section 3 hw
Clarence, a movie producer, was allowed to work at a movie production company's offices (ITC) out of courtesy. His business card listed the ITC address and his phone calls were handled by ITC staff. In the office, he made a deal to produce a movie for another company. When problems developed, the other company, presuming Clarence worked for ITC, sued ITC. ITC will only be liable if: a. ITC ratified the agreement. b. there is a written agency agreement between ITC and Clarence. c. only if Clarence acquiesces to the agreement. d. only if the contract included ITC's name.
a. ITC ratified the agreement.
Nathan lives in Chicago but grew up in Green Bay, WI. When Nathan wears his Green Bay Packers tie to work one Friday, he is terminated by his employer because of the jersey. This is: a. Permissible under the employment at will doctrine. b. Not permissible because Nathan's choice of attire is a public right. c. Not permissible under the whistleblower doctrine if he posts his employers actions on social media. d. Impermissible if the company did not have a published disciplinary policy
a. Permissible under the employment at will doctrine
Vena filed for Chapter 7 bankruptcy, but would like to pay off several personal loans from friends because she gave her word that she would do so. a. These payments are forbidden by the automatic stay. b. Vena can make these payments after the debt is discharged in bankruptcy. c. The creditors cannot demand payment, but Vena can continue to make the payments from assets not included in the bankruptcy. d. If the personal loans are unsecured, the automatic stay has no impact and payment can be demanded.
a. These payments are forbidden by the automatic stay.
If a partner withdraws from a partnership a. a dissociation occurs. b. the partnership must file new organizational papers with the state. c. the partner remains personally liable for the obligations of the partnership until a new partner takes their place. d. the partnership must change its name.
a. a dissociation occurs
Henry, an employee of Auto Battery, Inc. takes a truckload of hazardous automobile batteries and dumps them in the lake, instead of taking them to the battery recycling center. When Henry returns with the empty truck 2 hours earlier than the usual time it takes to dump the batteries, Henry's supervisor winks and says "nice job." Auto battery a. has potentially ratified the illegal conduct of its employee. b. has found a more efficient way to do business. c. cannot be subjected to any potential liability since it did not instruct henry to dump the batteries in the lake. d. can only be held liable for dumping the batteries if the employee is held liable
a. has potentially ratified the illegal conduct of its employee
DST Telemarketing Company institutes has an ethnically diverse workplace. To promote unity and understanding in the workplace environment, DST adopts a policy that requires all employees to speak English in the work place at all times, unless they are on a call with a person whose first language is not English. This policy is a. mostly likely discriminatory based on race and/or national origin. b. a violation of the rights of the employees to exercise "freedom in speaking". c. a form of hate speech by DST. d. a company policy that in no way discriminates against race and/or national origin.
a. mostly likely discriminatory based on race and/or national origin.
Kate is being interviewed for a job and she volunteers that she has diabetes and has to occasionally take breaks to give herself insulin shots. The interviewer asks her how often she needs to take these breaks and how long the breaks take. These questions are: a. not illegal under the Americans with Disabilities Act. b. illegal under the Americans with Disabilities Act. c. illegal in California, but not in other states. d. illegal if the interviewer is a man, but not if it is a woman
a. not illegal under the Americans with Disabilities Act.
A company mails cards to consumers telling them they have won valuable prizes. When a consumer attempts to collect her prize, she discovers that she must pay $500 to collect the goods. In this case the FTC is likely to: a. seek a consent decree to end the practice. b. only allow consumers to use credit cards, not cash, to purchase the goods. c. have nothing to do with this case, it falls with the jurisdiction of the FBI. d. All of the answers
a. seek a consent decree to end the practice.
Ace Laundry Detergent advertises that its spot detergent "reduces the toil in removing oil", and "takes the whine out of spilling wine". If the detergent doesn't remove oil or wine from clothing, the FTC may require the manufacturer to a. show evidence to back its claims. b. refund all profits from detergent sales. c. offer a product supplement to offset any damages. d. re-label the product, but cannot remove the product from the market altogether once regulatory approval has been given.
a. show evidence to back its claims.
Carson files for a Chapter 11 bankruptcy on behalf of his company, Carson's B-B-Q. The company is allowed to continue its operations. During this period Carson is: a. the debtor in possession. b. the guarantor in extremis. c. insolvent. d. creditor.
a. the debtor in possession.
Jace did not receive a position that he applied for and has established a prima facie case against his employer for age discrimination. This means that Jace a. will win this if his employer does not have a valid reason for not giving him the position. b. Has won his case. c. Must be given the exact position or a comparable position in terms of responsibility and pay. d. Still has the burden to prove that he was discriminated against even if his employer does not offer an explanation as to why he did not receive the position.
a. will win this if his employer does not have a valid reason for not giving him the position.
Lisa's employment contract with Sports Marketing, Inc. requires that she pay back her signing bonus and be liable for damages if she (1) leaves the company within two years, (2) quits her job without providing 6 months of advance notice, or (3) recruits any of the firm's clients for a two-year period after she accepts employment from a competitor of the firm. Lisa quits without notice one day following the completion of her second year of employment with Sports Marketing, Inc. Which of the following sums up her responsibilities to Sports Marketing, Inc.? a. Lisa does not have to pay back the signing bonus because she was employed with the firm for more than 2 years, and she cannot recruit firm clients. b. Lisa must pay back the signing bonus and cannot recruit firm clients. c. Lisa does not have to pay back the signing bonus because 6 month's advance notice of leaving is unreasonable. d. All of the terms identified in her employment contract are unreasonable and unenforceable because of the employment at will doctrine.
b. Lisa must pay back the signing bonus and cannot recruit firm clients.
Jill wants to form a corporation, but she wants to avoid double-taxation. What type of corporation should she form? a. C Corporation b. S Corporation c. X Corporation d. F Corporation
b. S Corporation
Super Soaker, Inc. advertises its supersized squirt guns to "Kids of all ages - from five to fifty-five years of age". Super Soaker requires an e-mail address, credit card information and an actual physical address to place an order, which is so easy that they advertise - "Let your five-year old do it!" If a 10-year-old orders a squirt gun using a prepaid gift card, Super Soaker might be in violation of a. The Mail Order Rule b. The Kids' Online Privacy Rule c. The Fair Credit Billing Act d. The Fire Arms Act
b. The Kids' Online Privacy Rule
Carla agrees to try to sell Frank's prize dog Spike for him. Carla does this as a favor to Frank because she knows many professional dog breeders. Carla may be best described as: a. a universal agent. b. a gratuitous agent. c. an agent who has an agency coupled with an interest. d. a special agent.
b. a gratuitous agent.
Nicholas and Adeline started doing tax returns for friends in college and split the profits. Now they do tax returns for their startup businesses and split the expenses and profits, but have never adopted a business name or filed any organization papers with the state. They have formed a. a sole proprietorship. b. a partnership. c. an LLC. d. an illegal association.
b. a partnership.
June is buying a house from Marni. Marni wants to ensure that the bank will honor the check June uses to buy the house so she will probably insist that June pay with a: a. check. b. cashier's check. c. personal check. d. deposit slip.
b. cashier's check.
"Deep South" potato chips claim to have "that old-fashioned, deep-down satisfyin' taste." They also claim to be low-fat and low-calorie. According to standards created by the FDA, these chips must: a. have less fat and fewer calories than their nearest competitor. b. contain fewer than 40 calories per serving. c. contain fewer than 10 grams of fat per serving. d. All of the answer
b. contain fewer than 40 calories per serving.
Ian notices an ad for trampolines advertised at half the normal price. When goes to the store to buy it, the sale person informs him that the discounted trampoline is only three feet wide and will not accommodate more than 35 lbs. of weight, and attempts to persuade Ian to purchase one at a much higher price. This is likely a. a legitimate advertising plan and honest sale person. b. deceptive advertising. c. online deceptive advertising d. nothing, as the advertising is typical sales talk
b. deceptive advertising.
Ace Construction adopts a policy that forbids its pregnant employees from working on any construction site after their 28th week of pregnancy. This policy is a. an equitable policy because it shows sensitivity toward its female employees. b. discriminatory if the pregnant woman is able to perform the job duties. c. a form of reverse discrimination because it treats pregnant women different than women who are not pregnant. d. permissible under state law, as long as health benefits remain in tact.
b. discriminatory if the pregnant woman is able to perform the job duties.
Gary and Barry work at Stan's RV Lot. Gary dislikes Barry, makes insults about Barry's Iranian heritage, and treats him badly. Stan has heard the insults but does not reprimand Gary because Stan thinks Gary is right. Stan's actions are: a. legal because Barry is a U.S. citizen. b. discriminatory under Title VII. c. legal because Stan and Gary have a rational basis for their beliefs. d. legal because Iranian-Americans are not protected by Title VII.
b. discriminatory under Title VII.
Abby signs an exclusive contract with a real estate agent to list and sell her home for a 4% commission. The next day, a close friend of Abby contacts her directly and makes an offer on the house. Abby never makes the house available to the realtor, stops returning her calls, and sells the house on her own. Abby a. can withhold the 4% commission because the real estate agent did nothing to earn it. b. has a duty to cooperate and compensate her real estate agent. c. must only reimburse and indemnify her agent for reasonable expenses. d. does not have to pay the commission because no fiduciary relationship was ever developed
b. has a duty to cooperate and compensate her real estate agent.
Felix TV sells Ryan a 52" plasma television. Ryan does not have the cash necessary to buy the TV, so Felix allows him to make 12 monthly payments. If Ryan misses any payments, Felix may take the TV back. Felix: a. is an unsecured creditor. b. has a security interest. c. is a perfected debtor. d. is an unsecured creditor with a perfected interest.
b. has a security interest.
Simeon was granted a week of family and medical leave under FMLA. When his employer checked the GPS on his company phone, it showed that Simeon was in Orlando at a resort. When Simeon returned to work, his employer demanded verification that he had an illness and demoted him to an entry level position. Simeon a. can successfully challenge the demotion because FMLA ensures he will receive the same or a comparable position on his return. b. has no right to be left alone and his employer may check to ensure employees do not abuse their leave. c. can successfully challenge the demotion because his employer has no right to information about his health. d. will not succeed in challenging the demotion because he is not a "key" employee.
b. has no right to be left alone and his employer may check to ensure employees do not abuse their leave.
A company with 30 employees has no personnel department. Several male employees pester several female employees, including making sexual gestures, comments, and, at times, grabbing them. Telling the men to stop does not change behavior. Several women quit and file a complaint against the employer for sexual harassment. It is likely that the women will: a. have a case because the company does not have a personnel office as required by law. b. have a case because there was a persistent hostile environment that was not corrected. c. not have a case because they did not complain sufficiently to the company manager before they quit. d. not have a case because they did not complain to the EEOC (or equivalent state office) before they quit.
b. have a case because there was a persistent hostile environment that was not corrected.
Dale owns an excavating business and has a large piece of heavy machinery in which his bank has a perfected security interest. Strapped for cash, Dale takes out a loan with EZ cash, using the same piece of Machinery as collateral. EZ cash files a lien against the Machinery. If Dale defaults on the loan with EZ Cash, EZ cash a. can take possession of the collateral because it has a security interest. b. is second in priority to Dale's bank. c. is in the same position as any other unsecured creditor because Dale's bank has a perfected security interest. d. can demand sale of the asset because the second security interest creates a floating lien.
b. is second in priority to Dale's bank.
Lacey gives to Boris Construction, Inc. an instrument that reads "payable upon completion of the construction of my new home". This alone a. is not enough to make an otherwise valid instrument non-negotiable. b. makes the instrument non-negotiable. c. does not make the instrument non-negotiable if the construction of the home complete. d. serves as an extension clause to the contractor.
b. makes the instrument non-negotiable.
Lola endorses her annual bonus check and gives it to her two children for being so understanding about her hectic work schedule. Lola's children are a. holders in due course. b. ordinary holders. c. very manipulative. d. considered to be "drawees".
b. ordinary holders
Gary and Sue start a consulting firm. They are co-owners of it and have joint control over its operation and the right to share in its profits. Their organization is most likely a: a. proprietorship. b. partnership. c. limited partnership. d. corporation.
b. partnership
Hot Highlights Hair shampoo advertises that it is the best for bringing out golden highlights of people with blond hair. Hot Highlights ads state: "Tests prove that our shampoo is superior to other shampoos in making blond hair shine like gold." What FTC program monitors such claims? a. the product purity program b. the advertising substantiation program c. the proof of product program d. the consent decree program
b. the advertising substantiation program
Bart wants to borrow $10,000 to start a ballroom dancing business. Creditors are not anxious to lend him the funds and want someone to be responsible in the event that Bart is unable to pay. Gary agrees to assume this responsibility. Gary is: a. the borrower. b. the guarantor. c. the testator. d. the lender.
b. the guarantor.
Laura goes to the local appliance store and buys an oven on credit. The store extends her credit. The store's security interest in the oven perfects when: a. Laura completes the financing statement and leaves with the oven. b. the store files the financing statement with the Secretary of State. c. the store posts notice of Laura's security interest in the newspaper. d. the store posts notice of its security interest.
b. the store files the financing statement with the Secretary of State
Samuel works at a unionized workplace where the collective bargaining agreement requires all employees to pay union dues or agency fees. He refuses to join the union, which demands he pay an agency fee, part of which would be used for political purposes. Assuming this is a right-to-work state: a. union dues and agency fees must be equal. b. Samuel must pay agency fees, but is not supposed to have to pay fees to support political activities. c. Samuel may not be forced to pay any fees to the union. d. Samuel may not be forced to pay union fees or be represented by a union without permission.
c. Samuel may not be forced to pay any fees to the union.
TNC Accounting Firm establishes a policy that forbids workplace romances. This is a. sexual discrimination. b. religious discrimination for those who believe in marriage. c. a valid and effective company policy to reduce claims of harassment. d. an invasion of privacy.
c. a valid and effective company policy to reduce claims of harassment.
Starlight Manufacturing is unable to resolve a dispute between the company and the union representing workers by the standard internal grievance procedure. Most collective bargaining agreements call for the dispute to go to: a. federal district court. b. the National Labor Relations Board. c. an outside labor arbitrator. d. the Labor-Management Resolution Board.
c. an outside labor arbitrator.
A voluntary termination of a corporation's existence is typically accomplished a. with the sole approval of the board of directors alone. b. by a vote of the directors, officers and shareholders. c. by a vote of the shareholders and directors. d. when the state dissolves it or through bankruptcy.
c. by a vote of the shareholders and directors.
One afternoon while most of National Insurance Co.'s employees are in training, a maintenance worker steals 20 purses and other personal items of value. If it is later discovered that the maintenance worker had been convicted of armed robbery on two prior occasions, National a. cannot be held liable because the theft is outside the scope of the employee's job duties. b. can only be held liable if the maintenance worker was a general contractor. c. could be held liable for negligent hiring. d. Is not liable unless the maintenance worker was an independent contractor.
c. could be held liable for negligent hiring
If Don wants to form a corporation, he will need to: a. apply for permission from the Federal Trade Commission. b. apply for permission from the Department of Commerce to pursue an incorporation. c. create and file articles of incorporation with the proper state official. d. create and file articles of incorporation with the FCC.
c. create and file articles of incorporation with the proper state official
Mora is the only employee that has done book keeping and payroll for her employer for the past 22 years. One morning, without warning or notice, she abruptly says "I'm done. You can send my final check to south beach, which is where I will be." Mora's employer can a. sue her for failing to give two weeks notice that she's leaving, because it is an industry practice and creates an an implied contract. b. demand that she complete the payroll cycle if there's no other employee trained to do it, under the doctrine of respondeat superior. c. do nothing to make Mora continue her employment, based on the doctrine of employment at will. d. sue her based on the doctrine of employment at will, which only provides employers with the right to terminate employment, not vice versa.
c. do nothing to make Mora continue her employment, based on the doctrine of employment at will.
Tim has been warned by his supervisor at the golf country club he works about operating a golf cart with a disabled governor switch (speed restricting device). Tim disables the switch on a cart and is severely injured when the golf cart overturns as he is delivering supplies to the golf shop. Tim's claim for worker's compensation will be a. denied because he was in violation of the country clubs rules. b. granted, unless his employer chooses to terminate him. c. granted because he was injured in the course of employment. d. denied because the injury was due to his own negligence.
c. granted because he was injured in the course of employment.
The workers at a meat packing plant are on strike. They picket the banks in town to put pressure on the meat packing plant to come to a settlement. The pickets at the banks are: a. legal primary boycotts. b. legal under First Amendment rights to free speech. c. illegal secondary boycotts. d. illegal for committing a tort of injuring bank business.
c. illegal secondary boycotts.
Tyler discovers that his employer has engaged in unethical conduct, and exposes this on his personal social media page, but does not tell anyone else specifically. Tyler's employer has a strict privacy and social media policy that forbids disclosure of company business or information on social media, and fires Tyler immediately when it discovers his posts. Tyler: a. is protected under the whistle blower statute. b. cannot be fired as long as he was not involved in the unethical conduct he posted. c. is in violation of his company's privacy policy and the company can rightfully terminate him. d. can lawfully disregard the social media policy because the underlying behavior was unethical.
c. is in violation of his company's privacy policy and the company can rightfully terminate him.
The business judgment rule a. holds directors liable for corporate losses due to poor decision making. b. holds managers liable for poor performance in the function of their duties. c. makes directors immune from liability if there is a reasonable basis for their decisions. d. makes directors immune from liability if their good faith actions turn a profit for the corporation
c. makes directors immune from liability if there is a reasonable basis for their decisions.
Seth becomes seriously ill and now has a permanent disability after he takes a dietary supplement recently approved by the FDA. Seth can a. successfully bring an action against the FDA for false advertising. b. possibly sue the company if he used the supplement as intended. c. sue the FDA if the product is not removed from the market. d. sue the FDA if it requires that the company modify its labeling in any way after the fact.
c. sue the FDA if the product is not removed from the market.
Several consumers have complained to the FTC that the advertisements made by a new popular diet are unfair and deceptive. In its determination of whether the advertising is unfair or deceptive, the FTC will not consider a. the price paid for the dietary materials b. whether a reasonable consumer would be misled by the claims c. whether the consumer can show proof of injury. d. whether there is an omission of material information
c. whether the consumer can show proof of injury
Stella falls off a ladder at work while trying to reach supplies that are stored on a high shelf. Which of the following must be shown by Stella in order for her to have a claim under workers' compensation? a. The worker must have a personal injury. b. The injury must be the result of an accident or occupational disease. c. The accident or occupational disease must have arisen out of and in the course of employment. d. All of the answers are correct
d. All of the answers are correct
Hanson is Carla's agent. Carla has made it clear to Hanson that she does not want him to sign the contracts that he negotiates; she retains that power and Mario is aware of this. If, despite Carla's instructions, Hanson negotiates and signs a contract with Mario committing Carla to spend thousands of dollars, Carla is liable under the contract of: a. express authority. b. apparent authority. c. implied authority. d. None of the answers
d. None of the answers
ABC Lock Company hires a new book keeper who is overwhelmed with the number of past due invoices the business has pending. In her haste, the book keeper makes several errors in paying the invoices. Which of the following would adversely affect negotiability? a. Some instruments are post dated. b. Some instruments are partially typed and partially handwritten. c. Some have amounts stated in words that contradict the amount written in number. d. Some instruments are unsigned.
d. Some instruments are unsigned
Which of the following is not a basis for piercing the corporate veil? a. Corporate formalities are not observed. b. The officers pay corporate debts and bills with personal checks when the corporation is running low on cash. c. The corporation is undercapitalized at its start up. d. The corporation defaults on a loan business loan.
d. The corporation defaults on a loan business loan.
Taylor contracts with Macy's Manufacturing to do excavation work and gets injured on the job. If Taylor is an independent contractor, the injuries would typically not be covered by Macy's Manufacturing's insurance. Which of the following is not relevant to the determination of whether Taylor is an independent contractor or employee? a. The extent to which the employer exercised control over the details of work. b. Whether the work done involves significant skill. c. Whether compensation is by the job will by the hour. d. Whether there is a written agreement that outlines the expectation of the project.
d. Whether there is a written agreement that outlines the expectation of the project.
Jeanette wants to exercise sole managerial control over her business but she does not have enough money to set the business up so she is seeking investors. What type of organization should she form? a. a proprietorship b. a partnership c. a cooperative d. a corporation
d. a corporation
Stephanie hires an agent to sell her house. Typically, such an agent receives a fee only if they actually sell the house. This person is most likely: a. a universal agent. b. a gratuitous agent. c. an agent who has an agency coupled with an interest. d. a special agent.
d. a special agent
If Jason, an African-American employer with light skin, discriminates against Oscar, an African-American employee with dark skin, Oscar will most likely file a discrimination claim based on: a. sex. b. race. c. national origin. d. color.
d. color.
Craig and Dawn are candidates for promotions. Craig is 34, Dawn is 56. Craig is given the promotion. Management decided that since Dawn has said she plans to retire in four years, promoting her would make little sense. In this case, the company: a. had a legitimate reason for denying the promotion. b. had a compelling reason for denying the promotion. c. engaged in a forced retirement scheme. d. discriminated illegally based on age.
d. discriminated illegally based on age.
After Eli forms a corporation, he will need to do all of the following except: a. elect a board of directors. b. enact bylaws. c. issue stock. d. file the articles of incorporation.
d. file the articles of incorporation
Parker is a manager who runs all aspects of a hotel. He is most likely what kind of agent? a. universal agent b. special agent c. gratuitous agent d. general agent
d. general agent
Nas owns nine stores - three restaurants, three gas stations and three convenience stores. He employs a manager for each line of business to negotiate and enter into all transactions in connection with the stores in that business line. These managers are a. gratuitous agents. b. universal agents. c. special agents. d. general agents.
d. general agents
Every year millions of children are vaccinated against polio. For reasons that are unclear, some children contract polio from the vaccine, even though their dose was no different than the others. Assume that child who contracts polio after receiving a vaccine sues the vaccine maker for damages. The likely result of the case will be that: a. no liability will be imposed because of the public health benefits from the polio vaccine campaign. b. no liability will be imposed because the FDA Act prohibits liability from being imposed on drug producers who sell FDA approved drugs. c. if the FDA has approved the vaccine, liability may not be imposed due to the learned intermediary doctrine. d. it is uncertain if liability will be imposed; FDA approval is not a shield against liability.
d. it is uncertain if liability will be imposed; FDA approval is not a shield against liability.
An art gallery sells fake "authorized" Pablo Picasso prints to clients for $50,000 each, telling buyers their purchases are good investments. If the FTC sues, the gallery will: a. win because purchasing the prints did not harm the clients. b. win because the doctrine of caveat emptor applies to art. c. win because the purchasers are sophisticated art investors. d. lose because its actions meet the FTC test for deception.
d. lose because its actions meet the FTC test for deception.
ChemCo has 1,000 employees of which 550 are suddenly terminated without notice. Under the Worker Adjustment and Retraining Notification Act, the fired employees can: a. receive training from the Department of Labor. b. sue for up to 180 days back pay plus fringe benefits. c. sue for up to 90 days back pay plus fringe benefits. d. sue for up to 60 days back pay plus fringe benefits.
d. sue for up to 60 days back pay plus fringe benefits.
Purple Jet is a regional airline with smaller jets that fly no more than 500 miles. Eighty percent of the flight attendants are female. If a claim of gender discrimination is filed against the company because of its disproportionately female workforce, the companies best defense is a. flight attendants are traditionally female. b. the number of male pilots offsets the lack of male flight attendants. c. the males do not fit the flight attendant uniforms chosen by the company. d. the regional aircrafts typically have height restrictions which produces the predominantly female workforce
d. the regional aircrafts typically have height restrictions which produces the predominantly female workforce
Lee's company is trying to rejuvenate its workforce and hire a younger, more attractive and energetic sales staff. Lee has been asked to provide a bad performance review for a 61year-old employee that refuses to retire. If Lee refuses and sends an email to the local newspaper detailing what he has been asked to do, Lee a. will be labeled a snitch and eventually fired. b. will be terminated for exposing confidential company policies. c. have no relevance because the company has not engaged in any wrongful behavior. d. will be protected by the whistle blower statute.
d. will be protected by the whistle blower statute.