Business Law Practice Exam (Intermediate Level) Part- III

100 Questions | Total Attempts: 89

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Business Law Quizzes & Trivia

Questions and Answers
  • 1. 
    The payment of Brian’s debt to Chuck is guaranteed by Bryan’s personal property.This is
    • A. 

      A reorganization

    • B. 

      A secured transaction

    • C. 

      A suretyship

    • D. 

      A violation of most state laws

  • 2. 
    The payment of Eden’s debt to Flem is guaranteed by Eden’s personal property.  This property is
    • A. 

      A secured party

    • B. 

      A secured transaction

    • C. 

      A security interest

    • D. 

      Collateral

  • 3. 
    The Payment of John’s debt to kirsten is guaranteed by John’s personal property.  Kirsten is most likely to perfect her interest by
    • A. 

      Attaching a bright label to John’s property

    • B. 

      Calculating the precise amount of John’s debt

    • C. 

      Correcting grammatical errors in the parties’ written agreement

    • D. 

      Filing a financing statement with the appropriate authority

  • 4. 
    Select Furniture Store sells household consumer goods. To create a purchase-money security interest, Select Furniture must
    • A. 

      Assign, to the collecting agent, a portion of its account payable

    • B. 

      Assign, to a collecting agent, a portion of its accounts

    • C. 

      Extend credit for part or all of the purchase price of the goods

    • D. 

      Refers purchasers to a third-party lender

  • 5. 
    City Bank’s financing statement in collateral owned by Delta Waters Corporation will expire in less than a year. Filed timely, a continuation statement could extend the effectiveness of the financing statement for
    • A. 

      One year

    • B. 

      Two years

    • C. 

      Five years

    • D. 

      Ten years

  • 6. 
    Hal’s hardware store defaults on a debt to Intrastate Bank, which takes possession of the collateral securing the debt. Intrastate sells the collateral. THe proceeds from the sale are applied first to
    • A. 

      Hal’s debt to Intrastate

    • B. 

      Hal’s debt to other creditors

    • C. 

      Intrastate’s fees for the sale

    • D. 

      Payments Hal’s made on the debt to Intrastate

  • 7. 
    Ping’s debt to Oak Furniture Warehouse is past due. Oak obtains a judgement against Ping, but Ping refuses to pay it. Oak asks the court for an order that directs the sheriff to seize and sell any of Ping’s nonexempt real or personal property that is within the court’s geographical jurisdiction. This is a request for
    • A. 

      A writ of execution

    • B. 

      A composition agreement

    • C. 

      An order that would violate most state laws an order that would violate most state laws an order that would violate most state laws an order that would violate most state laws

    • D. 

      An order of garnishment an order of garnishment an order of garnishment

  • 8. 
    Doral, Eduard, and Francesca are co-sureties on Glenda’s debt to Hi-Credit Company. Doral Pays Glenda’s entire debt. Doral’s right to seek proportionate payments from Eduard and Francesca is the right of
    • A. 

      Contribution

    • B. 

      Redemption

    • C. 

      Reimbursement

    • D. 

      Subrogation

  • 9. 
    Seth files for bankruptcy. Seth must include with the petition
    • A. 

      Proof of each creditor's claim

    • B. 

      A list of creditors and the amount of debt owed to each

    • C. 

      All of his debt and credit cards to be disposed of by the court

    • D. 

      An affidavit testifying to have read the bankruptcy code

  • 10. 
    Teona files a voluntary petition in bankruptcy for relief through a liquidation. Debts that will not be discharged include claims for
    • A. 

      Domestic support obligation

    • B. 

      Money to be paid for goods not delivered

    • C. 

      Contributions to employee benefit plans

    • D. 

      Long overdue credit card debt

  • 11. 
    Tracy borrows $30,000 from Secure State Bank. The lender accepts Tracys equity in her home as collateral which ca preceding that occurs if Tracn be seized if the loan isn't paid on time. With respect to any fails to make payments this loan is subordinated. This means that
    • A. 

      Takes a higher priority

    • B. 

      Takes a lower priority

    • C. 

      Has the same priority as the primary mortgage

    • D. 

      Fluctuates with the market value of the property

  • 12. 
    Denise borrows $90,000 from Clear Lake Credit Union to buy a home. Denise loses her job and fails to make payments, but assures Clear Lake Union that she will secure a new job. The lender agrees to postpone the payments. This is
    • A. 

      A bridge loan

    • B. 

      Forbearance

    • C. 

      A renoitization

    • D. 

      Restructure

  • 13. 
    Erin and Dooley, a married couple, borrow $120,000 from Capital & Credit Bank to buy a home.  When Erin and Dooley divorce, they are unable to make payments on the mortgage.  The market value of the home has declined to less than the balance of the loan.  Capital and Credit agrees to a sale of the property for this amount.  This is
    • A. 

      A deed in lieu of foreclosure

    • B. 

      A home equity loan

    • C. 

      A reverse mortgage

    • D. 

      A short sale

  • 14. 
    Agnes borrows $110,000 from Bay Harbor Bank to buy a home under a mortgage with an acceleration clause. After eighteen payments, Agnes stops making payments on the mortgage. Bay Harbor
    • A. 

      Can foreclose once on the entire amount of the loan

    • B. 

      May seek only the amount of the missed payments, not the entire loan

    • C. 

      Must foreclose on small amounts over time as each payment comes due

    • D. 

      Must notify Agnes to accelerate the steps to cure the default

  • 15. 
    Reed borrows $150,000 dollars from Suburban Credit Union to buy a home, which secures the loan. Three years later, reed stops making payments. After suburban credit repossesses and auction off the property to Tyler equity remains. This amount most likely belongs to
    • A. 

      Reed

    • B. 

      Suburban credit union

    • C. 

      Tyler

    • D. 

      The equity in which the property is located

  • 16. 
    Ozzy is an officer of Prudent Financial Corporation. Ozzy serves in a representative capacity for Prudent Financial’s owners. With respect to binding Prudent Financial to Contracts, Ozzy is
    • A. 

      An agent and has the authority

    • B. 

      An agent but does not have the authority

    • C. 

      Not an agent and does not have the authority

    • D. 

      Not an agent but does have the authority

  • 17. 
    Delite Candy Company hires Elton to sell Delite’s products in a certain area. Delite agrees to pay Elton a salary, plus commission, for a trial period. They also agree that Elton can sell using any methods and during any hours that seem appropriate. The key factor in whether Elton is Delite’s employee is
    • A. 

      The amount of Eltons salary

    • B. 

      The control Delite has over the Details of the work

    • C. 

      The length of the trial period

    • D. 

      The title that designates Elton’s position

  • 18. 
    Jim agrees to act on Kit’s behalf, subject to Kit’s control, and Kit trusts Jim to go act.  This describes a relationship between
    • A. 

      A business and its competitors

    • B. 

      A government and its governed

    • C. 

      A parent and a child

    • D. 

      A principal and an agent

  • 19. 
    Elle is an agent for Fine Cosmetics, INC. Elle owes Fine Cosmetics the duty of
    • A. 

      Avoidance

    • B. 

      Cooperation

    • C. 

      Indemnification

    • D. 

      Performance

  • 20. 
    Lather Up Soap Products Company grants its agent Kathy an exclusive territory in which to sell Lather Up products.  The firm cannot compete with Kathy in that territory under the principal’s duty of
    • A. 

      Avoidance

    • B. 

      Cooperation

    • C. 

      Indemnification

    • D. 

      Reimbursement

  • 21. 
    Cory employs Daily Delivery Agency as an agent under a written agreement that describes the rights and the duties of both parties. This is a
    • A. 

      Apparent authority

    • B. 

      Equal authority

    • C. 

      Express authority

    • D. 

      Implied authority

  • 22. 
    Sonia manages a Tasty Party Store for United Food Company. To manage the business Sonia’s authority can be implied by
    • A. 

      An inference from the position Sonia occupies

    • B. 

      Any inference a reasonable customer or supplier would make

    • C. 

      Any inference Sonia chooses to make

    • D. 

      No inference

  • 23. 
    Based on Nan’s conduct Odel reasonably believes that Poppy has the authority to act on Nan’s behalf even though Poppy does not have the actual authority to do so. In this circumstance Poppy has
    • A. 

      Apparent authority

    • B. 

      Express authority

    • C. 

      Implied authority

    • D. 

      No authority

  • 24. 
    Iggy hires Joy to act as his agent to purchase Kup-a-Koffee Kompany. Iggy tells Joy to reveal only that she is buying the firm on behalf of a third party without telling the Kup-a-Koffee seller who that third party is. Iggy is
    • A. 

      A disclosed principal

    • B. 

      An implied principle

    • C. 

      An undisclosed principal

    • D. 

      A partially disclosed principal

  • 25. 
    Myron is an employee of Neto. Either party can terminate the employment relationship at any time for any reason without liability. With respect to the employment at will doctrine this is
    • A. 

      An example of the doctrine

    • B. 

      An exception based on contract theory

    • C. 

      An exception based on public policy

    • D. 

      An exception based on tort theory

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