ACCT 2700 Cochran Exam 1

A precedent is

A court decision that furnishes an example or authority for deciding subsequent cases involving identical or similar facts.

Cato is driving a car in which Diego is a passenger when an accident occurs. Diego is not injured. In Diego's tort action against Cato for negligence, Cato can most likely assert as a successful defense that

Diego was not injured

A choice-of-law clause permits a party to choose which nation's law to apply to a dispute arising under an international contract.

False

A default judgment is a judgment entered by a court in a case in which neither party prevails.

False

A defendant cannot be liable for negligence unless he or she intended to harm the plaintiff.

False

A defendant cannot be liable in an intentional tort action if he or she did not intend to cause harm to the plaintiff.

False

A false statement made with actual malice can constitute defamation, unless the statement is about a public figure.

False

A person who wrongfully hurts another's good name or reputation orally may be liable for libel.

False

A request for admission can lengthen a trial because the parties have to take the time to prove facts on which they may already agree.

False

An overemphasis on long-run profit maximization is a common reason for ethical problems that occur in business.

False

Any court can exercise jurisdiction over any person.

False

Conduct that is legal is ethically unquestionable.

False

Doing business within a jurisdiction is not enough for most courts to compel a defendant to appear.

False

Equal protection means that the government must treat all individuals the same.

False

Even if it conflicts with the U.S. Constitution, a state constitution is supreme within that states' borders.

False

Failing to strictly follow the procedural rules and standards for determining disputes in courts is not likely to affect the outcome in a particular case.

False

Judicial review is the process through which Congress approves or rejects judicial appointments.

False

Once a company has investigated any foreign suppliers, it is unnecessary to continue to monitor those suppliers.

False

Privacy rights receive no protection under federal law.

False

Proximate cause exists if "but for" a wrongful act, an injury would not have occurred.

False

State governments do not have any authority to regulate interstate commerce.

False

The rights secured by the Bill of Rights are absolute.

False

The study of business law does not involve an ethical dimension.

False

The study of ethics goes no further than the requirements of the law to evaluate what is right for society.

False

To meet the standard of proof of preponderance of the evidence, a party must prove its case beyond a reasonable doubt.

False

Grain Farm Inc. files a suit against Harvest Services. Before the court can exercise jurisdiction over Harvest, the court must have proof that

Harvest was notified of the suit

A federal form of government is one in which the national government shares sovereign power with

The States

A complaint contains a brief summary of the facts necessary to show the party filing the complaint is entitled to relief.

True

A constitution is a primary source of law.

True

A corporation's compliance with the laws of any jurisdiction in which it does business is complicated by the fact that those laws can be very different.

True

A deposition can be used to impeach a party or witness who changes his or her testimony at trial.

True

A federal court will apply federal law in a case involving a federal question.

True

A local ordinance commonly has to do with a matter concerning only a local governing unit.

True

A question of law is generally the focus of an appellate court.

True

A wrongful action that interferes with a person's legal right to personal property can support a tort action in trespass.

True

An act intended to make another person fearful of an immediate physical harm is an assault if the threat is reasonably believable.

True

An appellate court can modify a trial court's decision, in whole or in part.

True

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

True

Before a lawsuit is initiated, a plaintiff should consider whether the defendant is able to pay the damages sought.

True

Congress or a state legislature establishes an administrative agency to perform a specific function.

True

Corporate social responsibility may increase a business's reputation or goodwill.

True

Corporations enjoy many of the same rights and privileges as natural persons do.

True

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

True

Intent can be transferred when an individual intends to harm one individual but unintentionally harms another.

True

It can be difficult to predict with certainty how a court will apply a given law to a particular action.

True

Jurors must decide a case based only on the information that they learn during the trial.

True

Local governments, including cities, exercise police powers.

True

One of the most important ways to maintain an ethical workplace is for management to set standards and expectations for ethical behavior.

True

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

True

Proximate cause exists if "but for" a wrongful act, an injury would not have occurred.

True

Rules issued by administrative agencies affect almost every aspect of a business's operations.

True

The U.S. Constitution is the basis of all law in the United States

True

The amount of business a corporation does within a state can serve to subject or exempt the firm from that state's jurisdiction.

True

The basis of a civil law system is a written code of laws.

True

The common law is a body of law developed from judicial decisions.

True

The doctrines and principles announced in court decisions govern all areas not covered by statutory or administrative law.

True

The effect of the minimum-contacts standard is that a business firm has to comply with the laws of any jurisdiction in which it targets customers.

True

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

True

The first ten amendments to the U.S. Constitution are commonly known as the Bill of Rights.

True

The national government has the implied power to undertake actions necessary to carry out its expressly designated powers.

True

The system of checks and balances in the U.S. Constitution allows each branch of government to limit the actions of the other branches.

True

Under a state long-arm statute, a court can exercise jurisdiction only over certain nonresident defendants.

True

Under the full faith and credit clause, any judicial decision in one state with respect to contract rights will be honored and enforced in all states.

True

Voir dire refers to the jury selection process.

True

Fred, a clerk at a Games Store, takes a game player and a selection of games from the store without permission. Most likely, Fred is liable for

a conversion

To prepare for a trial between Sky Quest Inc. and Telescope Company, the plaintiff's attorney places the defendant's chief executive officer (CEO) under oath. A court official makes a record of the attorney's questions and the CEO's answers. This is

a deposition

Stare decisis is best defined as

a doctrine under which judges follow established precedents.

Lazlo, a citizen of Minnesota, wants to file a suit against Nadji, a citizen of Ohio. The diversity of citizenship may be a basis for

a federal court to exercise jurisdiction

Pete, a broker, advises Ollie to invest in Rocky Road Inc. When the share price of Rocky's stock decreases, Ollie accuses Pete of fraud, claiming reliance on Pete's advice. The reliance that gives rise to liability for fraud requires

a misrepresentation of fact knowing that it is false.

An award of damages is

a payment of money or property

Sportsfield Inc. files a suit against Tailgate Services. Before the trial, during the jury selection process, Sportsfield's attorney asks, without providing any reason, that one of the potential jurors not be sworn in. This is

a peremptory challenge

Bix backs out of City Parking Garage, colliding with Dill's car. Dill may recover $7,500 to cover the cost of the repairs if Bix failed to act as

a reasonable person

The Bill of RIghts embodies

a series of protections for the individual against government action

Marin files a suit against Nagle over payment due on a lease of grazing land. The case proceeds to trial, after which the court renders a verdict. The case is appealed to an appellate court. After its review of Marin v. Nagle, the appellate court upholds the lower court's verdict. The appellate court has

affirmed the case

n Peyton v. Quality Motors, a state supreme court held that a minor could cancel a contract for the sale of a car. Now a trial court in the same state is deciding Rikki v. Street Deals, Inc., a case with similar facts. Under the doctrine of stare decisis, the trial court is likely to

allow the minor to cancel the contract

Utah enacts a statute to ban advertising in "bad taste." Most likely, a court would hold this statute to be

an unconstitutional restriction of speech

Business ethics looks at whether business decisions

are right or wrong

n a suit to compel arbitration, a court will order a dispute to be arbitrated if

both parties consented to it.

Loni files a civil suit against Meme's Bridal Shop, seeking to recover the amount of a refund for an undelivered wedding dress. To succeed, the plaintiff must prove her case

by a preponderance of the evidence

Dylan applies for a position with Electrical Works LLC. Dylan's previous employer, Federal Circuits Inc., gives Electrical Works a review of Dylan that includes negative statements Federal Circuits knows are untrue. This is

defamation

A trial court's capacity to directly observe witnesses' gestures, demeanor, and other nonverbal behavior supports the decision of an appellate court to

defer to the trial court's findings on questions of fact

Barge Company and Cove Harbor dispute the meaning of their contract. Unable to agree on settlement, the parties prepare for trial. To obtain information, they engage in discovery. This includes gaining access to each other's witnesses and other types of evidence by

depositions and other devices

To reduce traffic, Market Town enacts an ordinance that allows only a few specific street vendors to operate in certain areas. A court would likely review this ordinance under the principles of

equal protection

Cloud Source LLC sells to Distribution Inc. a promising idea for a technological innovation that looks promising but that is still being developed. This is

ethical and legal

Under the U.S. Constitution, Congress has the power to regulate

every commercial enterprise in the United States

Fran tells Gio that her Hyundai Kia has never been in an accident. This may give rise to an action for fraud if the statement is

false

Bram knows that the pipes in his building leak, but he tells Cass, a potential buyer, that there are no leaks. On this assurance, Cass buys the building. On learning the truth, she may sue Bram for

fraudulent misrepresentation.

If a company strictly complies with existing laws, the firm will

fulfill some business ethics obligations

When the chief financial officer, or other executive, of a corporation is unsure whether a certain business action is legal, she should act

honestly and responsibly

"Be honest and treat people fairly." In regard to business ethics, implementing this motto is

important in all circumstances

Hobbes, a resident of Illinois, owns a warehouse in Indiana. A dispute arises over the ownership of the warehouse with Jules, a resident of Kentucky. Jules files a suit against Hobbes in Indiana. Regarding this suit, Indiana has

in rem jurisdiction

Recreation Corporation files a suit against Spring Break Tours Inc. and seeks to examine certain documents in the defendant's possession. A legitimate reason for this examination is that the documents contain

information that is relevant to the case

Two businesses—Berry Farms LLC and Canned Jams Inc.—dispute the quality of goods delivered by the seller and the price agreed to by the buyer. With regard to this dispute, the two parties can

litigate it, resolve it through an alternative method, such as arbitration, settle it between themselves.

Power, Inc., is a corporation engaged in the business of producing, refining, and distributing energy resources. With respect to the firm's managers, legal concepts can be useful for Power's

marketing manager, human resources manager, accounting and finance managers

Ethics focuses on how persons making business decisions apply

moral principles

The Florida legislature enacts a state law that violates the U.S. Constitution. This law can be enforced by

no one

Buddy's Burgers advertises so effectively that the regular customers of its competitor Slimy's Sliders patronize Buddy's instead of Slimy's. This is

none of the choices

According to the theory of corporate social responsibility, any decision by corporate management should consider how an action affects the firm's

officers, shareholders, suppliers, customers, and community

The members of Climate Action believe that a recently enacted federal law is unconstitutional. They write and sign a petition to the government to repeal the law, refuse to obey it, and stop others from complying with it. Under the First Amendment, these individuals have a right to

petition the government

Good Samaritan statutes were passed largely to protect, in emergency situations,

physicians and medical personnel.

Common law rules develop from

principles underlying judges' decisions in actual controversies.

Jon, a law enforcement official, monitors Kelsey's Internet activities—e-mail and website visits—to gain access to her personal financial data and student information. This may violate Kelsey's right to

privacy

Ethical issues that a business manager is not likely to encounter include

protocols for company meetings

Steel Mill Inc. makes steel forms of substandard quality. Tower Building Company has never bought or used a Steel Mill form, but files a suit against the firm, alleging that its products are defective. The defendant's best ground for dismissal of the suit is that the plaintiff does not have

standing to sue

Laws enacted by legislative bodies at any level of government make up the body of law generally referred to as

statutory law

The federal government has the power to regulate commercial activities among the states under

the commerce clause

The National Association of Manufacturers (NAM) announces a new industry code of ethics. The effectiveness of this code will be determined by

the commitment of NAM's members to enforcing the code

Carly files a complaint against Delivery Corporation, charging that she has not been paid and wants to recover the unpaid amount, plus interest. The complaint and a summons will most likely be served on

the corporation's registered agent

Ovid wants to file a suit against Petra. For a court to hear the case,

the court must have jurisdiction

Radiant Supply wants to initiate a suit against Solar Power LLC by filing a complaint. The complaint should include a statement of the facts necessary to show that

the plaintiff is legally entitled to a remedy

The 1803 decision of the United States Supreme Court in the case of Marbury v. Madison established

the power of judicial review

The term checks and balances refers to the system under which

the powers of government are divided among its branches, each of which exercises a check on the actions of the others.

Fresh Seafood Inc. and Grocers Market LLC dispute a term in their contract. Because the parties have a long-standing business relationship that they would like to continue, they could settle their dispute through mediation because

the process is not as adversarial as litigation

Administrative law includes

the rules, orders, and decisions of a government agency

On a challenge to a provision in a state constitution that conflicts with a provision in the U.S. Constitution.

the state provision will not be enforced

Federal regulations concerning medical devices directly conflict with a certain state law. Under the U.S. Constitution, which law takes precedence is determined by

the supremacy clause

Larry takes Kyla's textbook and hides it so that she cannot find it during the week before the exam. In taking the textbook, Larry most likely committed

trespass to personal property.

Build-It Inc. applied an inexpensive but untested technique to brace a transit tunnel wall. The technique was legal but the tunnel collapsed, killing several commuters. Build-It's action was

unethical because the technique was untested.

Ihlan initiates a lawsuit against Juno, alleging that Juno has not paid her rent for six months and Ihlan wants her to vacate her apartment. The sheriff serves a summons. Juno does not respond. Ihlan

will be awarded a default judgment

A challenge to the constitutionality of an executive order that limits certain state actions is

within the power of judicial review.