Business Law

Congress enacted the Sarbanes-Oxley Act to help reduce unethical management decisions.

True

The obligation of commercial reasonableness underlies every sales and lease contract.

True

Sam, driving under the influence, causes a car accident that results in the death of Tanya. Sam is arrested and charged with a crime punishable by imprisonment for more than a year. This crime is

a felony

An ethical code of conduct is not

a law

negotiable instrument

a signed writing that contains an unconditional promise or order to pay an exact amount, either on demand or at a specified future time

Owen and other managers employed by Pastry Bakeries are most likely to find that unethical behavior in the workplace can be deterred by

taking immediate action in response to unethical conduct

"Fair use" cannot be asserted as a defense to a charge of copyright infringement in a dispute concerning digital sampling.

False

A buyer is required to cover and a failure to do so will bar the buyer from using any other remedies available under the UCC.

False

A merchant who is in the business of selling certain goods makes an implied warranty of merchantability every time she sells any type of merchandise.

False

Because it may be unclear how a court will interpret and apply a law, companies can ensure decisions are viewed as ethical by documenting their own interpretation of the law.

False

Certain business processes are copyrightable.

False

Conduct that is legal is ethically unquestionable.

False

Federal law permits the sending of unsolicited commercial e-mail to randomly generated e-mail addresses.

False

If a contract for a sale of goods leaves the quantity term open, there is a basis for determining a remedy.

False

If a seller fails to deliver the goods, the buyer can purchase other goods to substitute for those due under the contract, but cannot then sue for consequential damages.

False

If the acceptance to a sales contract between non-merchants includes terms different from those in the offer, no contract is formed under the UCC.

False

In a product liability suit based on a design defect, a manufacturer is liable only when the harm was not reasonably preventable.

False

In a successful tort suit, an individual is awarded compensatory damages to put him or her in a better position than the party who committed the tort.

False

Making ethical decisions is most often best done by analyzing objective standards (such as profit or number of people fired) instead of subjective impacts on stakeholders.

False

Once a manufacturer's trademark is established, another manufacturer may use it without permission.

False

One of the purposes of criminal law is to compensate the victims.

False

Online conduct gives rise to only a narrow variety of legal actions.

False

Rationalization is the process of making a logical decision based in evidence and an analysis of the ethical dimensions of the decision.

False

Tender can occur at any hour and in any manner—such as by a phone call to the buyer, allowing "fifteen minutes to pick up the goods."

False

The UCC provides that a sale or lease contract will fail for indefiniteness if more than one of its terms is left open.

False

The Uniform Commercial Code requires parties to form sales and lease contracts with the same formality used in forming other types of contracts.

False

The law does not prohibit the creation or shipment of counterfeit labels unless they are attached to products.

False

The registration of a copyright is not evidence that the copyright is valid.

False

The term moral minimum is best defined as the highest degree of ethical behavior expected of a firm.

False

To gain a share of a market, a businessperson can interfere in another's business, even if the behavior is predatory.

False

To maintain a claim of trademark dilution, the products involved must be similar.

False

Under a shipment contract for the sale of a certain quantity of solar panels, the seller is required to deliver conforming goods at a particular destination.

False

Under the "stakeholder view," no group ever has a greater stake in company decisions than the shareholders do.

False

Under the Madrid Protocol, the fees and procedures for trademark registration vary significantly among individual countries.

False

Under the categorical imperative, an unethical decision that would have only a small impact is acceptable as long as no one else in society acts the same way.

False

When a buyer breaches a sales contract, the risk of loss remains with the seller to the extent of any deficiency in the buyer's insurance coverage.

False

When a sales contract contemplates shipment of the goods but does not specify the arrangements, either party can make those arrangements.

False

When profit maximization is the goal, a company does not benefit from ethical behavior.

False

A contract for a sale of natural gas is a contract for a sale for goods.

True

A descriptive term is protected under trademark law if it acquires a secondary meaning.

True

A license may limit the use of a software application to a specific device.

True

A person will not be liable for wrongful interference if the interference results from legitimate competitive behavior.

True

A seller who tenders nonconforming goods has reasonable grounds to believe that the buyer will accept the tender if it includes a price allowance.

True

Any time that one party's allegedly wrongful conduct causes injury to another, an action may arise under the law of torts.

True

As part of the IDDR approach as described in the text, it is important to list many possible actions and analyze them using several different ethical theories.

True

Corporate "citizenship" involves making decisions beyond just maximizing profits and dividends.

True

Corporate social responsibility links the responsibility of citizenship with the strategy and key principles of a business.

True

Ethical decision makers should test and reflect on the outcome of their decisions.

True

Express and implied warranties do not displace each other because more than one warranty can cover the same goods in the same transaction.

True

Generally, when an acceptance to a sales contract between merchants includes terms additional to those in the offer, the terms automatically become part of the deal.

True

If a person buys cattle at a livestock auction, title will pass to the buyer when the cattle are physically delivered unless the parties agree otherwise.

True

If a sales contract prohibits any changes unless they are in a signed writing, then only those changes agreed to in a signed writing are enforceable.

True

In a criminal case, the state must prove its case beyond a reasonable doubt.

True

In a sales contract, the passage of risk of loss from a seller to a buyer gives the buyer the right to insure the goods and the right to recover from third parties who damage them.

True

In entering personal information to a banking site online, a person may have a reasonable expectation of privacy.

True

In response to an order for a hundred baseballs, the shipment of a hundred basketballs is both an acceptance of the offer and a breach of the contract.

True

Intellectual property is property resulting from intellectual, creative processes.

True

One view of the role of business in society is the perceived duty of a company only to generate revenue for its owners.

True

Outcome-based ethics determines what is ethical by looking at the potential benefits and harms of a given action.

True

Some business processes can be protected as trade secrets.

True

The Fourth Amendment protects only against searches that violate a person's reasonable expectation of privacy.

True

The effectiveness of an industry code of ethics is partly determined by the commitment of the industry or company leadership to enforce it.

True

The first step in making an ethical decision is to understand the problem.

True

The parties to a sales contract can limit or exclude consequential damages for any commercial loss—such as a business's lost profits or property damage.

True

To the extent that it has not been modified by the UCC, the common law of contracts applies to sales contracts.

True

Under the perfect tender rule, a buyer or lessee has the right to insist on goods that conform to their contract in every detail.

True

When making ethical decisions, a business should evaluate the financial implications.

True

Life Products Inc. enters into a contract to sell medical supplies to Med Clinic, which later sells some of the items to Nina, a patient and consumer. Article 2 of the UCC applies to

both transactions

Precise Parts, Inc., and Quality Auto stores enter into a contract for a sale of auto parts that meet certain specifications. Precise Parts ships goods that do not comply. Quality Auto

can reject the entire shipment

Pine Mills Inc. agrees to sell a certain quantity of plywood to Quality Lumber Company under a destination contract. Pine Mills must

deliver the plywood to a particular destination

Rancho Stables orders ten saddles from Saddles, Inc. The sales contract states that if the tack is defective, Rancho will allow Saddles to repair or replace it instead of rejecting the shipment. When the gear arrives, it is defective. In this case, the perfect tender rule

does not apply

Artificial Intelligence Inc. sells to Beta Bots Corporation a promising idea for a technological innovation that is still being developed and that looks very promising. This is

ethical and legal

The Fraud Reduction and Data Analytics Act to prevent, detect, and respond to fraud in federal programs institutionalizes

ethical rights and duties.

Hilo tells the Internal Revenue Service that Jon "cheated on his taxes." This can lead to Hilo's liability for defamation if the statement is

false

The triple bottom line looks at all of the following except

how decisions impact the relationship between the U.S. and other nations.

Product Sales Inc. adheres strictly to the goal of maximizing profits. Even so, Product Sales will benefit from ethical behavior

if customer service is good

Jake offers to sell Kyle a collection of baseball cards. To qualify as a sale under the UCC, Kyle's payment for the cards must be

in cash, or its equivalent, or in other goods or services.

Business Rents LLC and Cartage Trucking Inc. enter into a contract for a lease of ten hydraulic lifts. Under the perfect tender rule, Business Rents must ship or tender lifts to Cartage that, with regard to the contract specifications, conform

in every way

Don interferes with the business interests of Erin in a way not permitted by law, and Erin's business is harmed as a result. To be liable to Erin for the commission of an intentional tort, Don must have

intended to commit the act

Hal posts online secretly recorded videos of Ida, and includes her name, address, phone number, and Facebook page. Most likely, Ida could bring a successful tort action against Hal for

invasion of privacy

Minerals Ltd. contracts to provide several manufacturers with tin. When a cartel of tin-producing countries suddenly embargoes future shipments of tin to Minerals so that it cannot fulfill its contracts, the distributor

is excused from the performance of its contracts

Volatile Investments Inc. sends e-mail ads to any e-mail address that the sender can find on the Web or otherwise generate. Under federal law, Volatile's marketing method

is prohibited

Ed works for Family Dwellings Inc., an investment firm that buys, renovates, and rents foreclosed houses. Ed steals his employer's digital files to start his own competing business, Good Homes LLC. This is

larceny

Ethics is important because laws may not always be easy to interpret or apply. This is because

laws represent the will of the people and that will is often changing.

Ethics has to do with how a businessperson making business decisions applies

moral principles

Lucy is a business manager for Manufacturing Company. Ethical issues that Lucy is not likely to encounter include determining

protocols for company meetings

When making decisions that are ethical under either profit maximization or corporate citizenship theories, a business should include all of the following steps except

publicize the options you rejected with your reasons

Sound Financials Corporation sends daily e-mail ads to its previous customers and those who have opted to receive the notices. The state in which the company is physically located has enacted an antispam law. Under federal law

the application of the state's law to Sound's ads is preempted

The National Restaurant Association announces a new industry code of ethics. The effectiveness of this code will be determined by

the commitment of management to enforcing the code.

Brewed Beans Inc. makes and sells "CoCoCafe," a chocolate-flavored coffee. Darkroast Inc. later markets a similar drink under the name "KoKoKafe." This is most likely

trademark infringement

Viaduct Corporation used untested and risky construction techniques to build a bridge under budget. The techniques were legal but the bridge collapsed, killing several people. Viaduct's actions were

unethical and may result in legislation to ensure it does not happen again.