Bus 393 - 2010 Final with Solutions (Fixed Format).pdf

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Simon Fraser University
Business Administration
BUS 393
Colin Hawes

BUS393       Practice  Exam  Questions  2010   Name___________________________________         [Note:  the  Final  Exam  will  have  approximately  40 -­‐‑45  multiple  choice  or  short  questions   in  random  order,  and  one  long  question.  These  questions  are  provided  to  help  you   practice  for  the  exam.  See  the  solutions  at  the  end  of  the  document]     MULTIPLE  CHOICE.     Choose  the  one  alternative  that  best  completes  the  statement   or  answers  the  question.       1)     lthough  Jason  had  participated  in  the  same  flower  auction  for  the   1)  _  ___     last  nine  years  as  an  agent  for  Thos.  Holt'ʹs  Ltd.  (Holt),  with  the   authority  to  buy  whatever  he  felt  the  store  needed,  this  day  he  was   given  express  instructions  to  buy  only  cut  flowers.  When  uncut  flats   of  young  camellia  bushes  with  a  rare  gold  flower  were  being  sold,   Jason  bought  them  on  behalf  of  the  company.  Which  of  the  following   is  true?     A)     olt  is  not  bound  by  the  contract,  because  Jason'ʹs  authority  was   expressly  restricted.     B)  T  he  key  to  determining  whether  or  not  Holt  is  bound  by  the   contract  is  this:  in  the  circumstances,  should  the  auctioneer  have   confirmed  with  Holt  the  extent  of  Jason'ʹs  authority?     C)  H  olt  is  estopped  from  denying  Jason'ʹs  authority.     D)H    olt  is  not  bound  since  Holt  didn'ʹt  ratify  the  contract.     E)  H   olt  is  not  bound  by  the  contract,  because  Jason  is  in  breach  of   his  agency  agreement.         2)     hich  of  the  following  is  a  violation  of  the  fiduciary  duty  of  a   2)  _  ___     partner?     A)W     here  a  partner  uses  the  partnership  property  for  partnership   business.     B)  W   here  one  partner  learns  of  an  investment  opportunity  in  the   field  of  the  partnership  and  tells  the  partners.  The  partners   decline  on  the  opportunity,  so  he  takes  advantage  of  it  himself     C)  W   hen  one  partner  starts  another  business  without  the  consent  of   the  other  partners  which  is  the  same  as  or  in  competition  with   the   partnership  business     D)W     here  one  partner  carries  on  a  business  unrelated  to  the   partnership  with  the  permission  of  the  partners     E)     here  one  partner  uses  information  that  he  has  ga ined  from  the   partnership  for  the  advantage  of  the  partnership.           3)     lison  told  her  partners  in  writing  that  she  would  be  leaving  the  law   3)  _  ___     partnership  at  the  current  partnership  year-end,  January  31,  2014.  At   year-end,  Alison'ʹs  partners  bought  her  partnership  interest  and   agreed  that  she  would  no  longer  be  liable  for  any  of  the  prior  or   subsequent  partnership  obligations.  In  February  2014,  one  of  the   remaining  partners  absconded  with  $2,000,000  held  for  Mr.  Smith,  a   long-time  client,  deposited  in  trust  in  September  2013.  Mr.  Smith   sued  the  partnership,  the  partners,  and  Alison.  Based  on  the   foregoing  facts,  which  of  the  following  statements  is  true?     A)A    fter  the  partnership  assets  are  exhausted,  Mr.  Smith  can  recover   on  his  judgment  from  any  one  of  the  remaining  partners  but  not   Alison.     B)    ven  if  Alison  gave  Mr.  Smith  actual  notice  of  her  leaving  the   partnership,  and  he  agreed  that  she  would  no  longer  be   obligated  for  the  partnership'ʹs  obligations,  she  will  can  be  held   liable  to  Mr.  Smith.     C)  O  nly  the  remaining  partners,  not  Alison,  have  the  right  to   recover  anything  they  have  to  pay  from  the  absconding  partner.     D)S     e  has  no  right  to  recover  any  funds  she  has  to  pay  from  her   former  partners.     E)     r.  Smith  can  recover  on  his  judgment  out  of  the  partnership   assets.               SHORT  ANSWER.     Write  the  word  or  phrase  that  best  completes  each  statement  or   answers  the  question.     4)    xplain  how  a  person'ʹs  status  as  a  limited  partner  could  be  lost.    4)   __ _________                   MULTIPLE  CHOICE.     Choose  the  one  alternative  that  best  completes  the  statement   or  answers  the  question.         5)    ecause  a  director  of  a  closely-held  corporation  breached  his  duties   5)  _  ___     to  the  corporation,  the  corporation  lost  $15,000.  Despite  the  urging  of   the  shareholders,  the  board  of  directors  refused  to  begin  an  action  on   behalf  of  the  corporation.  Which  one  of  the  following  provisions   would  aid  the  shareholders?     A)P    reemptive  right  provisions     B)  D  erivative-action  provisions     C)  R  elief-from-oppression  provisions     D)D    issent  procedure     E)  I   door-management  rule           6)     hich  one  of  the  following  is  an  example  of  breach  of  fiduciary  duty?   6  )  _  ____     A)A      director  profited  $120,000  from  a  contract  between  the   corporation  and  a  firm  in  which  he  had  an  interest  after  he  made   full  disclosure  of  his  interest  to  the  board  of  directors  and   abstained  from  the  vote  on  the  contract.     B)  A  n  officer  of  the  corporation  learned  of  a  business  opportunity   intended  for  the  corporation  and  intercepted  it  for  his  own   benefit.     C)  T  he  directors  refused  to  declare  a  dividend,  contrary  to  the   request  by  its  preferred  shareholders.     D)T    he  directors  of  the  corporation  refuse  to  give  a  pay  raise  to  the   employees  although  they  had  not  received  a  pay  raise  for  five   years.     E)  A    shareholder  owning  2%  of  the  outstanding  shares  started  a   business  in  direct  competition  with  the  corporation  in  which  he   held  shares.                   7)  A    real  estate  agent,  by  law,  is  not  allowed  to  buy  the  property  being   7)  _  ____     sold  by  his  principal  without  full  disclosure  to  and  consent  from  his   principal.  The  real  estate  agent  does  not  want  to  disclose  that  he  is   the  buyer  of  the  property,  so  he  forms  a  corporation  and  takes  an   offer  for  his  principal  from  the  corporation.  Based  on  these  facts,   which  of  the  following  is  true  if  the  principal  finds  out  the   corporation/buyer  is  owned  by  the  real  estate  agent  and  objects  to   the  contract?     A)T    he  court  would  enforce  the  contract  because  the  corporation  is  a   separate  legal  entity  in  the  eyes  of  the  law.     B)  T  he  court  would  enforce  the  contract,  but  the  principal  would  be   able  to  claim  any  profits  from  the  agent  when  he  took  them  out   of  the  corporation.     C)  T  he  court  would  “lift  the  corporate  veil”  and  would  not  enforce   the  contract.     D)T    he  court  would  dissolve  the  corporation.     E)  T  he  court  would  enforce  the  contract  because  this  is  not  a  direct   breach  of  the  agent'ʹs  fiduciary  duty.               SHORT  ANSWER.     Write  the  word  or  phrase  that  best  completes  eac h  statement  or   answers  the  question.     8)  "ʺ  In  modern  business  practice,  the  shareholders  of  a  corporation   8)   _ __________   own  that  corporation."ʺ  Explain  the  accuracy  of  that  statement.                   MULTIPLE  CHOICE.     Choose  the  one  alternative  that  best  c ompletes  the  statement   or  answers  the  question.     9)    ack,  Virgil,  and  Craig,  friends  for  several  years  and  all  worried   9)  _  ____     about  the  alarming  rise  in  land  prices,  want  to  go  in  together  and   buy  a  four-acre  parcel  in  the  country.  There  is  a  small  cabin  on  it.   They  hope  that  the  land  value  will  appreciate,  and  they  want  to  sell   it  in  a  few  years  to  help  finance  a  house  of  their  own.  Read  each  of   the  following  separately  and  indicate  which  is  true  with  regard  to   their  ownership  of  this  property.     A)O    wnership  of  the  property  entitles  them  not  only  to  the  surface   of  the  earth  between  the  boundaries,  but  also  to  the  infinite   airspace  above  and  everything  below  the  surface  of  their   property.     B)  O  wnership  of  the  fee  simple  does  not  guarantee  thei r  right  to   everything  below  the  surface  of  their  property.     C)  I    Canada,  in  strict  legal  terms,  the  only  owner  of  land  is  the   Crown,  and  if  they  buy  land  free  and  clear,  they  are  only  getting   a  life  estate.     D)I  f    they  buy  the  land  and  do  not  take  possession,  in  some   provinces  they  could  lose  their  right  to  claim  possession,  and   their  rights  become  a  fee  simple  estate.       E)  I    they  do  not  indicate  on  the  transfer  documents  the  nature  of   the  co-ownership,  the  law  presumes  they  will  take  as  joint   tenants.         10)     hich  of  the  following  is  false  with  regard  to  the  law  of  landlord   10) _ ____     and  tenant,  lessor  and  lessee?     A)R    esidential  properties  are  governed  by  provincial  statute  and   vary  from  jurisdiction  to  jurisdiction.     B)  A    tenancy  is  primarily  contractual  and  therefore  does  not  "ʺrun   with  the  land"ʺ;  it  does  not  bind  a  purchaser  of  the  building.     C)  T  he  law  of  frustration  applies  to  residential  leases.     D)I  f    a  commercial  lessee  defaults  on  his  rent,  the  lessor  has  the   power  to  seize  the  lessee'ʹs  property  left  on  the  premises.     E)  A    lease  agreement  is  a  contract  that  grants  an  estate  in  land;  i.e.,   it  gives  the  lessee  exclusive  possession  for  a  period  of  time. 11)     hich  one  of  the  following  is  true  with  regard  to  real-property  law?     11)   _ ____     A)T    he  "ʺleasehold  estate"ʺ  interest  in  land  is  the  greatest  interest  that   can  be  granted  and  bestows  the  rights  to  use  or  sell  the  property.     B)    roperty  includes  only  the  land  and  not  the  buildings  attached  to   it.     C)  If    two  people  own  land  as  tenants  in  common,  the  surviving  joint   owner  takes  the  interest  of  the  deceased  co-owner.     D)A      person  who  owns  an  interest  less  than  an  estate  (e.g.,  a  right  of   way)  has  a  right  to  exclusive  possession  of  that  property.     E)      legal,  registered  restrictive  covenant  "ʺruns  with  the  land"ʺ;  i.e.,   it  can  bind  subsequent  owners  who  were  not  parties  to  the   original  contract  under  which  it  arose.         12)     hich  of  the  following  is  true  with  regard  to  the  law  governing   12) _ ____ patents?     _     A)I  f    a  patent  is  developed  by  an  employee,  the  employee  has  the   right  to  obtain  the  patent.     B)    n  amendment  to  the  Patent  Act  allows  patent  protection   automatically.       C)  C  omputer  programs,  as  a  general  rule,  can  be  patented  as  well  as   copyrighted,  because  they  are  a  set  of  instructions  to  the   computer.     D)A      patent  will  only  be  granted  if  the  invention  has  been  the   subject  of  a  publication  of  over  one  year  prior  to  the  application.     E)      exchange  for  the  monopoly  given  under  the  Patent  Act,  the   owner  of  the  patent  must  disclose  the  invention  in  its  entirety.         13)     hich  of  the  following  is  true  with  regard  to  the  copyright  law  in   13) _ ____ Canada?     _     A)R    egistration  of  copyright  is  restricted  to  published  works.     B)    veryone  can  receive  copyright  protection  in  Canada  for  his  or   her  work  created  elsewhere.     C)  A    Canadian  author  must  register  upon  the  creation  of  her  book,   in  order  to  acquire  copyright  protection.     D)G    enerally,  the  term  of  copyright  is  fifty  years.     E)    opyright  law  is  governed  by  the  Copyright  Act,  but  an  author   need  not  register  under  the  statute  to  acquire  copyright.           14)  W   hen  one  person  leaves  tangible  personal  property  with  another  to   14)  _ ____ look  after,  the  resulting  relationship  is  called     _     A)a    chattel.     B)  a    fixture.     C)  a    chose  in  action.     D)a    bailment.     E)  a    fiduciary  relationship.           SHORT  ANSWER.     Write  the  word  or  phrase  that  best  completes  each  statement  or   answers  the  question.     15)  E  xplain  how  trademark  protection  is  obtained.     15)_      _______               16)  J  oe  wanted  to  start  up  a  restaurant  business,  did  some  research,   16)_      _______     and  found  out  McDonald'ʹs  had  not  properly  registered  its   trademark,  the  golden  arches,  in  his  particular  area.  Joe  u
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