lwen

Chapter 1

The party bringing a civil lawsuit has the burden of proof to prove her case beyond a reasonable doubt.

True

False
status: incorrect (0.0)
correct: false

A usual remedy granted by the courts in civil law is compensation for damages to the victim.

2 True

False
status: correct (1.0)
correct: true

Law and morals are the same.

3 True

False
correct: false .

Which of the following statements is true about administrative law?

a. Administrative laws in the form of rules and regulations are promulgated by legislatures.

4 b. The scope of administrative law has decreased in the past century.

c. Administrative law is considered to by most legal scholars to be the most complex area of private law.

d. Agencies create more law than all the legislatures combined.

correct: d

At common law, in a breach of a land contract, the remedy was:

a. reformation.

5 b. rescission.

c. specific performance.

d. injunction.

correct: c

A crime can be an act that the government prohibits to protect the public. The government must prove that the act was
done by the defendant by the following:

a. Preponderance of the evidence.

6 b. Beyond a reasonable doubt.

c. Higher probability of evidence.

d. Predominant evidentiary fact.

correct: b

The principle of stare decisis includes all but the following concept:

a. Courts, in deciding cases, adhere to rules of law that superior courts have applied in prior, similar cases.

7 b. Courts are prohibited from correcting past decisions.

c. Stare decisis allows the common law the flexibility to change without losing its sense of direction.

d. The common law purpose of indicating how courts will decide similar cases in the future.

correct: b

The method of briefing a case suggested in your textbook contains the following four elements:

a. facts, issues, decision of the court, and the court's reasoning.

8 b. reported cases, legal analysis, reported opinions, and questions.

c. petitions, negligence per se, common law negligence, and foreseeability.

d. allegations, facts, judgment, and sentence.

correct: a

9 The law that creates, defines, and regulates legal rights and obligations is known as:

a. substantive law.

b. procedural law.

c. constitutional law.

d. criminal law.

correct: a

Which of the following is NOT considered to be an equitable remedy?

a. Specific performance

10 b. Injunction

c. Reformation

d. Money damages

correct: d

Chapter 2

According to psychologist Lawrence Kohlberg, the most advanced state of moral development relies on a system of
punishment and rewards.

True

False
correct: false

Utilitarianism assesses right and wrong based on the feelings of individuals.

2 True

False
correct: false

3 Like the law, an analysis of ethics has central authority and clear-cut, universal standards.

True

False
correct: false

Philosophers have, over the centuries, tried to develop universal methods to make ethical decisions. The following is a true
statement concerning the search for a universal ethical truth that could be applied to almost any situation and provide
guidance for ethical decision making:

a. Ethical principles today are thought to be analogous to the derivation of mathematical proofs.

4
b. A priori reasoning is based on experimentation.

c. Reasoning based on theory rather than experimentation is called ethical fundamentalism.

d. Today most philosophers believe that the complexities of our world defeat attempts to create a prioriguidelines.

correct: d

Ethical fundamentalism is an ethical theory that includes the following as part of its definition:

a. Ethical fundamentalism is also called absolutism.

5 b. All ethical fundamentalists look to the Bible to guide them through ethical decision making.

c. Karl Marx is the main authority persons seek guidance from under ethical fundamentalism.

d. Proponents of ethical fundamentalism believe in total reliance on a central authority.

correct: a

Situational ethics can best be described by which of the following statements?

a. Situational ethics is the same theory as ethical relativism.

6 b. Situational ethics looks to precise theory to work through ethical situations.

c. Situational ethics is a less judgmental theory than ethical relativism.

Situational ethics insists that, once a decision is made, the judgment of others on the judgment of the actor can be
d. made as to whether the action was ethical.

correct: d

Mike is a legislator who adheres to rule utilitarianism. Mike would think that the following actions would be ethical:

Telling the truth, even though the truth would jeopardize the passage of a bill that Mike believed would improve the
a. lives of most people in his state.

7 b. Telling a lie that would help pass a bill that Mike believed would improve the lives of the majority of people in his state.

Telling a lie to pass a bill that would help a few people in his state and would have the added benefit of creating
c. contracts for Mike's construction company to fulfill and make a hefty profit.

Telling the truth, even though the truth would jeopardize the passage of a bill that would help a few people in his state
d. and have the added benefit of creating contracts for Mike's construction company to fulfill and make a hefty profit.

correct: b

A major criticism of rule utilitarianism is that:

a. cost-benefit analysis is a more efficient ethical model than utilitarianism.

some people have more insight into ethical behavior than others do, so utilitarianism equations are too difficult for
8 b. most people to work.

c. utilitarian theory ignores justice and the rights of minorities.

d. interpersonal and intrapersonal motivations are difficult to discern and therefore utilitarian theory is unworkable.

correct: c

To never treat another human being as a means to an end is a concept belonging to:

a. utilitarianism.

9 b. deontology.

c. the television test.

d. intuitionism.

correct: b

Psychologist Lawrence Kohlberg developed a theory by observation that people progress through various stages of moral
10
development. Of the following statements which is NOT true about Kohlberg's theory?

a. The two major variables in this theory are age and education.

b. There are two levels of development: preconventional and post-conventional.

c. Most adults operate at the conventional level.

d. People can learn to be more ethical.

correct: b

Chapter3

Article III of the U.S. Constitution directly established the entire U.S. federal court system.

True

False
correct: false

The court system in the United States is a dual system.

2 True

False
correct: true
your answer: true

A court has a right to hear and make a judgment in a case even if the court does not have proper jurisdiction.

3 True

False
correct: false
your answer: true

Congress created the idea of a Supreme Court of the United States in one of its first public laws.

4 True

False
correct: false

5 Congress has established federal judicial districts, each of which is located entirely in a particular state.

True

False
correct: true

The special courts in the federal system include:

a. The United States Supreme Court.

6 b. The United States District Court.

c. The United States Tax Court.

d. The United States Circuit Court of Appeals.

correct: c

Small claims courts are those courts that:

a. hear misdemeanors.

7 b. are inferior courts that decide civil cases involving a limited and relatively small amount of money.

c. hear disputes against the federal government.

d. are trial courts of general jurisdiction.

correct: b

________ jurisdiction gives a court the power to adjudicate claims involving property located within the state where the court is
located.

a. In rem

8 b. Quasi in rem

c. In personam

d. Venue


correct: a

One type of concurrent jurisdiction is diversity of citizenship. Diversity of citizenship requires:

a. that the amount the parties are disputing can in good faith be calculated to exceed $75,000.

9 b. only that a citizen of a foreign country bring a petition against a U.S. citizen

c. only that a citizen of a foreign country brings a lawsuit against the federal government.

d. that the plaintiff has legal residence in a state other than the state in which the plaintiff brings suit.

correct: a

The requirements for jurisdiction over the parties can be met by:

a. in personam jurisdiction only.

10 b. in rem jurisdiction only.

c. attachment jurisdiction only.

d. all of these are ways that jurisdiction over the parties can be had.

correct: d .

Long-arm statutes allow courts to:

11
a. create laws that are imposed on citizens of another state.

b. make obsolete the statutes in another state.

c. expand their jurisdictional reach beyond those persons who may be personally served within the state.

d. defend against courts from other states gaining jurisdiction over their citizens.

correct: c .

Chapter 4

The First Amendment protects a corporation's right to speak out on political issues.

True

False
correct: true
your answer: true

The framers of the U.S. Constitution enumerated precisely the liberties the people were to reserve for
themselves.
2
True

False
correct: false

The Bill of Rights was approved by the first Congress to calm the people's fears that the federal government
would abolish slavery.
3
True

False
correct: false

Substantive due process concerns:

a. review of the procedures protecting fundamental rights.

4 b. equal protection of all persons regardless of race.

c. a rational relationship to a legitimate governmental interest.

d. the compatibility of whether a law protects fundamental rights.

correct: d

Marbury v. Madison involves the principle of:

a. separation of powers.

5
b. judicial review.

c. state action.

d. federalism

correct: b

Whenever Congress enacts legislation within its constitutional powers, the action preempts any conflicting state statutes.
Federal laws preempt state laws:

a. if the federal legislation is intended by Congress to be pervasive.

6 b. if the subject of the federal legislation requires uniformity.

c. if there is danger of conflict between federal and state regulation.

d. all of these are reasons federal legislation can preempt state legislation.

correct: c

Texas passes a law that violates the U.S. Constitution. The legal concept by which this law will be invalidated is:

a. federal preemption.

7 b. conflict of laws.

c. judicial review.

d. Sseparation of powers.

correct: c

Some governmental powers may be exercised only by the federal government. These exclusive powers include the power
to:

a. establish laws about bankruptcy.

8 b. tax.

c. regulate health.

d. regulate safety.


correct: a

The purpose of taxes, whether levied by the state or federal government does not include:

a. raising revenues.

9 b. regulation.

c. effecting socioeconomic change.

d. borrowing money.

correct: d

The power of eminent domain for the federal and state governments is contained in the:

a. Fifth and Sixth Amendment.

10 b. Sixth Amendment.

c. Fourteenth Amendment and Fifth Amendment.

d. First Amendment.

correct: c

Chapter 5
A "major rule" is any rule that the Office of Management and Budget finds has resulted in a $100 million effect
on the economy.

True

False
correct: true

Legislative rules promulgated by agencies have the force of law if they are constitutional, within the power
granted to the agency by the legislature, and are issued according to proper procedure.
2
True

False
correct: true

In general, procedural rules are exempt from the notice and comment requirements of the APA.

3 True

False
correct: true

An enabling statute is a statute that creates an agency.

4 True

False
correct: true

The term "administrative process" refers to the creation of the administrative agency by the legislature.

5 True

False
correct: false

What is the name given to the process by which an administrative agency promulgates statements designed to implement,
interpret, or process law or policy?

a. Rulemaking

6 b. Lobbying

c. Adjudication

d. Enforcement

correct: a

To what do the letters ALJ refer?

a. American Law Judge

7 b. Administrative Legal Judge

c. Administrative Law Judge

d. Adjutant Legal Judiciary

correct: c

Administrative rules are of the following three types:

a. executive, legislative, and judicial.

8 b. enforcement, adjudication, and procedural.

c. legislative, interpretive, and procedural.

d. regulations, rules, and statutes.

correct: c

In exercising judicial review, the court may compel an agency to:

a. act when the agency has unlawfully withheld authority.

9 b. exceed its authority.

c. conduct a trial de novo.

d. dismiss its case without a hearing.

correct: a

When conducting a review of an agency's decision, courts generally use the:

a. Substantial Evidence test.

10 b. Unwarranted by the Facts test.

c. Arbitrary and Capricious test.

d. Scintilla of Evidence test.

correct: c

Chapter 6
Sale of alcohol to a minor would be an example of criminal liability without criminal intent.

True

False
correct: true

Corporations may be held criminally liable for a crime.

2 True

False
correct: true

A misdemeanor is a crime punishable by a fine or imprisonment in a local jail.

3 True

False
correct: true

Subjective crimes include crimes in which the perpetrator may have acted recklessly.

4 True

False
correct: true

Examples of mala in se crimes include:

a. making a prohibited U-turn.

5 b. burglary.

c. a prohibition against spitting on the sidewalk.

d. speeding.
correct: b

Which of the following statements is true about computer crime?

6
a. Many businesses do not report computer crime.

b. The incidence of computer crimes has declined in the recent past.

c. The federal government has passed comprehensive laws prohibiting computer crimes.

d. Only a few of the states have enacted computer crimes laws.
correct: a

The RICO Act is :

a. legislation passed to indict illegal aliens.

7 b. federal legislation that includes both criminal and civil aspects.

c. only applicable to gang crime.

d. only applicable to organized crime.
correct: b

False pretenses can be described as:

a. a property crime.

8 b. not a crime at all but a civil tort only.

c. another form of forgery.

d. always including a false statement of intention.
correct: a

The exclusionary rule is found in the:

a. Fifth Amendment.

9
b. Fourth Amendment.

c. Fifth Amendment.

d. First Amendment.

correct: b

The right to a speedy trial is found in the:

a. Fifth Amendment.

10 b. First Amendment.

c. Sixth Amendment.

d. Fourth Amendment.
correct: c

Chapter 7
In a defamation law suit, a public figure must show that the defendant published the defamatory statement with
actual malice.

True

False
correct: true

Tort reform expands tort law to cover more torts and allow increased damage awards.

2 True

False
correct: false

Tort law has one purpose--to prevent future harms.

3 True

False
correct: false

The law of torts is not static.

4 True

False
correct: true

5 Which of the following is not an example of the type of harm to the person protected against by the law of intentional
torts?

a. Nuisance

b. Apprehension

c. Confinement

d. Mental Distress
correct: a

The following example constitutes assault:

a. If you don't give me that book right now, I'll break your arm.

6 b. If I see you in here again, I'll punch you in the nose.

John is angry with Joe and swings a bat behind Joe's back. He does not actually hit Joe. Joe feels a cool breeze
c. as the bat swings behind him and says: "My is it getting cool in here!"

d. None of the answers constitutes an assault.
correct: a

The tort of false imprisonment may be brought about by the following conduct:

a. Physical force and physical barriers.

7 b. A merchant's detention of a suspected shoplifter for a reasonable time based on probable cause.

c. Inadvertently blocking someone's exit from a building.

d. Any and all acts that obstruct a person's movement.
correct: a

ABC Corporation employed Matt. After a year of work, Matt left ABC's employ. ABC was angry with Matt for leaving. When
prospective employers called ABC, ABC said the following about Matt: "He was a lousy employee, a quitter, not
cooperative at all." This is an example of:

8
a. free speech.

b. a qualified privilege.

c. defamation.

d. intentional infliction of emotional distress.
correct: c

The following statement(s) is/are true concerning misuse of legal procedure:

a. Two torts comprise this set of torts.

9 b. False light is one type of misuse of legal procedure.

c. A cause of action for the misuse of legal procedure is not applicable if there is probable cause.

Abuse of process can be an applicable cause of action even if the plaintiff succeeds in the litigation that was said
d. to be brought for a wrongful reason.
correct: d

A sales clerk at QuickWay Store observed a customer remove a watch from a display case and put it in his pocket. In
most states, QuickWay:

a. can detain the customer for suspicion of shoplifting.

10 b. cannot detain the customer but can alert the police.

c. cannot detain the customer but once the customer leaves the store, the sales clerk can make a citizen's arrest.

d. cannot detain the customer but can sue for conversion.
correct: a

Chapter 8
Generally, a violation of a state statute is proof that a defendant was negligent.

True

False
correct: true

Jill is 14 years old. She has been hunting with her father and grandfather since she was nine. Becky is 14.
2 She has never held a gun before in her life. These two children would be held to the same standard of care in
a negligence case involving a hunting accident.

True

False
correct: true

Strict liability is not based on negligence.

3 True

False
correct: true

According the general rule of torts a person is under a duty to all others at all times to exercise reasonable
care for the safety of the other's person or property.
4
True

False
correct: true

The standard of care for a blind man would be that of a reasonable man who is blind.

5 True

False
correct: true

The standard of care for an emotionally imbalanced person is that of the always-careful emotionally
imbalanced person.
6
True

False
correct: false

All but which of the following are considered defenses to negligence?

a. Contributory negligence

7 b. Comparative negligence

c. Proximate cause

d. Assumption of risk

correct: c

Joe keeps a herd of cows from which he receives a profit. One day, the cow Nellie escaped from the pasture. Ron ran into
poor Nellie on the road, severely damaging his BMW and giving him a concussion. The proper cause of action to file in
this case would be:

a. a negligence case against Joe.

8
b. a negligence case against Ron.

c. a strict liability case against Joe.

d. a strict liability case against Ron.
status: not answered ()
correct: c

The law of torts applies special standards of care in all but which of the following?

a. Emergencies

9 b. Superior skill and knowledge

c. Physical disability

d. Mental deficiency
correct: d

Alma was shot and severely injured during an armed robbery as she was working as a clerk at MiniMart Convenience
Store in the Astro Shopping Center. If Alma sues Astro, she probably would:

a. recover as strict liability would apply to Astro.

10 b. recover if she could show other similar acts in the Center.

c. not recover as she was contributorily negligent.

d. not recover as she could only sue the robbery suspect.
correct: b

Chapter 9

A party to a void contract is legally required to perform the specified contractual duties.

True

False
correct: false

Breach is defined as remedies provided for by the court.

2 True

False
correct: false

All written promises brought to the court's attention will be treated as contracts.

3 True

False
correct: false

Article 2 of the Uniform Commercial Code governs sales in all states except Louisiana.

4 True

False
correct: true

The definition of a quasi contract includes the following:

a. A quasi contract is not a contract.

5 b. A quasi contract is an implied contract.

c. A quasi contract is an unjust enrichment.

d. A quasi contract is an injustice.
correct: a

Remedies that a court may order for breach of contract include all but which of the following?

6
a. Restitution

b. Reliance damages

c. Mutual Assent

d. Equity
correct: c

The essential elements of a contract include all but which of the following?

a. Legality of object

7 b. Reliance

c. Capacity

d. Consideration
correct: b

While driving to work, Amanda stopped at a gas station and filled her gas tank. Amanda is obligated to pay for the gas
because there is a(n):

a. implied contract.

8 b. express contract.

c. bilateral contract.

d. unilateral contract.
correct: a

Which of the following statements are true about unenforceable contracts?

a. Unenforceable contracts are the same as void contracts.

9
b. Unenforceable contracts are the same as voidable contracts.

c. Unenforceable contracts are always executed.

d. Unenforceable contracts have no remedy available.
correct: d

Keith, a minor fully supported by his parents and without any particular skill or knowledge, enters into a written contract
with Robert's Used Cars. Keith has a(n):

a. formal contract.

10 b. informal and unenforceable contract.

c. informal and wholly enforceable contract.

d. voidable contract.
correct: d

Chapter 10

A contract may be formed by silent conduct.

True

False
correct: true

The law applies a subjective standard to mutual assent.

2 True

False
correct: false

An offer must take a particular form to have legal validity.

3 True

False
correct: false

It is insignificant in contract law whether an offer was made under obvious emotional strain.

4 True

False

correct: false

Because no real offer is made in a merchant's advertisement, the merchant is free to offer goods at one price
and to then sell the goods at a higher price once demand is stimulated.
5
True

False
correct: false

George reads an ad in the newspaper that has the following language: "Come visit our new Jaguar dealership! The first
ten visitors to help us open the doors at 6:00 a.m. Wednesday morning get a new Jag for a mere $43,000!" George goes
to the dealership on Wednesday morning and is one of the first ten visitors. George has:

a. made a valid unilateral contract with the dealership.

6
b. not made a valid contract with the dealership.

c. received only an invitation to make an offer from the dealership.

d. none of these choices.
correct: a

The ways in which an offer may be terminated include all but the following:

a. Lapse of time

7 b. Acceptance

c. Open terms

d. Counteroffer
correct: c

Which of the following statements is true concerning the definiteness of an offer?

a. The offeree's terms must be clear enough to provide a court with a basis for granting a remedy.

8
b. Price terms may not be left open in valid offers for the sale of goods.

The Code is much stricter than the common law in requiring that no significant terms in the contract be omitted for
c. the courts to consider that a valid offer has been made.

The terms of a contract, all of which the offer usually contains, must be reasonably certain so as to provide a
d. court with a basis for determining the existence of a breach and for giving an appropriate remedy.
correct: d

Commercial reasonableness is:

a. a standard of conduct used in the common law of contracts.

9 b. a term that has nothing to do with the mutual assent element of contracts in the modern era.

c. a standard of conduct used in the Code to help the courts determine the fairness of open terms in an offer.

d. a definite, unwavering standard that can be relied upon not to change.
correct: c

Georgia offered to sell her riding lawnmower to Carl. Before Carl responded, Georgia's house burned down and the
mower was destroyed. Which statement is correct?

a. Carl has the option to accept or reject the offer. If Carl accepts, Georgia must find a comparable mower.

10 b. Carl has the option to accept or reject the offer. If Carl accepts, Georgia must give Carl the insurance money.

c. Carl cannot accept the offer. The offer is terminated by law.

d. Carl must accept the offer. This is a force majeure.
correct: c

Chapter 11

When consent by one of the parties to a contract is not effective because it was not knowingly and voluntarily
given, it is considered by law to be duress.

True

False
correct: false

An agreement that does not include knowing and voluntary agreement by both parties is always void.

2 True

False

correct: false

There are two types of duress.

3 True

False
correct: true

Undue influence and duress have the same elements to be proven in court.

4 True

False
correct: false

A voidable contract is a contract:

a. the breach of which has no remedy at law.

5 b. that does not meet all the requirements of a binding contract.

c. which is only a promise or agreement with no legal effect.

which, because of the manner in which the contract was formed, the law permits one or more of the parties to
d. avoid it.
correct: d

Which of the following would probably be considered a misrepresentation of a material fact if what was said was untrue?

a. "This is the one that I think is the best buy."

6 b. "This is the best computer on the market."

c. "This car has new brakes."

d. "These tires will wear like iron."
correct: c

Which of the following is NOT an element of fraud in the inducement?

7
a. Material misrepresentation

b. Competent parties

c. Knowledge of falsity

d. Justifiable reliance
correct: b

Important factors to consider in determining whether a contract is fair or made under undue influence, include all but which
of the following?

a. That the contract was legally challenged by the ward of the guardian.

8 b. Whether the dominant party made full disclosure of all the relevant information known to him.

c. Whether consideration was at least 5% above market value.

d. Whether the dependent party received competent and independent advice before completing the transaction.
correct: c

Tom's parents died in a plane crash and he went to live with his guardian, Aunt Rose. Rose had a very small house and
did not have a separate bedroom or bath for 12-year-old Tom. She and Tom decided to use some of his inheritance to pay
for an addition to her home. Tom had some of his shares of stock sold to give to Aunt Rose to pay for the home
improvements. Tom gives his stock to Rose in consideration that a room is built for him. This agreement is:

a. presumed voidable unless Rose can show no unfair advantage was taken.

9
b. presumed valid unless Tom can prove that he was taken advantage of and pressured into entering an agreement.

c. null and void because of undue influence.

d. presumed void because of duress.
correct: a .

Sal borrowed $2,000 from his friend, Steve. Sal signed a promissory note agreeing to repay the $2,000 in twelve equal
monthly installments beginning next month. After making the first payment, Sal made no further payments. After
repeated efforts to collect the money, Steve sent Sal a letter threatening to sue him for breach of contract if the loan was
not repaid. Matt's letter:

10
a. constitutes duress.

b. constitutes undue influence.

c. constitutes fraud.

d. is legally permissible.
correct: d

Chapter 12

Consideration is the primary basis for the enforcement of promises in our legal system.

True

False
correct: true

Consideration, or whatever is exchanged for a promise, exists when the parties only intended an exchange.

2 True

False
correct: false

To receive a legal benefit means that the object of the consideration is not an illegal act or object.

3 True

False
correct: false

Legal sufficiency is another way of saying that the market value of the act, forbearance, or thing bargained for
is adequate.
4
True

False
correct: false

Which of the following statements is true regarding moral obligations and their relationship to the element of consideration
in valid contracts?

a. Under the common law a promise made to give value for a pre-existing moral obligation is enforceable.
5

b. A minority of states give considerable recognition to moral obligations as a form of consideration.

c. Under the Restatement, the courts treat pre-existing moral obligations as they do past consideration.

The common law and the Restatement follow the same rule regarding moral obligations and their relationship to
d. the element of consideration.
correct: b

Mark promises Tom $5,000 for one of his original oil paintings on the condition that he receives $2 million from his
mother's will.

a. Mark has made a promise that is legally sufficient.

6 b. Mark's promise is legally inadequate, and the courts will therefore not enforce it.

c. Mark has made an illusory promise.

d. Mark has made a conditional promise, which is not sufficient to form consideration.
correct: a

George says to Edna, "If I decide to have the bathroom redone, I will contract with your company to do it." George's
statement to Edna is an example of:

a. good consideration.

7 b. an illusory promise.

c. a pre-existing duty.

d. past consideration.
correct: b

Which of the following would not be enforceable without consideration?

a. A promise to pay a debt barred by the statute of limitations.

A promise to pay a debt discharged in bankruptcy where the promise meets the requirements of the Bankruptcy
8 b. Act.

c. A promise which falls within the doctrine of promissory estoppel.

d. The settlement of an undisputed debt.
correct: d

Which of the following promises would not be enforceable without consideration?

a. A charitable subscription promise.

9 b. Modifications of an existing contract for goods of $500 or more.

c. A modification of an existing contract at common law.

A written offer made and signed by a merchant to keep open an offer open for a stated time period, not to exceed
d. three months.
correct: c

The following statement is true about renunciation:

Renunciation is a common law doctrine created to, without any consideration, waive claims arising from a
a. breach of contract.

10 b. Renunciation is a form of consideration under the Code.

Under the Uniform Commercial Code, renunciation is a written waiver of a claim or right arising from a breach of
c. contract that is signed and delivered by the aggrieved party.

d. Under the Uniform Commercial Code, a renunciation can be oral.
correct: c

Chapter 13

A recent trend in the law has been to relax or limit usury statutes.

True

False
correct: true

The court will sometimes enforce an agreement that involves acts declared illegal by statute.

2 True

False
correct: false

The Restatement clearly defines the term "illegal bargain."

3 True

False

correct: false

The courts do not make a distinction as to whether a statute is regulatory or revenue raising in enforcing
contracts that may involve a violation of statute.
4
True

False
correct: false

Which of the following is not an exception to the general rule that illegal contracts are unenforceable?

A party to an illegal agreement may, prior to performance, withdraw from the transaction and recover whatever he
a. had contributed, no matter what the party had done up to the point of withdrawal.

Where one party is less at fault than the other, that party may be allowed to recover payments made or property
5 b. transferred.
Sometimes an agreement is illegal because it violates a statute designed to protect persons in the position of one
of the parties. In such a case, the statute may expressly give the party to be protected the right to rescind and
c. recover whatever money he paid.
An agreement that appears on its face to be permissible, but is illegal due to facts or circumstances of which one
party is completely unaware, may be enforced or the party who is excusably ignorant may maintain a lawsuit
d. against the other party for damages.
correct: a

Which of the following is not true with regard to exculpatory clauses?

a. Exculpatory clauses relieving a party from tort liability for harm caused recklessly are generally enforceable.

6 b. An exculpatory clause may be unenforceable for unconscionability.

Where the party trying to use the exculpatory clause is a common carrier, the courts are inclined to nullify a
c. clause attempting to excuse negligent behavior.

d. An exculpatory clause excuses one party from liability for its own tortious conduct.
correct: a

Jo sells her highly successful, award-winning television production company, JoTV, to Myra. The sales contract says that
Jo agrees to never again create a television production company or to produce television programming. Which of the
following best describes this contract clause?

a. Voidable as an unreasonable restraint of trade.
7

b. Binding as fair protection.

c. Valid as a reasonable restraint on trade.

d. Unenforceable as an exculpatory clause.
correct: a

If the restriction in an employment contract is found to be too harsh, a court may do any of the following EXCEPT which?

a. Change the terms of the contract.

8 b. Refuse to enforce the whole contract.

c. Refuse to enforce that part of the contract.

d. Refuse to void the restriction.
correct: d

Which of the following would generally be considered to be a revenue-raising licensing law?

a. A statute requiring that doctors be licensed.

9 b. A statute requiring that salespeople be licensed, but not establishing any educational or training requirements.

c. A statute requiring that public school teachers be licensed.

d. A statute that requires insurance agents to pass a test before selling insurance in the state.
correct: b

The following statement is NOT true concerning enforceable "non-competition" covenants:

a. The covenant relates to a contract for employment or the sale of a business.

The rules regarding covenants for Internet company employees are identical to the rules for other types of
10 b. employment.

c. The covenant must be reasonable in regard to time.

d. The covenant must be reasonable in regard to territory.
correct: b

Chapter 14

Business people deal at their own peril with minors.

True

False
correct: true

Everyone is regarded as having contractual capacity unless public policy is best served by regarding an
individual or class of individuals as not having contractual capacity.
2
True

False
correct: true

The age of majority is twenty-one years of age.

3 True

False
correct: false

Disaffirmance will not release a minor from contract liability.

4 True

False
correct: false

Under the majority rule in this country, if a minor fraudulently misrepresents his age when entering a contract:

a. the minor may disaffirm.

5 b. the minor may not disaffirm if the adult party in good faith reasonably relied upon the misrepresentation.

c. the minor must restore the other party to the position she occupied before making the contract.

d. the other party to the contract is allowed to recover damages against the minor in tort.
correct: a

Which of the following statements is true concerning disaffirmance?

6
a. A minor's disaffirmance must come only within a reasonable time after reaching majority.

b. A minor's disaffirmance must come only during the period of minority.

c. A minor's disaffirmance must come within one year after the contract had been entered into.

In most states, defining a reasonable time for disaffirmance depends on the nature of the transactions, what
d. caused the delay, and to what extent the parties have been injured by the delay.
correct: d

Joe, a sixteen-year-old orphan minor, transferred the home that was left to him by his parents to his Uncle Snavely for
consideration. Uncle Snavely transferred the property to Miss Grande. Miss Grande bought the property not knowing that
Joe had ever owned it. She paid $300,000 for the property. Joe, now seventeen, wants his home back. What is the most
probable solution to Joe's, Miss Grande's, and Uncle Snavely's dilemma?

a. Miss Grande talks the problem over with Joe, and Joe ratifies the contract.

7
b. Joe sues Miss Grande and Uncle Snavely for the return of the property on the basis of Joe's lack of capacity.

Joe gets advice from a lawyer who tells him he should save his money for college rather than spend it on a
c. lawsuit because good faith purchasers for value generally get the goods they bargained for.

Joe has retained title to the home. Uncle Snavely never had good title because Joe's contracts while a minor
d. were void and of no legal effect.
correct: b

The definition of ratification includes all of the following statements except:

a. a minor has the option of ratifying a contract after reaching the age of majority.

8 b. ratification makes the contract binding ab initio.

c. ratification makes the contract binding from the beginning.

d. ratification cannot be implied.
correct: d
your answer: a
feedback: Incorrect. This statement is a true statement regarding the concept of ratification and minority status. As a true
statement, it cannot be the exception asked for as a correct answer to the question.

Which of the following statements is true regarding the concept of necessaries as this concept applies to minority status
and contractual capacity?

9 a. Contractual incapacity excuses a minor from an obligation to pay for necessaries.

b. Necessaries are things that the minor contracts for whether they suitably supply needs or not.

With regard to necessaries, the minor is liable for the reasonable value of the items or services furnished, not the
c. actual price contracted for by the parties.

d. A minor may recover for necessaries based on quasi-contractual theory.
correct: c

In which of the situations below would a minor most likely not be held liable for a tort that they committed?

a. Bobby, a minor, hits a ball through his neighbor's window.

10 b. Mary, a minor, runs over Mrs. Gort's flower bed with her car.

c. Kim, a minor, rents a room at the Moonbeam Motel and trips over the TV stand in the room and breaks the TV.

Jack, a minor, after having rented a car From We Rent to Little Ones car rental, gets drunk and robs a
d. convenience store. In his getaway, he wrecks the car.
correct: c

Chapter 15

George promises to marry Beth if Beth promises to buy him a new Ferrari for his birthday. This promise must
be in writing to be enforceable.

True

False
correct: true

All contracts do not have to be in writing to be enforceable.

2 True

False
correct: true

The statute of frauds has to do with fraud in the inducement of a contract.

3 True

False
correct: false

To induce Ben's car dealership to sell Keith a car on credit, Mike promises that he will pay for his son Keith's
car if Keith defaults on the loan. Mike's promise must be in writing to be enforceable.
4
True

False
correct: true

Which of the following is a true statement about the history of the statute of frauds?

a. The original statute of frauds appeared in the Uniform Commercial Code.

5 b. The original statute of frauds became law in 1677.

The original statute of frauds became law in the British American colonies to protect the colonists from British
c. oppression.

d. No state had a statute of frauds in the early days of U.S. history.
correct: b .

The rules of construction are rules that:

a. set down in a statute the ways that construction contracts must be written to avoid fraud.

6 b. allow the parties to a contract to introduce evidence to resolve contractual ambiguity.

c. disallow the court to hear testimony to show the meaning of language used in the contract.

d. allow a court to construct or make terms of a contract where none previously existed.
correct: b

The words, "If he doesn't pay, I will." creates a:

a. defense to the statute of frauds.

7 b. primary contract between the one speaking the words and the one the words are spoken to.

c. suretyship.

d. merger clause.
correct: c

Which of the following is a false statement about the main purpose doctrine?

a. Contracts determined to be created under the main purpose doctrine are not within the statute of frauds.

The underlying and fundamental purpose of a contract within the scope of the main purpose doctrine is to pay a
8 b. duty for another party.

c. The main purpose doctrine is an exception to the suretyship provision of the statute of frauds.

d. The main purpose doctrine is also called the leading object rule.
correct: b

Mimi had made an oral contract with Myra to make a new wardrobe for Mimi each year for the past two years for a sum of
$300,000. Myra has made all the dresses and suits, and Mimi owes her for this last year. This is:

a. an administered contract and does not require a writing.

9 b. an executed contract and cannot be enforced by the courts.

a contract that should have been within the statute of frauds, but since one of the parties has fully performed, the
c. court will most probably enforce Mimi's requirement to pay.

d. a contract within the statute of frauds and unenforceable without a writing.
correct: c

We-R-Dusters (WRD) and Best American Hotels (BAH) orally agreed to sell 500 Ostrich feather dusters to BAH. WRD
delivered 400 of the dusters on January 15 but two weeks later, on February 1, BAH notified WRD that it would not honor
the agreement. Which statement is correct?

a. The contract is void since it was oral.

10
b. The contract is enforceable against BAH for 400 dusters.

c. The contract is enforceable against BAH for the 500 dusters.

d. The contract is preventative.
correct: b

Chapter 16

An incidental beneficiary is intended by the two parties (the promisor and the promisee) to the contract to
receive a benefit from the performance of their agreement.

True

False
correct: false

Consideration is required in order to have a valid assignment.

2 True

False
correct: false

The UCC imposes a writing requirement on all assignments of over $5,000.

3 True

False
correct: true

Delivery of an assignment consists only of physically delivering a signed, written assignment of the contract
right.
4
True

False
correct: false

A third person who may benefit incidentally from the performance of a contract to which he is not a party, has
rights under the contract.
5
True

False
correct: false

The rights and duties of a third party to a contract may arise by all but which of the following?

a. An assignment of the rights of a party to the contract.

6 b. A delegation of nonpersonal duties of a party to the contract.

c. A delegation of personal duties of a party to the contract.

d. The express terms of a contract entered into for the benefit of a third person.

correct: c

Which of the following is NOT true concerning the requirements for an effective assignment?

a. The assignment must be voluntary.

7 b. Consideration is required.

c. There must be an intention to make the assignee the owner of the right.

d. The assignment may be either oral or written.
correct: b

Annie entered into a contract with a local truck dealer to have a new truck delivered to her daughter, Beth, as a graduation
present. On this contract, Beth is:

a. an incidental beneficiary.

8 b. a donee beneficiary.

c. a creditor beneficiary.

d. an assignor.
correct: b

Which of the following is the party owing a duty to the assignor under the original contract?

a. Assignor

9 b. Obligor

c. Assignee

d. Obligee
correct: b

Nonassignable contractual rights include all but which of the following?

10
a. Rights that materially change the obligor's duty or materially increase the risk or burden upon the obligor.

b. Rights that transfer highly personal contract rights.

c. Rights the transfer of which is validly prohibited by the contract.

d. Rights under an option contract.
correct: d

Chapter 17

"Discharge" has to do with the promisor's being released from the duty to perform.

True

False
correct: true

The law assumes that respective performances under a contract are concurrent conditions, unless there is an
agreement to the contrary.
2
True

False
correct: true .

A condition subsequent is an event that continues an existing duty.

3 True

False
correct: false

An express condition is explicitly set forth in language.

4 True

False
correct: true .

A condition precedent is not an event that must occur before performance under a contract is due.

5 True

False
correct: false

Tender is an offer by one party who is:

a. ready, willing, and able to perform.

6 b. willing to perform, but who may need a reasonable time beyond the contractual date in which to do so.

c. excused from performance if he tries to make a partial performance, which is rejected by the other party.

d. willing to adjust contractual terms to meet the other party's requests.
correct: a

A(n) ________ is a contract between a promisee and a promisor by which the promisee agrees to accept and the
promisor agrees to render a substituted performance in satisfaction of an existing contractual duty.

a. accord

7 b. mutual rescission

c. material alteration

d. novation
correct: a

Which of the following is correct with regard to conditions subsequent?

a. Conditions subsequent are quite common in contracts.

8 b. A "sale or return" contract is an example.

c. A condition subsequent must occur before performance is due under a contract.

d. A condition subsequent must occur after a contract is discharged.
correct: b

Discharge by operation of law includes all but which of the following?

9 a. Objective impossibility

b. Mutual rescission

c. Frustration of purpose

d. Bankruptcy
correct: b

The unjustified failure to perform substantially the obligations promised in a contract constitutes a(n):

a. intentional breach.

10 b. material breach.

c. prevention of performance.

d. substantial performance.
correct: b

Chapter 18

Courts of equity will grant specific performance of contracts for personal service.

True

False
correct: false

Restitution requires a return of value to the aggrieved party.

2 True

False
correct: true

Punitive damages are recoverable for a breach of contract.

3 True

False
correct: false

If Martin leases to John a defective machine that causes him $4,000 in property damage and $12,000 in
4 personal injuries, John may recover, in addition to damages for loss of value and incidental damages, $8,000
as consequential damages.

True

False
correct: false

If a negligent misrepresentation occurs, the deceived party may recover general damages, under the out-of-
pocket measure, and consequential damages.
5
True

False

correct: true

Restitution is available in all but which of the following contractual situations?

a. As an alternative remedy for a party injured by breach.

6 b. For a party in default.

c. For a party who may not enforce a contract because of the statute of frauds.

d. For a party who received the remedy of specific performance for the breach.
correct: d

When an injured party is required to elect remedies, which of the following would be mutually exclusive?

a. Restitution and incidental damages.

7 b. Specific performance and restitution.

c. Incidental and consequential damages.

d. Specific performance and compensation for incidental damages.
correct: b

The process whereby a court "rewrites" or "corrects" a written contract to make it conform to the true intention of the
parties is known as:

8
a. an Injunction.

b. reformation.

c. specific performance.

d. restitution.
correct: b

Which of the following is the basic remedy for misrepresentation?

a. Monetary damages

9 b. Compensatory damages

c. Rescission

d. Specific performance
correct: c

Restitution is available in all but which of the following contractual situations?

a. As an alternative remedy for a party injured by breach.

10 b. For a party in default.

c. For a party who may not enforce a contract because of the statute of frauds.

d. For a party who received the remedy of specific performance for the breach.
correct: d

Chapter 19

A principal does not owe to any agent the same duties under tort law that the principal owes to all parties.

True

False
correct: false

An agency contract appointing the agent for a period of more than one year does not have to be in writing.
2
True

False
correct: false

All employees are agents, but not all agents are employees.

3 True

False
correct: true

Agency is a consensual relationship that the principal and agent may form by contract or agreement.

4 True

False
correct: true

A duty of diligence is one of utmost loyalty and good faith.

5 True

False
correct: false

Agency is a(n) ________ relationship that the principal and agent may form by contract or agreement.

a. employment

6 b. fiduciary

c. consensual

d. gratuitous
correct: c

A ________ is the written instrument evidencing the formal appointment of an agent.

a. fiduciary

7
b. revocation

c. power of attorney

d. rescission
correct: c

Bob, who is 16 years old, appoints Fred, age 21, as his agent to purchase a videotape recorder from VideoWorld.

a. The transaction is voidable by VideoWorld because Bob is a minor.

8 b. The transaction is not voidable because Fred is not a minor.

c. The transaction is void because Bob is a minor.

d. The transaction is voidable by Bob because he is a minor.
correct: d

In determining whether a person acting for another is an employee or an independent contractor, the courts consider all
but which of the following factors listed in Section 220 of the Restatement?

a. The skill required in the particular occupation.

9 b. The length of time for which the person is employed.

c. Whether the person is an agent.

d. Whether the principal is or is not in business.
correct: c

The contractual duties owed by a principal to an agent include all but which of the following?

a. Accounting

10 b. Reimbursement

c. Indemnification

d. Compensation
correct: a , and compensation are contractual duties of the principal to the agent.

Chapter 20

An employer will have tort liability for the acts of his employee in the course of employment.

True

False
correct: true

An agent has the power to contractually bind his principal whenever he has actual or apparent authority and
acts within his authority.
2
True

False
correct: true

A principal may be liable where his agent sells liquor to an underage person--a criminal offense.

3 True

False
correct: true

An agent with actual or apparent authority has the power to bind the principal.

4 True

False
correct: true

Actual implied authority is not found in express or explicit words of the principal.

5 True

False
correct: true

Types of principals include all but which of the following?

a. Disclosed principal

6 b. Partially disclosed principal

c. Undisclosed principal

d. Implied principal

status: not answered ()
correct: d

A(n) ________ principal is one whose existence and identity is known to the third party, and the agent usually is not a
party to a contract made with a third person on the principal's behalf.

a. undisclosed

7 b. partially undisclosed

c. disclosed

d. nonexistent principal
correct: c

Ratification:

a. can only occur after the third party withdraws from the transaction and gives notice of such withdrawal.

8 b. can be done by a corporation in most states.

c. relieves the agent of liability.

is effective even if the principal does not manifest an intent to ratify with knowledge of all material facts
d. concerning the transaction.
correct: c

Which of the following is true regarding an agent who is acting for an undisclosed principal?

a. The agent will personally bind himself on most contracts for an undisclosed principal.

9 b. The third party will never be bound in a contract with the principal.

c. An undisclosed principal will bind only himself and not the agent.

d. Failure to disclose the name of the principal is a form of fraud.
correct: a

An agent is normally not a party to a contract made with a third person on behalf of a(n):
10
a. disclosed principal or a partially disclosed principal.

b. disclosed principal only.

c. undisclosed principal.

d. nonexistent principal.
correct: b

Chapter 21

A "sale" is defined any transfer of title to goods from seller to a buyer.

True

False
correct: false

At common law, a contract was valid despite missing terms.

2 True

False
correct: false

Most of the Code's provisions are not mandatory and allow the parties to vary or displace them by agreement.

3 True

False
correct: true

"Goods" for purposes of the Code are essentially tangible, moveable personal property.

4 True

False
correct: true

Unless otherwise agreed, the place of delivery for a sale of goods is the seller's place of business.

5 True

False
correct: true

To meet the statute of frauds for the sale of goods, the Code requires merely some writing:

a. sufficient to indicate that a contract has been made between the parties.

6 b. signed by both parties or by their authorized agent or broker.

c. that includes a term specifying the price.

d. that includes the particulars of performance.
correct: a

A "sale" of goods happens:

a. when the parties agree.

7 b. when the parties sign the contract.

c. when title to the goods is passed.

d. when a promise to transfer title is made.
correct: c

The Code defines ________ as "honesty in fact in the conduct or transaction concerned."

a. good faith

8 b. unconscionability

c. merchantability

d. entrusting
correct: a

A "merchant" is defined as a person who:

9 a. is a dealer in the type of goods the transaction involves.

b. by her occupation holds herself out as not having knowledge or skill peculiar to the goods or practices involved.

c. employs an agent to make contracts with third parties.

d. is held to a lower standard of conduct in trade and commerce because of his degree of knowledge.
correct: a

Under the Code, the price is reasonable at the time for delivery where the agreement:

a. adds to the price.

10 b. provides that the parties will negotiate later as to the price and they do so.

fixes the price in terms of some agreed market or other standard as set by a third person or agency, and the
c. price is not so set.

d. sets forth the price.
correct: c

Chapter 22

The buyer is obligated to accept conforming goods and to pay for them according to the contract terms.

True

False
correct: true

A buyer who sells rejected goods on behalf of the seller is entitled to reasonable expenses not to exceed ten
percent of the gross proceeds.
2
True

False
correct: true

The seller's tender of performance does not have to conform to the Code's perfect tender rule.

3 True

False
correct: false

4 The obligations of the parties are determined by their contractual agreement.

True

False
correct: true

The buyer has no right to inspect the goods before payment or acceptance.

5 True

False
correct: false

Which one of the following choices is not a shipment contract?

a. C.I.F

6 b. F.O.B. place of shipment

c. F.A.S. port of shipment

d. F.O.B. city of buyer
correct: d

Under the ________, a buyer may reject goods for even the slightest defect.

a. revocation of acceptance rule

7 b. perfect tender rule

c. rules for inspection

d. nonhappening of Presupposed Condition
correct: b

All but which of the following indicates acceptance of goods by the buyer?

a. Express words.
8

b. Conduct of the buyer that is inconsistent with the seller's ownership of the goods.

c. The presumed intention of the buyer through his failure to act.

d. Buyer's conduct that is consistent with the seller's ownership of the goods
correct: d

Under a shipment contract, the seller is required to do all but which of the following?

a. Deliver the goods to the city of the buyer.

Make a contract for the transportation of the goods that is reasonable given the nature of the goods and other
9 b. circumstances.

c. Promptly notify the buyer of the shipment.

Obtain and promptly deliver or tender to the buyer any document necessary to enable the buyer to obtain
d. possession of the goods from the carrier.
correct: a

The buyer's express or implied manifestation of willingness to become the owner of the goods is known as ________.

a. inspection

10 b. acceptance

c. rejection

d. tender
correct: b

Chapter 23

If the seller possesses the goods when the contract is formed, risk of loss passes to the buyer at that time.

True

False
correct: false

A "buyer in the ordinary course of business" is necessarily a "good faith purchaser for value."

2 True

False
correct: true

When goods are to be physically moved by a third party carrier and delivery is made by physically moving the
goods, title passes at the time and place at which the seller completes performance.
3
True

False
correct: true

A person claiming ownership of goods by an agreement that is void can obtain title to the goods.

4 True

False
correct: false

Where one party breaches the contract, the Code places the risk of loss on the breaching party.

5 True

False
correct: true

A ________ is one acquired under circumstances that permit the former owner to rescind the transfer and retain title.

a. security interest

6 b. void title

c. voidable title

d. valid title
correct: c

All but which of the following is necessary to be a good faith purchaser?

a. The purchaser must act honestly.

7 b. The purchaser must give value for the item.

c. The purchaser must take the goods without notice of any defect in the title of the transferor.

d. The purchaser must take the goods with knowledge of any defects in the chain of title.

correct: d

The transfer of possession but not title to a buyer for a trial period is known as:

a. a sale or return.

8 b. a sale on approval.

c. entrusting to a merchant.

d. a consignment.
correct: b

A ________ contract does not require the seller to deliver the goods to a particular destination but merely to the carrier.

a. shipment

9 b. destination

c. sales

d. consignment
correct: a

In some sales, the goods, at the time the contract is made, are held by a ________ and are to be delivered without being
moved.

a. bailor

10 b. bailee

c. good faith purchaser

d. merchant
correct: b

Chapter 24

The implied warranty of fitness for a particular purpose does not require any specific statement by the seller.

True

False
correct: true

A seller can provide an express warranty and then disclaim it.

2 True

False
correct: false

The Federal Trade Commission administers the Magnuson-Moss Warranty Act.

3 True

False
correct: true

An express warranty does not require that the warranty be expressed in formal words.

4 True

False
correct: true

An implied warranty is an explicit undertaking by the seller with respect to the quality or performability of the
goods.
5
True

False
correct: false

________ limits the time period for which a manufacturer is liable for injury caused by its defective product.

a. A warranty of title

6 b. Fitness for particular purpose

c. A statute of repose

d. Contributory negligence

correct: c

Barbara purchased 100 flowerpots from a local merchant. The general category of warranties which are not included in
her sales contract, but exist by "operation of the law," are the:

a. express warranties.

7 b. warranties of title.

c. quasi warranties.

d. implied warranties.
correct: d

Strict product liability exists if:

a. the consumer misuses the product.

8 b. the consumer alters the product before he or she uses it.

c. the product reaches the consumer without substantial change in the condition in which it is sold.

d. the product is somewhat dangerous to the user.
correct: c

The liability of manufacturers or other sellers of goods for a defective product, or for its failure to perform adequately, may
be based on all but which of the following?

a. Negligence

9 b. Misrepresentation

c. Violation of statutory duty

d. Embezzlement
correct: d

The purpose of the reasonable notice requirement for a breach of warranty includes all but which of the following?
10
a. To enable the seller to cure the defect or to minimize the buyer's loss.

b. To provide the seller an opportunity to prepare for conflict resolution and litigation.

c. To provide the seller with an end point to liability.

d. To provide the buyer with a better remedy.
correct: d

Chapter 25

The buyer may deduct from the price due any damages resulting from any breach of contract by the seller.

True

False
correct: true

If the seller discovers that the buyer is insolvent, he may unilaterally alter the terms of the contract by
demanding cash before delivery.
2
True

False
correct: false

Code remedies are available together with remedies expressly stated in the contract if the contract does not
expressly limit the remedies.
3
True

False
correct: true

The seller is accountable to the buyer for any profit made on any resale of the goods.

4 True

False
correct: false

Where existing goods are identified to the contract of sale, the buyer acquires a special property interest in
the goods.
5
True

False
correct: true

The seller may resell the goods identified to a contract:

a. only at a public sale.

6 b. only at a private sale.

c. at a public or private sale.

d. only at auction.
correct: c

The Code's remedies for breach of a sales contract are:

a. identical for the buyer and seller.

7 b. cumulative.

c. intended to punish the wrongdoer.

d. are all money oriented.
correct: b

Damages a buyer may recover for, resulting from requirements and needs of which the seller had reason to know at the
time of contracting and which could not reasonably be prevented by cover, are:

a. incidental.

8 b. consequential.

c. punitive.

d. liquidated.
correct: b

9 Under the Statute of Limitations, any action for breach of a sales contract must be begun within ________ after the cause
of action has accrued.

a. 1 year

b. 2 years

c. 4 years

d. 10 years
correct: c

The Code permits the seller to recover the price plus incidental damages in all but which of the following situations?

a. Where the buyer has accepted the goods.

10 b. Where conforming goods have been lost or damaged after the risk of loss has passed to the buyer.

Where the goods have been identified to the contract and there is no ready market available for their resale at a
c. reasonable price.

d. Where the seller stops delivery of goods in transit to the buyer.
correct: d

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