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Questions
Q:
Over the course of a year, Retail Marketers, Inc., sells goods from its inventory and one of its warehouses. In exchange, Retail receives checks and other items that substitute for cash, which Retail uses to repay a loan from Savings Bank. Article 2 of the UCC governs
a. the checks.
b. the payment of the loan.
c. the sale of the buildings.
d. the sale of the goods.
Q:
If the quantity of hamburgers is measured along the horizontal axis and the quantity of movies is measured along the vertical axis, an increase in the price of a movie would be shown byA) shifting the budget constraint in towards the origin. B) shifting the budget constraint out.C) rotating the budget constraint around the horizontal intercept such that the new vertical intercept is closer to the origin.D) making the budget constraint steeper.
Q:
An agency by ratification occurs when a principal ratifies an authorized act.
Q:
Omni Corporation is a Pennsylvania-based firm that does business throughout the United States. With respect to this circumstance, the UCC has been adopted by, and applies in,
a. a few of the states.
b. all of the states, in whole or in part.
c. half of the states.
d. none of the states, to date.
Q:
In an agency by ratification, the agent is relieved of any liability for misrepresentation.
Q:
Over the course of a year, Real Deal Corporation sells appliances to customers to whom it extends credit. Real Deal orders the appliances from Superior Appliance Company's warehouse, from which the items are shipped via common carrier to Real Deal's customers. Article 2 of the UCC governs
a. all of the parties' sales of the goods.
b. Real Deal's extension of credit.
c. Superior's storage of the goods.
d. the common carrier's delivery of the goods.
Q:
If an agency is not an exclusive agency, the principal can employ more than one agent to try to accomplish a stated purpose.
Q:
A buyer has an insurable interest in identified goods.
Q:
When a buyer breaches a contract, the risk of loss immediately shifts to the buyer.
Q:
A durable power of attorney remains effective even if the principal is incapacitated.
Q:
The consumer optimum for consuming two goods is achieved whenA) the total utility from each good is equal. B) the price of each good is equal.C) the price multiplied by the marginal utility is equal for the two goods. D) the marginal utility per last dollar spent is equal for the two goods.
Q:
An orally agreed upon power of attorney is acceptable in court.
Q:
If a seller is a merchant, and the seller holds the goods, the risk of loss cannot pass to a buyer.
Q:
Only a lawyer can become an attorney-in-fact.
Q:
A bailee is a buyer or lessee.
Q:
An agent given a power of attorney is known as an attorney-in-fact.
Q:
A special power of attorney empowers an agent to act in any matters on the principal's behalf without limitation.
Q:
If a seller is not a merchant, and the seller holds the goods, the risk of loss cannot pass to a buyer.
Q:
The income elasticity of demand isA) the percentage change in demand divided by the percentage change in income.B) the change in income divided by the percentage change in price. C) the change in quantity demanded divided by the change in price.D) the percentage change in income divided by the percentage change in quantity demanded.
Q:
A general power of attorney limits an agent to those acts enumerated by the agreement.
Q:
If a lessor is a merchant, the risk of loss passes to a lessee when the lessee takes physical possession of the goods.
Q:
If a seller is a merchant, and the seller holds the goods, the risk of loss passes to a buyer when the buyer takes physical possession of the goods.
Q:
A power of attorney gives an agent the power to sign legal documents on behalf of the principal.
Q:
A receipt issued by a warehouser for goods stored in a warehouse is a bill of lading.
Q:
An express agency contract cannot be orally agreed upon.
Q:
Unless a contract provides otherwise, it is assumed to be a destination contract.
Q:
If a principal and an agent enter into an express agency contract, the principal cannot employ any agent other than the agent who entered into the contract.
Q:
Suppose that the absolute price elasticity for cookies equals 0.53. We could then say that the demand for cookies isA) elastic. B) inelastic.C) unit-elastic. D) perfectly elastic.
Q:
A bill of lading serves as a conÂtract for the transportation of goods.
Q:
Which of the following is true of an apparent agency?
A) The authority of an apparent agent is implied from the conduct of the parties.
B) The third-party is not bound to the contract created by an apparent agent.
C) The principal is bound to the contracts entered into by an apparent agent.
D) The actions of an apparent agent create an apparent agency.
Q:
"Unless otherwise explicitly agreed," title passes to the buyer at the time and place at which the seller physically delivers the goods.
Q:
Which of the following describes an agency by estoppel?
A) an agency that arises when a principal ratifies a contract created by an unauthorized agent
B) an agency created when a principal and an agent expressly agree to enter into an agency agreement
C) an agency that is not expressly stated but is implied from the conduct of the parties
D) an agency that arises when a principal creates the appearance of an agency that in actuality does not exist
Q:
Identification takes place when specific goods are designated as the subject matter of a sales or lease contract.
Q:
An agency by ratification occurs when the principal ________.
A) accepts an unauthorized act created by an unauthorized agent
B) accepts an authorized act created by an authorized agent
C) creates the appearance of an agency that in actuality does not exist
D) accepts an act carried out under the implied authority of an agent
Q:
Frank Hannigan sees a grand piano that his musician friend Scott Kristoff had been looking for in an antique store. Frank enters into a contract to purchase the grand piano from the antique seller and signs the contract, "Frank Hannigan, agent for Scott Kristoff." As Frank is not Scott's agent, Scott is not bound by the contract. If Scott decides to accept the contract, what kind of agency would be created?
A) express agency
B) implied agency
C) agency by ratification
D) power of attorney
Q:
In which of the following externality situations would it be most likely that voluntary agreements could be used to internalize an externality?
A) Littering on highways
B) Overharvesting of alligators in Louisiana
C) Poaching of elephants in Africa
D) Trees of one neighbor blocking a view of another
Q:
The UCC has replaced the common law concept of title in part with the concept of identification.
Q:
Marcus employs a real estate broker, Dean, to sell his house. Dean's express powers are to advertise and market the house for sale, show the house to prospective buyers, and accept offers from persons who want to purchase the house. He is not allowed to complete a deal without Marcus's consent. Marcus goes away on a month-long trip where he cannot be contacted. During this time, a short circuit in the house causes a power outage. Dean uses his authority to hire an electrician to repair the circuits and restore electricity in the house. Marcus then comes back and pays Dean for the electricity repair. What is the nature of the agency that Dean used to fix the electricity problem in the house?
A) implied agency
B) agency by ratification
C) power of attorney
D) express agency
Q:
Title is one concept that the UCC has substituted for the common law concept of risk of loss.
Q:
An express agency agreement that is often used to give an agent the power to sign legal documents on behalf of the principal is known as a(n) ________.
A) assignment
B) accommodation
C) power of attorney
D) letter of credit
Q:
An unconscionable contract is a contract so one-sided and unfair at the time it is made that enforcing it would be unreasonable.
Q:
Canton has listed his house for sale but cannot be present to take care of the sale, as he needs to go out of town. He intends to give his brother Stratham the power of attorney to just make decisions regarding the selling of his house while he is gone. What kind of power of attorney should Canton execute?
A) a general power of attorney
B) a special power of attorney
C) an unlimited power of attorney
D) an implied power of attorney
Q:
Under the UCC, an oral contract for a sale of goods is enforceable unless payment has been made and accepted.
Q:
Which of the following is true about a durable power of attorney?
A) It is only effective for as long as the principal has contractual capacity.
B) It remains effective even though the principal is incapacitated.
C) It is effective even when the agency is based on an oral agreement.
D) It is only effective if the attorney-in-fact is a licensed attorney.
Q:
Joseph decides to join the Big State Universityʹs football team when he learns that his health insurance will pay for any subsequent injury. This illustratesA) a moral hazard problem. B) monopolistic behavior. C) a symmetric information problem. D) oligopolistic behavior.
Q:
No oral contract is enforceable under the UCC.
Q:
Which of the following is true about a special power of attorney?
A) It is an implied form of power of attorney.
B) It limits the agent's powers to those enumerated in the agreement.
C) It allows the agent to act in any matters on the principal's behalf.
D) It only allows a licensed attorney to act as the attorney-in-fact.
Q:
If a contract for a sale of goods does not include a quantity term, it is a requirements contract.
Q:
The rules governing firm offers apply to all merchants.
Q:
Taylor gives a power of attorney to his twin brother Corey, permitting Corey to make all decisions on his behalf while he is abroad. As per the terms of the power of attorney, Corey is allowed to make decisions to purchase or sell stocks on Taylor's behalf, sell Taylor's real estate if he deems it to be in Taylor's best interest, pursue or defend lawsuits on Taylor's behalf, and make all other relevant decisions for Taylor. What kind of power of attorney confers such powers to Corey?
A) a special power of attorney
B) a limited power of attorney
C) an implied power of attorney
D) a general power of attorney
Q:
Which of the following is true of a general power of attorney?
A) It can be based on a conversation between the principal and agent.
B) It must appoint a licensed attorney to act as the attorney-in-fact.
C) It is one of the most informal types of express agency agreements.
D) It allows the agent to sign legal documents on the principal's behalf.
Q:
If a contract for a sale of goods does not include a price term, a reasonable price can be determined by looking at the market for the goods.
Q:
A power of attorney is an example of an ________ agreement.
A) agency by ratification
B) apparent agency
C) express agency
D) implied agency
Q:
Which of the following is the best definition of what economists define as total income?A) Payment for labor services.B) Payment for labor services and for ownership of other factors of production.C) Payment for labor services, for use of other factors of production, and gifts and government transfers.D) Inheritance.
Q:
Under the UCC, a contract for a sale of goods that includes open terms is void.
Q:
Which of the following is true of an express agency?
A) It can be either oral or written unless the Statute of Frauds stipulates that it must be written.
B) It is implied from the actions or conduct of the parties.
C) It originates when the principal ratifies an unauthorized act.
D) It arises when a principal creates the appearance of an agency that does not exist.
Q:
Under the UCC, the validity of a contract depends on its price term.
Q:
A lessor is a party who acquires a right to the possession and use of goods under a lease.
Q:
An agency that occurs when a principal and an agent categorically agree to enter into an agency agreement with each other is known as an ________.
A) agency by ratification
B) implied agency
C) apparent agency
D) express agency
Q:
A lessee is a party who transfers a right to the possession and use of goods under a lease.
Q:
Marlon intends to sell a piece of real estate he owns and contracts Nita, a real estate broker, to make the sale. In the contract, Marlon authorizes Nita to make the sale at or above a minimum price he wants and the date by which he wants the sale to be completed. The contract also stipulates that Marlon must not hire another broker to sell that piece of land until the expiration of the contract period. Nita finds a suitable buyer, makes the sale in time, and is paid by Marlon for her services. What kind of contract existed between Marlon and Nita?
A) an apparent agency contract
B) a ratified contract
C) an exclusive agency contract
D) an exclusive principal contract
Q:
A consumer lease is exempted from coverage under the UCC.
Q:
Marlon intends to sell a piece of real estate he owns and contracts Nita, a real estate broker, to make the sale. In the contract, Marlon authorizes Nita to make the sale at or above a minimum price he wants and the date by which he wants the sale to be completed. The contract also stipulates that Marlon must not hire another broker to sell that piece of land until the expiration of the contract period. Nita finds a suitable buyer, makes the sale in time, and Marlon pays for her services. Which of the following types of agencies had Marlon and Nita entered into?
A) apparent agency
B) agency by ratification
C) implied agency
D) express agency
Q:
If you get a job and are required to join the union within a month, this is known as a(n)A) closed shop. B) open shop. C) agency shop. D) union shop.
Q:
The UCC imposes the same rules of conduct on all parties in all circumstances.
Q:
A party who employs another person to act on his or her behalf is known as a(n) ________.
Q:
An employer-employee relationship occurs when an employer gives an employee the authority to act and enter into contracts on his or her behalf.
Q:
A sale of "things attached" to realty is always considered a sale of goods.
Q:
A party that employs an independent contractor is called an agent.
Q:
Article 2 of the UCC governs contracts for sales of services.
Q:
A principal-agent relationship exists when an employer hires an employee to perform some form of physical service.
Q:
Suppose the price elasticity of demand for iPods is inelastic. What would you expect about the demand elasticity for workers producing iPods? Explain.
Q:
Corporate stocks are an example of property that does not come under UCC Article
Q:
A principal works on behalf of an agent.
Q:
Article 2 of the UCC governs contracts for sales of goods.
Q:
Agency law is a mixture of contract law and tort law.
Q:
Owen buys a used Prius from Quality Motors, Inc., paying $1,000 down and agreeing to pay off the balance in thirty-six monthly payments of $200 each. The terms of the agreement call for Owen to make a payment on or before the first of each month, beginning March 1. During the first six months, Quality receives a $200 payment before the first of each month. Starting in September, however, and continuing for the subsequent five months, Owen's payment is never made until the fifth of the month. Quality accepts and cashes the payment check each time. Before the next payment is due, Quality decides that it is no longer willing to accept late payments. Can Quality sue Owen immediately for breach? Can Owen continue to make late payments without liability? Explain.
Q:
Which of the following is true of an employer-employee relationship?
A) An employee has implied power of attorney toward the principal.
B) An employee has authority to act on behalf of the principal.
C) An employee can enter into contracts on behalf of the employer.
D) An employee is hired to perform a task or service.
Q:
General Equity Corporation enters into a contract with Honi, who agrees to create artwork for General's main office building. Honi delays and eventuÂally refuses to perform. Meanwhile, General contracts to sell the building to Ideal Investments, Inc., but before the transaction is complete, Jewel Funds Company offers to pay a higher price. General reÂfuses to transfer the buildÂing to Ideal. In separate suits by General against Honi and by Ideal against General, each plaintiff seeks specific performance. How might the court rule in each case, and why?
Q:
Which of the following types of relationships exists when a person hires another person to perform some form of physical service but does not authorize that person to enter into contracts on his or her behalf?
A) employer-employee relationship
B) employer-agent relationship
C) principal-third party relationship
D) principal-agent relationship