Business Law Chapter 21 Questions

[21-04] In the context of tort liability, which of the following rules indicates that a principal escapes liability when the agent's actions are outside the scope of employment? A. Respondeat superior B. Frolic and detour C. Nolo contendere D. Novation E. Promissory estoppel

B

[21-01] One major purpose of the Fair Labor Standards Act is to provide A. overtime pay. B. guaranteed employment. C. disability benefits. D. permanent employment. E. private pension plans.

A

[21-01] Which of the following acts is directed at protecting employees' health care? A. the Consolidated Omnibus Budget Reconciliation Act (COBRA) B. the Family Medical Leave Act (FMLA) C. the Fair Labor Standards Act (FLSA) D. the Employment Retirement Income Security Act (ERISA) E. the Worker Adjustment and Retraining Notification (WARN) Act

A

[21-02] The discharge of an employee for reporting the employer's alleged violations of law is known as ______. A. whistleblowing B. affirmative action C. ratification D. benchmarking E. accommodation

A

[21-02] Which of the following holds true for the Fair Labor Standards Act? A. It forbids discharge for exercising rights guaranteed by minimum-wage and overtime provisions of the act. B. It prohibits discharge of employees due to garnishment of wages for any one indebtedness. C. It forbids discharge of employees for service on federal grand or petit juries. D. It prohibits discharge to prevent employees from getting vested pension rights. E. It forbids age-based discharge of employees over age 40.

A

[21-04] According to the tort doctrine of ______, any time an employee is liable for tortious acts in the scope of employment, the employer is also liable. A. respondeat superior B. frolic and detour C. nolo contendere D. novation E. promissory estoppel

A

[21-04] In agency law, to accomplish the establishment of a new principal-third party relationship, agents A. should keep the principal fully informed. B. must guarantee profit from sale of goods to the principal. C. should charge the lowest fees to the principal for the performance of the duty. D. must avoid ratifying any contract entered by the principal. E. must express apparent authority while entering into a contract with contractors.

A

[21-04] Under which of the following does the liability of an employer for the actions of the employee cease to exist? A. A store manager argues with a supplier for delivering a wrong product. B. A service representative argues with a customer over the allegiance of his basketball team instead of the poor quality product delivered. C. A floor manager at a store argues with a customer about the revised pricing of a product that is inconsistent with their previous sales. D. A sales representative drives to a customer's house to deliver goods and crashes into a tree. E. A store representative strikes a customer during an argument over the return of merchandise.

B

[21-01] The Fair Labor Standards Act (FLSA) addresses issues regarding A. disability benefits. B. reemployment rights after performing uniformed service. C. minimum wage. D. workplace safety. E. private pension plans.

C

[21-03] Public employees are protected from some drug testing by the ______ Amendment's prohibition against unreasonable searches. A. First B. Fifth C. Fourth D. Tenth E. Seventeenth

C

[21-04] Which of the following statements is true of partners in a trading partnership? A. The partners in such a partnership are an accounting or a service firm. B. The partners require actual authority to conduct a business transaction. C. The partners are usually engaged in the business of selling and buying commodities. D. The partners usually lack the implied power to borrow money. E. The partners are required to exercise apparent and actual authority to pledge the credit of their firm.

C

[21-01] If an employer already provides compensated breaks, an employee who uses that break time to express milk A. is legally entitled to be compensated but at a rate lower than the other employees. B. is legally to be compensated using the compensation funds of the other employees. C. is legally entitled to stretch the duration of the break time. D. is legally required to take a pay cut. E. is legally entitled to be compensated in the same way as other employees.

E

[21-01] Under the Fair Labor Standards Act (FLSA), the overtime pay for workers is A. a rate that is lower than the minimum wage. B. decided by the employer after mutual consent and agreement with the workers. C. a rate that is equal to the employer's regular rate of revenues. D. variable depending upon the particular job involved. E. a rate not less than one and one-half times the employee's regular rate of pay.

E

[21-01] Which of the following statements is true of the Worker Adjustment and Retraining Notification (WARN) Act? A. It requires employers to give notice of plant closings and mass layoffs. B. It requires employers to give prior notice to an "at-will" employee that he or she is being fired. C. It requires employers to give notice to employees that a drug test will be conducted for all employees. D. It requires employers to give notice to employees that they will be subjected to polygraph tests. E. It requires employers to give notice to employees that they are being subpoenaed by a court of law.

A

[21-02] Flora has been working at Abacrux Inc. for four-and-a-half years. Her pension plan will vest at her five-year work anniversary. She has had great performance evaluations and has received regular raises and promotions. The internal finance department has determined that cost cutting is needed to keep the company profitable. They recommend that Flora be fired before her pension vests and becomes a permanent liability against the corporation. According to the ______ they cannot fire her to prevent her from getting vested pension rights. A. Employee Retirement Income Security Act (ERISA) B. Consolidated Omnibus Budget Reconciliation Act (COBRA) C. Health Insurance Portability and Accountability Act (HIPPA) D. Fair Labor Standards Act (FLSA) E. Immigration Reform and Control Act (IRCA)

A

[21-04] Which of the following statements is true of the doctrine of respondeat superior? A. The liability with an employer ceases to exist in cases where the employer had warned the employee against tortious acts. B. Many respondeat superior cases involve employee negligence. C. Employers are usually exempted from liability once the employee's fault is established. D. Under respondeat superior cases, the scope of employment is irrelevant in determining the liability of the employer. E. An employee is legally exempted from making any reimbursements to the employer once the employer pays for the tortious acts.

B

[21-02] Employers were prohibited from firing employees for union activities under the A. common law. B. Fair Labor Standards Act. C. Labor-Management Relations Act. D. Labor Rights Act. E. Worker Adjustment and Retraining Notification (WARN) Act.

C

[21-01] Which of the following statements is true of the Fair Labor Standards Act (FLSA)? A. The FLSA sets 16 years of age as the minimum age for employment. B. The FLSA limits the number of hours worked by minors under the age of 18. C. The FLSA was amended in 2006 to increase penalties against employers who violate child labor laws. D. The FLSA increased penalties from $10,000 to $50,000 for each FLSA violation leading to the serious injury or death of a child worker. E. The FLSA increased the penalties for violations from $11,000 to $50,000, which are subject to doubling for repeated or willful violations.

E

[21-01] Which of the following statements holds true for a Worker Adjustment and Retraining Notification (WARN) notice in cases involving the sale of a business? A. Any required notice prior to the sale being completed is the responsibility of the seller. B. The seller of the business holds the responsibility of issuing a WARN notice even after the date of the closing. C. A failure on the part of the seller to issue a WARN notice results in a $1,000 fine. D. The seller has to provide written notice to the federal government at least 90 days before the sale of the business. E. The sale of a business mandatorily requires the WARN notice.

A

[21-03] Under common law, even though an employer is negligent in permitting a hazardous condition to persist, if the worker is aware of the dangers that exist, he will be unable to recover damages because of the ______ defense of the employer. A. assumption of the risk B. exclusive remedy rule C. fellow-servant rule D. proportionate liability E. shelter rule

A

[21-04] The only defense an employer has to the strict liability of respondeat superior is that the employee was outside the scope of employment. This defense is made using the language of frolic and detour by an employer when an agent A. acts outside the scope of employment. B. represents the employer in a third-party transaction. C. behaves as prescribed by the employer. D. receives no prior warning about tortious acts. E. advances the interests of the employer.

A

[21-01] An employee is eligible to qualify for the Family and Medical Leave Act benefits if the employee has worked at least A. 1,500 hours during the previous 12 months. B. 1,250 hours during the previous 12 months. C. 2,250 hours during the previous 24 months. D. 2,500 hours during the previous 12 months. E. 3,000 hours during the previous 24 months.

B

[21-01] If an employee's tips combined with the cash wage is inconsistent with the minimum hourly wage, ______. A. the employee is entitled to work for a reduced number of hours B. the employer must make up the difference with certain conditions C. the federal government must make up the difference D. the employee is entitled to be paid for the inconvenience caused along with the difference, with certain conditions E. the employer is not liable to pay the difference if he or she reduces the number of working hours for the employee

B

[21-01] The Worker Adjustment and Retraining Notification (WARN) notice is required of employers with: A. 50 employees working within a 75-mile radius. B. 100 or more full-time employees. C. 300 employees, including both full- and part-time. D. less than 70 half-time employees. E. more than 200 virtual employees.

B

[21-01] The purpose of the Social Security Act is to provide A. employment. B. disability benefits. C. policy guidance on employment discrimination. D. protection for employee privacy. E. provisions for restrictions on child labor.

B

[21-01] Which of the following statements is true of an employer in case an employee is on family medical leave? A. The employer is entitled to review the actual medical records of the employee. B. The employer may request a medical certification that a qualifying event has occurred in the employee's life. C. The employer should ensure that the employee is supposed to be disadvantaged by the fact that the leave was taken. D. The employer can rescind the employee's job contract when the employee returns to work. E. The employer should refrain from awarding bonus to employees for perfect attendance who were granted leaves under the Family and Medical Leave Act (FMLA).

B

[21-01] Which of the following is true of the Occupational Safety and Health Administration (OSHA)? A. Employees are refrained from having the right to request an OSHA inspection. B. Employees making complaints who are subjected to discrimination are prohibited from filing a complaint with OSHA. C. The private cause of action is absent under OSHA. D. An employee can sue an employer for damages based on an OSHA violation. E. OSHA boycotts the principles of the Severe Violator Enforcement Program (SVEP).

C

[21-03] Under common law, if an injury occurred because of the negligence of another employee, the employer would escape liability because of the ______ defense. A. assumption of the risk B. exclusive remedy rule C. fellow-servant rule D. contributory negligence E. shelter rule

C

[21-04] In the context of agency law, outside accountants and subcontractors hired to perform construction projects are examples of ______. A. principal employers B. agents C. independent contractors D. traders E. mediators

C

[21-01] If the state minimum wage rate differs from the federal minimum wage rate, then employers A. are legally required to pay a state minimum wage rate that is lower than the federal minimum wage rate. B. have the legal right to choose the minimum wage rate to be paid. C. are legally required to pay the federal minimum wage rate. D. are legally required to pay whichever minimum wage is higher. E. have the legal right to pay the state minimum wage rate.

D

[21-01] Which of the following acts provides a national policy for governing the union-management relationship? A. The Social Security Act B. The Fair Labor Standards Act C. The Worker Adjustment and Retraining Notification Act D. The Taft-Hartley Act E. The Employment Retirement Income Security Act

D

[21-01] Which of the following statements is true of the National Defense Authorization Act (FY 2010 NDAA) under the Family and Medical Leave Act? A. It extended military caregiver leave to eligible employees whose family members are recent veterans with serious injuries or illnesses. B. It excluded conditions that do not arise until after a veteran has left the military. C. It modified the definition of a serious injury for current service members to exclude injuries that result from a condition that existed before the start of the service member's active duty service. D. It added that for qualifying exigency leave, the military member need not be deployed to a foreign country. E. It limited military caregiver leave to employees whose immediate family members are current service members.

A

[21-04] In the context of tort liability, which of the following doctrines is reflected in the phrase "let the master reply"? A. Respondeat superior B. Frolic and detour C. Nolo contendere D. Novation E. Promissory estoppel

A

[21-04] Jeff is the owner of a small scale manufacturing unit that specializes in selling customized automobiles. He is on the lookout for wholesalers or suppliers to sell him a unique set of spare parts. In the context of agency relationships, Jeff is a(n) ______. A. principal B. agent C. independent contractor D. middleman E. mediator

A

[21-01] Which of the following statements is true of the Uniformed Services Employment and Reemployment Rights Act (USERRA)? A. Employers may retaliate against anyone assisting in the enforcement of USERRA rights, provided that person has no service connection. B. The USERRA also contains health insurance provisions. C. Covered individuals who leave a job to perform military service are barred from continuing any existing employer-based health plan coverage. D. For individuals who elect to continue existing employer-based health plan coverage, they have the right to be reinstated in the employer's health plan when reemployed. E. It applies to all individuals released from service irrespective of whether it was under "honorable conditions" or "dishonorable conditions."

B

[21-02] The Age Discrimination in Employment Act forbids age-based discharge of employees over age A. 35. B. 40. C. 45. D. 50. E. 60.

B

[21-02] Which of the following holds true for the Internal Revenue Service (IRS) Whistleblowers Rewards Program? A. To be eligible to recover compensation from the IRS, a person must bring information to the Department of Justice. B. The whistleblower may receive compensation only from monies actually collected based on the information provided. C. The total collected proceeds based on which the reward is calculated exclude penalties, interest, additions to tax, and additional amounts. D. The reward to the whistleblower is independent of his contribution to the prosecution of the action. E. Under no circumstances does the IRS have the right to lower the amount of the reward given to the whistleblower.

B

[21-03] The ______ states that an employee's sole remedy against an employer for workplace injury or illness shall be workers' compensation. A. assumption of the risk rule B. exclusive remedy rule C. fellow-servant rule D. contributory negligence rule E. shelter rule

B

[21-03] Under workers' compensation laws, ______. A. the compensation paid to the workers excludes medical benefits B. liability requires the necessary association between the injuries and the business of the employer C. employers may not pass the costs of injuries on to the consumers, treating them as part of the costs of production. D. the three defenses under the common law are strengthened E. liability exists only if there is lack of negligence or fault

B

[21-01] The Health Insurance Portability and Accountability Act A. provides that employees may continue to purchase health insurance even after their employment is terminated. B. exempts health insurance companies from the federal anti-trust legislation that applies to most businesses. C. protects employees who have preexisting health conditions when they change jobs. D. calls for the creation of a universal single-payer health care system in the United States. E. ensures that elderly and needy individuals receive proper medical care.

C

[21-01] Under the Worker Adjustment and Retraining Notification (WARN) Act, which of the following constitutes a loss of employment? A. a transfer leading to a reduction in position and pay B. a layoff exceeding one month C. a reduction in an employee's work time of more than 50 percent in each month for six months D. an extended leave period of more than 10 weeks E. a disciplinary notice requiring immediate response from an employee

C

[21-03] Under the Employee Polygraph Protection Act, ______. A. employers cannot be sued by employees for violating the act B. private employers are permitted to use lie detector tests while screening job applicants C. current employees may not be tested randomly but may be tested as a result of a specific activity that causes an economic loss to the employer D. private security companies are prevented from using lie detector tests while screening job applicants E. current employees are refrained from being tested even in cases involving distinct incidents that cause loss to an employer's business

C

[21-03] Which of the following statements is true of polygraph tests? A. They are legally used by most private employers to screen job applicants. B. They may be legally used by most private employers to randomly check current employees. C. They may be legally used by private companies that sell controlled substances to test both job applicants and current employees. D. They are used when senior employees are being transferred to a different department within a firm. E. They are generally not used by public employers for screening job applicants.

C

[21-04] Which of the following statements is true of an agency relationship? A. In an agency relationship, usually any or all agents are employees. B. Principals directly control independent contractors. C. Independent contractors usually work for more than one principal. D. Agents are usually exempt from the duty to account to a principal for monies handled. E. Agents are bound to benefit themselves at the expense of a principal.

C

[21-04] Which of the following statements is true of partners in a nontrading partnership? A. The partners are usually engaged in the business of selling and buying commodities. B. The partners have an implied authority to pledge the credit of the firm. C. The partners have no implied power to borrow money. D. The partners are exempt from showing any actual power for the firm to be bound. E. The partners are allowed to conduct any business transaction regardless of the authority vested in them.

C

[21-04] ______ occurs when a principal voluntarily decides to honor an agreement, which otherwise would not be binding due to an agent's lack of authority. A. Novation B. Accession C. Ratification D. Rescindment E. Foreclosure

C

[21-01] Jamie works as a barista at Coffee-Hutz, a coffeehouse in New Jersey, with 60 other employees. He has been working there full time for 18 months. One day his wife called with some bad news. His mother-in-law and 10-year-old daughter, Delores, were severely injured in a car accident while returning from school. Jamie has asked his employer for leave under the Family Medical Leave Act (FMLA). In this scenario, which of the following statements is true? A. Granting the leave is entirely at the discretion of the employer; the employer does not permit him the leave as it would hamper the functioning of Coffee-Hutz. B. Jamie is not entitled to the leave because the number of hours he has worked during the preceding 12 months is less than what is required by the act. C. Jamie is entitled to leave for taking care of his mother-in-law and daughter, regardless of his daughter's age. D. Jamie is only entitled to the leave to take care of his daughter. E. Jamie is not entitled to the leave because the provisions of the FMLA Act apply only to females.

D

[21-01] Which of the following statements holds true for the internship programs under the Fair Labor Standards Act (FLSA)? A. The intern is entitled to a job at the conclusion of the internship. B. The intern is entitled to wages for the time spent in the internship. C. The intern generally displaces regular employees. D. The internship includes the actual operation of the facilities of the employer. E. The employer that provides the training derives an immediate advantage from the activities of the intern.

D

[21-01] Which of the following provides requirements for private pension plans? A. the Fair Labor Standards Act B. the Social Security Act C. the Worker Adjustment and Retraining Notification Act D. the Civil Rights Act of 1964 E. the Employment Retirement Income Security Act

E

[21-04] The owner of Oasis Store regularly sends Miguel, one of his employees, to act on behalf of the store and obtain goods from Polar Inc., a local retail outlet. A few months later the store owner terminates Miguel, but fails to notify Polar Inc. about the termination. Miguel buys goods from Polar, and Polar charges Oasis for the purchases made. This liability is a result of ______. A. apparent authority B. implied authority C. expressed authority D. actual authority E. written authority

A

[21-02] Tom has a back injury that required surgery in the past. He is able to work but has to undergo periodic medical checkups and physiotherapy. If he leaves his current job and moves to another company, he will receive medical coverage that includes coverage for his treatment due to the provisions of the: A. Family Medical Leave Act (FMLA). B. Fair Labor Standards Act (FLSA). C. Occupational Safety and Health Act (OSHA). D. Health Insurance Portability and Accountability Act (HIPAA). E. Uniformed Services Employment and Reemployment Rights Act (USERRA).

D

[21-03] Under common law, if an injury was caused by the carelessness of an employee as well as the employer, the employee would be unable to recover damages because of the ______ defense of the employer. A. assumption of the risk B. exclusive remedy rule C. fellow-servant rule D. contributory negligence E. shelter rule

D

[21-04] Viola hires Chris to purchase goods from Liferunner Shoes, a local sportswear store. She sends a note along with Chris to be delivered to the manager at Liferunner Shoes to charge her store for the goods purchased by Chris. Chris is to purchase goods on behalf of the store for the first time. In this case, the contractual authority thus created is a form of ______. A. apparent authority B. implied authority C. verbal authority D. actual authority E. passive authority

D