Test Bank Business Its Legal, Ethical and Global Environment 11th Edition by Jennings
True / False
- Violations of civil laws can result in imprisonment.
- True
- False
ANSWER: False
- If conduct is a criminal violation, it cannot also be a civil violation.
- True
- False
ANSWER: False
- There are no criminal laws at the federal level.
- True
- False
ANSWER: False
- Terms of a consulting contract are an example of private law.
- True
- False
ANSWER: True
- Substantive laws provide the means and mechanisms for the enforcement of laws.
- True
- False
ANSWER: False
- Stare decisis is Latin for "let the decision stand."
- True
- False
ANSWER: True
- The common law in each state is the same.
- True
- False
ANSWER: False
- Jurisprudence is legal philosophy.
- True
- False
ANSWER: True
- Zoning laws are substantive only.
- True
- False
ANSWER: False
10.The scholars of jurisprudence generally agree on the theory of law.
- True
- False
ANSWER: False
11.Statutory law exists at all levels of government.
- True
- False
ANSWER: True
12.The United States Code includes laws on anticompetitive activities as well as laws regulating the sale of securities.
- True
- False
ANSWER: True
13.Ordinances are generally found in state legislative codes.
- True
- False
ANSWER: False
14.The Code of Federal Regulations includes the enactments of federal administrative agencies.
- True
- False
ANSWER: True
15.States do not have administrative laws.
- True
- False
ANSWER: False
Name: Class: Date:
Ch01: Introduction to Law
16.City ordinances generally cover the legal aspects of incorporation and securities registration.
- True
- False
ANSWER: False
17.Citations are a form of legal shorthand for referring to statutes, ordinances, and cases.
- True
- False
ANSWER: True
18.Constitutions exist at both state and federal levels.
- True
- False
ANSWER: True
19.The Internal Revenue Code is part of federal statutory law.
- True
- False
ANSWER: True
20.Equitable remedies are not available in courts of law in the United States.
- True
- False
ANSWER: False
21.Laws' flexibility allow adjustments for technology changes.
- True
- False
ANSWER: True
22.A personnel manual is an example of private law.
- True
- False
ANSWER: True
23.Union/management laws demonstrate the role of law as a compromiser.
- True
- False
ANSWER: True
Name: Class: Date:
Ch01: Introduction to Law
24.Criminal laws are generally enforced by individuals.
- True
- False
ANSWER: False
25.A multilateral treaty is a treaty among several nations.
- True
- False
ANSWER: True
26.The act of state doctrine permits other countries to intervene in a nation's government when human rights are violated.
- True
- False
ANSWER: False
27.The EU has its own currency.
- True
- False
ANSWER: True
28.The Uniform Commercial Code and the Uniform Partnership Act are both enactments of Congress.
- True
- False
ANSWER: False
29.Party autonomy is not permitted in international contracts.
- True
- False
ANSWER: False
30.The EU will be disbanded in 2018.
- True
- False
ANSWER: False
31.Treaties are a source of international law.
- True
- False
ANSWER: True
Name: Class: Date:
Ch01: Introduction to Law
32.Custom has no impact on international law.
- True
- False
ANSWER: False
33.Once a court decision is issued, it cannot be reversed without legislative action.
- True
- False
ANSWER: False
34.A curfew is an example of the type of law that would be found in city or town ordinances.
- True
- False
ANSWER: True
35.The uniform laws on partnerships and corporations are found codified in the United States Code.
- True
- False
ANSWER: False
36.There are agency regulations at both the state and federal levels.
- True
- False
ANSWER: True
37.Courts create and apply the common law.
- True
- False
ANSWER: True
38.If you run a red light and hit and injure a pedestrian, both civil and criminal laws will apply.
- True
- False
ANSWER: True
39.Most countries follow a philosophy of caveat emptor.
- True
- False
ANSWER: True
Name: Class: Date:
Ch01: Introduction to Law
40.The Uniform Commercial Code (UCC) has been adopted in all 50 states.
- True
- False
ANSWER: False
41.The CISG is another name for the UCC.
- True
- False
ANSWER: False
42.Scalping ordinances are an example of criminal laws.
- True
- False
ANSWER: True
43.Context is a factor in types of legal systems.
- True
- False
ANSWER: True
44.Courts interpret all levels of statutes and regulations.
- True
- False
ANSWER: True
45.Zoning is an example of private law.
- True
- False
ANSWER: False
46.A question about a licensing exam for a real estate agent is best answered by going to federal laws.
- True
- False
ANSWER: False
47.Statutes that eliminate constitutional protections are still valid if they are federal statutes.
- True
- False
ANSWER: False
48.The U.S. Constitution does not apply to the states.
- True
- False
ANSWER: False
49.Judicial review is one means for clarifying the meaning of laws.
- True
- False
ANSWER: True
Multiple Choice
50.Which of the following is not a purpose of law?
- keeping order
- influencing conduct
- promoting equality
- providing compromises
- All of the above are purposes of law.
ANSWER: e
51.Several states have recently enacted legislation to permit casino gambling on river boats docked in their states. Gambling is permitted only while the boats are traveling in the rivers surrounding or inside the states. One governor issued the following statement: "It wouldn't matter how many gaming statutes are passed or how many legislatures passed them, the fact of the matter is that commercial gambling is wrong." This governor's views:
- indicate that he follows the positive law theory.
- indicate that he follows the natural law theory.
- indicate that he is against principles of justice.
- are most parallel to those of Oliver Wendell Holmes.
ANSWER: b
52.Bill Blackburn is the new mayor of Oceanside, Washington. He discovered that the city-run utility requires a deposit of $50 from new customers in homes. However, new customers who reside in apartments, condominiums, or townhouses must pay a $500 deposit. Mayor Blackburn proposed that the utility deposit be $100 for all new customers. Blackburn's change fits best under which theory of law?
- positive law theory
- natural law theory
- theory of justice
- theory of custom
ANSWER: c
53.Which of the following is not an example of a law that promotes equality?
- employment discrimination laws
- antisegregation statutes
- Social Security statutes
- trespassing statutes
- All of the above laws promote equality.
ANSWER: d
54.Which is the proper cite for the Code of Federal Regulations?
- CFR
- USC
- USCFR
- none of the above
ANSWER: a
55.Which of the following is not part of the United States Code?
- 1933 Securities Act
- Sherman Act
- Equal Employment Opportunity Act
- Uniform Commercial Code
- All of the above are part of the United States Code.
ANSWER: d
56.Which is the proper cite for Executive Orders?
- CFR
- USC
- E.O.O.C.
- none of the above
ANSWER: d
57.The UCC has been adopted by:
- all 50 states.
- over half the states.
- 49 states.
- a quarter of the states, but it is rapidly gaining in adoptions.
ANSWER: c
58.Enactments of federal administrative agencies are found in:
- the United States Code.
- the Code of Federal Regulations.
- the U.S.C.
- none of the above
ANSWER: b
59.In "cite 15 U.S.C. sec. 77," the 15 represents:
- the page number.
- the volume number.
- the session of Congress when enactment occurred.
- none of the above
ANSWER: b
60.Uniform laws are:
- required to be adopted by states.
- written to make interstate business less complicated.
- found in USC.
- none of the above
ANSWER: b
61.Legal and equitable remedies:
- are available in all courts in the United States.
- are awarded by separate courts of equity and law.
- are the same remedies.
- exist only in the United States.
- none of the above
ANSWER: a
62.Which is not an example of private law?
- lease on a residential home
- lease on a commercial building
- zoning ordinances
- contract for the sale of a car
- employer regulations
ANSWER: c
63.Which of the following is not true regarding constitutional law?
- exists at the state and federal levels
- establishes government structure
- establishes individual rights
- can be changed by Congress
ANSWER: d
64.Phil's Corner Mart is a convenience store and gasoline station. A representative from the Environmental Protection Agency (EPA) has just notified Phil that there is some leakage from his underground gasoline storage tanks. The EPA representative explains to Phil that he will be issuing a citation for violation of federal environmental laws and that Phil could be liable for clean-up costs and penalties. Which of the following statements is true?
- Phil has been charged with a crime.
- Phil has been charged with violation of a state statute.
- Phil is facing civil penalties for the violation.
- The EPA promulgates USC provisions.
ANSWER: c
65.A state statute that prohibits "baby buying" regardless of circumstances is a law that most closely follows which theory of jurisprudence?
- justice
- natural law
- positive law
- custom
ANSWER: b
66.Administrative regulations are promulgated by:
- Congress.
- constitutional conventions.
- administrative agencies.
- state legislatures.
- none of the above
ANSWER: c
67.Which of the following subjects is not generally covered by local ordinances?
- zoning
- curfews
- dog licensing
- partnerships
- traffic
ANSWER: d
68.Criminal laws:
- carry fines and/or imprisonment penalties.
- are enforced by individuals.
- are generally not enforced by government agencies.
- are the same as private laws.
- none of the above
ANSWER: a
69.On faxed documents, it is often difficult to tell if a signature is authentic, both because clarity is a problem and also because signatures can be cut and pasted onto new documents from old documents. The Uniform Commercial Code provides that anything placed on a document with the intent to authenticate it is a binding signature for a valid contract. The UCC definition:
- did not anticipate the technology problems arising from the fax.
- will apply even in these fax situations.
- is a common law definition.
- is part of federal law.
ANSWER: a
70.Which of the following is not an example of a law that promotes order?
- disclosure statutes for securities sales
- curfew
- speed limits
- trespassing laws
ANSWER: a
71.Changes in laws that are made because of changes in technology illustrate which characteristic of law?
- consistency
- pervasiveness
- flexibility
- none of the above
ANSWER: c
72.Which of the following is an example of a law that provides compromises?
- curfews
- antitrust laws
- traffic laws
- union/management laws
ANSWER: d
73.The federal statute that carries imprisonment as a penalty for trading securities on inside information is an example of a:
- private law.
- civil law.
- procedural law.
- criminal law.
- all of the above
ANSWER: d
74.Common law:
- no longer exists today.
- began in the United States.
- exists only in England.
- was eliminated with the courts of equity.
- none of the above
ANSWER: e
75.Which of the following is not a source of international law?
- custom
- treaties
- private law
- Code of Federal Regulations
ANSWER: d
76.The European Union:
- was disbanded by GATT.
- is an organization of European countries.
- has established trade barriers.
- has strict customs controls among the members.
ANSWER: b
77.Ellen Benson has been operating a small catering business out of her home. Business growth is now requiring an office and kitchen facilities. Before expanding facilities, Ellen wishes to incorporate her business. Where would Ellen find the laws of incorporation?
- state statutes
- zoning ordinances
- Code of Federal Regulations
- county ordinances
ANSWER: a
78.Which of the following is not a source of private law?
- lease
- employment agreement
- ordinance
- marriage prenuptial agreement
ANSWER: c
79.When is precedent not followed?
- when circumstances have changed
- when technology has changed
- when there are changes in the factual circumstances from those in which the precedent was established
- It is possible that precedent would not be followed in all of the above circumstances.
ANSWER: d
80.Anna Elleson has just opened her plumbing business in a small industrial park located within the boundaries of the city of Tempe, Arizona. Upon opening her plumbing business, Anna receives a notice from the landlord that her largest pieces of equipment (backhoes) may not be parked in the parking lot of the industrial park overnight. Anna asks why and the landlord explains that there is a restriction in her lease. The restriction against parking equipment in the complex is:
- enforceable as a private law.
- unenforceable unless a city zoning ordinance prohibits such parking.
- an unconstitutional regulation of private property.
- unenforceable unless signs are posted.
ANSWER: a
81.Anna's landlord of her business property in Tempe, Arizona notifies her that when the next lease period begins, her rent will increase $45 each month. Where can Anna go to determine her rights with respect to the rent increase?
- her rental contract
- Arizona Revised Statutes
- rent control ordinances
- all of the above
ANSWER: d
82.Anna would like to incorporate her plumbing business, which is located in Tempe, Arizona. Where can she find out the requirements for incorporation?
- Tempe city ordinances
- her rental agreement
- Arizona Revised Statutes
- none of the above
ANSWER: c
83.Anna feels, after negotiating her first few plumbing contracts, that there is a pricing conspiracy involving other plumbing contractors that keeps her from really breaking into the market. Her business is located in Tempe, Arizona. Where would Anna find the law on anticompetitive behavior?
- Arizona Revised Statutes
- United States Code
- Tempe city ordinances
- none of the above
ANSWER: b
84.John Renfro was recently downsized as part of a corporate restructuring at the jet propulsion firm where he works. Renfro is confused, "Do I have any rights on my health insurance? What about unemployment?". Which sources of law would have information for Renfro in answering his questions?
- jurisprudence
- ordinances
- executive orders
- federal statutes (U.S.C.)
ANSWER: d
85.Jane Dixon is going to create a limited liability company for operating her business that does billing for physicians and medical laboratories. Jane is unsure whether her state allows for the creation of limited liability companies. Advise Jane on the best place to look for finding whether she can create a limited liability company in her state:
- United States Code
- Code of Federal Regulations
- municipal ordinances
- state statutes
- none of the above
ANSWER: d
86.Wexler Corporation has established a new policy on employee e-mails. The policy reads: "All e-mail sent using the company server is the property of the company and is not private. Supervisors and managers shall have the right to review such e-mails. Inasmuch as the company is liable for e-mail content, it reserves the right to review it." The policy:
- is an example of private law.
- is an example of statutory law.
- is an example of constitutional law.
- is never enforceable.
- none of the above
ANSWER: a
87.Which of the following is an example of law not enacted by an elected body?
- municipal law
- administrative regulations
- state codes
- United States Code
- all of the above are enacted by an elected body
ANSWER: b
88.The CISG:
- is an example of uniform state laws.
- is an example of uniform international laws.
- is an example of a war convention among several nations.
- does not exist in the EU.
- none of the above
ANSWER: b
89.Jim Ream is a freshman at Woise State. Jim is a computer whiz and has found a way to download movies from DVDs and then transfer the files to others. “But, Jim,” you tell him, “that Grokster thing made all that illegal.” Jim responds, “That was music, this is movies. Completely different. No legal problems.” Jim:
- is correct because federal law does not apply to movies.
- is correct because the precedent can be distinguished.
- is incorrect because there is an infringement issue and Napster is precedent.
- Both a and b
ANSWER: c
90.Frank Zelco is a manufacturer’s rep who represents the product lines of several manufacturers. Frank has worked with his brother, Dion, in their two person firm for almost five years. They have no written contract, but they split the profits. Frank would like to create a business organization and put their arrangement in a written contract. Which sources of law will Frank need to help him do this?
- ordinances
- the UCC
- state laws on business organizations
- both b and c
ANSWER: c
91.During 2003, the White House asked its legal counsel for an interpretation of what constitutes torture of prisoners of war and who is considered a prisoner of war. What sources of law will the legal counsel need to consult?
- federal statutes
- international treaties
- ordinances
- both a and b
ANSWER: d
92.The term “common law” has been in existence since:
- the end of the Civil War.
- the end of World War I.
c. 1492.
d. 1066.
ANSWER: d
93.When the music companies filed suit against the peer-to-peer file sharers on copyrighted music, they wanted legal and equitable remedies. Which of the following is an equitable remedy?
- money damages for the loss of royalties on the downloaded copyrighted songs
- injunction against the facilitating software provider for the downloading
- civil penalties for the infringement
- both a and c
ANSWER: b
94.A court of chancery:
- is another name for a court that provides equitable remedies.
- is another name for a court that provides legal remedies.
- never existed in the United States.
- handles decisions regarding lottery disputes at the state level.
ANSWER: a
95.The laws on copyright ownership and infringement were passed by the U.S. Congress. Where would you find those laws?
- in the Uniform Commercial Code
- copyright is governed by the common law
- in the Federal Register
- in the United States Code
ANSWER: d
96.Jane Simms had a number of files on her computer that consisted of drafts of speeches that her supervisor had planned to give at an industry conference. Jane had a problem with many of her files being destroyed when she upgraded her operating system. Her supervisor did not give his speech at the industry conference, but was subsequently indicted, along with others in the industry, for price-fixing. The Justice Department has subpoenaed Jane's computer files, and Jane explains that the files no longer exist. Jane has been charged with a violation of 18
U.S.C. § 1519 for destroying "records and documents". Which of the following statements is correct?
- Jane cannot be charged because the speeches were not hers.
- Whether Jane can be charged is controlled only by the language of the statute.
- Jane cannot be charged because computer files are different from "records and documents".
- A court determines whether the statute applies to Jane.
ANSWER: d
97.Which of the following would not be an example of public law?
- state constitution
- federal constitution
- a state's lease of an office building
- county property tax laws
ANSWER: c
98.You did not obtain a license for your bicycle. The city ordinance requiring bike licenses carries a $50 fine for the failure to obtain a license. Which of the following is true?
- This is an example of a criminal law.
- This is an example of a private law.
- This is an example of a state regulation.
- This is an example of tort law.
ANSWER: a
99.Rachel Salazar is a writer of children's books who is well known and appears on television talk shows on a regular basis. The magazine, Literary Guild, wrote an article that compared passages of her children's books to those of other authors to show that she had plagiarized her work. The examples Literary Guild used were from books written after Ms. Salazar's works. What type of law affords Ms. Salazar a way to recover damages for the errors in the article?
- criminal law
- civil law
- procedural law
- both b and c
ANSWER: d
100.Which of the following is not a part of common law?
- statutes in England
- precedent
- customs
- All of the above are part of common law.
ANSWER: a
101.John Gee developed a software program that helped retail stores better manage their shelf inventories. Gee has discovered that a student who worked stocking shelves at Highland Grocery Store obtained a bootleg copy of the software and has been selling it from his dorm room at State University. Gee wishes to know what types of remedies he has available.
- He has no remedies, but he could report the activity for criminal prosecution.
- An injunction to stop the sales of his program.
- There are no remedies for him if the program can be downloaded because that is only criminal activity.
- both a and c
ANSWER: b
102.In the Yates v. U.S. case, what was the purpose of the court's decision?
- to decide whether an injunction was an appropriate remedy
- to determine the civil liability of fishers
- to interpret a statute
- both b and c
ANSWER: c
103.Mark Knopf is an auditor who has been asked to provide an audit and financial statement certification for a company that is going public on the New York Stock Exchange. Knopf wants to know his personal liability if the company provides him with inaccurate or false information. Which of the following sources of law will help him answer that question?
- the city ordinances where the company headquarters is located
- the state constitution of the state where the company is incorporated
- Code of Federal Regulations
- all of the above
ANSWER: c
104.Where would you find the Uniform Commercial Code?
- United States Code
- Code of Federal Regulations
- state legislative law
- all of the above
ANSWER: c
105.NAFTA is a treaty of the United States, Canada, and Mexico. Which term describes this treaty?
- bilateral treaty
- multilateral treaty
- party autonomy
- federal statute
ANSWER: b
106.The CISG resembles which of the following?
- Uniform Commercial Code
- the EU governing document
- the Internal Revenue Code
- both a and b
ANSWER: a
Essay
107.Ralph Waters is a developer who is interested in developing a planned adult mobile home community in Mesa, Arizona. Ralph will need to incorporate and then learn the procedures necessary to begin the development. What levels of law will affect Ralph? What types of laws will apply to him?
ANSWER: Students should discuss the following: County ordinances - zoning
City ordinances - zoning, permits State statutes - incorporation
Federal statutes - mortgages (FHA, VA) Federal regulations - HUD
Private law - contracts for homes
108.Give a sample citation for each of the following statutes/regulations:
- United States Code
- Code of Federal Regulations
ANSWER: 15 U.S.C. sec. 77
12 C.F.R. sec. 226
109.In confirmation hearings of nominated judges and justices, what role may stare decisis play in the questioning of the nominee?
ANSWER: Stare decisis means to “let the decision stand”. A judge is supposed to apply the law as written by a legislature. By following stare decisis, a judge will not disregard established precedent simply because the judge does not like it. Since Senators are not supposed to ask nominees about specific case holdings, the questions can try to avoid that by, for example, asking a nominee if she or he believes Roe v. Wade is a legal precedent and then asking if she or he believes in stare decisis.
110.Discuss the differences between public and private law.
ANSWER: Criminal versus civil penalties
Private enforcement versus public enforcement Governmental enactment versus individual enactment
- Give an example of the type of law found at each level of government noted:
- U.S. Constitution
- congressional enactments
- state legislation
- federal administrative regulations
ANSWER: U.S. Constitution: Bill of rights protections like First Amendment; structure of government Congressional: Antitrust statutes
Securities laws Internal Revenue Code
State legs: Uniform Commercial Code Uniform Partnership Act Corporations laws
Federal regs: IRS regs
Truth-in-lending regs Securities regs
112.The Family Leave Act was passed by Congress in 1993. The Act requires certain employers (those of a certain size) to give 12 weeks of leave to their employees for the birth or adoption of a child or the care of an ill spouse, parent, or child. Answer the following questions:
- In which set of statutes will this new law be found?
- Is the statute a civil or criminal law?
- Is the statute an example of legislating natural law?
ANSWER: a. United States Code
- Civil Law
- Yes, in a way. The law legislates the right to be with family members when we are needed most.
113.Name three types of business arrangements governed, at least in part, by private law.
ANSWER: Leases; employment contracts; consulting contracts; sales contracts
114.Draw the pyramid of laws and label each level of the pyramid with the appropriate source of law.
ANSWER: The students should reproduce the pyramid figure from chapter one with the sources of law from bottom to top being: constitution; federal legislative enactments; federal agency regulations; state constitutions; state legislative enactments; state agency regulations; county, city and borough laws; private laws; and the pyramid is surrounded by case law; all statutes are subject to interpretation.
115.Give the source of statutory law for each of the following topics:
- Uniform Revised Limited Partnership Act
- 1933 Securities Act
- law requiring bikes on public streets to be licensed
- no taking of property without just compensation
- establishment of the House of Representatives
ANSWER: a. state law
- federal law
- ordinance
- constitution
- constitution
116.For each of the following actions, describe the sources of law the individuals should consult:
- obtaining a bicycle license
- incorporating a company
- determining how many feet of set back are required for residential construction
- selling securities on a national exchange
ANSWER: a. ordinances
- state law
- ordinances
- federal statutory law - U.S.C. and SEC regulations, C.F.R.
117.Following the 1999 tragedy at Columbine High School in Littleton, Colorado, when 13 students were killed by two of their armed classmates, there was discussion of Second Amendment rights and gun control regulations were passed by Congress. What sources of law were part of the discussions and legislation?
ANSWER: Second Amendment is part of U.S. Constitution and Congress passed laws that became part of U.S.C.
118.Give an example of an executive order.
ANSWER: The book gives several examples such as executive branch agencies being required to first try alternative dispute resolution, the "gag rule" on abortion counseling, ban on federal funds for abortion, the classification of executive branch documents and the use of minority workers in federal contracting.
Others that are topical and in the news include the use of federal funds for stem-cell research and the declaration of national preserves.
119.In 2006, Congress passed the Pension Reform Act. The act amended the Employee Retirement Income Security Act (ERISA). The act was passed when several companies declared bankruptcy and were discharged from paying their pension obligations to retired employees. Discuss how the Pension Reform Act illustrates the purpose of law and what purposes emerge from the new legislation.
ANSWER: The pension reforms accomplished several purposes that are part of the law. First, the law restored stability to the economy as well as the lives of the retired workers by not eliminating their only source of income. Second, the law was used to enforce expectations and provide reassurance that we can plan on the basis of promises and law in existence at the time we were employees and savings funds in the pension plan. With this reassurance that pensions would be honored. Congress also imposed some new requirements on employers that required them to honor their promises. In all likelihood the reforms had a secondary goal of keeping order because there were threatened strikes and protests when the pensions were discharged.
120.Write the type of law (federal, state, city or county, private) for each of the following:
HOA regulations Dog licenses
Internal Revenue Code
Model Business Corporation Act Real estate licenses
Emissions permits Securities registration
ANSWER: HOA regulations - Private
Dog licenses - City or county Internal Revenue Code - Federal
Model Business Corporation Act - State Real estate licenses - State
Emissions permits - Federal Securities registration - Federal