1. Distinguish which of the following is an advantage of limited liability companies (LLCs) over corporations.
a) Only one member of a LLC must have unlimited liability as compared with corporations in which all shareholders have unlimited liability.
b) LLCs can be formed without any specific steps being taken by the owners as compared with corporations that must file Articles of Incorporation with the State.
c) In most cases, a LLC can choose whether to be taxed as a partnership or corporation, as compared with corporations that are subject to double corporate taxation.
d) LLCs can choose whether to sell shares publically to investors, as compared to private corporations that must sell shares publically to investors.
2. Restitution allows for the return of any monies paid if
There is a material breach of the contract
There is a minor breach of the contract
If there has been complete performance
Any time the Buyer is unsatisfied with the products delivered.
3. A contract may be discharged by the Parties if there is
Mutual Rescission
Novation
Accord & Satisfaction
All of the above
4. A Quasi contract
Confers a benefit on another even though there is no formal contract.
Can never be enforced.
Are contracts in law.
Would cause unjust enrichment to not cause a party to pay for a benefit received.
A & C
A & D
A, C & D
5. If a contract is to be assigned notice must be given by
The assignor to the third party.
By the assignee to the third party.
By the third party to the assignor and the assignee.
Any of the above.
6. The Statute of Frauds was created
To allow for verbal contracts in certain circumstances.
To allow for the rescission of a contract prior to performance.
Require that certain contracts be in writing to be enforceable.
All of the above.
7. In order to prove undue influence, a party must show:
That a fiduciary relationship existed between the Parties.
It must be shown that one Party has a mental incapacity.
There must be a dominant Party who used unduly used their influence to cause the other party to enter into the contract.
A & B
A & C
All of the above.
8. In order to prove fraud which of the following elements must be present?
There must be an intentional misrepresentation, with reliance on the misrepresentation by the other party.
There must be an intention by the wrongdoer that the other Party rely on the misrepresentation.
There must be harm.
A & B
B & C
All of the above
9. An illegal contract is:
Voidable
Void.
Fully enforceable.
None of the above.
10. A contract made by a minor for necessaries is:
Voidable because the Party is a minor
Void because the Party is a minor
Fully enforceable.
All of the above.
11. A contract made by a minor may be ratified
At any time up to the time of majority.
Never. A contract made by a minor is void ab initio.
Only after the minor reaches the age of majority.
At any time.
12. An acceptance is effective:
After it is received by the offeror.
When the offeree performs
As soon as the offeree executes the acceptance.
As soon as the offeree transmits the offer
13. A unilateral contract requires:
A bilateral exchange of promises
An offer
A written acceptance
An acceptance by performance
All of the Above
A & D
None of the above
14. A contract must always contain the following:
A. An offer, acceptance, and consideration
B. A writing
C. A legal purpose
D. A handshake
E. A, B, & C
F. A & C
G. All of the above