BLAW test 1

1. A crime can be committed only against persons. a. True b. False

ANSWER: False

17. Administrative law is a source of American law that is comprised of statutes. a. True b. False

ANSWER: False

19. According to German philosopher Immanuel Kant, individuals should evaluate their actions in light of the consequences that would follow if they were the only members of society that acted in that way. a. True b. False

ANSWER: False

19. An answer never admits to the allegations made in a complaint. a. True b. False

ANSWER: False

18. Duty-based ethical standards often come from religious precepts or through philosophical reasoning. a. True b. False

ANSWER: True

2. Ethics is concerned with the fairness or justness of an action. a. True b. False

ANSWER: True

2. Law consists of enforceable rules governing relationships among individuals and between individuals and their society. a. True b. False

ANSWER: True

20. Felonies are punishable by imprisonment for more than a year or death. a. True b. False

ANSWER: True

21. Administrative law consists of the rules, orders, and decisions of administrative agencies. a. True b. False

ANSWER: True

21. Someone suffering from a mental illness may be incapable of the state of mind to commit a crime. a. True b. False

ANSWER: True

22. A deposition is a sworn testimony by a party to a lawsuit or any witness. a. True b. False

ANSWER: True

22. In ethical terms, a cost-benefit analysis is an assessment of the negative and positive effects of alternative actions on individuals. a. True b. False

ANSWER: True

23. Interrogatories are written questions for which written answers are prepared and signed under oath. a. True b. False

ANSWER: True

24. According to utilitarianism, an action that affects the majority adversely is morally wrong. a. True b. False

ANSWER: True

25. Corporations can be good citizens by promoting goals that society deems worthwhile. a. True b. False

ANSWER: True

26. Corporations can be perceived as owing ethical duties to groups other than their shareholders. a. True b. False

ANSWER: True

28. A business firm's profits may suffer if the firm is not a "good corporate citizen." a. True b. False

ANSWER: True

38. John is sales manager for Kleen 'N Brite Products, Inc. Compared to John's personal activities, his business activities most likely involve a. more complex ethical issues. b. no ethical issues. c. simpler ethical issues. d. the same ethical issues.

ANSWER: a

41. The case of Max v. National Credit Co. is heard in a trial court. The case of O! Boy! Ice Cream Co. v. Refrigerated Transport, Inc. is heard in an appellate court. The difference between a trial and an appellate court is whether a. the proceedings focus on the presentation of evidence and the examination of witnesses. b. the court is appealing. c. the parties question how the law applies to their dispute. d. the subject matter of the case involves complex facts.

ANSWER: a

42. Laney is a resident of Maine. Delacorte is a Canadian. They dispute the ownership of Petite Isle, an island in North Rapids River on the border between Canada and the United States. The diversity of the parties' citizenship could serve as a basis for a. federal jurisdiction. b. general jurisdiction. c. limited jurisdiction. d. universal jurisdiction.

ANSWER: a

43. The Uniform Commercial Code has been adopted, at least in part, in a. all states. b. forty-five states. c. thirty-five states. d. no state.

ANSWER: a

61. In Kettle Cafe's suit against Food Services, Inc., the court issues a judgment in Kettle's favor. The judgment can be appealed to an appropriate court of appeals by a. either party. b. Kettle only. c. Food Service only. d. neither party.

ANSWER: a

61. Jane enters into a contract with Jill to provide 100 roses for a dinner party. Jane fails to deliver the roses. Jill initiates a suit against Jane, asking the court to order Jane to deliver the roses. Jill is a. the plaintiff. b. the defendant. c. the binding authority. d. the king's conscience.

ANSWER: a

62. A common ethical dilemma faced by the management of Spencer Hydraulics Corporation involves the effect that its decision will have on a. one group as opposed to another. b. the firm's competitors. c. the government. d. the U.S. Chamber of Commerce.

ANSWER: a

62. To Cody, the written law of a particular society at a particular time is most significant. Cody is a a. legal positivist. b. legal rationalist. c. legal realist. d. person who adheres to the natural law school.

ANSWER: a

63. At a meeting of employees, Fuel Injection Design & Manufacturing, Inc.'s managers announce the creation of a new company-wide code of ethical conduct and the initiation of an ad campaign to publicize the new code. They also say that any employees who do not adhere to the code will be discharged. The effectiveness of this code will be determined by a. the commitment of company leadership to enforcing the code. b. the extent to which the employees comply with the code. c. a marketing campaign posted online to tout the firm's ethical tone. d. management directing employees to "do as we say, not as we do."

ANSWER: a

63. Kelly files a suit against Lewis in a state court. The case proceeds to trial, after which the court renders a verdict. The case is appealed to an appellate court. After its review of Kelly v. Lewis, the appellate court upholds the lower court's verdict. The appellate court has a. affirmed the case. b. reversed the case. c. remanded the case. d. reversed and remanded the case.

ANSWER: a

64. iTablets, Inc., files a suit against Andromeda Pads Corporation. Suri is a witness for iTablets. Kevin is a witness for Andromeda. iTablets may direct interrogatories to a. Andromeda. b. Suri. c. Kevin. d. the judge.

ANSWER: a

65. Ergonomic Corporation convenes its employees for its managers to announce (1) a new company-wide ethical code of conduct, (2) an ad campaign to publicize the new code, and (3) the discharge of employees who do not adhere to the code. One of the most effective ways to set a tone of ethical behavior within a business organization is a. to create an ethical code of conduct. b. to discharge employees who create the appearance of impropriety. c. to post a marketing campaign online touting the firm's ethical tone. d. for management to direct employees to "do as we say,not as we do."

ANSWER: a

67. Refer to Fact Pattern 1-1. Bellamy's opinion is a. a concurring opinion. b. a dissenting opinion. c. a majority opinion. d. a per curiam opinion.

ANSWER: a

68. Refer to Fact Pattern 3-1. If Bean and Java resolve their dispute by having a neutral third party render a binding decision, they will have used the method of a. arbitration. b. conciliation. c. intervention. d. mediation.

ANSWER: a

54. Drummond wants to make a federal case out of his dispute with Elena. Federal cases originate in a. federal courts of appeals. b. federal district courts. c. state trial courts. d. the United States Supreme Court.

ANSWER: b

49. Lora files a suit in Michigan against Ned over the ownership of a boat docked in a Michigan harbor. Lora and Ned are residents of Ohio. Ned could ask for a change of venue on the ground that Ohios a. has a sufficient stake in the matter. b. has jurisdiction. c. has sufficient minimum contacts with the parties. d. is a more convenient location to hold the trial.

ANSWER: d

69. Transnational Corporation and United Shipping, Inc., agree to a contract that includes an arbitration clause. If a dispute arises, a court having jurisdiction mays a. monitor any arbitration until it concludes. b. order an arbitrator to rule in a particular way. c. order a party to bring the dispute to court. d. order a party to submit to arbitration.

ANSWER: d

Fact Pattern 1-1 The Texas Supreme Court decides the case of Livewire Co. v. Power Corp. Of nine justices, five believe the judgment should be in Livewire's favor. Justice Bellamy, one of the five, writes a separate opinion. The four justices who believe the judgment should be in Power's favor join in a third separate opinion.​ 66. Refer to Fact Pattern 1-1. These opinions are collected and published in volumes called a. citations. b. codes. c. regulations. d. reporters.

ANSWER: d

5. Businesspersons are expected to make decisions that are ethically sound. a. True b. False

ANSWER: true

46. The best definition of a precedent is a. a law developed from custom. b. a judicial proceeding for the determination of a dispute between parties in which rights are enforced or protected. c. a proceeding by one person against another in court. d. a court decision that furnishes an example or authority for deciding subsequent cases involving identical or similar facts.

ANSWER: D

26. Common law is a term for the laws that are familiar to most of us. a. True b. False

ANSWER: FALSE

31. The basis for the U.S. legal system is the natural law school. a. True b. False

ANSWER: FALSE

1. Business ethics is not more complicated than personal ethics. a. True b. False

ANSWER: False

20. Absolute mandates such as the commandment "Thou shalt not steal" can be justifiably broken if there is a benevolent motive. a. True b. False

ANSWER: False

34. Government authorities cannot enforce national law a. True b. False

ANSWER: False

30. Equity is a branch of law, founded in justice and fair dealing that seeks to supply a remedy when no adequate remedy at law is available. a. True b. False

ANSWER: TRUE

55. Starlight Café brings a suit, seeking a remedy at law. A remedy at law is a. the payment of money or property as compensation for damages. b. a decree of specific performance. c. a judicial proceeding for the resolution of a dispute. d. an injunction.

ANSWER: a

56. In a suit against Knut, Leon obtains an injunction. This is a. an order to do or to refrain from doing a particular act. b. an order to perform what was promised. c. a payment of money or property as compensation. d. the cancellation of a contract.

ANSWER: a

57. Eliza is a state court judge. Flora appears in a case in Eliza's court, claim-ing that Glover breached a contract. Which of the following actions may Eliza take? a. Award damages or issue a decree of specific performance b. Imprison Glover, but not Flora c. Imprison Flora, but not Glover d. Order the parties to pay Eliza to render a favorable ruling

ANSWER: a

70. Patricia commits an act via e-mail against Othman Finance Company, a business in California, where the act is a cyber crime. Patricia resides in New York where the act is not a crime. Prosecution of Patricia in California involves questions of a. jurisdiction. b. "maximum contacts." c. the immunity of Internet service providers. d. encryption.

a

11. Acting in good faith gives a business firm a better chance of defending its actions in court. a. True b. False ANSWER: True

a. True b. False

32. All persons who are arrested have the constitutional right to remain silent. a. True b. False

true

33. Any criminal activity occurring via a computer in the virtual community of the Internet is a cyber crime. a. True b. False

true

34. Identity theft occurs when a wrongdoer steals another's form of identification and uses it to access the victim's financial resources. a. True b. False

true

35. A hacker is someone who uses one computer to break into another. a. True b. False

true

71. Sophie is the president of Tasty Foods Corporation, a wholesale grocery company. An inspection by Uri, a government agent, uncovers unsanitary conditions in the company's ware-house caused by Vic, a Tasty Foods employee. Will, a Tasty Foods vice president, assures Uri that the situation will be corrected, but a later inspection finds that the warehouse is still unsanitary. Sophie knows nothing about any of this. Can Tasty Foods be convicted of a crime in these circumstances? Can Sophie be held personally liable? ;

ANSWER: The answer to both questions is yes. A corporation may be held liable for the crime of its employee if (1) the criminal act is within the scope of the employment and the purpose of the statute defining the act as a crime is to impose liability on the corporation, (2) the crime consists of a failure to perform a specific duty imposed on corporations by law, and (3) the crime was authorized by one of the corporation's "high managerial agents." Here, all of these elements exist. The unsanitary conditions in the warehouse are within the employee's scope of employment, the crime consists of a failure to keep the warehouse clean, and the crime was authorized by a company vice president. As for the president's personal liability, if she has the authority and the responsibility to deal with the situation, she can be held personally liable. A corporate officer must have the authority and the responsibility to deal with such situations. Personal liability is imposed in these circumstances, not because the corporate officer knew about the crime or intended it, but because the officer is in a "responsible relationship" to the corporation and has the power to prevent the crime. Under this "responsible corporate officer" doctrine, a corporate officer can be held liable for an employee's violations of the law. This liability may be imposed regardless of whether the officer participated in, directed, or knew about the violation.

72. An unknown individual launches a series of attacks against the Web sites of Prime Sales Corporation. The attacks significantly slow the sites, leading to $100 million in damage in terms of lost work time, lost revenue, site repair costs, and other expenses. The attacker does not intend to profit from the onslaught and in fact does not realize any financial benefit from the effects. How is this attack most likely orchestrated? Who is most likely to engage in this act—that is, whose habits and limitations are clearly suited to such conduct—and why? ;

ANSWER: The perpetrator in this question likely committed the attack through hacking—using one computer to break into another. The hacker may have appropriated a large number of computers without their owners' knowledge. Each computer might have become a bot, together constituting a botnet, through which the hacker could secretly install programs to forward transmissions to even more computers. The hacker might then have installed other malware, or other programs harmful to computers. This might have consisted of a worm, which could reproduce and transfer itself to other computers, or a virus, which could reproduce itself but could not transfer without being attached to an infected file. These programs might have been uploaded to Web sites based anywhere in the world.

52. Julia, the head executive of Fine Woolen Sweaters, Inc., is a committed Christian who strongly adheres to the Ten Commandments. One of Julia's employees is found to be stealing sweaters and giving them to a local homeless shelter. Julia is likely to a. punish the employee for stealing even though the employee's motive was benevolent. b. view the employee's actions as justified because the employee was clothing the poor. c. contribute more sweaters to the homeless shelter. d. gently reprimand the employee without suggesting that the employee's actions were unethical.

ANSWER: A

64. Precision Engineering Inc., like other corporations, is subject to laws that are broad in their purpose and their scope. Compliance with these laws is not always sufficient to determine "right" behavior because a. the law does not codify all ethical requirements. b. company codes are also sources of law. c. business decisions can have negative impacts. d. ethical problems occur in business.

ANSWER: A

72. Discount Mart, Inc., files a suit in a state court against Elements Computer Corporation, alleging that Elements breached a contract to sell 500 notebook computers to Discount. During the course of the suit, Discount files a motion for judgment on the pleadings, Elements files a motion for a directed verdict, and both parties file motions for summary judgment. When and for what purpose are each of these motions made?

ANSWER: After the pleadings have been filed, either party can file a motion for judgment on the pleadings. This motion may be used when no facts are disputed and, thus, only questions of law are at issue. The difference between this motion and a motion for summary judgment is that the party requesting the motion may support a motion for summary judgment with sworn statements and other materials on a motion for a judgment on the pleadings, a court may consider only those facts pleaded. At the conclusion of the plaintiff's case, the defendant can file a motion for a directed verdict (federal courts use the term motion for a judgment as a matter of law), asking the court to direct a verdict for the defendant on the ground that the plaintiff has presented no evidence to justify the granting of the plaintiff's remedy. In considering the motion, the judge looks at the evidence in the light most favorable to the plaintiff and grants the motion only if there is insufficient evidence to raise an issue of fact. At the end of the defendant's case, either party can move for a directed verdict. If the only question is which laws apply to the facts in a case, either party can move for summary judgment before or during a trial. When a court considers a motion for summary judgment, it can take into account evidence outside the pleadings. The evidence may consist of sworn statements by parties or witnesses, as well as documents. A motion for summary judgment will be granted only when there are no genuine questions of fact, and the only question is a question of law.

71. Norwest Trucking Corporation files a suit in a state court against Bob's Service Company (BSC), and wins. BSC appeals the court's decision, asserting that the evidence presented at trial to support Norwest's claim was so scanty that no reasonable jury could have found for the plaintiff. Therefore, argues BSC, the appellate court should reverse the trial court's decision. Is the appellate court likely to reverse the trial court's findings with respect to the facts? If not, why not? What are an appellate court's options after reviewing a case?

ANSWER: An appellate court will reverse a lower court's decision on the basis of the facts if the evidence does not support the findings or if it contradicts them. Appellate courts normally defer to a trial court's decision with regard to the facts of a case, however, for several reasons. First, trial judges and juries have the opportunity to observe witnesses and tangible evidence first hand. The appellate court sees only a cold record of the trial court proceedings and therefore cannot make the kind of judgments about the credibility of witnesses and the persuasiveness of evidence that can be gleaned only from first hand experience. Second, as occurs when there is no jury and the case is heard by a judge, trial judges routinely sit as fact finders. As a result, they develop a particular expertise in determining what kind of evidence and testimony is reliable and what kind is not. (There are also constitutional reasons for an appellate court to defer to a jury verdict. If, based on the evidence presented to a jury, a reasonable person could have come to the same decision that the jury came to, an appellate court cannot reverse the jury's decision with regard to the facts because this would, in essence, take away a person's right to a jury trial.) An appellate court's options after reviewing a case are to affirm the trial court's judgment, to reverse it in whole, to reverse it in part, to modify the decision, or to remand the case for further proceedings. POINTS: 1

72. Recreation & Sports Equipment Corporation sells a product that is capable of seriously injuring consumers who misuse it in a foreseeable way. Does the firm owe an ethical duty to take this product off the market? What conflicts might arise if the firm stops selling this product?

ANSWER: Ethical behavior can sometimes generate sufficient good will to warrant practicing it out of a desire for increased profits. By the same token, unethical behavior can sometimes generate enough bad publicity to warrant avoiding it out of the same desire. A business firm's activities that are perceived as ethical and receive wide publicity can benefit the firm's owners in the short run-and even in the long run if the firm's enhanced public image continues to attract more consumers to its products. There is nothing unethical about making a profit. It is the behavior that generates the profit that can be questionable. Business ethics thus has a practical element. A business firm should act in its best interest. A firm interested in profits should also be interested in the public's opinion. Of course, it is not a company's fault when consumers misuse its product. If continuing to sell a product is not a strict violation of the law, stopping its sale would likely reduce profits. This could impact the firm's owners, employees, and others. But suspending sales could reduce injuries, and it could lead to increased profits from the sales of other products, if the suspension stops negative publicity. When a business entity decides to respond to what it sees as a moral or ethical obligation by removing a product from the market, an ethical conflict is raised between the firm and its employees and between the firm and its shareholders. This conflict arises directly out of the impact that the decision has on the firm's profits. If meeting this perceived obligation increases the firm's profitability, then all parties "win" and the dilemma would be easily resolved in favor of "doing the right thing." POINTS: 1 DIFFICULTY: Challenging

1. There is really no reason to be acquainted with business laws and government regulations, except to pass this test. a. True b. False

ANSWER: False

10. Counterfeiting is robbery a. True b. False

ANSWER: False

10. Lawyers are not allowed to represent people in small claims courts in any of the states. a. True b. False

ANSWER: False

11. Small claims courts hear both civil and criminal cases a. True b. False

ANSWER: False

12. All states have intermediate appellate courts. a. True b. False

ANSWER: False

14. Embezzlement can be committed only by physically taking property from the possession of another. a. True b. False

ANSWER: False

15. It is not a crime to defraud the public through the use of ads on television. a. True b. False

ANSWER: False

15. There are twelve justices on the United States Supreme Court. a. True b. False

ANSWER: False

17. Bribing foreign officials to obtain favorable business contracts is not a crime. a. True b. False

ANSWER: False

17. There is one set of procedural rules for federal courts and one set for state courts. a. True b. False

ANSWER: False

18. A default judgment is a judgment entered against the party who brought the claim before the court. a. True b. False

ANSWER: False

18. Uniform laws apply in all states, including those in which the laws have not been adopted. a. True b. False

ANSWER: False

19. In some states, misdemeanors are punishable by imprisonment for up to 10 years. a. True b. False

ANSWER: False

19. The American Law Institute was the only organization involved in developing the Uniform Commercial Code. a. True b. False

ANSWER: False

2. Criminal law spells out the duties that exist between persons or between citizens and their governments. a. True b. False

ANSWER: False

2. Generally, a state court's power is limited to the territorial boundaries of the state in which it is located and the immediately adjacent states. a. True b. False

ANSWER: False

20. On a motion for judgment on the pleadings, a court may consider evidence outside the pleadings. a. True b. False

ANSWER: False

21. A summary judgment is granted only if there is no genuine question of law. a. True b. False

ANSWER: False

21. The categorical imperative cannot be applied to many business actions. a. True b. False

ANSWER: False

22. Ordinarily, "ignorance of the law" is a valid defense to criminal liability. a. True b. False

ANSWER: False

23. Common law is the same as statutory law. a. True b. False

ANSWER: False

24. Any relevant material, except information stored electronically, can be the object of a discovery request. a. True b. False

ANSWER: False

24. Stare decisis is a doctrine obligating judges to help persons who have failed to protect their own rights. a. True b. False

ANSWER: False

25. A closing argument is a statement by a party that results in a summary judgment in that party's favor. a. True b. False

ANSWER: False

26. A motion for a new trial will be granted only if a constitutional issue is involved. a. True b. False

ANSWER: False

28. Any judgment is enforceable. a. True b. False

ANSWER: False

29. Arbitration is always legally binding. a. True b. False

ANSWER: False

3. Cases involving diversity of citizenship arise only between citizens of different states.. a. True b. False

ANSWER: False

31. Negotiation is the most complex form of alternative dispute resolution. a. True b. False

ANSWER: False

32. ADR proceedings are always strictly regulated by federal statutes. a. True b. False

ANSWER: False

32. Criminal law focuses on duties that exist between persons. a. True b. False

ANSWER: False

33. Criminal acts are prohibited only by federal government statutes. a. True b. False

ANSWER: False

33. Setting realistic workplace goals can increase the probability that employees will act unethically. a. True b. False

ANSWER: False

34. The verdict in a summary jury trial is binding. a. True b. False

ANSWER: False

35. International law is the law of a foreign nation and varies from country to country. a. True b. False

ANSWER: False

4. The amount in controversy in a diversity of citizenship case must be more than $1 million before a federal court can take jurisdiction. a. True b. False

ANSWER: False

6. Being a small-business owner means that you will never have to take on the role of finance manager, marketing manager or accountant. a. True b. False

ANSWER: False

6. State courts cannot have exclusive jurisdiction. a. True b. False

ANSWER: False

6. The crime of theft requires the taking of property, without regard to whether the perpetrator knew it belonged to another. a. True b. False

ANSWER: False

8. Larceny relies on fear and force. a. True b. False

ANSWER: False

8. The federal government and the states have the same constitution. a. True b. False

ANSWER: False

8. The legality of an action is always clear. a. True b. False

ANSWER: False

9. Federal courts are superior to state courts. a. True b. False

ANSWER: False

9. To be a "good citizen," when making decisions a business should not evaluate the public relations impact. a. True b. False

ANSWER: False

72. In a dispute between Cosmic Games Corporation and Mythic Engineering Associates, Inc., the court applies the doctrine of stare decisis. What is this doctrine? What does this doctrine have to do with the American legal system?

ANSWER: In a common law legal system, past judicial decisions are binding in current disputes with similar facts. This feature of the common law, which is the basis of the American legal system, is unique because, unlike the law in other legal systems, it is judge-made law. Within the common law system, when possible, judges attempt to be consistent and to base their decisions on the principles suggested by earlier cases. The body of principles and doctrines that form the common law emerged over time as judges applied the principles announced in earlier cases to subsequent legal controversies. The practice of deciding cases with reference to former decisions, or precedents—the cornerstone of the American legal system—is called the doctrine of stare decisis. Under this doctrine, judges are obligated to follow the precedents established within their jurisdictions. This helps courts to be more efficient, and makes the law more stable and predictable. POINTS: 1 DIFFICULTY: Challenging

Essay 71. Americans with a Better Cause (ABC), a nonprofit organization, files a suit against the U.S. Department of Justice (DOJ), claiming that a certain federal statute the DOJ is empowered to enforce conflicts with the U.S. Constitution and with a state constitution. In each situation, which source of law has priority?

ANSWER: The U.S. Constitution is the supreme law of the land. A law in violation of the Constitution, no matter what its source, will be declared unconstitutional and will not be enforced. Thus, the federal statute does not have priority over the Constitution. The federal statute would have priority over the state constitution, however, because under the U.S. Constitution, when there is a conflict between a federal law and a state law, the state law is rendered invalid.. POINTS: 1 DIFFICULTY: Challenging

1. Judicial review is the process by which a court decides on the constitutionality of legislative enactments and actions of the executive branch. a. True b. False

ANSWER: True

10. State constitutions are supreme within their respective borders. a. True b. False

ANSWER: True

11. Falsifying public records is forgery a. True b. False

ANSWER: True

11. Statutory law includes state statutes and ordinances passed by cities and counties. a. True b. False

ANSWER: True

12. A bank employee stealing funds from a client is an example of embezzlement. a. True b. False

ANSWER: True

13. Crimes occurring in a business context are popularly referred to as white-collar crime. a. True b. False

ANSWER: True

13. There is at least one federal district court in every state. a. True b. False

ANSWER: True

14. There are legal questions involved when choosing an appropriate business organizational form. a. True b. False

ANSWER: True

14. U.S. district courts have original jurisdiction in federal matters. a. True b. False

ANSWER: True

15. A small business owner is likely to face legal questions when determining ways to reduce his small business's taxes. a. True b. False

ANSWER: True

16. Statutes are laws enacted by Congress and the state legislatures and comprise one of the sources of American law. a. True b. False

ANSWER: True

16. The United States Supreme Court has original jurisdiction in some situations. a. True b. False

ANSWER: True

16. The crime of bribery occurs when the bribe is offered. a. True b. False

ANSWER: True

18. Divestiture of a business interest is a possible penalty under RICO. a. True b. False

ANSWER: True

27. A court may depart from a precedent if the precedent is no longer valid. a. True b. False

ANSWER: True

27. A motion for a directed verdict is also known as a motion for judgment as a matter of law. a. True b. False

ANSWER: True

27. If the interests of different stakeholders conflict, it can be difficult to determine which group's interest should receive greater weight. a. True b. False

ANSWER: True

3. Adhering strictly to all business laws is all that is necessary to fulfill all business ethics obligations. a. True b. False

ANSWER: True

3. Laws and government regulations affect almost all business activities. a. True b. False

ANSWER: True

3. Public officials prosecute criminal defendants a. True b. False

ANSWER: True

30. In mediation, the mediator proposes a solution that includes what compromises are necessary to reach an agreement. a. True b. False

ANSWER: True

32. Some companies set up confidential systems for employees to "raise red flags" about suspected unethical practices. a. True b. False

ANSWER: True

33. A court's review of an arbitrator's award may be restricted. a. True b. False

ANSWER: True

35. Most online dispute resolution services apply general, universal legal principles to resolve disputes. a. True b. False

ANSWER: True

4. A criminal case must be proved beyond a reasonable doubt. a. True b. False

ANSWER: True

4. Business ethics focuses on ethical behavior in the business world. a. True b. False

ANSWER: True

4. Many different laws may apply to a single business transaction. a. True b. False

ANSWER: True

5. Concurrent jurisdiction exists when both federal and state courts have the power to hear a particular case. a. True b. False

ANSWER: True

5. One purpose of criminal sanctions is to deter others from committing similar crimes in the future. a. True b. False

ANSWER: True

6. Compliance with the law does not necessarily fulfill all ethical obligations. a. True b. False

ANSWER: True

7. A state court can exercise jurisdiction over an out-of-state defendant who does business in the state over the Internet. a. True b. False

ANSWER: True

7. Corporations, like persons, can be liable for crimes. a. True b. False

ANSWER: True

7. Focusing on a firm's short-term profits without considering the company's long-term needs may be acting unethically. a. True b. False

ANSWER: True

8. A business firm may have to comply with the laws of any jurisdiction in which it actively targets customers. a. True b. False

ANSWER: True

9. A state law that conflicts with the U.S. Constitution will be deemed unconstitutional. a. True b. False

ANSWER: True

9. Picking pockets is larceny. a. True b. False

ANSWER: True

71. Olaf, an executive with Pharma Product Distribution, Inc., has to decide whether to market a product that might have undesirable side effects for a small percentage of users. How should Olaf decide whether to sell the product? How does the standard of ethics that is applied affect this answer?

ANSWER: When a corporate executive has to decide whether to market a product that might have undesirable side effects for a small percentage of users but that would be beneficial for most users, the decision turns on the benefit to the many versus the harm to the few. Of course, all possible precautions should be taken to protect the few. A more specific answer depends on which system of ethics is applied. From a religious duty-based perspective, the answer might be absolute: do not sell the product because some would be harmed, sell the product only to those who would not be harmed, or sell the product with clear warnings of the possible harm. Similar conclusions might be reached through a philosophical, "categorical imperative," duty-based approach, which would consider the result if every corporation chose to sell the product. A principle-of-rights duty-based approach might likewise come to the same conclusions, reasoning that all persons have a right to life, for example, and that the corporation has an ethical duty to respect that right and act accordingly. From a utilitarian perspective, under a cost-benefit analysis, if the product were sold, it could benefit the greatest number of persons—future and current employees, as well as shareholders, and most consumers. If there was "bad" publicity, and it was adverse enough to reduce sales, however, more persons could benefit from the decision not to market the product. Under any of the different corporate social responsibility theories, the decision whether to market the product would acknowledge the firm's duty to act ethically and be accountable to society. There might be a balancing of the interests of competing stakeholder groups or a shouldering of the responsibility to behave in a socially beneficial way as a good corporate citizen. Of course, the firm would likely have to accept any legal liability that would arise from its sale of the product. To apply any of these approaches, the executive might evaluate the situation according to the six guidelines for making ethical business decision. Is the action legal? Is it in line with the company's rules? If so, is it in accord with the "spirit" of the law, those policies, and one's conscience? Could it withstand the glare of publicity and satisfy promises made to others? It seems probable that sales of the product would violate the company's rules—at the least because in the long run the sales could negatively impact corporate profits when some are harmed by the product's use—and that, thus, the sales could not withstand publicity, promises to others, or any individual's conscience. Under the five-step procedure to review the ethical conflicts, the first step is to specify the facts, the problem, and the ethical principles at issue. The second step is to discuss potential actions and their effects. The third step is to come to a consensus as to what to do. This consensus should withstand moral scrutiny (the fourth step) and fulfill corporate, community, and individual values (the fifth step). It seems unlikely that a proposed sale of the product would survive the fourth step, under either a duty-based or an outcome-based ethical standard. POINTS: 1 DIFFICULTY: Challenging `

38. Megan, a resident of Ohio, runs a red light in Texas and hits Sarah, a Texas resident. Sarah files suit against Megan. The statute that allows the Texas court to exercise jurisdiction over Megan is called a(n) a. long arm statute. b. in personam statute. c. in rem statute. d. out-of-state jurisdiction statute.

ANSWER: a

39. A Montana state court can exercise jurisdiction over Endurance Insurance Corporation, an out-of-state defendant, but the defendant must have a. minimum contacts with the state. b. maximum contacts with the state. c. legitimate contacts with the state. d. legal contacts with the state.

ANSWER: a

40. Fresh Harvest Company, which is based on Georgia, packages and sells vegetables. Jack, who is a resident of North Carolina, buys a Fresh Harvest product, eats it, and suffers severe food poisoning. Jack wants to file a suit against Fresh Harvest. The diversity of citizenship between these parties means that a. federal and state courts have concurrent jurisdiction. b. federal courts have exclusive jurisdiction. c. no court has jurisdiction. d. state courts have exclusive jurisdiction.

ANSWER: a

40. The Tenth Amendment to the U.S. Constitution a. reserves to the states all powers not granted to the federal government. b. reserves to the federal government all powers not granted to the states. c. requires each state in the union to have its own constitution. d. does not exist.

ANSWER: a

41. In studying the legal environment of business, Professor Dooley's students also review ethics in a business context. Ethics includes the study of what constitutes a. fair or just behavior. b. financially rewarding behavior. c. legal behavior. d. religious behavior.

ANSWER: a

41. The Pennsylvania legislature enacts a state law that violates the U.S. Constitution. This law can be enforced by a. no one. b. the federal government only. c. the state of Pennsylvania only. d. the United States Supreme Court only.

ANSWER: a

43. According to the view that New Allied Manufacturing Corporation is a "citizen," New Allied is expected to a. participate in bettering communities and society. b. primarily generate revenue for its owners. c. have no responsibility other than profit maximization. d. efficiently allocate scarce resources.

ANSWER: a

44. The Bay City Planning Department, the Coastal County Zoning Commission, the Delaware Environmental Quality Agency, and the U.S. Bureau of Land Management issue regulations. These rules constitute a. administrative law. b. case law. c. stare decisis. d. statutory law.

ANSWER: a

44. Tyler, a citizen of West Virginia, files a suit in a West Virginia state court against Louisville Sales Corporation, a Kentucky state company that does business in West Virginia. The court has original jurisdiction, which means that a. the case is being heard for the first time. b. the court has a unique method of deciding whether to hear a case. c. the court has unusual procedural rules. d. the subject matter of the suit is interesting and new.

ANSWER: a

46. Eden, the chief executive officer of Flo-Thru Piping Corporation, wants to en-sure that Flo-Thru's activities are legal and ethical. The best course for Eden and Flo-Thru is to act in a. good faith. b. ignorance of the law. c. regard for the firm's shareholders only. d. their own self interest.

ANSWER: a

47. With respect to the potential for Great American Discount Stores, Inc., and any other major corporation to suffer damage to its reputation or loss of profits through negative publicity, the Internet has a. increased the potential. b. decreased the potential. c. had no impact. d. allowed a company to keep negative information or opinions hidden.

ANSWER: a

48. ​PriceLess Retail Corporation specifies that its employees should not use social media to damage the company, harm another person's reputation, or violate company policies. An employee who violates these rules may be subject to discipline and could be fired. According to the National Labor Relations Board, this social media policy a. violates federal labor law. b. is too lenient toward employees. c. is too stringent toward management. d. is necessary to prevent inaccurate statements from being spread across the Internet.

ANSWER: a

49. Ridgeline Excavation & Construction, LLC, creates an internal code of ethics. Like the codes of other firms, Ridgeline's company code is not a. law. b. a set of rules that the company can enforce. c. an outline of the company's policies. d. a guide for decision makers facing ethical questions.

ANSWER: a

50. Elinor sells Cathy a horse for $2,000. When Elinor goes to the bank to deposit Cathy's check, the check bounces. Elinor is furious and files suit against Cathy. Elinor probably filed her suit in a. a small claims court. b. a domestic relations court. c. a municipal court. d. a probate court.

ANSWER: a

51. Lyle, vice-president of sales for Mi-T Electric, Inc., adheres to Judeo-Christian re-lig-ious ethical standards. With respect to their application, these standards are a. absolute. b. analytical. c. discretionary. d. utilitarian.

ANSWER: a

56. Ben files a suit in a federal district court against Cathy. Cathy loses the suit, appeals to the U.S. Court of Appeals for the Second Circuit, and loses again. Cathy asks the United States Supreme Court to hear the case. The Court agrees to hear the case. This means that a. at least four justices approve of hearing the case. b. Cathy's petition does not raise a possibility of an important constitutional question. c. the amount in controversy in Cathy's suit is greater than $100,000. d. the Court feels that the lower courts' judgments were erroneous.

ANSWER: a

57. Hailey, a lawyer on the staff of International Group, always considers the consequences of an action rather than the nature of the action itself when making ethical decisions in a business context. Hailey is applying a. the utilitarian theory of ethics in business contexts. b. religious beliefs in business contexts. c. Kantian ethics in business contexts. d. the principle of rights theory of ethics in business contexts.

ANSWER: a

59. Maggie and Nate enter into a contract for the sale of a car, but Nate later refuses to deliver the car. Maggie asks a court to order Nate to perform as promised. Ordering a party to perform what was promised is a. specific performance. b. damages. c. rescission. d. beyond the court's authority.

ANSWER: a

65. Solar Power, Inc., files a suit against Thunder Bay Utility Company and seeks to examine electronic documents in Thunder's possession. A legitimate reason for this examination is that the documents contain a. evidence about the case. b. private information about Thunder's operations. c. public information about energy generation. d. irrelevant data that can be eliminated from consideration.

ANSWER: a

66. Straitway Company encourages its managers to behave ethically, reasoning that the employees will take their cues from management. One of the most important ways to create and maintain an ethical behavior workplace is for management to a. demonstrate a commitment to ethical decision making. b. discreetly engage in unethical or illegal acts. c. look the other way when an employee engages in an unethical act. d. direct employees to "do as we say,not as we do."

ANSWER: a

67. Richard suspects his supervisor of unethical accounting practices. However, he does not want to lose his job if he reports the supervisor and the supervisor finds out who reported him. An important feature of online reporting systems like NAVEX Global is a. the employee reporting the unethical behavior can do so anonymously. b. the employee reporting the unethical behavior is financially compensated if he loses his job as a result of the report. c. the employee reporting the unethical behavior must give his full name when making the report. d. the employee reporting the unethical behavior must have another employee supporting him.

ANSWER: a

70. To resolve a dispute, Amy in Boston and Chris in Denver utilize E-Solution, an online dispute resolution (ODR) service. This limits these parties' recourse to the courts a. not at all. b. until the ODR service has issued a decision. c. with respect to any dispute arising between them. d. with respect to this dispute only.

ANSWER: a

45. Much of American law is based on a. the English legal system. b. the Spanish legal system. c. the civil law of the Greeks. d. Ancient Chinese law.

ANSWER: a POINTS: 1 DIFFICULTY: Easy

36. Any decision by the management of Fast-Food Franchise Corporation may significantly affect its a. operators only. b. operators, owners, suppliers, the community, or society as a whole. c. owners only. d. suppliers, the community, or society as a whole only.

ANSWER: b

36. Justin wants to file a suit against Mikayla. For a court to hear the case a. Mikayla must agree. b. the court must have jurisdiction. c. the court must issue a deposition. d. the parties must own property.

ANSWER: b

38. Under Ohio's state constitution, the Ohio Environmental Protection Agency issues a new rule, the Polk County Commission approves a new property tax measure, and the professors and students at Ohio Law School publish the results of their most recent legal research. Sources of law do not include a. the measures approved by local governing bodies. b. the results of legal scholars' research. c. the rules issued by state administrative agencies. d. the states' constitutions.

ANSWER: b

39. Mary works in the public relations department of New Trends Sales Company. Her job includes portraying New Trends's activities in their best light. In this context, ethics consist of a. a different set of principles from those that apply to other activities. b. the same moral principles that apply to non-business activities. c. those principles that produce the most favorable financial outcome. d. whatever saves New Trends's "face."

ANSWER: b

45. David, the chief accounting officer of Tension Fencing Corporation, wants to be sure that all the company's accounts are legal and ethical. Sometimes, however, he is unsure exactly what is legal and what is illegal. David should a. not worry about what is legal or illegal as long as the corporate executives benefit in the short run. b. try his best to not do anything illegal and keep documentation showing that he always acts in good faith. c. not worry about what is legal or illegal as long as it benefits the shareholders. d. not worry about what is legal or illegal as long as it benefits the chief executive of the corporation.

ANSWER: b

46. David, an Alabama resident, files a suit in an Alabama court against QuickAds, an Internet company based in Georgia that provides advertising services. QuickAds only contact with persons in Alabama has been through QuickAds's passive advertising. The Alabama court is a. likely to have jurisdiction over the case. b. not likely to have jurisdiction over the case. c. likely to refer the case to a higher district court. d. likely to refer the case to an appellate court.

ANSWER: b

47. Milo files a suit against Nick in an Ohio state court, noting that Nick operates a Web site through which Ohio residents have done substantial business with him. The court is most likely to have jurisdiction over Nick if Milo's claim arises from a. anything an Ohio resident has done. b. Nick's Web site activities. c. nothing an Ohio resident has done. d. something other than Nick's Web site.

ANSWER: b

48. Jo files a suit against Lara in a Missouri state court. Lara's only connection to Missouri is an ad on the Web originating in Nebraska. For Missouri to exercise jurisdiction, the issue is whether Lara, through her ad, has a. a commercial cyber presence in Missouri. b. conducted substantial business with Missouri residents. c. general maximum contact with Missouri. d. solicited virtual business in Missouri.

ANSWER: b

52. Kit loses her suit against Lou in a Minnesota state trial court. Kit appeals to the state court of appeals and loses again. Kit would appeal next to a. a U.S. district court. b. the Minnesota Supreme Court. c. the United States Supreme Court. d. the U.S. Court of Appeals for the Eighth Circuit.

ANSWER: b

53. Martha brings a suit against SafeCars, Inc. claiming that she was injured during a car crash due to defects in the car she had purchased from SafeCars. There is no evidence that Martha was injured in the accident, but the trial court awards her $1 million in damages. SafeCars appeals the decision. The appellate court will most likelys a. not modify the trial court's finding of fact because appellate courts are forbidden to look at questions of fact. b. modify the trial court's finding of fact because the finding was clearly erroneous. c. modify the trial court's finding of fact because the award amount was more than $25,000. d. modify the trial court's finding of fact because the award amount was less than $5 million.

ANSWER: b

55. Ryan, the owner of SuperMart Stores, Inc., adheres to the "principle of rights" theory. Under this theory, a key factor in determining whether a business decision is ethical is how that decision affects a. the right determination under a cost-benefit analysis. b. the rights of others. c. the "right"thing to do. d. the right to make a profit.

ANSWER: b

55. The Arizona Supreme Court rules against Jennifer in a case against Kut Rate Stores, Inc. Jennifer wants to appeal her case to the United States Supreme Court. She must ask the Court to issue a writ of a. appeal. b. certiorari. c. jurisdiction. d. summons.

ANSWER: b

60. Lyn files a suit against Karl. Karl denies Lyn's charges and sets forth his own claim that Lyn breached their contract and owes Karl money for the breach. Karl's claim is a. a contrary charge. b. a counterclaim. c. a counterpoint. d. a cross complaint.

ANSWER: b

60. MeatMen, Inc. spends a great deal of money and effort to ensure that all employees are safe on the job, that all products are safe for consumers, and that the environmental impact of the corporation is minimal. MeatMen appears to strongly believe in the concept of a. the moral minimum. b. corporate social responsibility. c. "grey areas" in the law. d. government oversight.

ANSWER: b

68. Margaret is the top manager of Pecans, Inc. She sets strict ethical standards for all employees. Margaret, however, often takes some of the company's best nuts and sells them from her house. The ethical tone at Pecans, Inc. is a. likely to be good because Margaret has set such strict standards for her employees. b. not likely to be good because although Margaret sets strict ethical standards for the other employees, she does not follow them. c. not related to either Margaret's ethical standards or her own unethical behavior. d. not likely to be good because employees tend to resent strict ethical standards.

ANSWER: b

70. To assist in detecting illegal bribes, International Civil Engineers, Inc., and all other U.S. companies must a. conceal financial records that reveal past bribes. b. keep records that "accurately and fairly" reflect their financial activities c. make bribes through third parties rather than directly to officials. d. permit payments to foreign officials that are unlawful in that country.

ANSWER: b

49. Karen is a judge hearing the case of Local Dispatch Co. v. National Transport Corp. Applying the relevant rule of law to the facts of the case requires Karen to find previously decided cases that, in relation to the case under consideration, are a. as different as possible. b. as similar as possible. c. at odds. d. exactly identical.

ANSWER: b POINTS: 1

47. As a judge, Bonnie applies common law rules. These rules develop from a. administrative regulations. b. court decisions. c. federal and state statutes. d. proposed uniform laws.

ANSWER: b POINTS: 1 DIFFICULTY: Moderate

37. Hua, a resident of Illinois, owns a warehouse in Indiana. A dispute arises over the ownership of the warehouse with Jac, a resident of Kentucky. Jac files a suit against Hua in Indiana. Regarding this suit, Indiana has a. federal jurisdiction. b. in personam jurisdiction. c. in rem jurisdiction. d. no jurisdiction.

ANSWER: c

45. Jack and Jill, citizens of Vermont, are involved in a case related to the adoption of their child. The Vermont state courts a. have concurrent jurisdiction with federal courts over this case. b. have original jurisdiction over this case. c. have exclusive jurisdiction over this case. d. do not have jurisdiction for over case.

ANSWER: c

50. In business deals, Fiona, the chief executive officer of Snacks n' Bites, Inc., follows duty-based ethical standards. These are most likely derived from a. a corporate ethics code. b. a cost-benefit analysis. c. philosophical reasoning. d. the law.

ANSWER: c

51. Carol files a suit against Andy in a state trial court and loses. Carol a. cannot take her case any higher in the court system. b. can insist that the United States Supreme Court hear her case. c. can plead her case before an appellate court. d. can plead her case before a small claims court.

ANSWER: c

59. Jason files a suit against Maybelline. If Maybelline fails to respond, Jason a. must appeal the case to a different court. b. must refile the suit in the same court. c. will be awarded the remedy sought. d. will have a default judgment entered against him.

ANSWER: c

60. Chelsea is a state court judge. Like judges in most state courts, in a particular case, she may grant a. a remedy at law only. b. a remedy in equity or a remedy at law, but not both. c. a remedy in equity and a remedy at law. d. a remedy in equity only.

ANSWER: c

61. Applied Business Corporation makes and markets its products nationwide. Under the stakeholder approach, to be considered socially responsible when making a business decision, Applied must take into account the needs of a. its consumers, the community, and society only. b. its employees and owners only. c. its employees, owners, consumers, the community, and society. d. no one.

ANSWER: c

67. Refer to Fact Pattern 3-1. If Bean and Java have a long-standing business relationship that they would like to continue, they may prefer to settle their dispute through mediation because a. the case will be heard by a mini-jury. b. the dispute will eventually go to trial. c. the process is not adversarial. d. the resolution of the dispute will be decided an expert.

ANSWER: c

69. Ethical standards would most likely be considered violated if Team Logos Merchandising Corporation deals with a company in a developing nation that a. agrees to produce goods at Team Logos's desired price. b. goes unnoticed by "corporate watch" groups. c. routinely violates labor and environmental standards. d. pays its workers less than the U.S. minimum wage.

ANSWER: c

36. Data Analytics, Inc., is a corporation engaged in the business of compiling, analyzing, and marketing data. To accomplish its purposes, Data Analytics obtains financing, and hires and fires employees. Laws and government regulations affect such business activities as a. hiring and firing decisions. b. the manufacturing and marketing of products. c. business financing. d. all of the choices.

ANSWER: d

39. A provision in the California state constitution conflicts with a provision in the U.S. Constitution. If challenged a. neither provision will be enforced. b. the provisions will be balanced to reach a compromise. c. the state provision, not the U.S. Constitution, will be enforced. d. the U.S. Constitution, not the state provision, will be enforced.

ANSWER: d

43. Sandy, a resident of Illinois, wants to file suit against Carl, a resident of Kansas, over Carl's failure to pay Sandy for work on his house. The amount in dispute is $15,000. Under diversity of citizenship requirementse a. no court can exercise jurisdiction. b. a state court cannot take jurisdiction because the amount in controversy is less than $25,000. c. a federal court cannot take jurisdiction because the amount in controversy is more than $10,000. d. a federal court cannot take jurisdiction because the amount in controversy is less than $75,000.

ANSWER: d

44. Destiny and Eduardo, investors in Competitive Acquisitions Corporation, are dissatisfied with the profit-maximization theory of corporate objectives. These investors and others who look beyond profits and dividends may consider the triple bottom line, which does not include a corporation's a. impact on people. b. profits. c. impact on the planet. d. congressional lobbying activities.

ANSWER: d

57. Uma wants to initiate a suit against Valley Vacation Tours by filing a complaint. The complaint should include a. an explanation to refute any defense the defendant might assert. b. a motion for summary judgment. c. a motion to dismiss. d. a statement of the facts necessary to show Uma is entitled to relief.

ANSWER: d

58. To initiate a lawsuit, Darla files a complaint against E-Sales Company, which responds with an answer. Together, the complaint and answer are a. a motion to dismiss. b. a summons. c. a writ of certiorari. d. the pleadings.

ANSWER: d

59. In deciding questions of corporate social responsibility, Valley Disposal & Recycling, Inc., is concerned with a. how the corporation can best fulfill any ethical duty to society. b. the effect on corporate profits of ignoring any ethical duty to society. c. whether the corporation owes any ethical duty to society. d. all of the choices.

ANSWER: d

62. During the trial phase of Fuel Corporation's suit against Gas Stations, Inc., their attorneys engage in voir dire. This is a. an assessment of the validity of the arguments for both parties. b. a determination of the issues to be argued before the court. c. the trial. d. the selection of jurors.

ANSWER: d

63. Beth is a victim of Carl's violation of a criminal law. Criminal law is concerned with a. the prosecution of private individuals by other private individuals. b. the prosecution of public officials by private individuals. c. the relief available when a person's rights are violated. d. wrongs committed against the public as a whole.

ANSWER: d

Fact Pattern 3-1 Bean Vendors, Inc., and Java Bistros Corporation dispute a term in their contract. 66. Refer to Fact Pattern 3-1. The least expensive method of resolving the dispute between Bean and Java may be a. arbitration because the case will be heard by a mini-jury b. litigation because each party will pay its own legal fees. c. mediation because the dispute will be resolved by a non-expert. d. negotiation because no third parties are needed.

ANSWER: d

51. There are no precedents on which the court deciding the case Financial Investment Co. v. Goodhands Insurance, Inc., can base its decision. The court may consider a. issuing an order according to the judge's personal values. b. refusing to decide the case. c. postponing a decision until a precedent is available. d. basing a decision on public policy or social customs and values.

ANSWER: d POINTS: 1

48. Owen is a federal judge whose judicial decisions are part of case law, which does not include interpretations of a. other case law. b. constitutional provisions. c. statutes. d. sound bites in the media.

ANSWER: d POINTS: 1 DIFFICULTY: Moderate

12. Whether financial statements created by an accountant need to be verified for accuracy is not a legal question. a. True b. False

ANSWER: false

50. In the case of Retail Sales Corp. v. Trucking Delivery Co., the court may rule contrary to a precedent if the court decides that the precedent a. is incorrect or inapplicable. b. is not in line with the judge's personal values. c. would lead to unintended consequences. d. would not bring about the result the judge prefers.

ANSWER: A

37. Congress enacts a statute, the Federal Deposit Insurance Corporation (an administrative agency) issues rules, the Southeast Financial Institutions Association (a private organizations) issues instructions, South Valley Bank posts a memo with orders for its employees, and Tina tells her co-worker about a recent news story. Sources of law include a. the instructions issued by private associations. b. the orders posted by employers. c. the rules issued by federal administrative agencies. d. the stories released by news agencies.

ANSWER: C

42. Smithy Saddlery is a saddle shop subject to the laws of New York. In New York, the highest-ranking (superior) law is a. a case decided by the New York Court of Appeals. b. a rule created by a New York state administrative agency. c. a provision in the New York constitution. d. a statute enacted by the New York legislature.

ANSWER: C

16. ​A company can broadly prohibit its employees from criticizing the company via social media. a. True b. False

ANSWER: FALSE

20. No state has adopted the Uniform Commercial Code. a. True b. False

ANSWER: FALSE

22. Administrative law includes only state regulations. a. True b. False

ANSWER: FALSE

12. An ethical code of conduct typically outlines a company's policies.

ANSWER: TRUE

13. There are legal questions involved when considering ways to raise capital so a business can grow. a. True b. False

ANSWER: TRUE

25. Stare decisis is a doctrine obligating judges to follow the precedents established within their jurisdictions. a. True b. False

ANSWER: TRUE

28. In order to truly understand our legal system, it is important to understand the origins of the common law tradition. a. True b. False

ANSWER: TRUE

29. Money or property, including land, are remedies at law. a. True b. False

ANSWER: TRUE

30. An ethics program can clarify what a company considers to be unacceptable conduct. a. True b. False

ANSWER: TRUE

31. The effectiveness of a company's code of ethics is determined by the commitment of the company leadership to enforcing the code. a. True b. False

ANSWER: TRUE

34. Management's behavior sets the ethical tone of a firm. a. True b. False

ANSWER: TRUE

23. According to utilitarianism, it matters how many people suffer a negative effect from an act. a. True b. False

ANSWER: True

40. Flexo Trucking Company transports hazardous waste. Garn is a Flexo driver, whom the company knows drives longer hours than federal regulations permit. One night, Garn exceeds the limit and has an accident. Spilled chemicals contaminate Hill City's water source, forcing the residents to move away. Flexo acted unethically because a. Flexo showed reckless disregard for Hill City's residents and others. b. Garn exceeded the federal time limit. c. harm was caused by an unfortunate accident. d. Hill City should have better protected its water source.

ANSWER: a

52. In Benny v. City Car Dealership, a state supreme court held that a minor could cancel a con-tract for the sale of a car. Now a trial court in the same state is deciding Daphne v. Even Steven Auto Deals, Inc., a case with similar facts. Under the doctrine of stare decisis, the trial court is likely to a. allow the minor to cancel the contract. b. disregard the Benny case. c. order the minor to cancel the contract. d. require the minor to fulfill the contract. ANSWER:

ANSWER: a

53. Carrie Ann works at Paper Products, Inc. She considers taking home a few sheets of stationery so she can write letters to her ailing grandmother. Since Paper Products produces thousands of sheets of stationery every day no one will miss the few sheets she takes and company profits will not be affected. Carrie Ann then considers what would happen if every employee took some stationery home and decides not to take any. Carrie Ann is being influenced by a. the categorical imperative. b. the principle of rights. c. a cost-benefit analysis. d. outcome-based ethics.

ANSWER: a

54. In an action against the sate of Idaho, Jaime obtains a remedy. This is a. the relief given to an innocent party to enforce a right or to prevent or compensate for the violation of a right. b. medication paid for by the government. c. a right guaranteed by the Bill of Rights. d. a situation or state of facts that gives a person a right to initiate a judicial proceeding.

ANSWER: a

69. Standard Business Company appeals a decision against it, in favor of Top Flight Corporation, from a lower court to a higher court. Standard is a. the appellant. b. the appellee. c. the defendant. d. the plaintiff.

ANSWER: a

37. Lia works for Media Marketing Company. Her job includes putting "spin" on the firm's successes and failures. In this context, ethics consist of a. "bad" versus "good" publicity. b. questions of rightness and wrongness. c. the firm's quarterly revenue. d. whatever is legal.

ANSWER: b

42. Peak & Vale Accountants provides other firms with accounting services. Questions of what is ethical involve the extent to which Peak & Vale has a. a legal duty beyond those duties mandated by ethics. b. an ethical duty beyond those duties mandated by law. c. any duty beyond those mandated by both ethics and the law. d. any duty when it is uncertain whether a legal duty exists.

ANSWER: b

64. Civil law a. defines, describes, regulates, and creates legal etiquette. b. spells out the rights and duties that exist between persons and between persons and their governments. c. establishes the methods of enforcing the rights established by criminal law. d. has to do with the wrongs committed against society for which society demands redress.

ANSWER: b

68. Refer to Fact Pattern 1-1. The opinion joined by the four justices who favor Power is known as a. a concurring opinion. b. a dissenting opinion. c. a majority opinion. d. a per curiam opinion.

ANSWER: b

70. Mikkayla is a well-known professional athlete. Mikkayla Co. owns trademarks, including "mikkayla," that it uses to sell merchandise. Norm owns photos of Mikkayla that he markets through his Web site, mikkaylapics.com. Under the principles discussed in "A Sample Court Case," Experience Hendrix, L.L.C. v. Hendrixlicensing.com Ltd., Norm's domain name most likely a. constitutes nominative fair use of the "mikkayla" mark. b. infringes the "mikkayla" mark. c. is a legitimate description of Mikkayla Co.'s products. d. is a legitimate reference to Mikkayla Co.'s products.

ANSWER: b

54. In making business decisions, Glenda, personnel manager for HVAC Maintenance, Inc., applies her belief that all persons have fundamental rights. This is a. a religious rule. b. the categorical imperative. c. the principle of rights. d. utilitarianism.

ANSWER: c

58. Leona enters into a contract with Munchie Bakery to cater a sales conference. When the conference is postponed indefinitely, Leona asks a court to cancel the contract and return the parties to the positions that they held before its formation. This request involves a. specific performance. b. an injunction. c. rescission. d. an action that the court cannot order.

ANSWER: c

65. Japan violates an international law. Other countries may take coercive actions, which include a. violating the same law in the same way with impunity. b. confiscating Japanese businesses. c. boycotting Japanese goods. d. taxing Japanese citizens.

ANSWER: c

56. In making decisions for Smartt Investments, Rita uses a cost-benefit analysis. This is a part of a. duty-based ethics. b. Kantian ethics. c. rights-based ethics. d. utilitarian ethics.

ANSWER: d

58. Bob, research manager for CornAgri Products, Inc., applies utilitarian ethics to determine that an action is morally correct when it produces the greatest good for a. Bob. b. CornAgri. c. the fewest people. d. the most people.

ANSWER: d

10. Ethics can be highly subjective and subject change over time. a. True b. False

ANSWER: true

29. Managers should apply the same ethical standards to themselves and to their employees. a. True b. False

ANSWER: true

5. Ethics is less certain than law. a. True b. False

ANSWER: true

53. Judge Julia decides that the precedent for the case she is hearing is no longer correct due to technological changes. She overturns the precedent when she decides the case. It is most likely that her case will a. go unnoticed by the public. b. be thrown out of court. c. receive a great deal of publicity. d. be ignored by the media.

Answer: c

15. No one believes that judging a job candidate based on what he or she does outside the work environment is ethical. a. True b. False

FALSE

13. There is no debate that employees have an absolute right to free expression to make negative posts in social media about other employees and managers. a. True b. False

False

14. Many companies have provided guidelines about what is appropriate when making posts on social media accounts. a. True b. False

TRUE

17. Ethical reasoning is the process through which an individual links his or her moral convictions or ethical standards to the particular situation at hand. a. True b. False

TRUE

24. There is at least one circumstance in which a person cannot refuse to testify on Fifth Amendment grounds. a. True b. False

TRUE

35. Bribery of foreign government officials is both an ethical and a legal issue. a. True b. False

TRUE

38. Mary enters a gas station and points a gun at the clerk. She then forces the clerk to open the cash register and give her all the money. Mary can be charged with a. robbery. b. forgery. c. larceny. d. embezzlement.

a

47. Briana, an employee of Cotillion Bank, is charged with embezzlement, which requires a. fraudulently appropriating another's property. b. obtaining lawful possession of property. c. physically taking property from its owner. d. the use of force or fear.

a

63. Jackson is accused of a crime. Jackson can refuse to provide information about his allegedly criminal activities a. if he suspects the information will be used to prosecute him. b. if the police do not promise to keep the information confidential. c. if the information is "fruit of the poisonous tree.". d. under no circumstances.

a

66. Travis sends Suri what purports to be a link to an e-birthday card, but when she clicks on the link, software is downloaded to her computer to record her keystrokes and send the data to Travis. He uses the data to obtain her personal information and access her financial resources. This is a. identity theft. b. cyberterrorism. c. entrapment. d. no crime.

a

68. Farouk uses his computer to break into Global Financial Center's computer. Farouk is a a. hacker. b. phisher. c. worm. d. virus.

a

69. Via the Internet, Rocky sabotages the computer system of Quik Chik'n Company, a food manufacturer, to alter the levels of ingredients in the company's products so that consumers of the food become ill. Rocky is a a. cyberterrorist. b. botnet. c. virus. d. an inquisition.

a

39. William goes to Saddle Up Stables in the middle of the night when no one is around and takes five saddles. William's crime is a. forgery. b. larceny. c. robbery. d. embezzlement.

b

41. Scott, a State Bank employee, deposits into his account checks that are given to him by bank customers to deposit into their accounts. This is a. embezzlement. b. larceny. c. money laundering. d. no crime.

b

44. Leah gains access to government records and alters certain dates and amounts in her favor. This is a. embezzlement. b. forgery. c. larceny. d. no crime.

b

45. Ivan signs Jeb's name, without his authorization, to the back of a check.This is a. no crime. b. forgery. c. larceny. d. robbery.

b

49. Robert uses the Internet to defraud Prairie Valley Credit Union. He is found guilty of wire fraud. He can be punished by a. imprisonment for not more than one year. b. imprisonment for up to thirty years and fines of up to $1 million. c. fines for not more than $50,000. d. death.

b

50. Mona offers Ned, a building inspector, $5,000 to overlook the violations in her new warehouse. Ned accepts the cash and overlooks the violations. Mona is charged with the crime of bribery. The crime occurred when a. Mona decided to offer the bribe. b. Mona offered the bribe. c. Ned accepted the bribe. d. Ned overlooked the violations.

b

51. Dirk, an employee of Ergonomic Elevators, Inc., pays Ferbie, an employee of Ergonomics' competitor G-Force Risers Company, for a secret G-Force pricing schedule. This is a. an effective marketing strategy. b. commercial bribery. c. creative legal bookkeeping. d. money laundering.

b

52. Bruno is a businessperson with investments in legal and illegal operations. Bruno may be subject to penalties under RICO a. for making an unprofitable, but legal, investment. b. for the commission of any business fraud. c. only in a case involving a "racket." d. only in a case involving organized crime.

b

55. Smitty, driving while intoxicated, causes a car accident that results in the death of Tiffany. Smitty is arrested and charged with a felony. A felony is a crime punishable by death or imprisonment for a. any period of time. b. more than one year. c. more than six months. d. more than ten days.

b

58. Davis points a gun at Eton, threatening to shoot him if he does not steal from his employer, Freddy's Convenience Store, and give the stolen funds to Davis. Charged with theft, Eton can successfully claim, as a defense a. nothing. b. duress. c. entrapment. d. self-defense.

b

60. Maya, a police officer, wants to search the offices of Niles Corporation. Maya asks Judge Orion to issue a warrant. Under the Fourth Amendment, no warrants for a search or an arrest can be issued without a. double jeopardy. b. probable cause. c. reasonable doubt. d. immunity.

b

65. Gina sells "Bulk Up" steroids over the Internet. She is arrested and charged with the sale of a controlled substance. This is cyber crime, which is a. a new category of crime that is not related to older types of crime. b. a crime that occurs the virtual community of the Internet. c. a crime that is less real than the same crime in the physical world. d. no crime.

b

67. Posing as Platinum Bank, Oswald e-mails Nadia, asking her to update her personal banking information through a link in the e-mail. She clicks on the link and types in the data, which Oswald promptly sells to Moe. This is a. hacking. b. identity theft. c. cyberterrorism. d. bribery.

b

36. Mike is arrested at a warehouse in North Industrial Park and is charged with the crime of theft. Mike will be prosecuted by a. the owner of the warehouse. b. the owner of the property that Mike is charged with stealing. c. a public official. d. any third party unrelated to Mike, the property, or the crime.

c

37. Ludwig receives from Milo a marimba stolen from Nadine. To be criminally liable, Ludwig must know a. Milo. b. Nadine. c. that the marimba is stolen and Ludwig must intend to keep it. d. what a marimba is.

c

40. Mariah takes off her ring and places it on her desk while she works. Without her knowledge or consent, her coworker Nita picks up the ring, puts it on, and walks away. Nita has likely committed a. burglary. b. forgery. c. larceny. d. no crime.

c

42. Plato works for Quirky Squirters, Inc. During work hours, Plato "steals" time, space, and data on his employer's computer system to start up his own business, Rowdy Drenchers. This is a. burglary. b. robbery. c. larceny. d. no crime.

c

53. Jared is arrested and found guilty of a misdemeanor. His punishment will not include a. imprisonment for six months. b. a fine of $100. c. death. d. imprisonment for six months and a fine of $500.

c

54. Megan is charged with jaywalking, which is classified as a. a misdemeanor. b. a felony. c. a petty offense. d. no crime.

c

57. Evan is charged with a crime. Almost all federal courts and some state courts would not hold Evan liable if, at the time of the offense, as a result of a mental disease or defect, Evan lacked substantial capacity to a. appreciate the wrongfulness of his conduct only. b. appreciate the wrongfulness of his conduct and obey the law. c. appreciate the wrongfulness of his conduct or obey the law. d. obey the law only.

c

59. Mae is granted immunity after she agrees to testify about a crime. Mae has an absolute privilege against self-incrimination and a. can be prosecuted only for a crime about which she agreed to testify. b. cannot be prosecuted for any crime. c. cannot refuse to testify on Fifth Amendment grounds. d. can refuse to testify on Fifth Amendment grounds.

c

61. Justin is charged with a crime. He insists that he should have an opportunity to object to the charges before a "fair, neutral decision maker." No one can be deprived of "life, liberty, or property without due process of law" under the a. Second Amendment. b. Fourth Amendment. c. Fifth Amendment. d. Eighth Amendment.

c

62. Alan, the president of Bayside Investments, Inc., and Colin, Bayside's accountant, are charged with a crime, after the police search Bayside's offices. Under the exclusionary rule a. certain Bayside records are excluded from subpoena. b. certain parties to a criminal action may be excluded from a trial. c. illegally obtained evidence must be excluded from a trial. d. persons who have biases that would prevent them from fairly deciding the case may be excluded from the jury.

c

43. Susan is unhappy with the way her mother has made out her will. Susan has a lawyer draft a new will and then signs her mother's name to it without her mother's consent. Susan has committed a. larceny. b. no crime. c. robbery. d. forgery.

d

46. Jake is charged with embezzlement. Embezzlement may be committed without a. a criminal act. b. a criminal intent. c. taking property from its owner. d. the use of force or fear.

d

48. After Edie solicits clients to invest in a nonexistent business, she is charged with "mail fraud." This requires, among other things a. claiming that an item is "in the mail" when it is not. b. deceiving postal authorities as to the content of an item of mail. c. depositing items in the postal system without proper postage. d. mailing or causing someone else to mail a writing.

d

56. Vance points a gun at Workman and threatens to shoot him. Workman hits Vance, causing his death. Charged with homicide, Workman can successfully claim as a defense a. nothing. b. duress. c. entrapment. d. self-defense.

d

64. Herb, a computer programmer for Inventory Control Corporation, is arrested in his employer's parking lot on suspicion of larceny. Herb must be informed of his right to a. a trial by jury. b. punishment. c. question witnesses. d. remain silent.

d

26. Under the Fourth Amendment, a general search warrant and a general search through a person's belongings are permitted. a. True b. False

false

28. Under the exclusionary rule, illegally obtained evidence may not be included in any criminal prosecution. a. True b. False

false

30. Under the exclusionary rule, all evidence must be included in a criminal prosecution. a. True b. False

false

23. Most crimes must be prosecuted within a certain number of years after the crimes occur. a. True b. False

true

25. Constitutional safeguards protect the rights of individuals against federal government actions. a. True b. False

true

27. A suspect cannot be tried twice in the same court for the same crime. a. True b. False

true

29. The purpose of the exclusionary rule is to deter police from misconduct. a. True b. False

true

31. Individuals who are arrested must be informed of certain constitutional rights. a. True b. False

true