1.The person who owes the payment of a secured obligation is the secured party.
A) True
B) False
2.A financing statement must include the debtor's signature.
A) True
B) False
3.Proceeds consist of whatever is received when collateral is sold.
A) True
B) False
4.The payment of Mo's debt to Neil is guaranteed by Mo's personal property. This is governed by
A) the Uniform Commercial Code.
B) the Federal Trade Commission.
C) the U.S. Constitution's commerce clause.
D) the Bankruptcy Reform Act of 2005.
5.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.
6.Mona borrows $1,000 from National Bank, using her motorcycle as collateral. To perfect its security interest, the bank must file its financing statement with
A) the secretary of state.
B) the county clerk.
C) the city treasurer.
D) the ward alderman.
7.A mechanic's lien can be enforced to obtain payment for work that adds value to personal property.
A) True
B) False
8.A writ of attachment is a court order to seize a debtor's property before the entry of a final judgment in a creditor's lawsuit against the debtor.
A) True
B) False
9.Khali's debt to Lew is past due. Lew obtains a judgment against Khali to collect the debt, but Khali refuses to pay. Lew asks the court to order Khali's employer to pay a portion of Khali's paycheck to Lew. This is a request for
A) an exemption from most federal limits on creditors' actions.
B) an order of garnishment.
C) an order that would violate most state laws.
D) a right of contribution.
10.Rob is a surety for Sue's loan from Total Finance Company. Rob's right to "step into the shoes" of Total Finance, after paying Sue's debt, and exercise any of the Total Finance's rights against Sue is the right of
A) contribution.
B) redemption.
C) reimbursement.
D) subrogation.
11.One goal of bankruptcy law is to encourage the continued use of credit.
A) True
B) False
12.The filing of a petition for bankruptcy will automatically stay most legal actions against the debtor.
A) True
B) False
13.A debtor in a Chapter 13 bankruptcy can continue in business.
A) True
B) False
14.Pola files a petition in bankruptcy. Pola's non-dischargeable debts include
A) domestic-support obligations.
B) student loans if payment would impose undue hardship.
C) unpaid loans to finance home repairs.
D) unsecured credit-card debt.
15.Beth files for bankruptcy under Chapter 13. The value of the property to be distributed under the plan is more than the amount of the creditors' claims. The court can approve the plan over the objection of
A) an unsecured creditor only.
B) any unsecured creditor or the trustee.
C) neither an unsecured creditor nor the trustee.
D) the trustee only.
16.A party must own property to have an insurable interest in it.
A) True
B) False
17."Major medical" and "marine" insurance are military policies.
A) True
B) False
18.Land Sales Company insures its real and personal property, as well as the lives of its key employees, to protect its financial interest should some event undermine its security. This is
A) risk management.
B) risk pooling.
C) risky.
D) risqué.
19.American Manufacturing Company obtains an insurance policy to pro¬tect against losses incurred by the firm as a result of being held liable for personal injuries or property damage sustained by others. This is
A) casualty insurance.
B) employer's liability insurance.
C) fidelity or guaranty insurance.
D) life insurance.
20.Rolling Transport & Storage Corporation wants to insure its warehouse to obtain the maximum possible recovery for the lowest possible premium. To obtain the maximum recovery under a coinsurance clause, the percentage of the value of the property that should be insured is
A) 80 percent.
B) 90 percent.
C) 100 percent.
D) 120 percent.