BUS 201 FINAL EXAM QUESTIONS WITH ACCURATE
ANSWERS
_______ is/are responsible for managing the business of a corporation. A)
Investors B) Shareholders C) Incorporators D) Organizers E) The board of directors
correct answer E) The board of directors
________ corporations generally do not offer stock to the public. A) Alien B)
Foreign C) Closely held D) Multinational E) Domestic correct answer C) Closely
held
________ is the legal enforcement of an otherwise unenforceable contract due to
a party's detrimental reliance on the contract. A) Forbearance B) Promissory
estoppel C) Res ipsa loquitur D) Res judicata E) Mutual exclusivity correct answer
B) Promissory estoppel
. ________ is the legal enforcement of an otherwise unenforceable contract due
to a party's detrimental reliance on the contract. A) Promissory estoppel B)
Substantial estoppel C) Substantial performance D) Frustration of purpose E)
Commercial impracticability correct answer A) Promissory estoppel
. ________ is/are responsible for running the day-to-day business of a
corporation. A) Investors B) Shareholders C) Officers D) Incorporators E) The
board of directors correct answer C) Officers
. A corporation is a ________ corporation in the state in which it is incorporated.
A) domestic B) foreign C) multinational D) closely held E) public correct answer A)
domestic
,. A false statement about a fact material to an agreement that the person making
the statement believed to be true is considered a(n) ________. A) commercial
disparagement B) innocent misrepresentation C) fraudulent misrepresentation D)
scienter-based misrepresentation E) criminal misrepresentation correct answer B)
innocent misrepresentation
. A party who is ________ liable is responsible for paying the amount designated
on an instrument if the primarily liable party defaults. A) primarily B) secondarily
C) customarily D) statutorily E) strictly correct answer B) secondarily
. Agency is generally defined as a relationship between a principal and a third-
party beneficiary. A) True B) False correct answer B) False
. An agency relationship that arises when an individual misrepresents herself as
an agent for another party and that party accepts the unauthorized act is an
agency by _________. A) ratification B) implication C) estoppel D) default E)
agreement correct answer A) ratification
. Creditors can attempt to repossess property during bankruptcy proceedings. A)
True B) False correct answer B) False
. Forbearance is defined as: A) An invitation to negotiate. B) An offer. C) A
counteroffer. D) A bilateral contract. E) Promising to refrain from doing something
you are legally entitled to do. correct answer E) Promising to refrain from doing
something you are legally entitled to do
. Which of the following is a way that a corporation can avoid double taxation? A)
By forming a C corporation B) By forming a D corporation C) By forming an S
, corporation D) By forming an F corporation E) By forming a traditional corporation
correct answer C) By forming an S corporation
. Which of the following modifies the mirror-image rule? A) The Uniform
Contracts Code. B) The Uniform Commercial Code. C) The Restatement of
Contracts, Second. D) The International Business Code. E) The International
Commercial Code. correct answer B) The Uniform Commercial Code.
A ________ is a specific draft, drawn by the owner of a checking account,
ordering the bank to pay the payee from that drawer's account. A) promissory
contract B) certificate of deposit C) note D) check E) time instrument correct
answer D) check
A bilateral contract is commonly defined as a promise in exchange for an act. A)
True B) False correct answer B) False
A buyer may revoke acceptance of goods if the buyer can show that defects in the
goods have caused their value to be ________. A) reduced preponderantly B)
reduced by ten percent or more C) reduced by twenty-five percent or more D)
substantially impaired E) compromised correct answer D) substantially impaired
A common law standard known as ________ requires that the seller deliver goods
in conformity with the terms of the contract, right down to the last detail. A)
substantial performance B) preponderant performance C) the principle of good
faith D) the principle of good faith and reasonable commercial standards of fair
dealing E) the perfect tender rule correct answer E) the perfect tender rule
ANSWERS
_______ is/are responsible for managing the business of a corporation. A)
Investors B) Shareholders C) Incorporators D) Organizers E) The board of directors
correct answer E) The board of directors
________ corporations generally do not offer stock to the public. A) Alien B)
Foreign C) Closely held D) Multinational E) Domestic correct answer C) Closely
held
________ is the legal enforcement of an otherwise unenforceable contract due to
a party's detrimental reliance on the contract. A) Forbearance B) Promissory
estoppel C) Res ipsa loquitur D) Res judicata E) Mutual exclusivity correct answer
B) Promissory estoppel
. ________ is the legal enforcement of an otherwise unenforceable contract due
to a party's detrimental reliance on the contract. A) Promissory estoppel B)
Substantial estoppel C) Substantial performance D) Frustration of purpose E)
Commercial impracticability correct answer A) Promissory estoppel
. ________ is/are responsible for running the day-to-day business of a
corporation. A) Investors B) Shareholders C) Officers D) Incorporators E) The
board of directors correct answer C) Officers
. A corporation is a ________ corporation in the state in which it is incorporated.
A) domestic B) foreign C) multinational D) closely held E) public correct answer A)
domestic
,. A false statement about a fact material to an agreement that the person making
the statement believed to be true is considered a(n) ________. A) commercial
disparagement B) innocent misrepresentation C) fraudulent misrepresentation D)
scienter-based misrepresentation E) criminal misrepresentation correct answer B)
innocent misrepresentation
. A party who is ________ liable is responsible for paying the amount designated
on an instrument if the primarily liable party defaults. A) primarily B) secondarily
C) customarily D) statutorily E) strictly correct answer B) secondarily
. Agency is generally defined as a relationship between a principal and a third-
party beneficiary. A) True B) False correct answer B) False
. An agency relationship that arises when an individual misrepresents herself as
an agent for another party and that party accepts the unauthorized act is an
agency by _________. A) ratification B) implication C) estoppel D) default E)
agreement correct answer A) ratification
. Creditors can attempt to repossess property during bankruptcy proceedings. A)
True B) False correct answer B) False
. Forbearance is defined as: A) An invitation to negotiate. B) An offer. C) A
counteroffer. D) A bilateral contract. E) Promising to refrain from doing something
you are legally entitled to do. correct answer E) Promising to refrain from doing
something you are legally entitled to do
. Which of the following is a way that a corporation can avoid double taxation? A)
By forming a C corporation B) By forming a D corporation C) By forming an S
, corporation D) By forming an F corporation E) By forming a traditional corporation
correct answer C) By forming an S corporation
. Which of the following modifies the mirror-image rule? A) The Uniform
Contracts Code. B) The Uniform Commercial Code. C) The Restatement of
Contracts, Second. D) The International Business Code. E) The International
Commercial Code. correct answer B) The Uniform Commercial Code.
A ________ is a specific draft, drawn by the owner of a checking account,
ordering the bank to pay the payee from that drawer's account. A) promissory
contract B) certificate of deposit C) note D) check E) time instrument correct
answer D) check
A bilateral contract is commonly defined as a promise in exchange for an act. A)
True B) False correct answer B) False
A buyer may revoke acceptance of goods if the buyer can show that defects in the
goods have caused their value to be ________. A) reduced preponderantly B)
reduced by ten percent or more C) reduced by twenty-five percent or more D)
substantially impaired E) compromised correct answer D) substantially impaired
A common law standard known as ________ requires that the seller deliver goods
in conformity with the terms of the contract, right down to the last detail. A)
substantial performance B) preponderant performance C) the principle of good
faith D) the principle of good faith and reasonable commercial standards of fair
dealing E) the perfect tender rule correct answer E) the perfect tender rule
