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Title: Final Exam

Started: March 16, 2009 7:54 AM


Submitted: March 16, 2009 11:32 AM
Time spent: 03:38:05
Total score: 114/150 = 76% Total score adjusted by 0.0 Maximum possible score: 150
1.
Raj went to the Napa Valley Harvest Festival, where he stopped at Tina's booth
where she was selling paintings of vineyards. Raj admired a painting of
vineyards, which did not appear to be for sale. Raj said to Tina, "I will give you
$200 if you give me that painting right now." Tina said nothing in response, but
she gave Raj the painting, and Raj gave her $200 in cash. This is an example of a
contract that is now:

Student Correct
Value Feedback
Response Answer
A. Bilateral
and
executed.
B. Bilateral
and
executory.
C. Unilateral 100%
and
executed.
D. Unilateral
and
executory.
Score: 3/3

2.
Carlos tells Sally he will sell her his car for $5,000. Sally agrees. The exchange is
to take place in ten days. The contract between Carlos and Sally is now:

Student Correct
Value Feedback
Response Answer
A. unilateral,
executory,
and valid
B. bilateral,
executed,
and
Student Correct
Value Feedback
Response Answer
voidable
C. bilateral, 100%
executory,
and
express
D. bilateral,
executory,
and
implied
Score: 3/3

3.
On May 1, X sends Y a letter offering to pay Y $1000 if Y will promise to paint
X's house. The offer says nothing about stipulated or authorized means of
acceptance. On May 2, Y sends X a letter rejecting X's offer. On May 3, Y
changes his mind and (saying nothing about his May 2 letter) telephones X to
accept the offer. On May 4, X goes completely insane. On May 5, X receives Y's
rejection letter. Which of the following is true?

Student Correct
Value Feedback
Response Answer
A. There is no 0%
contract
because Y's
written
rejection
was
effective
upon
dispatch.
B. There is no
contract
because X's
insanity
terminated
the offer on
May 4.
C. There is no
contract
because Y's
telephoned
Student Correct
Value Feedback
Response Answer
May 3
acceptance
was
inadequate.
D. There is a
contract
here.
Score: 0/3

4.
Larson Lexus, a new car dealer, runs the following newspaper ad during the Fall
of 1994. "Three '94 Lexus LS-400s must go! $45,500 each! The first three
customers who arrive at our dealership on Saturday, October 8 with this ad can
buy one of these cars for $45,500!" Knowing that $45,500 is a very good price
for an LS-400, Mike is the first customer to appear at the Larson lot on Saturday,
October 8. He hands the ad to the Larson salesman and says that he'd like to buy
one of the LS-400s for $45,500. Is the dealership contractually bound to sell
Mike the car at that price?

Student Correct
Value Feedback
Response Answer
A. No, because
advertisements
are not offers
but rather are
invitations to
negotiate.
B. No, because a
written offer
must be
accepted in
writing.
C. No, because
under the UCC
rule, ads of
this kind are
not offers.
D. Yes, because 100%
this ad is an
offer and Mike
accepted it.
Score: 3/3

5.
Ian offered to sell his car to Beth for $5,000. Beth responded by saying "will you
put new seat covers on the car at that price?" Beth's response was:

Student Correct
Value Feedback
Response Answer
A. a counter- 0%
offer.
B. a rejection.
C. a
conditional
acceptance
of A's
offer.
D. none of the
above.
Score: 0/3

6.
On Monday Jane sent a contract offer to Mikhail, offering to sell him her car for
$5,000. The offer was contained in a letter that Mikhail received on Friday.
However, Jane's secretary needed a car and wanted to purchase Jane's. On the
Wednesday before Mikhail received this offer the secretary delivered a written,
signed acceptance to Jane that was a "mirror image" of Jane's offer. What is the
legal result?

Student Correct
Value Feedback
Response Answer
A. a contract
is now
formed
between
Jane and
her
secretary
for the sale
of Jane's
car
because an
Student Correct
Value Feedback
Response Answer
effective
offer has
combined
with an
effective
acceptance
B. a contract
is now
formed
between
Jane and
her
secretary
for the sale
of Jane's
car
because
there is a
"meeting
of the
minds"
between
Jane and
her
secretary
over the
sale of
Jane's car
C. no contract 100%
results
from the
facts stated
in this
problem
D. two of the
above are
correct
Score: 3/3

7.
Junior is a senior at State University. Dad, Junior's father, is concerned about
Junior's study habits, given that Junior spends most of his evenings at the campus
pub instead of the library. Dad promises Junior that he will send him on an
expense-paid trip to Europe after his graduation if Junior spends at least five
evenings a week studying in the campus library for the remainder of his senior
year. After returning home from his graduation, Junior asks Dad about the
European trip. Dad replies, "your education was your reward. I do not owe you a
trip to Europe." Dad:

Student Correct
Value Feedback
Response Answer
A. is correct:
Junior has
already
gained a
benefit of the
bargain.
B. is correct:
Junior did
not give
anything of
legal value.
C. is not correct: 100%
Dad owes
Junior a trip
to Europe
because
Junior's acts
are
consideration
.
D. is not correct,
but only if
Junior's acts
are adequate
consideration
for such an
expensive
trip.
Score: 3/3

8.
X and Y contract for X to build Y a house for $150,000. Later, without
terminating the first contract, X and Y modify that contract so that Y will pay X
$175,000. In return, X promises to build exactly the same house, but one day
earlier than in the previous contract. Assume that all the other elements of a
contract besides consideration are present; this is a consideration question. This
second contract:

Student Correct
Value Feedback
Response Answer
A. Is not
binding
because it is
unliquidated.
B. Is not
binding
because X is
promising to
perform a
preexisting
legal
obligation.
C. Is not
binding
because the
earlier
completion
date is
inadequate
consideration
for $25,000.
D. Is a binding 100%
contract.
Score: 3/3

9.
X sells a house to Y for $300,000. Before selling the house, X forgets to tell Y
about a leaky faucet in a little-used sink in the basement (which would cost about
$10 to fix). Y inspected the house, but just didn't notice the faucet. Later, Y
wants to rescind the deal on the basis of fraud or misrepresentation because of the
leaky faucet. Which of the following is the best reason why Y cannot rescind?

Student Correct
Value Feedback
Response Answer
A. Because Y
didn't make an
Student Correct
Value Feedback
Response Answer
express
misstatement
regarding the
faucet, but
merely said
nothing.
B. Because Y's
failure to notice
the leaky faucet
means that he
did not
justifiably rely
on X's
"misstatement."
C. Because X's
failure to
disclose the
condition of the
faucet is not
material.
D. Because X 0%
didn't do
anything to
actively hide
the leaky
faucet.
Score: 0/3

10.
Joe sells his business to Shirley. During the negotiations, Joe negligently tells
Shirley that the business has turned a profit for the last five years. In reality, the
business operated at a loss for each of those years. However, Shirley did not hear
Joe's misstatement. Shirley cannot rescind the contract because:

Student Correct
Value Feedback
Response Answer
A. Joe's false
statement was
negligent
rather than
intentional.
Student Correct
Value Feedback
Response Answer
B. Joe's
misstatement
was not
material.
C. Shirley did
not actually
rely on Joe's
misstatement.
D. Shirley did 0%
not justifiably
rely on Joe's
misstatement.
Score: 0/3

11.
Otto inherited an old safe from his uncle. Otto did not have the combination to
the safe and had no idea of its contents, if any. He sold the safe to his friend
Marcel "as is" for $35. When Marcel opened the safe, he found $25,000 in cash.
Now Otto wants to rescind the contract, claiming that the doctrine of mistake
gives him that right.

Student Correct
Value Feedback
Response Answer
A. Otto is
correct,
because
there is
mutual
mistake
here as
neither
party
knew of
the
money
inside the
safe
B. Otto is
correct,
because it
would be
Student Correct
Value Feedback
Response Answer
unfair to
him to
allow
Marcel to
keep the
money
C. Otto is 100%
not
correct,
because
both
parties
knew that
they did
not know
about the
contents
of the
safe
D. Otto is
not
correct,
because
the
remedy of
rescission
is
available
only
when
there is a
unilateral
mistake;
here both
parties
were
mistaken
Score: 3/3

12.
Mike Minor buys some real estate for investment purposes. The contract
obligates Mike to make monthly installment payments for ten years. Mike
reaches the age of majority one month after making the contract. After this, Mike
makes 25 monthly payments under the contract, but then decides that he wants to
rescind (disaffirm) the deal. Which of the following is most true?

Student Correct
Value Feedback
Response Answer
A. Mike can
disaffirm.
B. Mike
cannot
disaffirm
because
contracts
for the sale
of land can
only be
disaffirmed
before the
age of
majority.
C. Mike
cannot
disaffirm
because
contracts
for the sale
of land
must be
disaffirmed
within one
year of the
age of
majority.
D. Mike 100%
cannot
disaffirm
because he
has already
ratified the
contract.
Score: 3/3

13.
In January 2002, a court with the necessary subject-matter jurisdiction holds
Mick mentally incompetent and appoints a guardian for him. In November 2002,
Mick escapes his guardian's care and takes off on his own. While eating lunch
with Carol, who knows about Mick's condition, Mick signs an agreement to sell a
valuable property he owns. When he signs the contract, Mick believes that he is
the President of the United States signing an important treaty. The agreement
between Mick and Carol is best described as:

Student Correct
Value Feedback
Response Answer
A. Void.
B. Voidable.
C. Unenforceable. 0%
D. Perfectly valid,
if the price
Carol pays for
the property is
fair.
Score: 0/3

14.
Smith and Benson make an oral contract for the sale of some land at a price of
$500,000. After paying Smith $400,000 of the purchase price, Benson takes
possession of the land. One month later, Smith wants to boot Benson off the land.
His argument is that the parties' oral agreement is unenforceable under the Statute
of Frauds. Which of the following is most correct?

Student Correct
Value Feedback
Response Answer
A. Smith is
correct,
because the
contract is
for an
amount
greater
than $500.
B. Smith is
correct,
because it
is less than
one year
Student Correct
Value Feedback
Response Answer
from the
making of
the
contract.
C. Smith is
correct,
because
this is an
oral
contract for
the sale of
real estate.
D. Smith is 100%
incorrect,
because
Benson
paid part of
the
purchase
price and
took
possession.
Score: 3/3

15.
Mikhail has a 3 year lease on the apartment he occupies. He has lived there one
year. He now wants to leave and go to Aspen, Colorado to be a ski instructor.
However, Mikhail's landlord will not release him from the lease, and threatens to
sue him if he breaks his lease. Mikhail finds Jose to take over the last two years
of the lease, but Mikhail is worried that Jose might cause damage or in other
ways inflict loss and that he, Mikhail, might be held financially responsible. In
order to assure Mikhail that he will be completely discharged from all obligations
under his lease, Mikhail should attempt to bring about a(n)

Student Correct
Value Feedback
Response Answer
A. assignment
B. novation 100%
C. either an
assignment
or novation
Student Correct
Value Feedback
Response Answer
- it will not
affect
Mikhail 's
future
liability
D. neither an
assignment
nor a
novation
will
accomplish
Mikhail's
objective
Score: 3/3

16.
Which of the following is not required to be disclosed in the solicitation of a
credit card customer?

Student Correct
Value Feedback
Response Answer
A. fees for
issuing
the card
B. what your 100%
credit
limit will
be
C. APR for
the card
D. all of the
above
Score: 3/3

17.
Diana and Charles Windsor are considering purchasing a swimming pool. The
representatives of Fun-in-the-Sun Pool arrange a meeting at the Windsor's home
to discuss the price and draw up plans. The Windsors sign a contract for the pool
for a price of $12,000 with payments of $3000 each month for the next four
months while the pool is under construction. The Windsors also agree to pay a
carrying charge for the payments of $250.00. Two days after signing the contract,
the backhoe operator arrives ready to dig the pool, but Charles tells him the
contract is off. The Windsors:

Student Correct
Value Feedback
Response Answer
A. have
breached
their
contract
and will be
liable to
Fun-in-the-
Sun for
damages.
B. are 100%
protected
by their
three-day
rescission
rights
under
Regulation
Z.
C. do not
have the
three-day
rescission
rights
since there
are no
monthly
installment
payments
over a
period of
one year.
D. none of the
above
Score: 3/3

18.
Professor Winona Wright has just read an article in Fortune magazine about
issues in the Enron bankruptcy. She wishes to share it with her class that morning
and makes 50 copies to distribute to them. Professor Wright:

Student Correct
Value Feedback
Response Answer
A. has
infringed
Fortune's
copyright.
B. has 100%
utilized
the fair
use
exemption
under
copyright
law.
C. has done
nothing in
violation
of
copyright
law
because
magazine
articles
are not
protected
under
copyright
law.
D. none of
the above
Score: 3/3

19.
Ted's Red Hots is a hot dog restaurant that has the shape of a hot dog in a bun,
with the hot dog wearing a white chef's hat at one end. Wally's is a new hot dog
restaurant that has a wiener dog shape with the wiener dog wearing a white chef's
hat. Ted's probably has an infringement claim based on:

Student Correct
Value Feedback
Response Answer
Student Correct
Value Feedback
Response Answer
B. trade dress 100%
appropriation.
C. copyright
infringement.
D. any of the
above
Score: 3/3

20.
Copying an article from a computer science journal that sells subscriptions and
then distributing it to 25 employees at your company:

Student Correct
Value Feedback
Response Answer
A. would be fair 0%
use.
B. would be
copyright
infringement.
C. would not be
copyright
infringement
unless you
charged the
employees
for the
copies.
D. none of the
above
Score: 0/3

21.
Which of the following makes the promisor a surety rather than a guarantor?

Student Correct
Value Feedback
Response Answer
A. "I
promise
Student Correct
Value Feedback
Response Answer
to pay D's
debt in
the event
that D
first
defaults."
B. "I 100%
promise
to pay D's
debt and
am
primarily
liable
along
with D on
that
debt."
C. Both of
the above.
D. Neither of
the above.
Score: 3/3

22.
The Cutco Lawn Products Company sells 100 riding lawn mowers to the Smith
Hardware Company, which is in the business of selling such products to
consumers. Smith pays for the mowers with a $50,000 loan from the Bass Bank.
Bass takes a security interest in the mowers to secure payment of the loan, and
perfects it by filing. Later, Smith sells one of the mowers to Cal Consumer, who
buys in good faith and in the ordinary course of Smith's business. As it happens,
however, Cal knows that Bass has a security interest in the mowers. Still later,
Smith defaults on its loan payments, and Bass moves to repossess all the mowers,
including the mower sold to Cal. Can it repossess the mower sold to Cal?

Student Correct
Value Feedback
Response Answer
A. Yes,
because
Bass
attached
its
Student Correct
Value Feedback
Response Answer
security
interest.
B. Yes,
because
Bass filed
a
financing
statement
on its
security
interest.
C. Yes,
because
Cal knew
about
Bass's
security
interest.
D. No. 100%
Score: 3/3

23.
Carol wants to purchase a new Winnebago as a surprise for her husband. In order
to pay cash for it, Carol borrows the necessary funds from Mel. Mel asks that
Carol provide collateral for the loan. Carol tells Mel that if she does not pay the
money back, then Mel can have her friend Penny's car. Does Mel have a security
interest in Penny's car?

Student Correct
Value Feedback
Response Answer
A. Yes,
because it
is collateral
for
something
of value
that Mel is
giving
Carol.
B. Yes,
because
Student Correct
Value Feedback
Response Answer
Carol
agreed to
give Mel a
security
interest in
the car.
C. No, 100%
because
Carol does
not have
rights in
Penny's
car.
D. No,
because
Carol is not
purchasing
the
Winnebago
from Mel.
Score: 3/3

24.
Helga is starting a new restaurant business. She borrows $25,000 from ABC
bank. Before this loan Helga owned only a stove and an oven. The bank and
Helga execute a security agreement whereby the bank is to acquire a security
interest in all kitchen equipment currently owned by Helga and also in all other
kitchen equipment that Helga may acquire later. 30 days later Helga purchased a
commercial refrigerator; six months later she purchased a large commercial
griddle. To which items of property does the bank's security interest apply?

Student Correct
Value Feedback
Response Answer
A. only the
stove and
oven,
which were
owned by
Helga at
the time
the security
Student Correct
Value Feedback
Response Answer
agreement
was
created
B. only the
stove,
oven, and
refrigerator
C. the stove, 100%
oven,
refrigerator
and griddle
D. none of the
above
Score: 3/3

25.
Lisa purchased a home from Carol in 1990. Lisa lived in her home continuously
through 2003. She paid property taxes each year. She treated the property as her
own for the entire 13-year period. The statute of limitations for adverse
possession in her state is 10 years. In 2003, Lisa listed her home for sale. Bob
sought to purchase the home. During the sale process, Bob discovered that Carol
did not have full title when she sold the home to Lisa in 1990. Unbeknownst to
Lisa, Carol's ex-husband Harry never signed a quitclaim deed on the property, so
his name is still on title.

Student Correct
Value Feedback
Response Answer
A. Lisa does
not own
the
property.
B. Lisa may 0%
not transfer
the
property to
Bob until
Harry signs
a quitclaim
deed.
C. In all
likelihood,
Student Correct
Value Feedback
Response Answer
Lisa cut off
Bob's
rights to
the
property
under the
doctrine of
adverse
possession.
D. Both a and
b.
Score: 0/3

26.
Agnew and Nixon own adjoining parcels of land. Nixon executes a written
document that allows Agnew "and his heirs and assigns forever" to install pipes
under Nixon's property for the purpose of pumping water from a nearby, publicly
owned lake to Agnew's property for irrigation uses. Some years later, Nixon sells
his property to Mitchell. Which of the following statements is accurate?

Student Correct
Value Feedback
Response Answer
A. Agnew had
an easement
appurtenant,
which
terminated
when
Mitchell
purchased
Nixon's
property.
B. Agnew has 0%
an easement
in for life,
which
continues to
exist even
though
Mitchell now
owns the
Student Correct
Value Feedback
Response Answer
property
Nixon had
owned.
C. Agnew's
interest in
Nixon's land
is best
characterized
as a
revocable
license,
which was
revoked
when Nixon
sold his
property to
Mitchell.
D. If Agnew
now sells his
land to Dean,
Dean would
have, as to
Mitchell's
land, the
easement
described in
the facts.
Score: 0/3

27.
In the sale of a home, which of the following would likely be treated as a fixture?

Student Correct
Value Feedback
Response Answer
A. A couch
in fabric
matching
the drapes
and
wallpaper
in the
Student Correct
Value Feedback
Response Answer
living
room
B. A ceiling 100%
fan
C. A lawn
mower
used to
mow the
front
lawn
D. Each of
the above
Score: 3/3

28.
Ace, Bud, and Chet leased an apartment from Stan Slumlord. They signed a lease
that established a 12-month rental period and set $400 per month as the rent. Two
months after the three tenants moved into the apartment, Ace and Bud moved
out. Ace and Bud each moved to a different--and distant--state. Slumlord insists
that Chet is responsible for the entire $400 per month rent. Is Slumlord correct?

Student Correct
Value Feedback
Response Answer
A. Slumlord is
incorrect.
Under
these facts,
each tenant
is
responsible
for one-
third of the
rent
payment as
an implied
term of the
lease
agreement.
B. Slumlord is 100%
correct.
The tenants
Student Correct
Value Feedback
Response Answer
are jointly
and
severally
liable for
the rent
payments
under the
lease.
C. Slumlord is
incorrect.
This is a
tenancy at
sufferance,
meaning
that any
tenant may
vacate
without
incurring
liability for
further rent
payments.
D. Slumlord is
incorrect.
Slumlord
must
proceed
against
Ace and
Bud for
their shares
of the
monthly
rent.
Score: 3/3

29.
Helga owns an insurance business in Idaho. Her clients are all Idaho residents.
She later sells her business to Carlos. As part of the deal, the contract contains a
non-compete clause that prevents Helga from operating an insurance business
anywhere in Idaho, Washington or Oregon for a period of five years. Six months
after this sale, Helga opens an insurance business in Oregon. If Carlos seeks to
enforce the non-compete agreement against Helga, will he probably be
successful?

Student Correct
Value Feedback
Response Answer
A. yes,
because
this
agreement
is
reasonable
B. yes,
because
non-
compete
agreements
that are
part of the
sale of a
business
are always
enforced
C. no, because 100%
this
agreement
is not
reasonable
D. no, because
non-
compete
agreements
that are
part of the
sale of a
business
are seldom
enforced
Score: 3/3

30.
Janet and Julie work at ABC Interiors. Janet is a designer who works with clients
of ABC on interior design projects. ABC closely supervises all of its designers,
and dictates their work schedules. Julie works part-time in the evenings cleaning
the offices. Janet is ABC's:

Student Correct
Value Feedback
Response Answer
A. Employee,
agent, and
independent
contractor
B. Employee 100%
and agent
C. Employee
but not
agent
D. Independent
contractor
Score: 3/3

31.
Janet and Julie work at ABC Interiors. Janet is a designer who works with clients
of ABC on interior design projects. ABC closely supervises all of its designers,
and dictates their work schedules. Julie works part-time in the evenings cleaning
the offices. Julie is ABC's :

Student Correct
Value Feedback
Response Answer
A. agent but
not
employee
B. employee 0%
and agent
C. employee or
independent
contractor,
depending
on whether
ABC
controls the
details of
her physical
performance
D. independent
contractor
Score: 0/3

32.
Russ Belmont is a staff accountant at a bank in the downtown Phoenix area.
Belmont is sent to various branches throughout the state to do audits and has an
accident while en route to one of the audits. Which of the following statements is
true?

Student Correct
Value Feedback
Response Answer
A. The bank 100%
will be
liable for
any injuries
to third
parties.
B. The bank
will not be
liable for
any injuries
to third
parties.
C. Belmont is
a
professional
and an
independent
contractor
and the
bank will
not be
liable.
D. none of the
above
Score: 3/3

33.
QSC requires its customers to pay by check. Ron, a QSC driver, tells customers
on his route that they can pay him with cash. When QSC learns of Ron's
collections, it takes no action to stop it. Ron steals some of the cash. QSC may
have to suffer the loss under the doctrine of:
Student Correct
Value Feedback
Response Answer
A. Apparent 100%
authority
B. Equal
authority
C. Express
authority
D. Implied
authority
Score: 3/3

34.
Nina works as an employee for Overland Sales. To protect Nina and other
employees from arbitrary discharge, courts have created exceptions to the
employment-at-will doctrine based on:

Student Correct
Value Feedback
Response Answer
A. An
implied
contract
theory
only
B. A public
policy
theory
only
C. Implied 100%
contract
and
public
policy
theories
D. Neither
implied
contract
nor public
policy
theories
Score: 3/3
35.
Pat is an assembly line worker who has developed a mild case of carpal tunnel
syndrome. She has asked for equipment that will allow her to stay on the
assembly line. The employer has declined her request. If Pat sues her employer
under the ADA, which of the following might be the employer's defense?

Student Correct
Value Feedback
Response Answer
A. Pat's condition 100%
is not a
"disability" as
defined by the
ADA
B. Pat is no
longer a
"qualified
individual" for
the job
because she
has carpal
tunnel
syndrome.
C. Pat is only
entitled to
workers'
compensation.
D. There are no
mitigating
measures
available to
Pat.
Score: 3/3

36.
Agnes, a waitress at a restaurant, suffers severe anxiety attacks when things get
really busy at her job. As a result, she is a very ineffective waitress when the
restaurant is crowded. For that reason, she is fired. Maybe her employer could
have assigned Agnes to shifts when the restaurant is not busy, but this would
have irritated the other waitresses, caused significant scheduling difficulties, and
cost some money. If Agnes sues the restaurant under the ADA, its best argument
is that:
Student Correct
Value Feedback
Response Answer
A. Agnes's anxiety 0%
attacks are not a
disability under
the ADA.
B. The ADA only
forbids
discrimination
against people
with disabilities;
it doesn't require
employers to
accommodate
those
disabilities.
C. Accommodating
Agnes would
cause the
restaurant undue
hardship.
D. The ADA has a
BFOQ defense
and the ability to
handle stress is a
BFOQ for the
job of being a
waitress.
Score: 0/3

37.
Jack is a new attorney for Day and Knight, a law firm in New York City. He is
told by Jill, Managing Partner, that retention and promotion depends on whether
he is seen as a "team player" who is "loyal" and "subordinate." Jill has asked out
Jack every day for the past week. Jack firmly refuses her invitation each time.
After four months, Jill terminates Jack after she criticizes him for being disloyal
and insubordinate. Jack asks Jill why, and she replies, "you know why." Which
of the following statements regarding Jack's termination is most accurate?

Student Correct
Value Feedback
Response Answer
A. Jack cannot
Student Correct
Value Feedback
Response Answer
sue the law
firm
because he
failed to
complain
about Jill's
conduct.
B. Jack cannot
sue under
Title VII
because its
protections
regarding
gender do
not include
men.
C. The law 100%
firm is
probably
liable for
Jack's
termination.
D. If Jill is
now
required to
attend a
seminar on
workplace
harassment,
then the
firm is not
liable under
Title VII.
Score: 3/3

38.
The Newtown Police Dept. (NPD) is a force of 55 officers and 30 support
personnel. NPD has just adopted new hiring standards for new police officers.
These include a minimum height of 5'8", a minimum weight of 160 pounds.
Susan is a recent graduate with a Bachelor's Degree in Police Science. She wants
to get a job as a police officer in Newtown. However Susan is only 5'5" and she
weighs 130 pounds. If Susan brings a legal challenge to NPD's new hiring
standards, what legal basis might she have?

Student Correct
Value Feedback
Response Answer
A. disparate
treatment
B. disparate 100%
impact
C. irrational
standards
D. all of the
above
Score: 3/3

39.
Jane works for Butler Warehouse Company. Jane is the only woman on her work
crew. The male crew members often tell jokes and play minor pranks on each
other. When Jane attempts a prank, the supervisor fires her, saying that "we don't
tolerate horseplay at Butler." If Jane challenges the discharge on the ground of
discrimination, she must show that:

Student Correct
Value Feedback
Response Answer
A. She is the member
of a protected
class and she was
qualified for the
job.
B. the misconduct
she engaged in
was only a pretext
for her discharge,
that
discriminatory
intent actually
motivated Butler's
decision.
C. there was a
legitimate,
nondiscriminatory
reason for the
discharge.
Student Correct
Value Feedback
Response Answer
D. both a and b. 100%

Score: 3/3

40.
Jane works for Butler Warehouse Company. Jane is the only woman on her work
crew. The male crew members often tell jokes and play minor pranks on each
other. When Jane attempts a prank, the supervisor fires her, saying that "we don't
tolerate horseplay at Butler." Assuming that Jane can establish the ground for a
lawsuit against Butler, Butler can defend itself by showing that:

Student Correct
Value Feedback
Response Answer
A. Jane is the
member of a
protected class
and she was
qualified for the
job.
B. the misconduct
Jane engaged in
was nearly
identical to that
engaged in by an
employee who is
not a member of
the protected class
and who was not
fired.
C. there was a 100%
legitimate,
nondiscriminatory
reason for the
discharge.
D. both a and b.
Score: 3/3

41.
Abby is a salesperson for Regional Sales, Inc. Ben is also a salesperson. Carl is
Abby and Ben's supervisor. Dave is a Regional Sales customer. If Abby is the
victim of sexual harassment, Regional Sales may be liable for such harassment
by:

Student Correct
Value Feedback
Response Answer
A. Ben or 0%
Carl only.
B. Ben or
Dave
only.
C. Dave
only
D. Ben, Carl,
or Dave.
Score: 0/3

42.
Mary, an employee of Alpha Tool Company, files a hostile-environment sexual-
harassment suit against Nick, a co-worker. Mary wins. Their employer Alpha
may also be held liable only if:

Student Correct
Value Feedback
Response Answer
A. Alpha 100%
knew or
should
have
known
about the
harassment
and failed
to take
remedial
action.
B. Mary
cannot
obtain
damages or
other relief
from Nick.
C. none of the
Student Correct
Value Feedback
Response Answer
above
D. all of the
above.
Score: 3/3

43.
Ace Tool Corporation and best Hardware Company combine so that all that
remains after the papers have been signed is Ace Tool Corporation. This is:

Student Correct
Value Feedback
Response Answer
A. a
consolidation
B. a merger 100%
C. a purchase of
assets
Da purchase
of stock
Score: 3/3

44.
Ample Corporation combines its assets and debts with those of Xantha
Corporation to form AX Corp. The formation of AX Corp is:

Student Correct
Value Feedback
Response Answer
A. a 100%
consolidation
B. a dissolution
C. a liquidation
D. a merger
Score: 3/3

45.
Applied Services Company and Big Brand Products Corporation plan to merge.
The plan must be approved by:
Student Correct
Value Feedback
Response Answer
A. neither their
boards of
directors nor
their
shareholders
B. their boards 100%
and their
shareholders
C. their boards
only
D. their
shareholders
only
Score: 3/3

46.
Lee, a salesperson for Macro Corporation, learns that Macro will increase the
dividend it pays to shareholders. Lee buys 1,000 shares of Macro stock. When
the price increases, Lee sells his shares for a profit. Lee would not be liable for
insider trading if the information about the dividend was:

Student Correct
Value Feedback
Response Answer
A. Material
when he
sold the
stock
B. Public 0%
after he
bought the
stock
C. Public
before he
bought the
stock
D. Too
speculative
when he
bought the
Student Correct
Value Feedback
Response Answer
stock
Score: 0/3

47.
Adam, a director of Beta Computer Company, learns that a Beta engineer has
developed a new and significantly faster computer chip. Adam buys Beta stock
and tells his friend Cathy, who also buys Beta stock. When the new chip is
announced three weeks later, Adam and Cathy sell their stick for a big profit.
Under SEC Rule 10b-5, Adam would not be liable if he had waited to buy Beta
stock until:

Student Correct
Value Feedback
Response Answer
A. After Adam
told Cathy of
the new chip
B. After Cathy
bought Beta
stock
C. After the 100%
public
announcement
of the chip
D. Just before the
chip was
announced
Score: 3/3

48.
Adam, a director of Beta Computer Company, learns that a Beta engineer has
developed a new and significantly faster computer chip. Adam buys Beta stock
and tells his friend Cathy, who also buys Beta stock. When the new chip is
announced three weeks later, Adam and Cathy sell their stick for a big profit.
Regarding Adam's profit on the purchase and sale of Beta stock, under SEC
section 16(b) Beta may recapture:

Student Correct
Value Feedback
Response Answer
A. All of 100%
Adam's
Student Correct
Value Feedback
Response Answer
B. Half of
Adam's
profits
C. 10
percent of
Adam's
profits
D. None of
Adam's
profits
Score: 3/3

49.
Adam, a director of Beta Computer Company, learns that a Beta engineer has
developed a new and significantly faster computer chip. Adam buys Beta stock
and tells his friend Cathy, who also buys Beta stock. When the new chip is
announced three weeks later, Adam and Cathy sell their stick for a big profit.
Adam is:

Student Correct
Value Feedback
Response Answer
A. a red
herring
B. a
tombstone
C. a tippee
D. a tipper 100%
Score: 3/3

50.
Dave, an accountant, does work for Eagle Oil Company, but wrongfully obtains
inside information concerning Eagle. Based on the information, Dave buys and
sells Eagle stock to his personal gain. The SEC prosecutes Dave, arguing that he
is liable because he stole information rightfully belonging to another. The SEC's
argument is:

Student Correct
Value Feedback
Response Answer
A. The blue-sky
Student Correct
Value Feedback
Response Answer
B. The 100%
misappropriation
theory
C. The red-herring
theory
D. The tipper/tippee
theory
Score: 3/3