FINA TEST 4
is a person who contracts with another to do something for him but who is not controlled by the other nor subject to the other's right to control with respect to his physical conduct in the performance of the undertaking.
An independent contractor
Cook instructs Chan, her agent, to buy a van for her business. Chan contracts for a van with a third party, who knows that Chan is an agent. If Cook does not like the van and refuses to pay for it, the seller may sue:
Cook because Chan has actual authority to make a contract on behalf of her principal
What law gives the SEC a basis for prosecuting insider trading?
Insider Trading Sanctions Act
Biotechnology products are subject to regulation under:
TSCA
What financial disclosure report is not required of traded securities regulated by the SEC?
a biannual 8-Q report
Jimmy must be at work no later than 7 AM on the days he works. Because he must hurry to get to work, he runs over a lady going across the street. She sues Jimmy and his employer for her injuries. She has:
a case against Jimmy, but no case against his employer
A share of stock represents the right to:
a share of future profits of a firm
When a company wants to take over another, it may issue:
a tender offer
The duties of a principal to an agent do not include:
all of the choices
An agency may not be ended by:
all of the other choices may end an agency
Most securities are issued by well-known seasoned issuers who have the right to:
all of the other specific choices
When the SEC reviews a prospectus for a new stock offering it may not
all of the other specific choices may be done
The principal is possibly liable for the torts of the agent if the agent's tort was:
authorized by the principal or an unauthorized intentional tort within the scope of the agent's employment
Which of the following securities professionals must be registered with the SEC to be able to engage in business?
brokers and dealers
An agency coupled with an interest is created
by an agent who has paid for the right to exercise authority with regard to a business
An employee of a company, who has good technical knowledge, is concerned that some televisions made by the company may have electrical shorts that could cause fires. Since no one in the company would address the problem, the employee provides evidence of the problem to the media and state attorney general, so consumers can be aware of the problem. If the employee is fired he is unlikely to have:
case against ecomony
To help enforce the Clean Air Act there may be:
citizen suits and EPA fines
Prior to passage of the Clean Air Act, the Clean Water Act, and other regulatory statutes in the 1970s, the most important protection for the environment came from:
common law remedies
Which of the following is not a duty owed by the agent to the principal:
compensation
Each year about 100 environmental offenses have been dealt with by government officials by:
criminal convictions
Which of the following is not a major pollutant regulated by the Clean Air Act
dihydrogen monoxide
Lyle is Thelma's agent. Thelma has made it clear to Lyle that she does not want him to sign the contracts that he negotiates; she retains that power. If, despite Thelma's instructions, Lyle negotiates and signs a contract with Tom committing Thelma to spend thousands of dollars, what will the consequences of Lyle's actions be?
if Tom was justified in presuming Lyle had authority to sign the contract, Thelma will be responsible
The buyer for an electronics store is bribed by a supplier to order more of the brand sold by the supplier. This action violates which of the agent's duties?
loyalty
The recycling of products containing mercury has meant that:
more is dumped into the atmosphere as it ends up in poor nations with few controls
New plants that discharge pollutants into the waters of the U.S. are subject to
new source performance standards
Suppose a hurricane is going to hit South Florida; there are two days to prepare for it and the owner of a house is on a raft trip in Brazil and cannot be reached. The next door neighbors spend $800 on plywood and other materials to protect the house from the hurricane. Legally, this expenditure:
none of the other choices
The Clean Air Act established specific procedures for:
none of the other choices
The SEC rule that requires public companies to release material information to the public rather than release the information on a selective basis, such as in meetings with security analysts, is called:
none of the other choices
The Securities Litigation Uniform Standards Act of 1998 requires:
none of the other choices
The Superfund is funded by
none of the other choices
To comply with the Clean Water Act, businesses that discharge wastes into a waterway must
none of the other choices
When a company wants to take over another, it may issue:
none of the other choices
When a principal creates an impression of authority in an agent that leads a third party to conclude that the agent has authority to act for the principal, the agent is said to have:
none of the other choices
Which class of securities is (are) exempt from the federal securities laws?
none of the other choices
You are on the subway in New York when you overhear two people you do not know talking about an upcoming merger, news not yet public. They seem to know their stuff. If you buy stock based on this information, and profit when the information turns out true, you have:
none of the other choices
more is dumped into the atmosphere as it ends up in poor nations with few controls
none of the other choices
Agency by estoppel means
none of the other choices Xthe agent creates an appearance of authority in the principal which leads a third party to reasonably conclude that the agent has the authority to perform certain acts
Insider trading is:
none of the other choices xonly the buying of stock by persons who have access to information, not yet revealed to the public, that affects the value of the stock
Traditionally, the chief difference between an agent and a servant (employee) was that the:
servant was generally not employed to represent a principal in business dealings
The National Ambient Air Quality Standards:
sets limits on quantities of certain pollutants that are emitted into outdoor air
Under the Clean Water Act
the EPA develops effluent guidelines on an industry-by-industry basis
The most important law that addresses protection for all wildlife and plants is:
the Endangered Species Act
Most securities are issued by firms that can use a quicker registration process. These are:
well-known seasoned issuers that have issued at least $1 billion in securities previously
The elimination of CFCs (cloroflourocarbons) to protect atmospheric ozone cost the world economy an estimated:
$200 billion
Employment-at-will:
a, b and c
A factor courts may consider in determining whether an act was within the course and scope of employment under vicarious liability is, was the:
act of the same general nature of those authorized by the principal and agent authorized to be in the location at the time the act occurred and agent serving or attempting to serve the principal's interests at the time of the tort
Businesses that wish to build new emission-producing facilities in "dirty air" areas must
agree to offset existing pollution in the area
In a suit for fraud against the issuer of a security, which element would not have to be shown?
all elements must be shown
If an employer and employee agree on employment of a certain time, or that job security will be provided, then there is likely:
an express contract
Barbara, a purchasing agent for UTA, was fired for good reason. Being angry about her dismissal, she calls one of UTA's suppliers and orders 1,000 purple widgets UTA does not need. If UTA, the principal, is held liable for this transaction, it is because Barbara had:
apparent authority
The primary dispute resolution mechanism between investors and brokers is:
arbitration
A principal has a ____ the agent for reasonable expenses incurred in carrying out the duties of the agency
duty to reimburse
A person authorized to execute all regular transactions connected with a business is called a:
general agent
Under the Investment Company Act, investment companies must:
hold their capital and debts in ways approved by the SEC
Dano owns a waste disposal site. Armand Chemicals hires Cary Trucking to transport the Armand's hazardous waste to the Dano disposal site. The regulatory obligations under the RCRA manifest system require that
if Armand is not informed of the safe disposal of its waste by receiving a signed copy of the manifest, it must notify EPA
A securities professional who are in the business of charging fees for recommendations on investments is a(an):
investment adviser
A red herring:
is a preliminary version of a prospectus
Suppose a hurricane is going to hit South Florida; there are two days to prepare for it and the owner of a house is on a raft trip in Brazil and cannot be reached. The next door neighbors spend $800 on plywood and other materials to protect the house from the hurricane. Legally, this expenditure is likely to be:
is the responsibility of the homeowner; there is agency by operation of law
Under Superfund, if there is a hazardous waste site, liability for cleaning it up is apportioned among responsible parties according to:
joint and several liability, whereby any one party could pay the entire bill
An agency coupled with an interest is created:
none
An agency through operation of law is established:
none
An employee (servant) who works for an employer (master):
none
Express authority consists of the agent's:
none
Suppose a hurricane is going to hit South Florida; there are two days to prepare for it and the owner of a house is on a raft trip in Brazil and cannot be reached. The next door neighbors spend $800 on plywood and other materials to protect the house from the hurricane. Legally, this expenditure:
none
Terry hires an agent, Janet, to sell a piece of property for no less than $50,000 with Janet to receive a 6% commission upon sale. Which of the following is Janet legally permitted to do without Terry's consent?
none
When a principal accepts the consequences of the activities of a person who had previously not been the principal's agent, the principal:
none
When liability is imposed on the principal for the unauthorized torts of an agent, it is called:
none
An independent contractor:
none of the other choices
In an action alleging environmental damage, by use of the common law of trespass, the plaintiff must show that the:
none of the other choices
In general, conventional water pollutants, such as human waste, are subject to an emission standard known as
none of the other choices
An agency may be established by:
operation of law or by oral agreement of the parties or by written agreement of the parties
When the SEC reviews a prospectus for a new stock offering it may not:
rule on the merits of the offering
In a corporation, the principal is:
the board of directors
Which of the following is least likely to be an issue in determining if an employer has hired an employee or an independent contractor:
the level of compensation
Implied authority consists of:
the power to do whatever is reasonable and customary to carry out the agency purpose
The principal may hold the third party to a contract, in an undisclosed principal situation, except when the:
undisclosed principal is expressly excluded as a party to the contract between the agent and the third party or the agent's performance is personal to the contract
An undisclosed principle is:
unknown to third parties to contracts entered into with the agent
