Business Law Unit 4 Exam

What is the minimum number of members an LLC can have?

1

Prima facie case of disparate treatment employment discrimination

1. Member of protected class 2. Qualified for the job 3. Tangible employment action 4. Based on class membership

What is the maximum number of shareholders an S-Corporation may have?

100

Clear View Corporation offers to sell its flat-panel display monitors to Best Computer & Video, Inc., only if Best agrees to buy Clear View's servicing of its products along with the monitors. This is

A tying arrangement

Ethan is employed by Montana Energy Company. His duties include negotiating the purchase of mineral rights for future mining projects. Ethan secretly buys some of the property and sells it to Montana Energy at a profit. Ethan has breached

Agent's duty of loyalty

Based on Rochel's conduct, Marcus reasonably believes that Andrew has the authority to act on Rochel's behalf even though Andrew does not have the actual authority to do so. In this circumstance, Andrew has

Apparent authority

Robert is an employee of Ridge Mining Company. Under federal labor law, Robert and other employees have the right to

Bargain collectively with Ridge through their reps

Which of the following statements is true: I. A promise that an employer makes in an employee handbook regarding discharge may be considered part of an implied employment contract II. Individual states may pass their own right-to-work laws

Both I and II.

Which of the following statements is true: I. An employer may defend against a claim of unintentional discrimination by asserting that a practice that has a discriminatory effect is a business necessity. II. Gender can be a bona fide occupational qualification.

Both I and II.

Which of the following entities does not have "pass-through" taxation?

C-Corporation

Which of the following business entity(ies) is managed by a Board of Directors elected by Shareholders:

Corporation

Which of the following are pros of a corporation? a) Limited liability b) transferable ownership c) structured management d) all of the above

D) all of the above

John is seventeen years old. Under the Fair Labor Standards Act, he a) must be directly supervised by an adult b) must obtain a work permit c) cannot work during school hours d) cannot work in a hazardous occupation

D) cannot work in a hazardous occupation

In which of the following entities do all owners have limited liability for all business debts? a) Corporations b) Partnerships c) S-Corps d) both a and c

D), both a and c. Corporations and S-Corps

Dan is a limited partner in XYZ partnership. Which of the following is true:

Dan has limited liability but cannot participate in management

Mack's Manufacturing, Inc., grants its agent Teona an exclusive territory in which to sell Mack's products. Mack's cannot compete with Teona in that territory under the principal's

Duty of cooperation

Amanda works at Montana Water Company. Amanda is a sales representative who works with Montana Water's customers, including restaurants, grocery stores, and other businesses, as well as individual consumers. Montana Water closely supervises all of its sales reps and dictates their schedules. With respect to third parties, Amanda is Montana Water's

Employee and Agent

Katherine employs Flash Delivery Agency as an agent under a written agreement that describes the rights and duties of both parties. This is

Express authority

Acme Pipe, Inc., employs Eduardo as a sales agent for a trial period. At the end of the period, Acme and Eduardo disagree on the amount of the commissions Eduardo is due for sales that he made. Eduardo may demand a constructive trust.

False

Beth, who has a disability, is an employee of Corporate Office Company (COC). After the installation of new doors on COC's building, Beth finds it nearly impossible to get in and out. For repeatedly failing to be on time, COC replaces Beth with Diane, who does not have a disability. To successfully defend against Beth's claim, COC will have to show that the doors were not installed as an act of intentional discrimination.

False

Blast-Off Company wants to genetically test its workers for potentially significant, future health problems. Blast-Off may, but is not required to, deny group health insurance for its employees who test "positive."

False

Bodycare Corporation makes and sells ChemMed, the most prescribed name-brand blood pressure-lowering medication. Deja Vu Drugs, Inc., has the potential to make a generic version of the same drug. A court would most likely rule that the agreement between Bodycare and Deja Vu is subject to analysis under the rule of reason.

False

Bodycare Corporation makes and sells ChemMed, the most prescribed name-brand blood pressure-lowering medication. Deja Vu Drugs, Inc., has the potential to make a generic version of the same drug. Bodycare pays Deja Vu not to sell its product. This is an exclusive dealing contract.

False

Dredgers, Inc., is the major wholesale distributor of heavy equipment in the state of Georgia. Its closest competitor is Excavators Company, another Georgia firm. The two firms agree that Excavators will operate in southern Georgia and Dredgers will operate in northern Georgia. This is a tying arrangement.

False

Hu believes that he is the victim of a form of employment discrimination that falls under Title VII of the Civil Rights Act. Compliance with this statute is monitored by the Equal Employment Opportunity Commission

False

If Mary involuntarily losses her job with ABC, Corp, she can continue her ABC health benefits for a period of time. However, if Mary voluntarily leaves a job with ABC, she cannot continue her ABC health benefits for a period of time.

False

Jane is the only female employee in the maintenance department of ABC Inc. Jane's supervisor and co-workers tease and play tricks on her so relentlessly that she feels compelled to quit. Janes' quitting is not considered a discharge under Title VII.

False

Megan works for Standoff, Inc. Under federal law, Standoff must provide Megan with up to twelve MONTHS of family or medical leave

False

Speedee Snoboards, Inc., refuses to sell its products to Timber Mountain WinterSports Stores, Inc., a retail snowboard dealership. This is an exclusive-dealing contract.

False

The basis for an employee's contribution to Social Security is the employee's age

False

To drive its competitors out of a certain geographic segment of its market, Drone Drives, Inc., sets the prices of its products below cost for the buyers in that area. This is predatory pricing.

False

Whistleblower statutes protect employers who report their employees' wrongdoing.

False

Betty, an employee of Longbow, Inc., is covered by federal overtime provisions. Betty may earn overtime only after she has worked more than

Forty hours in a week

Clive works for Digby Excavation Corporation. While operating a backhoe, Clive suffers an injury. Clive will be compensated under state workers' compensation laws only if

His injury was accidental

Acme Corp hires Ike to buy gems and precious metals from various sources on its behalf. In this relationship, I. Acme Corp is the principal. II. Ike is an employee but not an agent

I, only Acme Corp. is the principal

Which of the following statements are true: I. When a small number of companies share a large part of a market, the market is concentrated II. Size alone determines whether a firm is a monopoly

I, only When a small number of companies share a large part of a market, the market is concentrated

Which of the following statements is true: I. A key employee is defined as an employee whose pay falls within the top 10 percent of the firm's workforce. II. Under federal law, only key employees who take temporary family or medical leave are entitled to job reinstatement.

I, only. A key employee is defined as an employee whose pay falls within the top 10 percent of the firm's workforce.

Cody believes that Delta Corporation has discriminated against him on the basis of gender. Cody files a suit against Delta under Title VII. To establish a prima facie case of employment discrimination, Cody must show that which of the following: I. Cody is a member of a protected class. II. Delta has no legal defenses against the claim.

I, only. Cody is a member of a protected class.

Which of the following statements are true: I. Employers who do not accommodate the needs of persons with disabilities must demonstrate that the accommodations would cause undue hardship II. The Americans with Disabilities Act of 1990 requires that an employer provide a reasonable accommodation for an employee regardless of whether the employee is qualified for the work.

I, only. Employers who do not accommodate the needs of persons with disabilities must demonstrate that the accommodations would cause undue hardship

Which of the following statements is true: I. For an employee to recover workers' compensation, the employee must have been injured during the course of employment. II. An employee can usually recover workers' compensation for injuries occurring on the commute to and from work.

I, only. For an employee to recover workers' compensation, the employee must have been injured during the course of employment.

Which of the following statements are true: I. Monopoly power in and of itself constitutes the offense of monopolization II. The purpose of an antitrust legislation is to foster competition

II, only The purpose of an antitrust legislation is to foster competition

Which of the following statements is true: I. A whistleblower is an employee who reveals confidential information about a fellow employee to the employer II. Whistleblower statutes protect employees from retaliatory discharge.

II, only Whistleblower statutes protect employees from retaliatory discharge.

Which of the following statements is true: I. A tangible employment action is any change in employment status or benefits. II. The Civil Rights Act of 1964 prohibits job discrimination against majority group individuals, such as white males.

II, only. The Civil Rights Act of 1964 prohibits job discrimination against majority group individuals, such as white males.

If you and a friend decide to go into business as a partnership and you put up $2,000 and your friend puts up $1,000, how will management decisions be made?

Management decisions will be made by both partners

Lita replaces Manny in his job at Neighborly Business Corporation (NBC). To succeed with an age-discrimination claim against CBC, Manny will have to show that

Manny is qualified for his job

Lita replaces Manny in his job at Neighborly Business Corporation (NBC). Manny believes that he has been discriminated against on the basis of his age. For the Age Discrimination in Employment Act of 1967 to apply

Manny must be forty years old or older

Which of the following statements is true: I Sexual harassment occurs only if sexual favors are demanded of an employee II An employer is not liable to an employee if the employee is harassed by a non-employee

Neither I nor II

What formal requirements are required to start a sole proprietorship?

None

Earthgrown Flora, Inc., is one of many producers of cut flowers. Earthgrown refuses to sell its products to Florist Shops Corporation. Under antitrust law, this refusal is most likely

Not a violation

Melinda is a purchasing agent for Candy Crush Company (CCC). She enters into a contract with Delmar on CCC's behalf. But she only indicates to Delmar that she is acting as an agent on behalf of an unidentified client. Under these circumstances CCC is a

Partially disclosed principal

Paul hires Charles, a real estate broker, to act as his agent to sell his land for $150,000. Oil is discovered beneath the land, causing its market value to increase considerably. The agency agreement is likely

Terminated by operation of law

A suit is filed against Tamco Corporation, alleging that the firm committed the offense of monopolization. To determine whether Tamco has monopoly power requires looking at

The relevant market

Erica is a sixty-year-old woman with cerebral palsy. Erica is a member of

Three protected classes

Cindy is Stan's agent; however, Cindy is not authorized to enter into contracts on Stan's behalf. Nevertheless, Cindy contracts to have Edward paint the interior and exterior of Stan's home. Stan ratifies the contract. Later, Stan tries to rescind the part of the contract relating to the exterior. This attempt will be

Totally unsuccessful

A price-fixing agreement is an example of a per se violation of Section 1 of the Sherman Act.

True

An antitrust action is brought against Carrier Transport Company, alleging the offense of attempted monopolization. To be guilty of this offense, Carrier's attempt must have a dangerous probability of success.

True

Bob believes that ABC Corporation discriminates against men. Bob files a suit against ABC under Title VII. To establish a prima facie case of disparate impact discrimination, Bob must show that discriminatory intent motivated ABC's activity.

True

Branch Oil Company employs one hundred workers; therefore, Branch Oil must keep occupational injury and illness records for each employee

True

Dick works for First City Bank. When his spouse Elin is diagnosed with Lou Gehrig's disease, Dick asks to take temporary leave to care for her. First City discharges him. He files a suit against the bank under the Americans with Disabilities Act of 1990. Under these circumstances, Dick will not win his lawsuit.

True

In a general partnership, profits are split equally between the partners.

True

Jane participates in a Title VII investigation at the firm where she works. As a result, Jane's employer demotes her. Under these circumstances, Jane may file a disparate treatment discrimination claim.

True

Mary Jane is forty-two year old woman; therefore, the ADEA protects her from discrimination based on her age.

True

Southern Grocery, Inc., employs one hundred workers at three locations in two states. Under federal law, Southern Grocery must provide its employees, during and twelve-month period, family or medical leave of up to 12 weeks

True

The privacy rights of private-sector employees are governed by state law, which varies widely

True

Title VII of the Civil Rights Act of 1964 does not apply to employers with only five employees.

True

To hire employees from other countries, an employer must first obtain the approval of the U.S. Immigration and Customs Enforcement

True

Tom and Mary are employees of ABC Corporation. Under the Equal Pay Act of 1963, ABC can legitimately pay different wages on the basis of seniority.

True

Under the employment-at-will doctrine, an employer can end an employment relationship at any time.

True

Tangible employment action

When a significant change in employment status or benefits takes place. This can only be done by a person in a position of authority.

Jane is a drug addict who has completed a supervised drug-rehabilitation program. Mary used drugs casually in the past. Connie reports to work while under the influence of alcohol. Which of these women is considered to have a disability under the Americans with Disabilities Act of 1990: a) Jane b) Connie c) Mary d) All of the choices

a) Jane

By contract, Oil Shale Corporation forbids Petro Refining, Inc., a wholesale buyer of Oil Shale's products, from purchasing the products of its competitors. This exclusive-dealing contract is not permitted: a) if its effect is to substantially lessen competition b) under any circumstances c) unless there is no effect on a competitor d) if its effect is to cause a competitor a loss of any business

a) if its effect is to substantially lessen competition

Constructive discharge

occurs when a reasonable person would, in the same situation, would feel compelled to quit. Qualifies as a tangible employment action.

ESSAY PREP: Title VII of the Civil Rights Act of 1964 held that members of the following classes are afforded protection under this law:

race, color, national origin, religion, gender.