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BADM 412 - BUSINESS LAW
REVIEW QUESTIONS
- A football player overextends his knee, and requires surgery. A rehabilitation specialist later seeks the player's business. He promises the player that he will, after his therapy, have a 100% perfect knee. The player hires him. A year later, the player can walk, but his leg is far from perfect. If the player sues the therapist, what will he receive in damages?
a. his salary for one season b. the value of a perfect knee less the value of his knee as it really is c. the value of a perfect knee d. nothing
- Paul is hired to build a fence for $500. Before he starts, the man who hired him tells Paul he doesn't want the fence built after all. Paul is able to find another fence-building job, but it pays only $400. Further, the new job is far away, and it will cost Paul $50 in gas to travel back and forth. This $50 in gas is an example of
a. incidental damages. b. compensatory damages. c. punitive damages. d. both A and B
- In all of the following cases, the seller breached a contract to sell. The buyer is LEAST likely to receive monetary damages if the contract involved
a. a car. b. a construction contract. c. a piece of land. d. a computer.
- Stan breaches his contract with Al. If Al sues under a contract theory only, will he get punitive damages?
a. yes, if Stan acted unreasonably b. yes, if Stan willfully broke the contract c. yes, if Stan maliciously broke the contract d. no
- Mr. Tallyman orders 100 8-foot bunches of bananas from Chiquita for $2000. They are never
delivered. The market price of the bananas falls in the meantime to $1800. What type of damages are available to Mr. Tallyman in a breach of contract action?
a. compensatory damages b. punitive damages c. nominal damages d. both A and C
- Which of the following statements about rescission is accurate?
a. A party may never rescind a contract on his own. b. For rescission to occur, all parties must always agree to the rescission. c. A rescission can sometimes be done unilaterally. d. both A and B
- Ben makes an agreement to sell a painting for $300. The buyer gives Ben a $100 deposit, but Ben never delivers the painting. If a court issues Ben an order of specific performance, what will he have to give the buyer?
a. nothing b. $ c. $ d. the painting
- Al hires U2 to play at his Christmas party for $200,000. At the last minute, the Edge gets sick, and the show is canceled, breaching the contract. Al is crushed, as in his mind (and everyone else's) there is no substitute for U2. What remedies is a court likely to consider assessing against the band?
a. damages b. specific performance c. both A and B d. none of the above
- Amy contracts to buy a piece of land from Harold. Harold breaches the contract. What remedies may Amy actually seek in her lawsuit?
a. specific performance b. damages c. either specific performance or damages, but not both d. both specific performance and damages in the same lawsuit
b. Al, a sporting goods store owner, sells his car. c. Al, a sporting goods store owner, sells his house. d. both A and B
- Computer City signs a one-year requirement with IBM. The number of units to be delivered is not in the contract. They have dealt with IBM in the past, and their past orders have averaged 1,000 computers each. What quantity of computers must be delivered in this order?
a. 0 b. 1, c. the number of computers Computer City can sell in the next year d. a reasonable number of computers
- Al's Used Cars is going out of business. They offer to sell their entire inventory to Bill's Used Cars for $75,000. Bill's says, "We accept your offer, and expect that all cars will be washed and waxed before they are delivered to us." Al's calls Bill's and objects to the waxing clause. What has happened?
a. A valid contract has been formed, and the cars must be waxed. b. A valid contract has been formed, and the cars need not be waxed. c. Bill's has rejected the original offer with a counteroffer. d. none of the above
- Tom offers to sell his car to his friend Bill. Bill says, "I accept your offer if it will be waxed before I pick it up." Tom does not object to this additional request. What has happened?
a. A valid contract has been formed, and the car must be waxed. b. A valid contract has been formed, and the car need not be waxed. c. Bill has rejected the original offer with a counteroffer. d. none of the above
- What is the closest analogy to the CISG in our laws?
a. the common law b. federal statutes on trade and commerce c. the UCC d. executive orders
- Which of the following clauses may be predetermined in an international contract governed by the CISG?
a. what country any dispute resolution will take place in b. what language any dispute resolution will be conducted in
c. what nation's laws will govern any disputes d. all of the above
- Before any interest in specific goods can pass from a buyer to a seller, which of the following must be true?
a. The goods must be in existence. b. The goods must be identified as the specific goods designated in the contract. c. Both must apply. d. Neither need apply.
- Once goods have been identified, which of the following may a lessee do?
a. insure the goods b. recover from third parties who damage the goods c. both A and B d. none of the above
- Al and Dan have an agreement that says, "Title will pass on July 1." If UCC rules were followed in their contract, title would pass on June 21. When will title pass?
a. July 1 b. June 21 c. June 26 d. after the passage of a reasonable time
- If a shipment contract is formed, the seller has what duty?
a. no duty b. the duty to deliver the goods to a carrier c. the duty to deliver the goods to a buyer's place of business d. the duty to deliver the goods to the buyer himself
- Alex buys a computer at Best Buy. The check later bounces. The day after he buys it, Alex resells the computer to Diane. Can Best Buy recover the computer from Diane?
a. yes, always b. yes, if she did not purchase it in good faith c. yes, if the check bounced before Diane bought the computer d. no, never
- The risk of loss _______________ passes from seller to buyer at the same time as title passes.
c. is not; is d. is not; is not
- Al orders 500 pink shirts. Which of the following are conforming goods?
a. 499 pink shirts b. 500 red shirts c. both A and B d. none of the above
- Al owns a bicycle shop, and signs a sales contract that is silent on the place delivery will be made. Where will it take place under the UCC's rules?
a. the seller's residence b. the seller's place of business c. the buyer's residence d. the buyer's place of business
- Al orders 500 pink shirts. He is shipped 495 pink shirts and 5 red shirts. Under the common law, he _______________ have rejected the entire shipment, and under the UCC, he _______________ reject the entire shipment.
a. could; may b. could; may not c. could not; may d. could not; may not
- A sales contract calls for the delivery of goods by truck. All truckers go on strike just before the goods are to be shipped. May the seller ship the goods by train if it is more expensive?
a. yes, and the seller must pay the extra costs b. yes, and the buyer pays the extra costs c. yes, and they will split the extra costs d. no, because it will breach the contract
- Which of the following will make performance of a sales contract commercially impracticable?
a. an increase in costs to the seller b. a tornado that destroys the seller's inventory c. both A and B d. none of the above
- Lou and Ben have a sales contract. The goods involved have been identified, and are destroyed in a warehouse fire before they can be delivered. What happens now?
a. Lou must acquire identical goods at his expense. b. Lou must acquire identical goods, but Ben will bear the costs. c. The parties are discharged from the contract. d. none of the above
- A sales contract specifically calls for a cash payment. When delivery is made, the buyer offers to pay by credit card. What can the seller do?
a. Take the goods back and refuse to honor the contract. b. Demand cash immediately. c. Demand cash, provided he gives the buyer a reasonable time to acquire cash. d. Nothing--the seller must accept the credit card.
- A Cash on Delivery (C.O.D.) shipment may be rejected if
a. the buyer has agreed to a C.O.D. shipment. b. the buyer has not agreed to a C.O.D. shipment. c. it may be rejected in either situation. d. it may be rejected in neither situation.
- Which of the following will constitute an acceptance?
a. The buyer signifies to the seller that the goods are conforming. b. The buyer, after a reasonable amount of time, does not reject the goods. c. both A and B d. none of the above
