) The possession must be wrongful.

c) The possession must be permitted.

You and your roommate are driving through a nice neighborhood when you see some furniture piled on the curb to be picked up by the trash collectors the next morning. As you pick up a chair, the homeowner opens a window and yells, "Get away from my stuff" a) You may claim the chair as lost property. b) You may claim the chair as mislaid property. c) You may claim the chair as abandoned property. d) The homeowner retains ownership until it is picked up the next morning, so you must leave it. e) The homeowner retains ownership of the property until you buy it from him.

c) You may claim the chair as abandoned property.

In general, a valid and enforceable contract requires which of the following? a) Capacity b) Legality c) Offer and acceptance d) All of the above

d) All of the above

Gifts must be: a) Intentionally given. b) Accepted. c) Delivered. d) All of the above.

d) All of the above.

Business ethics reflects elements of: a) Formalism only. b) Consequentialism only. c) Both fundamentalism and consequentialism with a focus on formalism. d) Both fundamentalism and consequentialism with a focus on consequentialism. e) Neither formalism nor consequentialism.

d) Both fundamentalism and consequentialism with a focus on consequentialism.

The common law system originated in: a) France. b) The United States. c) Spain. d) England.

d) England

Mike is driving 15 miles over the posted speed limit when he is pulled over by Tom, a local police officer. As Tom approaches the car, he hears Kathy in the front seat moaning in pain. Mike tells Tom that Kathy is in labor and that he is rushing to the hospital. Tom issues Mike a speeding ticket, nevertheless. Tom's ethical approach in this matter most closely matches. a) Utilitarianism b) Relativism c) The protest ethic d) Formalism e) Hedonism

d) Formalism

Which of the following is not a condition of performance? a) Precedent b) Subsequent c) Concurrent d) Jointly severable.

d) Jointly severable.

The contract clause: a) Applies to the federal government. b) Allows a state to impose new prices on existing contracts. c) Prohibits the federal government from contracting with a state government. d) Limits a state's ability to impair the obligation of a contract. e) Allows a state to enact laws that impact rights under existing contracts.

d) Limits a state's ability to impair the obligation of a contract.

Which of the following is a valid bailment? a) Babysitting your sisters child for the weekend b) House sitting your friend's house for the weekend c) Feeding your neighbor's dog (who lives in the yard in a dog house) by tossing food over the fence d) Taking your boyfriend's car to have it detailed as a birthday present

d) Taking your boyfriend's car to have it detailed as a birthday present.

Fred has orally hired a world famous artist to paint his portrait. The cost is going to be $5,000 and the portrait is scheduled to take nine months to paint. Due to delays, the portrait takes thirteen months to complete. a) The contract is unenforceable because it took over a year to complete. b) The contract is unenforceable because it was for over $500.00. c) Both a and b make the contract unenforceable. d) The contract is enforceable.

d) The contract is enforceable.

Mike rents a car from Brandy for a day for $40. Which of the following statements is correct? a) This is a bailment for the sole benefit of the bailor b) Brandy is the bailee c) Mike owes the duty of slight care d) This is a bailment for the mutual benefit of the parties e) This is a bailment for the sole benefit of the bailee

d) This is a bailment for the mutual benefit of the parties

Contracts that may be terminated by one or more of the contracting parties are: a) Executory b) Unilateral c) Void d) Voidable

d) Voidable

Which of the following is not a security interest in land? a) A land sale contract b) A mortgage c) A deed of trust d) A negative easement e) A title

d) a negative easement

Josh borrows Amanda's car to get to school. Josh is obligated to exercise _____. a) The level of care imposed by Amanda. b) A reasonable duty of care c) A slight duty of care d) The level of care imposed by Amanda's parents e) A very high duty of care

e) A very high duty of care

Which of the following is true about the strict scrutiny approach? a) It is used if the classification is partially suspect. b) It falls between the minimum and quasi-strict scrutiny approaches. c) It is used when the rights involved are not quite fundamental. d) Classifications that are subject to this approach are presumed to be constitutional. e) It is applied to cases involving classifications directed at fundamental rights.

e) It is applied to cases involving calssifications directed at fundamental rights.

Which of the following is NOT a requirement for a successful application of adverse possession? a) The possessor must occupy the land openly and notoriously. b) The possessor must occupy the land continuously. c) The possessor must physically occupy the land. d) The possessor must occupy the land wrongfully e) The possessor must occupy the land with the owner's permission.

e) The possessor must occupy the land with the owner's permission.

The dominant form of consequentialism is: a) Utilitarianism. b) Social contract theory. c) The categorical imperative. d) The Protestant ethic. e) Marxism.

a) Utilitarianism

When Various laws are not consistent, which of the following is given first priority? a) United States Constitution b) State Laws c) Local Laws d) United States Laws e) Uniform State Laws

a) United States Constitution

Which of the following is a bailment for the sole benefit of the bailee? a) Borrowing a pencil b) Renting a car c) Babysitting for free d) Finding lost or misplaced property e) Using a car without permission.

a) Borrowing a pencil

A void contract: a) Can never have legal effect. b) Can become enforceable by the passing of a reasonable amount of time. c) Has legal effect until set aside by a court. d) Includes a voidable contract as well.

a) Can never have legal effect.

An express condition is: a) Found in the contract b) Implied from the contract c) Never in the contract d) A shipping term.

a) Found in the contract

Which of the following is true about freedom of speech? a) It covers both verbal and written communications. b) It exists to protect the majority from the minority. c) Its protection relates to private action that restricts our ability to express ourselves d) It covers written communications but not conduct or actions. e) It is an absolute constitutional guarantee. Freedom of speech covers both verbal and written communications. It also covers conduct or actions.

a) It covers both verbal and written communications.

An easement restricting what an adjoining land owner may do with their property is called a/an: a) Negative easement b) Easement by prescription c) Easement by reservation d) Easement by necessity

a) Negative easement

________ means to follow the case precedent. a) Stare decisis. b) Constitutional realism. c) Statutory construction. d) Constitutional relativism.

a) Stare Decisis

According to the mirror image rule, _____. a) The acceptance must exactly match the offer. b) To be enforceable, a contract must be accepted in writing by both the parties involved. c) The acceptance of an offer involves changing the terms of offer or adding new terms. d) Terms of contract must be definite to be clear and enforceable. e) The contract becomes enforceable by performing a requested act, not by making a promise.

a) The acceptance must exactly match the offer.

Although property law is categorized as one kind of private law; in our legal system, it is at the heart of both public and private law. a) True b) False

a) True

An executed contract is one that is fully performed. a) True b) False

a) True

Dicta is not precedent because it is a comment on a matter not necessary to the decision reached. a) True b) False

a) True

Legislation enacted by Congress is called a statute while a law passed by a local government is usually called an ordinance. a) True b) False

a) True

Private property is a system of law under which the state recognizes and enforces an individual's rights acquire, possess, use, and transfer scarce resources. a) True b) False

a) True

The United Kingdom, the United States, Canada, Jamaica, India, Nigeria, New Zealand, and a few other countries—all colonized by England - Follow the common law. a) True b) False

a) True

The secret to economic prosperity and the wealth of nations lies in the foundation of property law and the legal system to implement it under the rule of law. a) True b) False

a) True

Under the contract clause, state governments cannot pass laws that impact rights and duties under existing contracts. a) True b) False

a) True