Question 1
Which of the following applies to trade restraints that are inherently anticompetitive?
The rule of reason
The pro rata rule
The per se rule
The rule of four
Question 2
When one party acquires a license to use another party's business model and intellectual property in the distribution of goods and services, the arrangement is a __________.
limited liability partnership
franchise
joint venture
Kickback
Question 3
Which of the following is prohibited by the Food, Drug, and Cosmetic Act (FDCA) with regard to food?
The sale of adulterated food
Labeling of genetically engineered food products
The sale of non-organic food products
Labeling of raw seafood products
Question 4
The obligation owed by individuals to one another not to cause any unreasonable harm or any risk of harm is called:
duty of restoration.
duty of care
duty of loyalty.
duty of restitution.
Question 5
When can an arbitrator's decision and award be appealed to the courts?
While drafting a submission agreement
When an arbitration is binding
While entering a negotiation
When an arbitration is nonbinding
Question 6
Which of the following is an advantage of franchising?
It enables two businesses to pool their resources to pursue a common goal.
It allows a business to consist of only general partners.
It allows businesses to reach profitable new markets.
It grants free access to the intellectual property of a business to anyone in the same market.
Question 7
Workers' compensation is defined as the:
system that provides retirement and death benefits to covered employees and their dependents.
insurance obtained by employees from private insurance companies and government-sponsored programs.
remuneration awarded to employees and their families when the employees are injured on the job.
set of programs mandated by the government to ensure safety in places of work.
Question 8
Corporate officers are elected by a corporation's __________.
owners
board of directors
common stockholders
preferred stockholders
Question 9
Which of the following is a difference between embezzlement and larceny?
Embezzlement is the snatching of personal property from a person's home, whereas larceny is the snatching of personal property from a person on the street.
Embezzlement is an unintentional tort, whereas larceny is a nonintent crime.
Embezzlement is the stealing of property by a person to whom the property was entrusted, whereas larceny is the stealing of property by a person not entrusted with it.
Embezzlement is usually punishable by the payment of monetary damages, whereas larceny is usually punishable by the death penalty.
Question 10
Which of the following is a criticism of the ethical fundamentalism theory?
It does not allow people to decide for themselves what is right and what is wrong.
It is impossible in the real world to expect that everyone in society will obey moral rules.
It does not reach an agreement on what the universal rules should be.
It is impossible to measure the "good" that may result from different actions.
Question 11
The manifestation of the substance of a contract by two or more individuals is called __________.
consideration
an offer
acceptance
an agreement
Question 12
Which of the following is a remedy that requires the breaching party to perform the acts promised in a contract?
Specific performance
Binding arbitration
Punitive damages
Special damages
Question 13
Laws that prohibit discrimination based on race, gender, or religion in the workplace primarily serve the function of:
advocating social justice.
providing a basis for compromise.
creating a new status quo.
minimizing the freedom of employees.
Question 14
Which of the following is a difference between arbitration and mediation?
Arbitration is an informal method of dispute resolution, whereas mediation is a formal method of dispute resolution.
The decision of an arbitrator is nonbinding, whereas the decision of a mediator is binding.
The role of an arbitrator is merely to assist parties in reaching a settlement, whereas the role of a mediator is similar to the role of a trial judge.
An arbitrator is authorized to issue an award, whereas a mediator can only assist in reaching a settlement.
Question 15
Which of the following is a requirement for obtaining a patent for an invention?
The invention needs to be made of highly valuable components.
The invention must be in the form of a service.
The invention must be original.
The invention needs to be recognizable to the general public.
Question 16
An agency that appears to be created by a principal but does not exist in reality is called a(n) __________.
apparent agency
implied agency
agency by ratification
fully disclosed agency
Question 17
Laws that protect governments from being overthrown primarily serve the function of:
advocating social justice
providing bases for compromise.
maintaining the status quo.
minimizing individual freedom.
Question 18
Ken owns a small convenience store in a street corner in California. One afternoon, a teenage boy enters his store, looks around, and prepares to walk out without buying anything. Ken is wary of the boy because of the boy's shabby clothing. He stops and asks the boy to empty his pockets and then questions him for about five minutes. After finding that the boy does not have anything from the store on him, Ken reluctantly lets him go. Which of the following is a merchant protection statute that Ken has violated?
Reasonable grounds for suspicion
Reasonable duration of detention
Adverse possession
Adequate assurance of performance
Question 19
Corporate officers are best described as:
directors elected by a corporation's shareholders.
partners pursuing a joint venture transaction
owners of a corporation with limited liability for its debts and obligations.
employees appointed to manage the daily operations of a corporation.
Question 20
Which of the following scenarios is an example of law and ethics contradicting each other?
A florist in the United States employs an illegal immigrant to help the immigrant and her family overcome their financial difficulties.
A large apparel retailer copies the trademarked garment designs of a well-known fashion designer.
A restaurateur, whose restaurant is violating labor laws, bribes a federal official to prevent him from reporting the violations.
An iron-ore manufacturing company provides its employees with high-quality safety equipment.
Question 21
Robert orders coffee while having breakfast in a diner. He suffers third-degree burn injuries when the coffee accidently spills on him. He presses charges against the diner for failing to notify him that the coffee was exceptionally hot. In this scenario, the diner is guilty of a(n) __________.
unintentional tort
intent crime
intentional tort
Question 22
Which of the following best describes the term warranty?
It refers to the transfer of possession of stolen property to a person who had bought the property without the knowledge that it has been stolen.
It is a purchaser's title to goods obtained by the impersonation of another person.
It refers to the terms in a sales contract stipulating the party that will bear the risk of loss of goods during shipment.
It is the seller's assurance to a buyer that the goods sold meet certain standards of quality.
nonintent crime
Question 23
Which of the following is a characteristic of torts?
They are punishable by the death penalty.
They are usually not tried by the jury.
They are brought to court by a plaintiff.
They are tried by criminal procedure.
Question 24
A group boycott occurs when:
competitors at one level of distribution collectively refuse to deal with others at a different level of distribution.
parties enter into a trade agreement that has greater anticompetitive effects than procompetitive effects.
parties at different levels of distribution enter into an agreement to adhere to a schedule that will stabilize prices.
competitors agree that they will distribute their goods to only a particular portion of the market.
Question 25
A goal of the Sarbanes-Oxley Act of 2002 is to:
control and closely monitor the financial accounts of all corporations in the United States.
allow directors and executive officers of public companies to be given personal loans from the companies.
end conflicts of interest, establishing better corporate governance.
enable smooth settlement of alleged fraud among major corporations.
Question 26
Helen buys a toy railway set for her 3-year-old son, Ben. The product's cover mentions that the toy is suitable for children only aged between 3 and 12. While playing with the toy one evening, without Helen's supervision, Ben chokes on an inch-long engine driver figure that forms part of the train. Although he survives, he is traumatized by the incident. For which type of defect can Helen sue the toy manufacturer?
Failure to tamperproof
Defect in product packaging
Defect in manufacture
Failure to warn
Question 27
Insider trading is considered illegal because:
it results in excessive losses for the company.
it makes use of nonmaterial public information.
it fails to account for the short-swing profits brought into a company.
it limits investment opportunities for the investing public.
Question 28
When an employer does not discriminate against women in general but treats women above the age of 40 differently, the employer is practicing __________.
color discrimination
sex-plus discrimination
religious discrimination
racial discrimination
Question 29
The power and authority to exclude competition or control prices is known as __________.
enumerated power
monopoly power
implied power
reserved power
Question 30
Which of the following is a category of torts?
Professional malpractice
Personal liability
Strict liability
Nonintent crime
Which of the following applies to trade restraints that are inherently anticompetitive?
The rule of reason
The pro rata rule
The per se rule
The rule of four
Question 2
When one party acquires a license to use another party's business model and intellectual property in the distribution of goods and services, the arrangement is a __________.
limited liability partnership
franchise
joint venture
Kickback
Question 3
Which of the following is prohibited by the Food, Drug, and Cosmetic Act (FDCA) with regard to food?
The sale of adulterated food
Labeling of genetically engineered food products
The sale of non-organic food products
Labeling of raw seafood products
Question 4
The obligation owed by individuals to one another not to cause any unreasonable harm or any risk of harm is called:
duty of restoration.
duty of care
duty of loyalty.
duty of restitution.
Question 5
When can an arbitrator's decision and award be appealed to the courts?
While drafting a submission agreement
When an arbitration is binding
While entering a negotiation
When an arbitration is nonbinding
Question 6
Which of the following is an advantage of franchising?
It enables two businesses to pool their resources to pursue a common goal.
It allows a business to consist of only general partners.
It allows businesses to reach profitable new markets.
It grants free access to the intellectual property of a business to anyone in the same market.
Question 7
Workers' compensation is defined as the:
system that provides retirement and death benefits to covered employees and their dependents.
insurance obtained by employees from private insurance companies and government-sponsored programs.
remuneration awarded to employees and their families when the employees are injured on the job.
set of programs mandated by the government to ensure safety in places of work.
Question 8
Corporate officers are elected by a corporation's __________.
owners
board of directors
common stockholders
preferred stockholders
Question 9
Which of the following is a difference between embezzlement and larceny?
Embezzlement is the snatching of personal property from a person's home, whereas larceny is the snatching of personal property from a person on the street.
Embezzlement is an unintentional tort, whereas larceny is a nonintent crime.
Embezzlement is the stealing of property by a person to whom the property was entrusted, whereas larceny is the stealing of property by a person not entrusted with it.
Embezzlement is usually punishable by the payment of monetary damages, whereas larceny is usually punishable by the death penalty.
Question 10
Which of the following is a criticism of the ethical fundamentalism theory?
It does not allow people to decide for themselves what is right and what is wrong.
It is impossible in the real world to expect that everyone in society will obey moral rules.
It does not reach an agreement on what the universal rules should be.
It is impossible to measure the "good" that may result from different actions.
Question 11
The manifestation of the substance of a contract by two or more individuals is called __________.
consideration
an offer
acceptance
an agreement
Question 12
Which of the following is a remedy that requires the breaching party to perform the acts promised in a contract?
Specific performance
Binding arbitration
Punitive damages
Special damages
Question 13
Laws that prohibit discrimination based on race, gender, or religion in the workplace primarily serve the function of:
advocating social justice.
providing a basis for compromise.
creating a new status quo.
minimizing the freedom of employees.
Question 14
Which of the following is a difference between arbitration and mediation?
Arbitration is an informal method of dispute resolution, whereas mediation is a formal method of dispute resolution.
The decision of an arbitrator is nonbinding, whereas the decision of a mediator is binding.
The role of an arbitrator is merely to assist parties in reaching a settlement, whereas the role of a mediator is similar to the role of a trial judge.
An arbitrator is authorized to issue an award, whereas a mediator can only assist in reaching a settlement.
Question 15
Which of the following is a requirement for obtaining a patent for an invention?
The invention needs to be made of highly valuable components.
The invention must be in the form of a service.
The invention must be original.
The invention needs to be recognizable to the general public.
Question 16
An agency that appears to be created by a principal but does not exist in reality is called a(n) __________.
apparent agency
implied agency
agency by ratification
fully disclosed agency
Question 17
Laws that protect governments from being overthrown primarily serve the function of:
advocating social justice
providing bases for compromise.
maintaining the status quo.
minimizing individual freedom.
Question 18
Ken owns a small convenience store in a street corner in California. One afternoon, a teenage boy enters his store, looks around, and prepares to walk out without buying anything. Ken is wary of the boy because of the boy's shabby clothing. He stops and asks the boy to empty his pockets and then questions him for about five minutes. After finding that the boy does not have anything from the store on him, Ken reluctantly lets him go. Which of the following is a merchant protection statute that Ken has violated?
Reasonable grounds for suspicion
Reasonable duration of detention
Adverse possession
Adequate assurance of performance
Question 19
Corporate officers are best described as:
directors elected by a corporation's shareholders.
partners pursuing a joint venture transaction
owners of a corporation with limited liability for its debts and obligations.
employees appointed to manage the daily operations of a corporation.
Question 20
Which of the following scenarios is an example of law and ethics contradicting each other?
A florist in the United States employs an illegal immigrant to help the immigrant and her family overcome their financial difficulties.
A large apparel retailer copies the trademarked garment designs of a well-known fashion designer.
A restaurateur, whose restaurant is violating labor laws, bribes a federal official to prevent him from reporting the violations.
An iron-ore manufacturing company provides its employees with high-quality safety equipment.
Question 21
Robert orders coffee while having breakfast in a diner. He suffers third-degree burn injuries when the coffee accidently spills on him. He presses charges against the diner for failing to notify him that the coffee was exceptionally hot. In this scenario, the diner is guilty of a(n) __________.
unintentional tort
intent crime
intentional tort
Question 22
Which of the following best describes the term warranty?
It refers to the transfer of possession of stolen property to a person who had bought the property without the knowledge that it has been stolen.
It is a purchaser's title to goods obtained by the impersonation of another person.
It refers to the terms in a sales contract stipulating the party that will bear the risk of loss of goods during shipment.
It is the seller's assurance to a buyer that the goods sold meet certain standards of quality.
nonintent crime
Question 23
Which of the following is a characteristic of torts?
They are punishable by the death penalty.
They are usually not tried by the jury.
They are brought to court by a plaintiff.
They are tried by criminal procedure.
Question 24
A group boycott occurs when:
competitors at one level of distribution collectively refuse to deal with others at a different level of distribution.
parties enter into a trade agreement that has greater anticompetitive effects than procompetitive effects.
parties at different levels of distribution enter into an agreement to adhere to a schedule that will stabilize prices.
competitors agree that they will distribute their goods to only a particular portion of the market.
Question 25
A goal of the Sarbanes-Oxley Act of 2002 is to:
control and closely monitor the financial accounts of all corporations in the United States.
allow directors and executive officers of public companies to be given personal loans from the companies.
end conflicts of interest, establishing better corporate governance.
enable smooth settlement of alleged fraud among major corporations.
Question 26
Helen buys a toy railway set for her 3-year-old son, Ben. The product's cover mentions that the toy is suitable for children only aged between 3 and 12. While playing with the toy one evening, without Helen's supervision, Ben chokes on an inch-long engine driver figure that forms part of the train. Although he survives, he is traumatized by the incident. For which type of defect can Helen sue the toy manufacturer?
Failure to tamperproof
Defect in product packaging
Defect in manufacture
Failure to warn
Question 27
Insider trading is considered illegal because:
it results in excessive losses for the company.
it makes use of nonmaterial public information.
it fails to account for the short-swing profits brought into a company.
it limits investment opportunities for the investing public.
Question 28
When an employer does not discriminate against women in general but treats women above the age of 40 differently, the employer is practicing __________.
color discrimination
sex-plus discrimination
religious discrimination
racial discrimination
Question 29
The power and authority to exclude competition or control prices is known as __________.
enumerated power
monopoly power
implied power
reserved power
Question 30
Which of the following is a category of torts?
Professional malpractice
Personal liability
Strict liability
Nonintent crime
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