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5 Written questions

5 Matching questions

  1. 35. Under federal securities law, the Securities and Exchange Commission (SEC) can obtain a civil penalty up to _________ times the illegal profits gained by insider trading.

    A. one
    B. two
    C. three
    D. five
    E. ten
  2. 6. (from the book) and, the two largest online book retailers in the world, together lobby Congress to pass a new federal statute requiring online book retailers to offer a minimum of 3 million titles from their company web sites in order to remain in business. Smaller book retailers who want to sell books online sue and for allegedly violating Section 1 of the Sherman Act by engaging in an unlawful restraint of trade. What defense should the defendants raise?

    A. Unilateral refusal to deal
    B. Conscious parallelism
    C. Noerr doctrine
    D. Failing company doctrine
    E. Small company doctrine
  3. 25. Oprah is president of Dieter's, Inc. The common stock of Dieter's is listed on the New York Stock Exchange ("NYSE"). The stock price of Dieter's goes up and down with Oprah's weight; therefore USC MBA students stay at home every afternoon and watch the Oprah TV show to see Oprah's weight in making their investment decisions; the MBA students fail to attend their portfolio analysis course at the USC MBA program that is offered at the same time as the Oprah TV show. On August 1, 2009, Oprah purchases 1,000 shares of Dieter's common stock for $100 per share over the NYSE. She does not possess any inside information. On November 1, 2009, Oprah leaves her job at Dieter's Inc. to become president of a rival company, Weight Watchers, Inc. On January 1, 2010, Oprah sells the 1,000 shares of Dieter's stock for $150 per share. She does not possess any inside information. Oprah is liable for violating which of the following?

    A. Section 16(b) of the Securities Exchange Act of 1934
    B. Section 10(b) of the Securities Exchange Act of 1934
    C. Section 27 of the Securities Exchange Act of 1934
    D. Section 5 of the Securities Act of 1933
    E. None of the above
  4. 29. The small offering exemption exempts the sale of securities not exceeding $__________ during a 12-month period from registration with the Securities Exchange Commission (SEC).

    A. $500,000
    B. $1,000,000
    C. $10,000,000
    D. $100,000,000
    E. No dollar limit
  5. 14. In 2004, Tube bought a house on the beach in Malibu, California for $500,000 in order to be closer to the waves so he can surf more often. Tube paid $100,000 cash and borrowed $400,000 in a first loan from Wells Fargo Bank secured by his Malibu house. In 2009, Tube, because he is surfing all of the time and makes no money, defaults on the loan and files and qualifies for Chapter 7 bankruptcy. Because of the 2006-2012 Depression in California, Tube's house is only worth $200,000 at the time of default. Wells Fargo Bank receives the house in bankruptcy and sells the house for $200,000 to Patience. Which of the following is (are) true?

    A. Wells Fargo Bank properly sold the house to Patience
    B. Wells Fargo Bank becomes an unsecured creditor in the bankruptcy proceeding for $200,000
    C. Wells Fargo Bank would be able to recover a deficiency judgment for $200,000 against Tube
    D. A and B
    E. A, B, and C
  1. a B. $1,000,000
  2. b D. A and B
  3. c C. three
  4. d C. Noerr doctrine
  5. e E. None of the above

5 Multiple choice questions

  1. E. Section 24
  2. B. Nine months
  3. C. Chanel, Prada, Louise Vuitton, and Gucci have engaged in legal conscious parallelism
  4. E. None of the above
  5. D. A and C

5 True/False questions

  1. 11. Frog Inc., a chain of over 500 fancy and expensive French restaurants located throughout the United States, has failed to keep up with the times. Its snooty restaurants with snooty waiters serving snooty food now have financial statements that are the same color as the restaurant chain's red mahogany booths and red décor. Frog Inc. needs time to redecorate, change its menu to fast food French cuisine, and reinvent itself as a viable "going concern" that serves "American Fries." You are Frog Inc.'s attorney. What type of bankruptcy should Frog Inc. file for?

    A. Chapter 7
    B. Chapter 9
    C. Chapter 11
    D. Chapter 12
    E. Chapter 13
    B. Yes, under partial discharge


  2. 28. General Motors Corporation is (was) a major manufacturer of automobiles, trucks, SUVs, and other vehicles in the United States. General Motors has franchise agreements with 2,000 independent automobile dealerships across the United States that are independently owned businesses that sell General Motors vehicles. General Motors (who is more like a lieutenant than a general) sales have dropped 50% over the past two years. General Motors (whose "L" is much greater than its "a") files for Chapter 11 reorganization bankruptcy. General Motors wants to eliminate 1,000 of the automobile dealer franchises even though each of these franchises has ten more years to go before their expiration date. General Motors would ask the Bankruptcy Court to allow it to rescind 1,000 dealer contracts under which of the following doctrines?

    A. Executory contract
    B. Automatic stay
    C. Discharge of debts
    D. Antideficiency statute
    E. The 1,000 dealership contracts cannot be avoided by General Motors
    A. Executory contract


  3. 10. "Pinkberry" Incorporated is a company that operates a chain of franchised outlets that serve frozen yogurt, smoothies, and other desserts. The company has attained a cult-following of customers called "crackberries." Anyway, Pinkberry franchises franchisees to sell its products at small pink-colored outlets. Each Pinkberry franchisee is granted a specific territory. The Pinkberry Company provides each franchisee with the machines to make the yogurts, smoothies, and other food items, but all of these items are made at each location from yogurt, fruits, berries, and other items purchased by each franchisee. This is considered a ______________________ franchise.

    A. Distributorship
    B. Processing plant
    C. Chain-style
    D. Area
    E. Fu fu
    C. Chain-style


  4. 23. Planet Hollywood, Inc., a chain of over 100 restaurants worldwide, has failed to keep up with the times. Its financial statements now are now in the same shape as the restaurant chain' décor. Planet Hollywood needs time to redecorate, change its menu, and reinvent itself as a viable "going concern," Planet Hollywood files for chapter 11 Bankruptcy. Planet Hollywood has $100 million in unsecured debt but wants to come out of bankruptcy with only $40 million of unsecured debt. Planet Hollywood files a plan of reorganization in which it proposes to do away with $60 million of unsecured debt. Is this possible?

    A. Yes, under the automatic stay rule
    B. Yes, under partial discharge
    C. Yes, under executory contract
    D. No, no unsecured debt can be reduced under a Chapter 11 bankruptcy
    E. No, unless Planet Hollywood proves "undue hardship"
    B. Yes, under partial discharge


  5. 32. Which antitrust law makes price discrimination illegal?

    A. Section 1 of the Sherman Act
    B. Section 2 of the Sherman Act
    C. Section 2 of the Clayton Act
    D. Section 3 of the Clayton Act
    E. Section 7 of the Clayton Act
    D. A and C