Legal Environment in Business
Disparagement is an untrue statement made by one person or business about the products, services, property, or reputation of another business.
True
Each state is required to prepare a state implementation plan (SIP) that sets out how the state plans to meet the federal pollutant standards.
True
Federal antitrust laws provide for both government and private lawsuits.
True
Federal workers are not covered under the Equal Pay Act.
True
General partnerships do not pay federal income taxes.
True
If a joint venture is operated as a partnership, then each joint venturer is considered a partner of the joint venture
True
If an agent competes with the principal without the principal's permission, the principal may recover profits made by the agent.
True
In a criminal lawsuit, guilt has to be proven beyond a reasonable doubt.
True
In a mortgage transaction, the creditor is known as the mortgagee.
True
Monetary damages and equitable remedies are provided in a civil lawsuit.
True
Native American tribes and tax-exempt private clubs are expressly excluded from Title VII of the Civil Rights Act of 1964.
True
Once a default judgment is established, the plaintiff only has to prove damages.
True
Provision of services qualifies as consideration for an enforceable contract.
True
Receipt of a share of business profits is prima facie evidence of a general partnership.
True
Some states' laws provide for the use of a deed of trust and note in place of a mortgage.
True
State governments do not have the power to regulate commerce with foreign nations.
True
The CAN-SPAM Act does not end spam but instead approves businesses to use spam as long as they do not lie.
True
The CAN-SPAM Act does not regulate spam sent to Americans from other countries.
True
The Occupational Safety and Health Administration (OSHA) is a federal administrative agency within the Department of Labor that is empowered to enforce the Occupational Safety and Health Act.
True
The Uniform Limited Liability Company Act is a model act that provides comprehensive and uniform laws for the formation, operation, and dissolution of LLCs.
True
The United States considers Native American tribes as "domestic dependent" nations with limited sovereignty.
True
In a(n) ________ franchise, the franchisor manufactures a product and licenses a retail dealer to sell the product to the public.
distributorship
Which of the following is an example of a horizontal restraint of trade?
division of markets
The ________ is an equitable doctrine that allows the court to order an oral contract for the sale of land or transfer of another interest in real property to be specifically performed if it has been partially performed and performance is necessary to avoid injustice.
doctrine of part performance
The designation for a business that is operating under a trade name is ________.
doing business as (d.b.a.)
The ___________ Clause of the Fifth Amendment protects persons from being tried for the same crime twice.
double jeopardy
If a casting agent works for two Hollywood actors, the agent is liable for ________.
dual agency
Which of the following is a fiduciary duty owed by an agent not to act adversely to the interests of the principal?
duty of loyalty
Ashley owns a piece of vacant real estate through which a small river runs. Ashley hires Warren, a licensed real estate broker, to list the property for sale and help sell the property. While inquiring in the neighborhood, Ashley's neighbor Lenny tells Warren that a chemical plant upstream has polluted his property and that Warren should have environmental engineers test the soil on Ashley's property as well. Warren does not tell Ashley about Lenny's suggestion. Warren manages to find a buyer for Ashley's property in Martha. It is later discovered that the property Martha bought from Ashley is also polluted. What important agent's duty has Warren failed to perform?
duty to notify
A restraint of trade in which two or more competitors at one level of distribution agree not to deal with others at another level of distribution is known as ________.
group boycott
A ________ refers to a promise in which one person agrees to answer for the debts or duties of another person.
guaranty contract
E-commerce ________.
is subject to the Commerce Clause of the U.S. Constitution
The U.S. Foreign Intelligence Surveillance Court is considered to be a "secret court" because ________.
its hearings are not open to the public and its decisions are classified
Which of the following is acceptable consideration for a contract?
money
A ________ alleges that if all the facts presented in the paperwork filed with the court to initiate or respond to the lawsuit are true, the party making the motion would win the lawsuit when the proper law is applied to these facts.
motion for judgment on the pleadings
________ refers to the knowledge that a representation is false.
Scienter
_________ is the French word for "a wrong."
tort
The geographical area served by each U.S. court of appeals is referred to as a ________.
circuit
Personal property that is subject to a security agreement is known as ________.
collateral
Which of the following is true of workers' compensation?
A worker who receives workers' compensation cannot sue his or her employer in civil court.
Which of the following is true of a business operating under sole proprietorship?
It is not considered a separate legal entity.
The ________ is a federal statute, enacted in 1890, that makes certain restraints of trade and monopolistic acts illegal.
Sherman Act
Which of the following statements is true of email contracts?
All email contracts require consideration, capacity, and lawful object.
The ________ is the party who employs another person to act on his or her behalf.
principal
If a wage employee works 50 hours one week and 30 hours the next week, for how many hours of overtime pay does the employer owe the employee?
10
With regard to contractual capacity, what is the most commonly-recognized age of majority?
18
Once the U.S. became industrialized in the late 1800s, large corporate employers had much more bargaining power than their employees did. In response, beginning in the __________, federal legislation was enacted that gave employees the right to form and join labor unions.
1930s
In the United States, the first person to invent an item or a process is given patent protection over a later inventor who was first to file a patent application.
False
________ is a statute that relieves medical professionals from liability for ordinary negligence when they stop and render aid to victims in emergency situations.
A Good Samaritan law
Which of the following is true of the Small Company Offering Registration (SCOR) form?
A SCOR form doubles as a prospectus for potential investors.
Which of the following is true of a gift promise?
A completed gift promise cannot be cancelled for a lack of consideration
What does "maximizing profits" as a social responsibility theory in business imply?
A corporation has a duty to take action to increase profits for its shareholders.
Which of the following statements is true about a counteroffer?
A counteroffer terminates the existing offer.
Which of the following statements is true about the pretrial litigation process?
A default judgment establishes the defendant's liability.
In which of the following cases is a default judgment entered?
A defendant does not file a written response to a plaintiff's complaint.
Which of the following statements is true of a deposition?
A deponent is allowed to correct his or her answers before signing the deposition.
Which of the following is true of a general partnership?
A general partnership may be formed with little or no formality.
Which of the following instances depict the tort of outrage?
A gym teacher verbally abuses an overweight kid in every gym class and the kid suffers severe emotional distress.
Which of the following is true of a majority decision made by the U.S. Supreme Court?
A majority of the justices agree as to the outcome and reasoning used to decide a case.
Which of the following is true of cumulative voting?
A minority shareholder has a better opportunity to elect someone to the board of directors.
Which of the following statements is true of an agent taking an opportunity?
A principal is permitted to recover for a usurped opportunity taken by the agent.
The ________ imposes obligations on employers and providers of public transportation, telecommunications, and public accommodations to accommodate physically challenged individuals.
ADA
The ________ is a federal statute that prohibits age discrimination practices against employees who are 40 years and older.
ADEA
________ damages are the only damages that may be recovered for violations of the Federal Trade Commission (FTC) Act.
Actual
Our textbook lists five elements of negligence. Choose two elements of negligence from the list below.
Actual cause
Which of the following statements is true of the tort of assault?
Actual physical contact between plaintiff and defendant is not necessary.
What is the necessary condition for an accused person to be found guilty by a jury?
All the jurors have to unanimously agree that the defendant is guilty of the crime.
Which of the following is true of U.S. immigration law?
An H1-B visa is granted only to foreign nationals skilled in specialty occupations.
Which of the following is true of tort liability for principals and agents?
An agent is liable for the principal's tortious conduct if he or she participates in it.
What does the E-SIGN Act provide?
An e-signature is treated the same as a pen-inscribed signature.
Which of the following is true of Social Security?
An employee must pay taxes into the Social Security fund, and the employee's employer must pay a matching amount.
Which of the following is an example of insider trading?
An employee uses material nonpublic information to make a profit by trading in the securities of the company.
________ hears appeals from trial courts.
An intermediate appellate court
Which article of the Uniform Commercial Code (UCC) governs secured transactions in personal property?
Article 9
________ refer to the formal documents that must be filed at the secretary of state's office of the state of organization of an LLC to form the LLC.
Articles of organization
Why does an illusory contract lack consideration?
Because one or both of the parties can choose not to perform their contractual obligations..
Which of the following is true about the duty of care?
Breach of the duty of care is not actionable unless the plaintiff suffers personal injury or injury to his or her property.
________ are a panel of decision makers who are elected by the shareholders.
Board of directors
The ________ is a federal law that permits employees and their beneficiaries to continue their group health insurance after an employee's employment has ended.
COBRA
Which of the following is a difference between indictments and information statements?
Indictments are issued by a grand jury, while an information statement is issued by a magistrate.
The ________ is a federal statute, enacted in 1914, that regulates mergers and prohibits certain exclusive dealing arrangements.
Clayton Act
Common stocks and preferred stocks are considered to be _____.
Common securities
________ is a type of equity security that represents the residual value of a corporation.
Common stock
The ________ provides that internet service providers are not liable for the content transmitted over their networks by email users and websites.
Communications Decency Act
In three sentences or fewer, summarize the measures Congress has taken to regulate spam email.
Congress enacted the federal CAN-SPAM Act in 2003. Which places restrictions on people and businesses that send spam e-mail, prohibits falsified headers, prohibits deceiving subject lines, and requires spammers to label sexually oriented e-mail.
The ________ Act of 2010 is a federal statute that requires increased disclosure of credit information and terms to consumers and regulates consumer credit providers and others.
Consumer Financial Protection
________ laws are federal and state statutes and regulations that promote product safety and prohibit abusive, unfair, and deceptive business practices.
Consumer protection
The ________ is a federal statute that places certain restrictions on persons and businesses that send unsolicited commercial advertising to email accounts, prohibits falsified headers, prohibits deceptive subject lines, and requires spammers to label sexually oriented email as such.
Controlling the Assault of Non-Solicited Pornography and Marketing Act (CAN-SPAM Act)
The Electronic Signatures in Global and National Commerce Act (E-SIGN Act) contains several provisions to protect consumers. Which of these is NOT one of those protections?
Copies of all electronic records sent to consumers must also be sent to the National Archives.
________ are employees of a corporation who are appointed by the board of directors to manage the day-to-day operations of the corporation.
Corporate officers
Which of the following is true of a limited partnership?
Corporations are allowed to become partners in a limited partnership.
________ are courts that hear cases of a general nature that are not within the jurisdiction of limited-jurisdiction trial courts.
Courts of record
Which of the following is true of a sole proprietorship?
Creditors can recover claims against the business from the sole proprietor's personal assets.
________ is the making of false statements about a competitor's products, services, property, or business reputation.
Disparagement
Which of the following is true of employment discrimination defined under Title VII of the Civil Rights Act of 1964?
Disparate-impact discrimination occurs when an employer adopts a work rule that is neutral on its face but is shown to cause an adverse impact on a protected class.
Which of the following is true of dual agency?
Dual agency is permitted if all parties in the transaction agree to it.
________ refers to a situation in which a party threatens to do a wrongful act unless another party enters into a contract.
Duress
The ________ recognizes electronic contracts as meeting the writing requirement of the Statute of Frauds for most contracts.
E-SIGN Act
The electronic data and record system of the Securities and Exchange Commission (SEC) is known as ________.
EDGAR
Under common law, employers could terminate an employee at any time and for any reason. Employers were also free to hire and promote anyone they chose. This situation often created unreasonable hardship on employees and erected employment barriers to certain minority classes. Starting in the 1960s, Congress began enacting a comprehensive set of federal laws that eliminated major forms of employment discrimination. The ________ is the federal agency responsible for enforcing most federal anti-discrimination laws.
EEOC
The ________ is a federal act designed to prevent fraud and other abuses associated with private pension funds.
ERISA
Improvements to existing machines, processes, or compositions of matter cannot be patented.
False
The president is selected by the ________.
Electoral College
The ________ gives an e-signature the same force and effect as a pen-inscribed signature on paper.
Electronic Signatures in Global and National Commerce (E-SIGN) Act
In a civil lawsuit, liability has to be proven beyond a reasonable doubt.
False
In a lease contract, the title of goods is passed from the lessor to the lessee.
False
The ________ is a federal administrative agency created by the U.S. Congress to coordinate the implementation and enforcement of federal environmental protection laws.
Environmental Protection Agency (EPA)
The ________ Act is a federal statute that prohibits discrimination in the extension of credit based on sex, marital status, race, color, national origin, religion, age, or receipt of income from public assistance programs.
Equal Credit Opportunity
________ is an ethical theory according to which a person adheres to rules or commands that are from an outside source, such as a book or a central figure.
Ethical fundamentalism
The ________ forbids the use of oppressive child labor and makes it unlawful to ship goods produced by businesses that use oppressive child labor.
FLSA
Which of the following acts establishes the minimum wage and overtime pay requirements for workers in the United States?
FLSA
The ________ guarantees workers unpaid time off from work for family and medical emergencies.
FMLA
Under the ________ and state laws enacted to implement the program, employers are required to pay unemployment contributions (taxes). I'll give you a hint: it starts with an "F".
FUTA
Melissa owes money to her bank for her credit card bills. For the past two weeks, debt collectors have been harassing her for bill payment by sending people to her workplace. Her boss expressly asks her to avoid such meetings, but despite Melissa's repeated requests that the collection agency stop, the collectors continue to visit her workplace. Which of the following Acts has provisions that would help protect Melissa from such harassment?
Fair Debt Collection Practices Act
A corporation can be incorporated in several states.
False
A tie decision in the U.S. Supreme Court sets a precedent for later cases.
False
A tipper cannot be held liable for the profits made by the tippee.
False
A voidable contract is also termed as an unenforceable contract.
False
All laws are framed to meet the highest ethical standards.
False
Appellate court decisions are final and cannot be appealed to any higher courts.
False
Businesses that are organized in the United States are subject to its laws, but not to the laws of other countries in which they do business.
False
Email contracts need not meet the Statute of Frauds requirements as long as they meet UCITA guidelines.
False
Tangible personal property includes securities, patents, trademarks, and copyrights.
False
The Americans with Disabilities Act Amendments Act (ADAAA) is a federal statute that makes it illegal for an employer to discriminate against job applicants and employees based on genetic information.
False
The Environmental Protection Agency (EPA) lacks adjudicative powers to hold hearings and order remedies for violation of environmental laws.
False
The Revised Uniform Partnership Act is a federal statute that is recognized in all states.
False
The power to regulate interstate commerce lies exclusively with the federal government.
False
Ajax, a pharmaceutical company, has designed a new medicine for morning sickness among pregnant women. Testing at their R&D center showed the drug to be highly reliable. Ajax has to approach a U.S. federal administrative agency called the ________ for the drug to be deemed legal for sale to the public.
Food and Drug Administration
A small business can file a ________ with the Securities and Exchange Commission (SEC) if it plans on raising $1 million or less in any 12-month period from a public offering of securities.
Form U-7
Which of the following is considered an intentional tort?
Fraud
________ is a situation in which an agent does something during the course of his or her employment to further his or her own interests rather than the principal's.
Frolic and detour
The ________ is a federal statute that makes it illegal for an employer to discriminate against job applicants and employees based on genetic information.
GINA
________ crimes require that the perpetrator either knew or should have known that his or her actions would lead to harmful results.
General intent
Briefly describe what is meant by a "right to an accounting".
General partners cannot sue the partnership or other partners at law, but they have the right to bring an action for an accounting against other partners. This authorizes the court to review the partnership and the partners' transaction, and award each partner their share of assets.
Kingsland is a country that has been exporting apples to the United States for over a century, shipping 300 tons to Georgia each month. However, last month, Kingsland violated a trading norm which was not condoned by Georgia. Which of the following measures should be taken to regulate apple imports from Kingsland?
Georgia should appeal to the federal authority which can stop imports from Kingsland.
Which of the following is an instance of disparate-treatment discrimination?
Ghalib, who is fluent in English, is not hired as a writer due to his Iraqi heritage.
The state of Idaho has a two-year statute of limitations for personal injury actions. Graham was injured by Alice in a car accident on January 1, 2013. If Graham wants to bring a lawsuit against Alice on January 15, 2015, which of the following is most likely to be the outcome?
Graham is not allowed to sue Alice, having lost his right to sue her.
In terms of the doctrine of quasi-contract, which of the following statements is true?
It is an equitable doctrine intended to prevent unjust enrichment.
Which of the following scenarios makes Tim liable for undue influence?
He takes advantage of his grandmother's illness and persuades her to sign a will, leaving all of her property to him.
The ________ prohibits health insurance companies from terminating health insurance coverage when a person gets sick.
Health Care Reform Act
Which of the following is a necessary condition for a contract to be considered valid?
It is enforceable by at least one of the parties.
What is the period of copyright protection provided for individuals under the Copyright Term Extension Act of 1998?
Individuals are granted copyright protection for their lifetime plus 70 years.
The ________ Act sets the terms of casino gambling and other gaming activities on tribal land.
Indian Gaming Regulatory
Using three sentences or fewer, answer the following question: What is intentional misrepresentation and what are the four elements required to prove fraud?
Intentional misrepresentation is when one person knowingly decides to persuade someone to rely and act on a misrepresentation. In order to prove fraud you have to show the following: 1. The wrongdoer made a false representation of material fact. 2. The wrongdoer intended to deceive the innocent party. 3. The innocent party justifiably relied on the misrepresentation. 4. The innocent party was injured.
________ are courts that hear appeals from trial courts, but are not a state's highest court.
Intermediate appellate courts
________ are written questions submitted by one party to a lawsuit to another party.
Interrogatories
Irma won a case at the U.S. Court of Appeals. When the case was reviewed by the Supreme Court, only eight judges were present. Four of the judges voted for Irma while the other four voted against her. Which of the following would be the result of this case?
Irma will win the case, as she had already won at the U.S. Court of Appeals.
Which of these is NOT true regarding the Bill of Rights?
It allows for government intrusion into fundamental rights.
Which of the following is true of a general power of attorney?
It allows the agent to sign legal documents on the principal's behalf.
Which of the following is true of the CAN-SPAM Act?
It approves businesses to use spam as long as they do not lie.
Which of the following is true of an environmental impact statement (EIS)?
It can be challenged in court by environmentalists or other interested parties.
Which of the following is true of the EEOC?
It can seek injunctive relief.
Why does a sole proprietorship not pay taxes at the business level?
It does not have a separate legal existence.
What is the function of the judicial branch of the federal government?
It has the power to interpret and determine the validity of the law.
Which of the following is a key function of the U.S. Court of Appeals for the Federal Circuit regarding patents?
It helps promote uniformity in patent laws.
Which of the following is true of price fixing?
It includes fixing the quantity of a product or service to be produced or provided.
What is the importance of the Biosafety Protocol prescribed by the United Nations?
It notifies people of the presence of genetically modified food in the market.
In the context of copyrighted material, which of the following statements accurately describes the fair use doctrine?
It permits certain limited use of copyrighted material by someone other than the copyright holder without the permission of the copyright holder.
Which of the following is true about a durable power of attorney?
It remains effective even though the principal is incapacitated.
Which of the following is true of the Clean Air Act
It requires air pollution controls to be installed on motor vehicles.
Which of the following is true of the Insecticide, Fungicide, and Rodenticide Act?
It requires all pesticides to be registered with the EPA.
Which of the following is true of a plurality decision of the Supreme Court?
It settles the case but does not set the precedent for later cases.
Why was the Court of Appeals for the Federal Circuit created?
It was created to provide uniformity in the application of federal law in certain areas, particularly patent law.
George, Jerry, and Harry are passengers on a flight from Chicago to New York. They injure their legs when their seatbelts do not fasten during take-off. The airline is sued by all three together for injuries caused, and the airline is found to be negligent and is directed by the court to pay damages to the injured parties. Which of the following parties is entitled to recover maximum damages?
Jerry, a football player who earns $2 million a year
Which of the following moral theories would closely follow the categorical imperative, "Do unto others as you would have them do unto you"?
Kantian ethics
A(n) ________ is a special form of partnership in which all partners are limited partners, and there are no general partners.
LLP
Which of the following acts regulates internal union affairs and establishes the rights of union members?
Landrum-Griffin Act
________ is a business arrangement that occurs when the owner of intellectual property contracts to permit another party to use the intellectual property.
Licensing
Lila Miller, who works for a large software firm, is four months pregnant and is due for a promotion. However, her employer offers the promotion to Harry Oswald, a less-experienced candidate, as Lila would go on maternity leave soon and would be unable to perform her duties. Which of the following is true of this scenario?
Lila's employer has violated Title VII of the Civil Rights Act of 1964
The ________ is a federal statute that permits a complainant to file an employment discrimination claim against an employer within 180 days of the most recent paycheck violation.
Lilly Ledbetter Fair Pay Act
Which state has adopted only parts of the UCC?
Louisiana
________ is a restraint of trade in which competitors agree that each will serve only a designated portion of the market.
Market sharing
Martha contacts a bakery to get a cake for her son's birthday party. She tells the baker that she will pay him $150 for the cake if he delivers the cake on Friday evening. If the baker does not deliver the cake on Friday evening, which of the following is accurate?
Martha cannot sue the baker.
A closely guarded formula for a recipe protected by a soft drink manufacturer is a ________.
trade secret
Which of the following is true of liabilities of LLCs?
Members of the LLC are liable to the extent of their capital contribution.
Minksine Corporation employs Sandy as its marketing manager. Sandy is driving her automobile to attend a meeting with a client on behalf of her employer. On her way, Sandy is involved in an automobile accident that is caused by her negligence. Several people are seriously injured. Which of the following is true of this case?
Minksine Corporation is liable for the injuries caused by Sandy.
Which of the following acts is particularly designed to regulate the home loan market and put the burden on lenders to verify that a borrower can afford to repay the loan for which he or she has applied?
Mortgage Reform and Anti-Predatory Lending Act
Which of the following has the largest trading volume of any securities exchange in the world?
NASDAQ
The ________ oversees union elections, prevents employers and unions from engaging in illegal and unfair labor practices, and enforces and interprets certain federal labor laws.
NLRB
If at least 30 percent of the employees in a bargaining unit sign consent cards indicating they are interested in joining or forming a union, an election date can be set. In most of these situations, elections are contested by the employer. The ________ is required to supervise all contested union elections.
National Labor Relations Board (NLRB)
Uploading copyrighted material to an unauthorized website by a non-copyright holder would constitute copyright infringement under the ________.
No Electronic Theft Act
______ corporations are corporations that have many shareholders and whose securities are often traded on organized securities markets.
Publicly held
Rapid Rise is a health drink targeted at teenagers. Their advertisement campaign claims that regular consumption of the drink over a two-month period leads to a four-inch increase in height. However, this claim is not substantiated by laboratory research and has not been proven in most of its users. This act of making scientifically unsubstantiated health claims about one's product is likely to be a violation of the ________.
Nutrition Labeling and Education Act
The ________ is a federal statute passed in 1990 that requires food manufacturers and processors to provide nutrition information on many foods and prohibits them from making scientifically unsubstantiated health claim
Nutrition Labeling and Education Act
The ________ is federal act enacted in 1970 that promotes safety in the workplace.
OSHA
Orlando opened a hot dog stand in Brooklyn, doing business as Orlando's Red Hots. Unfortunately, the venture has not generated a profit. Orlando borrowed $5,000 from the bank to open his business, and the short-term loan is now due. Orlando's friend Bob has suggested partnering with him at the beginning of next year. From which of the following sources can the bank currently recover its $5,000?
Orlando's savings account
Philip and Deborah form an LLC. Philip contributes $50,000 capital and Deborah contributes $75,000 capital. They do not have an agreement as to how profits are to be shared. If the LLC makes $100,000 profit in its first year, how will the profit be divided among the members?
Philip gets $50,000 and Deborah gets $50,000.
________ is a power that permits states and local governments to enact laws to protect or promote the public health, safety, morals, and general welfare.
Police power
Which of the following is true of a principal-independent contractor relationship?
Principals are bound by the authorized contracts of their independent contractors.
________ is defined as the substantial likelihood that a person either committed or is about to commit a crime.
Probable cause
________ permits issuers to sell up to $50 million of securities to the public during a 12-month period, pursuant to a simplified registration process.
Regulation A
Which of the following is true of religious discrimination?
Religious organizations can give preference in employment to individuals of a particular religion.
The ________ is a federal statute, enacted in 1930, that prohibits price discrimination.
Robinson-Patman Act
The ________ is a federal statute that authorizes the EPA to establish national primary drinking water standards.
Safe Drinking Water Act
The ________ Act of 2002 is a federal statute enacted by Congress to improve corporate governance.
Sarbanes-Oxley
The ________ Act prohibits public companies from making personal loans to their directors or executive officers.
Sarbanes-Oxley
In the late 1990s and early 2000s, many large U.S. corporations were found to have engaged in massive financial frauds. Many of these frauds were perpetrated by the CEOs and other senior officers. In response, Congress enacted the ____________.
Sarbanes-Oxley Act of 2002
The ________ is a federal statute that primarily regulates the issuance of securities by companies and other businesses.
Securities Act of 1933
The ________ is a federal statute primarily designed to prevent fraud in the trading of securities after they are issued.
Securities Exchange Act of 1934
According to the provisions set forth by the Sarbanes-Oxley Act, the ________, a federal government agency, may issue an order prohibiting any person who has committed securities fraud from acting as an officer or a director of a public company.
Securities and Exchange Commission
The ________ is a federal agency that is created by the Securities Exchange Act of 1934 and is empowered to administer federal securities laws.
Securities and Exchange Commission
Which of the following is true of e-commerce?
Services can be listed for sale on websites.
Jeremy crashes his friend John's car because he is an incompetent driver. Emily, John's sister, is outraged and wants John to sue his friend. John refuses to file a case against his long-time friend. Which of the following can Emily do in this scenario?
She cannot sue Jeremy, as she has no stake in the outcome of the case.
________ are the most common form of business organization in the United States.
Sole proprietorships
There are two major court systems in the United States: (1) the federal court system and (2) the court systems of the 50 states, the District of Columbia, and the U.S.territories. _________ courts resolve more than 95% of the lawsuits brought in this country.
State
________ is/are primarily responsible for enforcing the provisions of the Clean Water Act
State governments
The ________ requires all contracts for the sale of goods costing $500 or more and lease contracts involving payments of $1,000 or more to be in writing.
Statute of Frauds
________ are state laws that require certain types of contracts to be in writing.
Statutes of Frauds
In the United States, what recourse does an accused person have if he cannot afford a private defense attorney?
The government will provide an attorney for the accused free of charge.
________ is a system in which each shareholder votes the number of shares he or she owns on candidates for each of the positions open.
Straight voting
The Labor Management Relations Act of 1947 is also known as the ________ Act.
Taft-Hartley
What two groups drafted the UCC?
The American Law Institute and the National Conference of Commissioners on Uniform State Laws
Which of the following is true of the FDA's role in the introduction of a new drug in the market?
The FDA has the power to implement a complete ban on a questionable drug.
Which of the following statements is true about the freedom of speech guaranteed by the Bill of Rights?
The Freedom of Speech Clause protects speech only, not conduct.
LetsConnect is a three-month-old internet service provider in the United States of America. In the last two months, it was discovered that several LetsConnect users exchanged online material that is illegal in the United States. The ISP took no measures to investigate the matter or prevent it. Which of the following is true of this case?
The ISP is not liable for the content transmitted over its network.
Which of the following is established by the Supremacy Clause of the U.S. Constitution?
The U.S. Constitution and federal treaties, laws, and regulations are the supreme law of the land.
Which of the following is true of a patent application?
The U.S. Patent and Trademark Office can grant priority to patent applications for products that are important to the national economy.
Which of the following is an accurate statement regarding the risk of loss in a shipment contract after the seller delivers conforming goods to the carrier?
The buyer bears the risk of loss during transportation.
Which of the following must be proven by a claimant pursuing compensation for an injury under workers' compensation?
The claimant was harmed by an employment-related injury.
Jonas enters into an oral contract with Chelsea to lease his house to her for $100,000. Chelsea pays him $100,000 and moves in. A month later, Jonas learns that his state requires contracts for the lease of goods with payments of $1,000 or more to be in writing. Which of the following options does either party have?
The contract cannot be rescinded by either party as it has already been executed.
Which of the following similarities is observed between tie and plurality decisions made by the U.S. Supreme Court?
The decisions do not set precedent for later cases.
Union shops are permitted only in states that have not passed "right-to-work" laws prohibiting practices that force employees to join or pay dues or fees to a labor union. Assuming you are in a state which allows union shops, which of the following is true of a union shop agreement?
The employee must join the union within a certain time after employment.
An employer pays higher wages to Shelly—who has worked with the company for six years—than Samuel, who holds a similar position to Shelly and performs the same functions as her, and has worked with the company for only five and a half years. Which of the following is true of this case, assuming that the employer recognizes seniority in its compensation system?
The employer has not violated the Equal Pay Act.
Fierra Inc. is a German automobile manufacturer that has a five percent market share in the United States' automobile market. The company has a unit in North Carolina that imports Fierra automobiles from its parent company in Germany and assembles them. Which of the following measures is in accordance with the United States' Foreign Commerce Clause?
The federal government imposes an additional hundred percent tax only on Fierra cars being sold in North Carolina.
In order to prove fraud, which of these elements must be shown?
The innocent party justifiably relied on the wrongdoer's misrepresentation.
Which of the following is true of an option contract?
The offer cannot be revoked during the option period.
Kimberley, a merchant seller in Kansas, had an oral contract to sell goods to Jane, a merchant buyer in Memphis, for $100,000. Two days after contracting, Kimberley sends a sufficient written confirmation to Jane of the agreed-upon transaction. Jane, who has reason to know the contents of the written confirmation, fails to immediately object to the contents of the confirmation. Two weeks after receiving the written confirmation, Jane receives delivery of the goods from Kimberley, and Jane then sends an objection to the written confirmation to Kimberley. Which of the following is true of the contract between Kimberley and Jane?
The offer is valid as the offeree knew the contents of the confirmation and did not object within 10 days.
Which of these is NOT true with regards to the duties of the owner of a trade secret?
The owner of a trade secret has an absolute right to the secret and, as such, need not do anything to prevent the secret from being discovered by others.
Which of the following statements is true of the patent period in the United States?
The patent term begins to run from the date the patent application is filed.
Which of the following is a course of action for a principal if an agent is found competing with him or her?
The principal can recover profits made by the agent in the competing venture.
________ refers to an attempt by another person to take over a living person's name or identity for commercial purposes.
The tort of appropriation
Which of the following is an accurate statement regarding the Berne Convention, an international copyright treaty?
The treaty eliminates the need to place the copyright symbol or the word "copyright" on a copyrighted work.
What happens to the ownership of a copyrighted work after the copyright period expires?
The work enters the public domain and can be used for free.
According to the mirror image rule, which of the following is true of additional terms being added in an acceptance?
They are considered to be counteroffers.
Which of the following is true of corporate bylaws?
They do not have to be filed with any government official.
Which of the following statements is true of intermediate appellate courts?
They review either pertinent parts or the whole trial court record from the lower court.
A member of a minority race applies for a promotion to a position advertised as available at his company. The minority applicant, who is qualified for the position, is rejected by the company which hires a nonminority applicant for the position. The minority applicant can sue under ________.
Title VII of the Civil Rights Act
________ was intended to eliminate job discrimination based on race, color, national origin, sex, and religion.
Title VII of the Civil Rights Act of 1964
Crowd funding offerings are subject to the anti-fraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934.
True
A according to the Howey test, a security exists if an investor invests money in a common enterprise and expects to make a profit from the significant efforts of others.
True
A competitor can lawfully discover a trade secret by performing reverse engineering.
True
A petitioner must file a petition for certiorari, asking the Supreme Court to hear the case.
True
According to the equal dignity rule, agents' contracts to sell property covered by the Statute of Frauds must be in writing to be enforceable.
True
Agency law is a mixture of contract law and tort law.
True
An ambiguity in a contract may constitute a mutual mistake of a material fact.
True
An e-contract is made when the offeree sends an email or another electronic document to the offeror.
True
An e-record is a record created, generated, sent, communicated, received, or stored by electronic means.
True
An employer is permitted to bar off-duty employees from union solicitation on company premises.
True
An environmental impact statement (EIS) must contain a cost-benefit analysis of the proposed action and alternative actions.
True
An ethically wrong state or condition can still be legal.
True
Article 2 applies to mixed sales only if the goods are the predominant part of the transaction.
True
Article 2 of the Uniform Commercial Code is also applied by federal courts to sales contracts governed by federal law.
True
Blue-sky laws are state laws that regulate the issuance and trading of securities.
True
The doctrine of part performance allows the court to order an oral contract for the sale of land or transfer of another interest in real property to be specifically performed if performance is necessary to avoid injustice.
True
The measure of damages awarded to an innocent party for fraud is the difference between the value of the property as represented and the actual value of the property.
True
The one-year rule states that an executory contract that cannot be performed by its own terms within one year of its formation must be in writing.
True
The paperwork that is filed with the court to initiate and respond to a lawsuit is referred to as the pleadings.
True
The stakeholder interest theory of social responsibility states that a corporation must consider the effects that its actions have on persons other than its shareholders.
True
When deciding in which state to start their new business, the founders of Telstar Autos decided to set up shop in the State of Illinois due to its well-designed commercial laws that allow businesses to plan their activities, allocate their productive resources, and assess the risks they take. This would be an example of the facilitating planning function of the law.
True
When the American colonies were first settled, the English system of law was generally adopted as the system of jurisprudence.
True
Workers' compensation benefits are usually paid according to preset limits established by statute or regulation.
True
Regulation Z is an administrative agency regulation that sets forth detailed rules for compliance with the ________ Act.
Truth-in-Lending
Which of the following federal statutes requires creditors to disclose finance charges, including interest, points, and other fees paid for the extension of credit to debtors?
Truth-in-Lending Act
List two (2) advantages and two (2) disadvantages of a sole proprietorship.
Two advantages are it does not cost a lot and it's easy, also it can be transferred or sold easily if the owners decides to do so. Two disadvantages are access to capital is limited to personal funds or loans and the sole proprietor is legally responsible for any torts committed by themselves or employees.
Lauren is being harassed by bill collectors. Her friend Hassan tells her that she might want to consider the protections afforded by the federal bankruptcy laws. As such, Lauren may be filing a case in which court?
U.S. Bankruptcy Court
The ________ is a special federal appeals court that hears appeals from the Board of Patent Appeals and Interferences of the U.S. Patent and Trademark Office and federal courts concerning patent issues.
U.S. Court of Appeals for the Federal Circuit
The ________ hears cases brought against the United States.
U.S. Court of Federal Claims
A special federal court that hears civil cases arising out of customs and international trade laws of the United States is the ________.
U.S. Court of International Trade
Jones & Hilton Co. owned a large cold storage warehouse where they stored and processed meat and meat products. An insider revealed to the media that the facility failed to meet numerous safety standards, encountered rodent infestation, and sold potentially harmful and infected meat in the market without notifying authorities. The ________ has the authority to conduct inspections of the cold storage warehouse and initiate legal proceedings against the owners for endangering the health of consumers.
U.S. Department of Agriculture
The ________ is a federal administrative agency that is primarily responsible for regulating the safety of meat, poultry, and other food products.
U.S. Department of Agriculture
Applications for patents must be filed with the ________.
U.S. Patent and Trademark Office (PTO)
Which of the following courts are the federal court system's trial courts of general jurisdiction?
U.S. district courts
The ________ is a model act that provides comprehensive and uniform laws for the formation, operation, and dissolution of LLCs.
ULLCA
Which of the following is considered real property?
a fixture permanently affixed to a building
Ubiquitous Enterprises is a franchisee of the HotPan chain of restaurants. One afternoon Linda, an employee of Ubiquitous Enterprises, is mopping the floor. Gary, a customer who enters the restaurant, is talking on his cell phone and does not notice Linda mopping the floor. He slips on the wet floor while walking to the counter and is injured. Which of the following statements is accurate regarding liability for Gary's injury?
Ubiquitous Enterprises is liable for not having its own "Caution" sign.
The ________ refers to a model act that includes comprehensive laws that cover most aspects of commercial transactions.
Uniform Commercial Code (UCC)
The ________ Act is a model act that codifies general partnership law.
Uniform Partnership
Which of the following is true of profits and losses in a general partnership?
Unless otherwise agreed, losses are shared equally by all general partners.
________ is a form of credit that does not require any security to protect the payment of the debt.
Unsecured credit
________ occurs where a principal is liable for an agent's tortious conduct because of the employment contract between the principal and agent, not because the principal was personally at fault.
Vicarious liability
Law is described as
a body of rules of action or conduct prescribed by controlling authority and having binding legal force
Under which of the following transactions does title to goods pass from the seller to the buyer?
a contract for the sale of goods
Which two elements are required to find a defendant guilty of an intent-based crime?
a criminal act and criminal intent
Which of the following would constitute the creation of an express warranty for goods?
a description of the goods
Which of the following types of patents is valid for only 14 years?
a design patent
Which of the following is an example of an informal contract?
a lease
Whistle Cabs, a taxi service company, has been ordered by the traffic department to upgrade its taxi meters to digital ones. Whistle Cabs contemplates a sales contract with Running Electricals, a company that manufactures digital taxi meters. Due to short notice from the city and a lack of funding, however, Whistle Cabs instead approaches Goldmint Bank, which purchases the digital taxi meters from Running Electricals and delivers them to Whistle Cabs. The contract between Whistle Cabs and Goldmint Bank allows the taxi service company to use the taxi meters for a set period of time by providing monthly rentals. What is the nature of the contract made between Whistle Cabs and Goldmint Bank?
a lease
According to the Revised Model Business Corporation Act (RMBCA), what establishes a quorum to hold a meeting of the shareholders?
a majority of the outstanding shares
What is a vertical merger?
a merger that integrates the operations of a supplier and a customer
An arrangement where an owner of real property borrows money from a lender and pledges the real property as collateral to secure the repayment of the loan is known as ________.
a mortgage
Which of the following is copyrightable?
a musical composition
Who is an agent?
a party who agrees to act on behalf of another
Which of the following is an example of intellectual property?
a patent
Ethics is a set of moral principles or values that governs the conduct of an individual or a group. Which of the following cases is an example of agreement of ethics and laws?
a person being penalized for bribing a judge to rule a case in the person's favor
Which of the following measures is most likely to reduce indoor air pollution in an office building?
a prohibition on copy machines
Mary hired the attorneys at the law firm of Sunny & Warm to represent her in a civil lawsuit. Erin Sunny, a partner, explained to Mary that she will need to pay to the firm a sum of money up-front that will be placed in a trust account before the firm proceeds. Periodically the lawyer's fees will be taken from the trust account as services are provided. What is this payment advance called?
a retainer
Which of the following describes a mixed sale?
a sale that involves the provision of a service and a good in the same transaction
Canton has listed his house for sale but cannot be present to take care of the sale, as he needs to go out of town. He intends to give his brother Stratham the power of attorney to just make decisions regarding the selling of his house while he is gone. What kind of power of attorney should Canton execute?
a special power of attorney
An agency by ratification occurs when the principal ________.
accepts an unauthorized act created by an unauthorized agent
_______ law refers to the law that governments enact to regulate industries, businesses, and professionals.
administrative
__________ agencies are created by the government to enforce regulatory statutes.
administrative
Which of the following actions requires all members in a manager-managed LLC to vote?
admitting new members
List the four basic requirements that must be met for a contract to be enforceable. Briefly explain each requirement.
agreement: This is between two parties and requires an offer by the offeror and acceptance by the offeree. consideration: A legally sufficient promise bargained for consideration. contractual capacity: The parties must enforce the contract against them. lawful object: The object must be lawful.
A corporation in the United States that has been incorporated in another country is referred to as a(n) ________ corporation.
alien
Which of the following describes an agency by estoppel?
an agency that arises when a principal creates the appearance of an agency that in actuality does not exist
The rule of reason is characterized by ________.
an evaluation of the company's market share, power, and other relevant factors
The Consumer Product Safety Commission (CPSC) is ________.
an independent federal administrative agency that regulates potentially dangerous consumer products
John Harley was on his way home when an assailant stopped his car and threatened to physically harm him. John can sue the assailant to recover damages for ________.
assault
A security can be defined as __________
an investment contract, an interest or instrument that is expressly mentioned in securities acts, and an interest or instrument that is common stock, preferred stock, a bond, a debenture, or a warrant
Ashton borrows $25,000 from Amanda, who lends the money without taking an interest in collateral for the loan. Amanda is relying on Ashton's credit standing when she made the loan. In this case, what kind of creditor is Amanda?
an unsecured creditor
Which of the following can be filed by the defendant in a lawsuit?
answer
The U.S. economic system was built on the theory of freedom of competition. After the Civil War, however, many large industrial trusts were formed that resulted in monopolies in several industries. Because the common law could not deal effectively with these monopolies, Congress enacted a comprehensive system of ____________ laws.
antitrust
A group of employees that a union is seeking to represent is known as a(n) ________ unit.
appropriate bargaining
The Electronic Signatures in Global and National Commerce Act (E-SIGN Act) provides that record retention requirements ________.
are satisfied if records are stored electronically
Businesses ________.
are subject to the laws of the countries in which they operate and owe a social responsibility not to harm society
A(n) ________ is a document for a person's detainment that is based on a showing of probable cause that the person committed a crime.
arrest warrant
Which of the following can be patented?
asexually reproduced plants
A rule that says clients can tell their lawyers anything about the case without fear that the attorney will be called as a witness against the client is called __________.
attorney-client privilege
Harvey was at his college reunion where he noticed Raymond, his former roommate. Harvey and Raymond did not get along well at the reunion. Offended by something Raymond mentioned, Harvey punched him in the face and broke his jaw. Harvey is liable for ________.
battery
Unauthorized and harmful or offensive physical contact with another person is called ________.
battery
The legislative branch of the U.S. federal government is ________.
bicameral
A contract is a(n) ________ contract if the offeror's promise is answered with the offeree's promise of acceptance.
bilateral
The Superfund, which is administered by the EPA, gives the federal government a mandate to ________.
clean up hazardous wastes that have been spilled, stored, or abandoned
The Electronic Signatures in Global and National Commerce Act (E-SIGN Act) provides that electronically signed contracts ________ because they are in electronic form or delivered electronically.
cannot be denied effect
In a(n) ________ franchise, the franchisor licenses the franchisee to make and sell its products or services to the public from a retail outlet serving an exclusive geographical territory.
chain-style
Rio-Werner Corporation owns Rio's Sandwiches, a fast-food restaurant in New Jersey. It wants to operate in five cities on the west coast by means of franchisees that make and sell all menu items from Rio's Sandwiches. Which of the following franchises would best suit the Rio-Werner Corporation's franchise plan?
chain-style
Which of the following consumer products comes under the purview of the Consumer Product Safety Commission (CPSC)?
children's toys
Which of the following is a function that the Consumer Product Safety Commission is empowered to execute?
collecting data regarding injuries caused by consumer products
The act of negotiating contract terms between an employer and the members of a union is known as ________.
collective bargaining
Which of the following is provided by the National Labor Relations Act of 1935?
collective bargaining with employers
According to priority, which of the following claimants is the last to be paid after a corporation's assets have been liquidated?
common stockholders
The National Environmental Policy Act (NEPA) is a federal statute that mandates that the federal government must ________.
consider the adverse impact a federal government action would have on the environment before the action is implemented
What type of transactions are covered under the Magnuson-Moss Warranty Act?
consumer transactions
A ________ is a legal right that gives the author of qualifying subject matter the exclusive right to publish, produce, sell, license, and distribute the work.
copyright
The articles of incorporation is also known as the ________.
corporate charter
The ________ theory of social responsibility argues that a business has a responsibility to help solve social problem that it did little, if anything to cause.
corporate citizenship
Most Web pages use electronic ordering systems that do not have the ability to evaluate and accept ________.
counteroffers
The deposition of a party or a witness can be given voluntarily or pursuant to a(n) ________.
court order
The lender in a credit transaction is known as the ________.
creditor
A defendant who believes that he or she has been injured by the plaintiff can file a(n) ________ against the plaintiff.
cross-complaint
Employees who choose not to strike or return to work after joining the strikers for a period of time are known as ________ workers.
crossover
Libel and slander constitute ________.
defamation of character
Some states permit a mortgagee (lender) to bring a separate legal action to recover a deficiency from a mortgagor (borrower). If the lender is successful, the court will award a ________ that entitles the lender to recover the amount of the judgment form the borrower's other property.
deficiency judgment
The term ________ refers to the oral testimony given by a party or witness prior to trial.
deposition
The Sarbanes-Oxley Act requires all public companies to _______.
disclose whether they have had adopted a code of ethics for senior financial officers
Which of the following best describes quid pro quo sex discrimination?
discrimination where sexual favors are requested in order to obtain a job or be promoted
Making false statements about a competitor's products, services, property, or business reputation could make a company liable for ________.
disparagement
Which of the following is an intentional tort?
disparagement
________ discrimination occurs when an employer adopts a work rule that is neutral on its face but is shown to cause an adverse impact on a protected class.
disparate-impact
A member's ownership interest in an LLC is called a ________.
distributional interest
Ronald, the purchasing manager of Telly's Supermarket in Georgia, was asked to purchase the latest video game console, FunCase, to be kept in the supermarket. Due to a truckers' strike, Ronald had to personally make the trip to the FunCase warehouse in Florida to pick up the console. Ronald paid for the trip himself, went to the warehouse, procured the console, and returned. After he got back, Telly's Supermarket paid Ronald for the personal expenses he incurred in making the trip to Florida. What duty of the principal did Telly's Supermarket satisfy when it paid Ronald for the trip?
duty to reimburse
Barney wants to rent an apartment and posts an advertisement in a classifieds website. Two days later, Michael, who wants to rent out his apartment, emails Barney and they finalize the deal over the internet. Barney pays Michael through an online transfer. This is an instance of ________.
e-commerce
Jessica wants to buy a laptop from the website of CloudFive Computers. Before confirming the purchase, the website asks her to provide biometric identification using an electronic scanner. This is an example of a(n) ________.
e-signature
A computer program or an electronic or other automated means used independently to initiate an action or respond to electronic records or performances in whole or in part, without review or action by an individual, is known as a(n) ________.
electronic agent
A(n) ________ is any computer system that has been established by a seller to accept orders.
electronic agent
A(n) ________ is the signature of a person that appears on an electronic record and is recognized as a lawful signature.
electronic signature
________ is the fraudulent conversion of property by a person to whom that property was entrusted.
embezzlement
If an employer reasonably anticipates a strike by some of its employees, it may legally arrange a(n) ________ to prevent these employees from entering the work premises.
employee lockout
The FLSA applies to ________.
employees engaged in the production of goods for interstate commerce
Which of the following types of relationships exists when a person hires another person to perform some form of physical service but does not authorize that person to enter into contracts on his or her behalf?
employer-employee relationship
A contract involving mutual mistake of value is ________.
enforceable
When the states ratified the Constitution, they delegated certain powers to the federal government. These powers are called ______ powers.
enumerated
The ________ states that agents' contracts to sell property covered by the Statute of Frauds must be in writing to be enforceable.
equal dignity rule
Fred routinely cheats on his taxes. Fred has decided that based on his personal feelings, cheating on his taxes is the right thing to do, and that no one else can criticize him for this stance. What moral theory does Fred apparently follow?
ethical relativism
What are the five major theories of ethics discussed in our textbook?
ethical relativism, ultiltarianism, ethical fundamentalism, Kantian ethics, and Rawl's social justice theory
The ________ branch of the federal government has the power to enforce the law.
executive
The executive branch of government, which includes the president of the United States and state governors, is empowered to issue ___________. (2 words)
executive orders
Elizabeth signs a contract to purchase a new car from Quickcash Motors. She has not yet paid for the car, and Quickcash Motors has not yet delivered the car to Elizabeth. This is an example of a(n) ________ contract.
executory
An oral agreement to purchase a neighbor's bicycle for $250 is a(n) ________ contract.
express
Kyle goes to a used automobile dealership to buy a truck. He signs an agreement with the dealership that includes a description of the truck, its price, and other details. This is an example of a(n) ________ contract.
express
A power of attorney is an example of an ________ agreement.
express agency
Marlon intends to sell a piece of real estate he owns and contracts Nita, a real estate broker, to make the sale. In the contract, Marlon authorizes Nita to make the sale at or above a minimum price he wants and the date by which he wants the sale to be completed. The contract also stipulates that Marlon must not hire another broker to sell that piece of land until the expiration of the contract period. Nita finds a suitable buyer, makes the sale in time, and Marlon pays for her services. Which of the following types of agencies had Marlon and Nita entered into?
express agency
The City of Hilbert is considering rezoning a part of its downtown so Flatlands University can build a satellite campus there. In accordance with local ordinance, the City Council will first conduct public hearings, then debate the proposed rezoning ordinance during one of its regular meetings, and finally vote on the proposed rezoning ordinance at its regular meetings. This would be an example of which function of the law?
facilitating orderly change
The ________ doctrine allows for certain limited unauthorized use of copyrighted materials.
fair use
The intentional confinement or restraint of another person without authority or justification and without consent is called ________.
false imprisonment
Jintopia is a country in which the federal government and the twelve state governments share powers. The form of government in Jintopia is ________.
federalism
________ are the most serious crimes, including crimes that are mala in se.
felonies
A ________ refers to a document filed by a secured creditor with the appropriate government office that constructively notifies the world of his or her security interest in personal property.
financing statement
The UCC rule that says that a merchant who offers to buy, sell, or lease goods and gives a written and signed assurance on a separate form that the offer will be held open cannot revoke the offer for the time stated or, if no time is stated, for a reasonable time is referred to as the ________.
firm offer rule
An LLP has a(n) ________ tax benefit, where no tax is paid at the partnership level, and all profits and losses are reported on the individual partners' income tax returns.
flow-through
A default by a debtor in a secured real estate transaction may trigger a legal court action for ________.
foreclosure
A(n) ________ is established when one party licenses another party to use the first party's trade name, trademarks, commercial symbols, patents, copyrights, and other property in the distribution and selling of goods and services.
franchise
Intentional misrepresentation is commonly referred to as ________.
fraud
A(n) ________ is an event that occurs when one person consciously decides to induce another person to rely and act on a misrepresentation.
fraudulent misrepresentation
The ________ rule permits certain open terms to be "read into" a sales or lease contract.
gap-filling
The ________ is an OSHA standard that requires an employer to provide a work environment free from recognized hazards that are causing or are likely to cause death or serious physical harm to employees.
general duty standard
Which of the following partners in a limited partnership invests capital, manages the business, and is personally liable for partnership debts?
general partners
A limited partnership has two types of partners, ________.
general partners and limited partners
To be covered by the FMLA, an employee must ________.
have performed more than 1,250 hours of service during the previous 12-month period
Which of the following is a primary cause of sick building syndrome in the United States?
hazardous construction materials
To claim under disparate-treatment discrimination, the complainant must prove that ________.
he or she belongs to a Title VII protected class
Which of the following is a compulsory subject during collective bargaining?
health benefits
Which of the following is a function of the state supreme courts?
hearing appeals from intermediate appellate state courts and certain trial courts
Decisions of the ________ are final unless a question of law is involved that is appealable to the U.S. Supreme Court.
highest state courts
Once a strike begins, the employer may continue operations by ________ to take the place of striking employees.
hiring replacement workers
A _______________ restraint of trade occurs when two or more competitors at the same level of distribution enter into an agreement to restrict trade.
horizontal
The primary level of national ambient air quality standards (NAAQS) protects ________
human beings
If union members picketing a restaurant block deliveries to and from the restaurant, this is ________ picketing.
illegal
Many multinational corporations conduct business in another country by using a(n) ________.
international subsidiary corporation
The courts apply the Howey test in determining whether an arrangement is a(n) ________ and therefore a security.
investment contract
Marcus employs a real estate broker, Dean, to sell his house. Dean's express powers are to advertise and market the house for sale, show the house to prospective buyers, and accept offers from persons who want to purchase the house. He is not allowed to complete a deal without Marcus's consent. Marcus goes away on a month-long trip where he cannot be contacted. During this time, a short circuit in the house causes a power outage. Dean uses his authority to hire an electrician to repair the circuits and restore electricity in the house. Marcus then comes back and pays Dean for the electricity repair. What is the nature of the agency that Dean used to fix the electricity problem in the house?
implied agency
A contract in which an agreement between the parties is inferred from their conduct is known as a(n) ________ contract.
implied-in-fact
A debtor who does not make the required payments on a secured real estate transaction is considered to be ________.
in default
If the grand jury determines that there is sufficient evidence to hold the accused for trial, it issues a(n) ________.
indictment
A member of the board of directors who is also an officer of the corporation is known as a(n) ________.
inside director
Intellectual property falls into a category of property known as a(n) ________.
intangible property
A ________ is an arrangement in which two or more business entities combine their resources to pursue a single project or transaction.
joint venture
Which of the following terms refers to the overturn of verdict when jury misconduct is detected?
judgment notwithstanding the verdict
The philosophy or science of the law is referred to as _______.
jurisprudence
The Federal Trade Commission (FTC) is empowered with enforcing the Controlling the Assault of Non-Solicited Pornography and Marketing Act (CAN-SPAM Act). Accordingly, the FTC has adopted a rule that spammers who send sexually oriented email are to ________.
label such email on the subject line with the words "SEXUALLY EXPLICIT."
The wrongful or fraudulent taking of another's personal intangible properties like trade secrets, computer programs, and other business property is considered a(n) ________.
larceny
________ is the taking of another's personal property other than from his or her person or building.
larceny
Which of the following would be considered an example of shaping moral standards, as seen as a function of the law?
laws discouraging drug and alcohol abuse
A ________ is a transfer of the right to the possession and use of named goods for a set term in return for certain consideration.
lease
Which of the following does Article 2A of the Uniform Commercial Code govern?
leases
The ________ branch of the U.S. government is responsible for making federal law.
legislative
The ________ is responsible for making federal law.
legislative branch/U.S. Congress
A person who transfers the right of possession and use of goods under a lease is known as the ________.
lessor
False statements that appear in a letter, newspaper, magazine, book, photograph, movie or video are ________.
libel
YouKnow Inc. is a corporation that creates educational resources. It grants Middlewest Public School the right to use its online encyclopedias for three years in return for a fee. In this arrangement, YouKnow Inc. is the ________.
licensor
Members of an LLC have ________ liability.
limited
The ________ is a general rule of corporate law that provides that generally, shareholders are liable only to the extent of their capital contributions for the debts and obligations of their corporation and are not personally liable for the debts and obligations of the corporation.
limited liability of shareholders
Which of the following partners of a limited partnership invests capital but does not participate in management?
limited partners
Traffic courts, juvenile courts, and family law courts fall into the category of ________.
limited-jurisdiction trial courts
The _____ rule states that acceptance is effective when it is dispatched, even if it is lost in transmission.
mailbox
What function of the law is being served when passing laws that protect the U.S. government from the risk of being forcefully overthrown?
maintaining the status quo
Which of the following is a provision of Section 8(a) of the NLRA?
makes it an unfair labor practice for an employer to restrain employees from forming and joining unions
Marshall is a purchasing agent for DigitoolArt Corporation. His duties require him to negotiate and execute contracts to purchase office supplies and equipment for the corporation. Assume that Bronson, a computer sales representative, pays Marshall a $20,000 kickback to purchase from him computers needed by DigitoolArt Corporation. What breach of the duty of loyalty has Marshall committed here?
making a secret profit
A civil action lawsuit in which the original defendant sues the original plaintiff for damages is known as ________.
malicious prosecution
One student actor wins a part in a play over another student actor. To get back at the winning student, the rejected student files a lawsuit against the winning student alleging intentional infliction of emotional distress, defamation, and negligence. The jury returns a verdict exonerating the defendant. The defendant is now entitled to sue the plaintiff for ________.
malicious prosecution
Monopoly power is characterized by ________.
market share above 70 percent in the relevant market
By allowing the U.S. citizens to practice any religion of their choice, what essential function of the law does the U.S. Constitution serve?
maximizing individual freedom
________ is a form of negotiation in which a neutral third part assists the disputing parties in reaching a settlement of their dispute.
mediation
The owner of an LLC is called a ________.
member
In legal terminology, evil intent is also known as ________.
mens rea
A ________ is a clause in a contract which stipulates that the contract is a complete integration and the exclusive expression of the parties' agreement.
merger clause/integration clause
The ________ imposes liability under Section 10(b) and Rule 10b-5 on an outsider who misappropriates information about a company, in violation of his or her fiduciary duty, and then trades in the securities of that company.
misappropriation theory
A(n) ________ is a less serious crime, is not inherently evil but nevertheless prohibited by society, and is punishable by fines or imprisonment for one year or less.
misdemeanor
A ________ alleges that if all the facts presented in the pleadings are taken as true, the party making the motion would win the lawsuit when the proper law is applied to these asserted facts.
motion for judgment on the pleadings
Which of the following motions asserts that based on supporting evidence outside the pleadings, there are no factual disputes to be decided by the jury, and the judge can apply the proper law to the undisputed facts and decide the case without a jury?
motion for summary judgment
Under the ________ test, if the agent committed an intentional tort to promote the principal's business, the principal is liable for any injury caused by the tort.
motivation
A(n) ________ exists if both parties know the object of the contract but are mistaken as to its value.
mutual mistake of value
If a company does not hire certain employees because of their accents, it has carried out ________ discrimination.
national origin
Tim Talon engaged in reckless driving and killed a pedestrian. His defense is that he was driving under the influence of alcohol and lost control of his automobile. How would a court classify Tim Talon's intent?
nonintent crime
If an employee is injured in an automobile accident while she is driving to an off-premises restaurant during her personal lunch hour, the injury is ________.
not covered by workers' compensation
In addition to recovering profits made by the offender and damages, a successful plaintiff in a misappropriation of a trade secret case can also ________.
obtain an injunction prohibiting the offender from divulging the trade secret
Which of the following would be considered a stationary source of air pollution?
oil rigs
According to the Statute of Frauds, a general partnership that exists for more than ________ must have a written partnership agreement.
one year
__________ are laws enacted by local government bodies, for example, cities, counties, and school districts.
ordinances
Which of the following shares have the right to vote?
outstanding shares
Any surplus funds following a judicial sale must be ________.
paid to the mortgagor or owner
The ________ states that if a written contract is a complete and final statement of the parties' agreement, any prior or contemporaneous oral or written statements that alter, contradict, or are in addition to the terms of the written contract are inadmissible in court regarding a dispute over the contract.
parol evidence rule
The doctrine of ________ allows the court to order an oral contract for the sale of land or transfer of another interest in real property to be specifically performed if it has been partially performed and performance is necessary to avoid injustice.
part performance
A ________ is a grant by the federal government to the inventor of an invention for the exclusive right to use, sell, or license the invention for a limited amount of time.
patent
A collection of criminal statutes is referred to as a ________.
penal code
The ________ is a rule that is applicable to restraints of trade considered inherently anticompetitive.
per se rule
Subjects that are not compulsory or illegal are known as ________ subjects of collective bargaining, which may be bargained for if the company and union agree to do so.
permissive
Which of the following is enacted under state police power?
personal property laws
In a litigation process, the party who files a complaint is called the ________.
plaintiff
A(n) ________ is an agreement in which the accused admits to a lesser crime than charged, and in return, the government agrees to impose a lesser sentence than might have been obtained had the case gone to trial.
plea bargain
In the U.S. Supreme Court, if a majority of the justices agree as to the outcome of a case but not as to the reasoning for reaching the outcome, it is a(n) ________ decision.
plurality
English common law was law developed by judges who issued their options when deciding cases. The principles announced in these cases became _____ for later judges when deciding similar cases.
precedent
The ________ provides that federal law takes precedence over state or local law.
preemption doctrine
Hill Company maintains most of their business records as electronically stored information (ESI). Recently the company's president, Clint Hill, was informed that the firm can reasonably anticipate being named as a defendant in a federal lawsuit. Accordingly, Clint should see to it that the company ________.
preserves all relevant ESI that may be useful to an adversary
The Securities and Exchange Commission (SEC) is an administrative agency composed of five members who are appointed by the ________.
president
A(n) ________ is a relationship formed when an employer hires an employee and gives that employee authority to act and enter into contracts on his or her behalf.
principal-agent relationship
In which of the following types of franchises does a franchisor provide a secret formula or process to the franchisee?
processing plant franchise
Limonelle Corporation owns the secret formula for a popular beverage brand, Limonelle. The corporation operates through franchises in over 50 countries. It uses a secret formula to prepare the drink concentrate that is dispatched to the franchises world over. These franchises then prepare and bottle the beverage for distribution. Which type of franchise has Limonelle adopted?
processing plant franchise
An organization or venture must have a ________ motive in order to qualify as a partnership.
profit
Which of the following contracts are required to be in writing in most states?
promises to transfer an ownership interest in real property
What function of the law is being served when passing laws that prohibit discrimination at workplaces?
promoting social justice
In a criminal case, the government is represented by the ________.
prosecutor
Troy Hughes was involved in a car accident in which the airbag of his car failed to deploy. He sued the car manufacturer for installing faulty airbags. But in the course of the case being heard in court, the car company and Troy decided to settle the lawsuit out of court. What important function of the law was served in this case?
providing a basis for compromise
A written document in which a shareholder authorizes a person to vote the shareholder's shares at the shareholders' meetings in the event of the shareholder's absence is known as a ________.
proxy
The tort of defamation of character requires a plaintiff to prove that the defendant ________.
published an untrue statement of fact about the plaintiff to a third party
QuickMoney LLC is looking to fill its chief executive officer position, as the current CEO is retiring soon. QuickMoney receives applications for this position from many persons, including Joe Thomas, an African-American. Joe is the best-qualified applicant for the job. If QuickMoney does not hire Joe because he is an African-American, the company has engaged in ________ discrimination.
race
According to the objective theory of contracts, the intent to enter into a contract is judged by the _____.
reasonable person standard
A relevant market is characterized by the presence of ________.
reasonably interchangeable goods and services
A satisfaction of a mortgage is also called a(n) ________.
reconveyance
A ________ statute requires a mortgage or deed of trust to be recorded in the county recorder's office of the county in which the real property is located.
recording
A(n) ________ is a person or a corporation that is empowered to accept service of process on behalf of a corporation and is identified in the articles of incorporation
registered agent
A document that an issuer of securities files with the SEC and that contains required information about the issuer, the securities to be issued, and other information is called a(n) __________________.
registration statement
Jason Smith, a Hispanic scriptwriter from Brazil, worked for a television show on an American cable network. He was fired after the producer learned that Smith was a Scientologist by faith. The producer's official reason for this termination was that as Smith was based in Brazil, communication was a problem. This is an example of ________ discrimination that violates Title VII of the Civil Rights Act of 1964.
religious
One of the features of the Marine Protection, Research, and Sanctuaries Act is that it ________.
requires a permit for dumping wastes and other foreign materials into ocean waters
A per se violation of Section 1 of the Sherman Act that occurs when a party at one level of distribution enters into an agreement with a party at another level to adhere to a price schedule that either sets or stabilizes prices is referred to as ________.
resale price maintenance
Any powers that are not specifically delegated to the federal government by the Constitution remain with the states. These powers are called _______ powers.
reserved
A competitor can lawfully use a rival's trade secret if the competitor discovers the trade secret by means of ________.
reverse engineering
A ________ is defined as the passing of title of goods from a seller to a buyer for a price.
sale
Jameson works for Fishy-Mart Corporation, a chain of superstores that sells large quantities of seafood. His job is to locate future sites for Fishy-Mart stores. Jameson finds a piece of real estate near a coastline that would make a great site for a Fishy-Mart store. He asks his friend to purchase the property from its current owner and has a secret agreement with his friend to split the profits when he sells the property to Fishy-Mart. Jameson, without disclosing his interest in the property, recommends the site to Fishy-Mart, which then purchases the property from Jameson's friend. The friend splits the profits with Jameson. What breach of the duty of loyalty has Jameson committed?
self-dealing
Owners of a corporation who elect the board of directors and vote on fundamental changes in the corporation are known as ________.
shareholders
According to Rawls's social justice theory of ethics, moral duties are based on an implied ________. (2 words)
social contract
The ________ established by Congress have limited jurisdiction.
special federal courts
OSHA standards establish safety requirements for safety guards on saws. This is an example of a(n) ________ standard.
specific duty
The OSHA guidelines that set safety rules for specific equipment, procedures, types of work, and unique work conditions are known as ________.
specific duty standards
Social responsibility requires corporations and businesses to act with awareness of the consequences and impact that their decisions will have on others. What are the four theories of social responsibility?
stakeholder interest, corporate citizenship, moral minimum, and maximize profits
A written law enacted by the legislative branch of the federal or state government is called a _____.
statute
Interests or instruments that are expressly mentioned in securities acts are known as ________.
statutorily defined securities
According to our textbook, the primary purpose of the Constitutional Conventions was to _______.
strengthen the federal government
The area franchisee is also called a ________.
subfranchisor
Throwing a lit match on the ground in the forest and causing a fire is a breach of ________.
the duty of care
A duty that requires directors and officers to not act adversely to the interests of the corporation and to subordinate their personal interests to those of the corporation and its shareholders is known as ________.
the duty of loyalty
Jorge, a forklift truck operator for the retail chain Hanes Ridge, was injured when the forklift he was operating toppled over. The forklift truck was designed and manufactured by Ionic Machines, Inc. Jorge received workers' compensation benefits for his injury. It was later determined that the forklift truck was not designed to be used to lift as much weight as Ionic Machines claimed it could. To which of the following legal rights is Jorge entitled?
sue Ionic Machines in civil court for damages
Once a complaint has been filed with the court, the court will issue a(n) ________, directing the defendant to appear in court.
summons
What is considered as the supreme law of the land in the United States?
the Constitution of the United States of America
What federal statute was enacted by the U.S. Congress to protect trade secrets?
the Economic Espionage Act
Which school of jurisprudence views law as a sort of evolutionary process, where changing norms of society will be reflected in the law?
the Historical School of jurisprudence
Which of the following is the only act that includes criminal sanctions for unfair trade practices?
the Sherman Act
Which of the following policies helps keep a corporate officer from being sued for honest mistakes made on behalf of a corporation?
the business judgment rule
Which of the following actions is prohibited under the Clean Water Act?
the construction of residences by filling qualified wetlands
In making a decision of whether to issue a loan to a consumer, an unsecured creditor may consider a number of factors. Which of these is/are factor(s) that a creditor would normally consider?
the consumer's credit history, the consumer's income, the consumer's other assets
Bonnie made the final payment to Big Bank on the 30-year mortgage loan she had on her home. Shortly thereafter Big Bank, to prove that the mortgage has been paid, filed a satisfaction of a mortgage with ________.
the county recorder's office
Who is the plaintiff in a criminal lawsuit?
the government
Which of the following best defines an initial public offering (IPO)?
the issuance of securities by an issuer to the public
Which of the following is regulated by the Securities Act of 1933?
the issue of securities online
Which of the following governs a limited partnership, its internal affairs, and the liability its limited partners?
the law of the state in which it is organized
Which of the following must be included in the articles of incorporation?
the number of shares the corporation is authorized to issue
A contract is created when ________.
the offeree mails the acceptance
Under the UCC, if the time, place, and manner of delivery of goods are not mentioned in a contract, ________.
the place of delivery is the seller's place of business
The Supreme Court case decision on the case of Brown v. Board of Education was important because it exhibited ________.
the scope of flexibility of the law
Secondary boycott picketing is lawful only if it is directed at ________.
the primary employer's product
If the mortgagee's or lienholder's foreclosure action in court is successful, the court will issue a judgment that orders ________.
the real property to be sold at a judicial sale
Which of the following is a federal government mandate under the Nuclear Waste Policy Act?
to select a permanent site for the disposal of nuclear wastes
The earnings and losses from a sole proprietorship are reported on ________.
the sole proprietor's personal income tax filing
What was the key factor in the development of the English common law?
the use of precedence of past cases for judges to decide present similar cases
Which of the following constitutes copyright infringement?
the use of several clips from a copyrighted movie in a documentary
One of the main features of the Electronic Signatures in Global and National Commerce Act (E-SIGN Act) is that it recognizes electronic contracts as meeting ________ of the Statute of Frauds for most contracts.
the writing requirement
The process by which heated water or material is discharged into waterways, upsetting the water's ecological balance and decreasing its oxygen content as a result, is defined as ________.
thermal pollution
What was the key reason for the creation of law courts during the early development of the English common law?
to administer law in a uniform manner
Why have checks and balances been built into the U.S. Constitution?
to prevent any one of the three branches of the government from becoming too powerful
Issued shares that have been repurchased by the corporation are referred to as ________ shares.
treasury
In addition to the Constitution, other sources of law in the United States include federal statutes, state statutes, and _____.
treaties, executive orders, ordinances
A ______ is a compact made between two or more nations and becomes part of the supreme law of the land.
treaty
In the U.S. Supreme Court, if all the justices voting agree as to the outcome and reasoning used to decide a case, it is a ________ decision.
unanimous
Which of the following best describes the tort of battery?
unauthorized and harmful or offensive physical contact with another person that causes injury
If a contract is required to be in writing under the Statute of Frauds but is not, the contract is ________.
unenforceable
Heather chooses to buy a scarf from Macy's and reads the price on the tag as $50. She uses her credit card to pay for the scarf, but only after the purchase does she notice that the price tag actually says $500. This is an instance of a(n) ________.
unilateral mistake
An LLC is a(n) ________.
unincorporated business entity
Which of these issues has NOT been addressed in an amendment to the U.S. Constitution?
universal health care
Which of the following would constitute false advertising under the FTC Act?
unsubstantiated claims
Most of the Bill of Rights' guarantees of certain fundamental rights and the protection of these rights from intrusive government action have been applicable to federal, state and local government action ________.
until the Fourteenth Amendment was ratified in 1868 and the Supreme Court applied its Due Process Clause to state and local governments via the incorporation doctrine
Helen is the vice-president of Gotspeed Corporation, a company that designs, manufactures and sells sports shoes. Nestor, an independent entrepreneur, designs a new shoe that helps the user's foot grip the shoe better, and he calls it the Anklator. Nestor's friend schedules an appointment for him to meet Helen and present the Anklator for possible adoption by Gotspeed. Instead of presenting the opportunity to Gotspeed's board of directors, Helen pays Nestor's asking price and purchases the Anklator design for herself. She then quits and forms her own company to manufacture and sell Anklator shoes. Helen has breached her duty of loyalty to Gotspeed Corporation by ________.
usurping a corporate opportunity
According to the ________ theory of ethics, persons choose the alternative that would provide the greatest good to society.
utilitarianism
Billionaire Lynn Miller convinced the Goudaville Town Council that they should condemn the Old McDonald Dairy so she can build an electronics plant on the land, arguing that the benefits to the community in the form of new jobs and extra tax revenues to be generated by the plant will far outweigh the detriment to the McDonald family from shuttering their business. Lynn's argument is an example of ________.
utilitarianism
A ________ patent protects the functionality of an invention.
utility
A ________ is a patent that protects the functionality of an invention.
utility patent
Compare valid, void, voidable, and unenforceable contracts. Give a brief definition of each.
valid contract: Meets all essential elements. void contract: Nullity, has no legal effect. voidable contract: One or both parties have the option to void their obligations. If it's voided both parties are released from their obligations. unenforceable contract: The essential elements of a valid contract are met but there is some legal defense to the enforcement.
A _______________ restraint of trade occurs when two or more competitors at the different level of distribution enter into an agreement to restrict trade.
vertical
A person who jaywalks commits a ________.
violation
Most strikes are legal. However, several types of strikes are not protected by federal labor law. According to our textbook, illegal strikes include sit-down strikes, wildcat strikes, partial or intermittent strikes, and _______ strikes .
violent
While Harry was intoxicated, he sold his car to Ben for substantially less than its fair market value. This contract is considered ________.
voidable
A contract that is entered into because of undue influence is ________.
voidable by the innocent party
A ________ is a seller's or lessor's express or implied assurance to a buyer or lessee that the goods sold or leased meet certain quality standards
warranty
At what stage of the criminal procedure is the accused asked to enter a plea?
when the accused is taken to an arraignment
When is a creditor referred to as a secured creditor?
when the creditor has acquired collateral
When does a patent enter the public domain?
when the patent term expires
Law and ethics ________.
while different, are intertwined
States usually require employers to purchase ________ insurance from private insurance companies or state funds to cover workers' compensation claims.
workers' compensation
Which of the following is not a Social Security benefit?
workers' compensation