QUESTION 1: Write short notes on all of the following:
1. Personal Insurance
2. Real Property
3. Lease Contract
4. Partnerships
5. Employee contracts
QUESTION 2: Berger checked into a motel and left a valuable stamp collection in his room because the motel didnot provide safe-deposit boxes. The stamps were stolen. Was the motel liable for the value of thecollection? Explain your answer.
QUESTION 3: Explain the difference between a secret partner and a silent partner. List and briefly explain five different types of partners.
QUESTION 4: Fox, who was going into the army, contracted with Scutti Auto Sales to sell his car for acommission. Scutti Auto Sales advanced $500 to Fox, with the understanding that the advancewould be paid back out of the proceeds of the sale. Three weeks later, before the car was sold, Foxchanged his mind and tried to terminate the agency. Was Fox legally able to terminate the agency?
MULTIPLE CHOCIE 30 MARKS
1. An example of a special bailment is the liability imposed on a
a. person who rents a car.
b. trucking company.
c. parking garage.
d. service station.
2. A special bailee is not liable for losses resulting from a typhoon because
a. a typhoon is a natural disaster that could not have been anticipated.
b. special bailments require only a reasonable level of care.
c. special bailees are exempt from all liabilities.
d. special bailees always have agreements with bailors to limit their liability
3. A common carrier whose equipment is detained by a customer for an unreasonable period of timecan make a special charge called
a. containerage.
b. detonage.
c. a bailee's charge.
d. demurrage.
4. A carrier that transports goods for certain customers only is a
a. limited carrier.
b. common carrier.
c. contract carrier.
d. mutual carrier.
5. The least costly type of life insurance is
a. endowment insurance.
b. limited payment life insurance.
c. term insurance.
d. whole life insurance.
6. In his application for life insurance, Meany lied about his health. The insurance company cannotcancel the policy if it discovers the lie after the policy has been in effect
a. one year.
b. two years.
c. three years.
d. five years.
7. At age thirty-five, Grimsby took out a life insurance policy and stated her age as twenty-nine.Grimsby died five years later. What effect, if any, does the misrepresentation have on the paymentto the beneficiary?
a. The insurer does not have to pay the beneficiary anything because the policy is void.
b. The insurer must pay the beneficiary only half the face value of the policy.
c. The insurer must pay the beneficiary an amount adjusted for the insured's correct age.
d. The insurer must pay the beneficiary the face value of the policy because themisrepresentation had no effect on the performance of the contract.
8. When Pogue retired from her job at age sixty-five, she became eligible for government-subsidizedhealth insurance called
a. Medicare.
b. Medicaid.
c. unemployment insurance.
d. disability income protection
9. Patent and copyright protection is granted by
a. state governments.
b. warranty.
c. the chamber of commerce.
d. the federal government.
10. On the death of a joint tenant, the property automatically belongs to the
a. surviving joint tenants.
b. state.
c. spouse.
d. heirs.
11. The temporary right to use a portion of another person's land is called a(n)
a. profit.
b. easement.
c. permit.
d. license.
12. A restrictive covenant is binding on
a. the seller.
b. the original buyer.
c. all subsequent buyers.
d. both b and c.
13. Under the statute of frauds, a lease of real property must be in writing if it is for
a. residential property.
b. commercial property.
c. more than one year.
d. less than one year.
14. When a lease is assigned by a tenant, the
a. original tenant has no further obligations.
b. the landlord assumes all responsibility.
c. the new tenant assumes all responsibility.
d. the original tenant is still liable
15. If a tenant fails to pay the rent when it becomes due, the landlord can
a. sue to evict the tenant.
b. sue the tenant for the rent due.
c. have the tenant arrested.
d. evict or sue the tenant.
16. A lease that omits the names of the landlord or tenant is
a. enforceable.
b. a sublease.
c. unenforceable.
d. a covenant
17. An inactive partner known by the public to be a partner is called a
a. limited partner.
b. silent partner.
c. secret partner.
d. dormant partner
18. When two or more persons conduct a business as a formal partnership without making apartnership agreement, they have formed a(n)
a. express partnership.
b. partnership by implication.
c. illegal partnership.
d. corporation.
19. Termination of a partnership can result from
a. the death of a partner.
b. the bankruptcy of a partner.
c. the retirement of a partner.
d. all of these
20. Frost was hired as general manager of Casey's snow plowing business. As general manager, Frosthas
a. implied authority to hire and fire people to help clear snow.
b. implied authority to sell the snow plowing business.
c. implied authority to purchase new equipment.
d. express authority to cancel equipment orders placed by Casey.
21. A principal whose identity is not known to a third party with whom the agent makes a contract iscalled a(n)
a. independent contractor.
b. fiduciary.
c. undisclosed principal.
d. irrevocable principal.
22. If the agent does not include the principal's name on a written contract,
a. both the principal and the agent are bound by the contract.
b. only the agent is bound by the contract.
c. only the principal is bound by the contract.
d. the contract is not binding
23. A person who pretends to be an agent
a. is personally liable to a third party.
b. binds the principal.
c. binds the third party.
d. has the power of ratification.
24. Doan authorized Marple to sell Doan's car for not less than $2,000 for a commission of 10%.Marple sold the car for $2,400. How much must Marple give Doan?
a. $2,000.
b. $2,000 less the commission.
c. $2,200.
d. $2,400 less the commission.
25. An agent is given formal written authority to sign checks for her principal. This formal writtenauthorization is called a(n)
a. affidavit.
b. power of attorney.
c. notary.
d. certification
26. The major difference between a special agent and a general agent is
a. the amount of compensation paid.
b. the way the agency is created.
c. the authority given to the agent.
d. the type of work the principal does.
27. A principal legally can appoint an agent by
a. a written contract only.
b. an oral contract only.
c. putting a notice in a newspaper.
d. either a written or an oral contract
(FOR 29 - 30) Curran was employed by Bond Wholesale Foods to deliver food supplies to grocery stores.
28. Curran legally is known as a(n)
a. independent contractor.
b. employee.
c. merchant.
d. employer.
29. After Curran had been employed for some time, he tried to organize his fellow workers into aunion. Curran was allowed to organize his fellow workers, without interference from BondWholesale Foods, under the provisions of the
a. National Labor Relations Act.
b. Fair Labor Standards Act.
c. Wage and Hour Law.
d. Occupational Safety and Health Act.
30. As a result of Curran's efforts, the workers formed a union that was recognized by BondWholesale Foods. Curran, as the union's representative, negotiated a contract with higher wagesand improved working conditions. Because both the employees and the company approved thecontract, it is called a(n)
a. workers' agreement.
b. collective bargaining agreement.
c. equal pay agreement.
d. workers' compensation agreement