Practice Quiz

DSST Business Law II Exam Prep - Question List

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46. Under what circumstances will a court enforce a liquidated damages clause?
  1. The damages were difficult to calculate at the time the contract was made.
  2. The amount of damages must be nominal.
  3. There is a reasonable relationship between the amount of the liquidated damages and the actual damages.
  4. A and C.
  5. A, B, and C.
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47. Which is true of a limited liability corporation (LLC)?
  1. It shields its owners' personal assets.
  2. A nonprofit can be organized as a limited liability corporation.
  3. It is the same as a sole proprietorship.
  4. Owners do not have to report income from limited liability corporations.
  5. None of the above.
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48. Under what circumstances can a creditor receive relief from an automatic stay?
  1. A creditor cannot receive relief from an automatic stay.
  2. If the debtor filed a Chapter 15 bankruptcy.
  3. If the debtor filed a Chapter 11 bankruptcy.
  4. When the creditor can show that the debt owed is before a statutory timeframe.
  5. When the creditor can show that the automatic stay does not give the creditor adequate protection.
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49. Which of the following is NOT necessary to show loss of profits?
  1. The loss is the direct and natural consequence of the breach.
  2. The loss is greater than $50,000.
  3. It is reasonably probable that the profits would have been earned except for the breach.
  4. The loss is either present or future.
  5. The amount of loss can be shown with reasonable certainty.
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50. In a Chapter 7 bankruptcy:
  1. A business ceases operations and liquidates.
  2. A city reorganizes.
  3. A business or individual reorganizes.
  4. A farmer reorganizes.
  5. An individual reorganizes.
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