BUS LAW 3800 Final Exam Study Questions

A tort is a type of civil or criminal wrong. T/F

False

According to the text, most advertisements are treated as offers, rather than as invitations to negotiate. T/F

False

Actions of administrative agencies often affect businesses but rarely affect individuals. T/F

False

Administrative agencies are usually part of the legislative branch. T/F

False

Federal diversity jurisdiction requires that litigants be residing in at least three different states. T/F

False

Intent cannot be implied. T/F

False

Only a licensed attorney can hold a power of attorney. T/F

False

Private law provides the legal rules within which firms compete. T/F

False

The Racketeer Influenced and Corrupt Organizations Act (RICO) was originally designed to combat corporate crime. T/F

False

The mens rea for recklessness involves the same elements and standards as those required for intentional wrongdoing. T/F

False

The __________ makes it a crime for any U.S. firm or any firm controlled by a U.S. firm to make payments to an official of a foreign government in an attempt to influence the actions of the official. a.Illegal Bribery Prohibition b.Foreign Corrupt Practices Act c.Extraterritorial Reach Prohibition d.Foreign Bribery Act

Foreign Corrupt Practices Act

The __________ Amendment provides that no state shall "deprive any person of life, liberty, or property, without due process of law." a.Seventh b.Tenth c.Eleventh d.Fourteenth

d.Fourteenth

Insurance policies may help firms manage risk. T/F?

T

A minor may ratify a contract after reaching the age of majority. T/F

True

Both the U.S. Congress and state legislatures may adopt statutes. T/F?

True

In the Bond v. United States case referenced in the text, the U.S. Supreme Court held that a border patrol officer cannot touch or squeeze a bus passenger's carry-on bag placed in the overhead rack, even though other passengers might also be expected to touch the bag T/F

True

The general rule is that agency action is ripe for judicial review when the impact of the action is sufficiently direct and immediate as to make review appropriate. T/F

True

Under strict liability, a defendant can be guilty of a crime regardless of his or her state of mind. T/F

True

When entering into contracts with companies in other nations, a manager should understand whether that company's laws are based civil codes, rather than on case-by-case common law. T/F

True

Prudence offered to sell her car to Danny for $3,000. Danny was not sure what to do, so he asked Prudence if she would hold the offer open for him for one week for $50. Prudence said sure, and the parties signed a contract to the effect that Prudence would hold the car. A few hours later, Bobby unexpectedly offered Prudence $3,500 for the car, and Prudence sold it to him on the spot. Danny decided to buy the car, but when he came by to pick it up the next day, it was gone. Prudence gave Danny his $50 back telling him that was her only obligation and that if he had any complaints, he could take it up with Bobby. Danny found a similar car the next week for $3,500 and purchased it. What damages, if any, could Danny likely collect against Bobby in litigation over the car? a.None b.Reliance damages consisting of $500 c.Incidental damages consisting of $50 d.Compensatory damages consisting of $500

a.None

The Bill of Rights consists of which of the following? a.The first ten amendments to the U.S. Constitution. b.The first five amendments to the U.S. Constitution. c.All amendments to the U.S. Constitution. d.All amendments to the U.S. Constitution after the first ten amendments were

a.The first ten amendments to the U.S. Constitution.

Hester offers to sell her house to Frank for $250,000. Frank says that he would like to think about it, and Hester says that is fine. The next day, Martha, Hester's friend, says that she will give Hester $240,000 for the house. Hester really likes Martha more than Frank and signs a contract to sell the house to Martha. Later that day Hester sees Frank walking up her driveway. She immediately opens the window and yells "I revoke the offer on the house" before Frank says anything. Frank replies that he accepts the offer and expects to purchase the home. Frank tells Hester that while he has not yet taken steps to sell his own home or get a loan, he feels confident that there will be no problem with those matters and he is a ready, willing, and able buyer. Which of the following is true regarding the offer to Frank assuming Hester's revocation was ineffective? a.The offer was probably still open the next day because a reasonable length of time would not have expired. b.The offer would have terminated because Frank did not provide any consideration to leave it open. c.By operation of law, it would have terminated at midnight on the day it was made. d.By operation of law, it would still have been open because it would not have terminated until midnight on the day after it was made.

a.The offer was probably still open the next day because a reasonable length of time would not have expired.

Which of the following is true regarding battery? a.Battery is the negligent, nonconsensual, harmful or offensive contact with the plaintiff's body or with something in contact with it. b.Battery is the intentional, nonconsensual, harmful or offensive contact with the plaintiff's body or with something in contact with it. c.Battery is the intentional, consensual, harmful or offensive contact with the plaintiff's body or with something in contact with it. d.Battery is the negligent, consensual, harmful or offensive contact with the plaintiff's body or with something in contact with it.

b.Battery is the intentional, nonconsensual, harmful or offensive contact with the plaintiff's body or with something in contact with it.

Prudence offered to sell her car to Danny for $3,000. Danny was not sure what to do, so he asked Prudence if she would hold the offer open for him for one week for $50. Prudence said sure, and the parties signed a contract to the effect that Prudence would hold the car. A few hours later, Bobby unexpectedly offered Prudence $3,500 for the car, and Prudence sold it to him on the spot. Danny decided to buy the car, but when he came by to pick it up the next day, it was gone. Prudence gave Danny his $50 back telling him that was her only obligation and that if he had any complaints, he could take it up with Bobby. Danny found a similar car the next week for $3,500 and purchased it. Did Danny have any type of contract with Prudence, and if so what type? a.Danny did not have any type of contract with Prudence. b.Danny had an option contract with Prudence. c.Danny had a hold contract with Prudence. d.Danny had a conditional contract with Prudence.

b.Danny had an option contract with Prudence.

Susan, the CEO of ABC Company, which was involved in the production and sale of hair care products, decided to hire new employees to develop new product lines for a planned expansion into the dog shampoo arena. She was concerned, however, that the employees specializing in canine products might leave at some point, taking company secrets with them for use in competition with ABC. She, therefore, required that the employees sign contracts containing covenants not to compete. Susan also consulted her in-house counsel, Sam, regarding the effect of some new regulations involving the use of certain chemicals in shampoo and conditioner. Sam told her, however, to ignore the regulations until some type of investigation of the company was started. Sam says that more than likely no one will ever check to see whether or not ABC is in compliance. Susan disagrees with his advice and decides to seek other counsel. The covenants not to compete involved which of the following types of law? a.Public b.Private c.Circumscribed d.Tangent

b.Private

Bruce had a disagreement with a new federal agency set up to give additional funds for college to individuals with an aptitude for math. After a hearing, the agency determined that Bruce had no aptitude for math and that he would not receive any funding. Bruce, however, was not discouraged. He told his friend Laura, who just graduated from law school, that he would simply appeal the decision to federal court, have the judge do a fresh review, and provide additional information to the judge regarding his math aptitude that the agency did not have. He feels certain that he will win at the federal court level. What should Laura tell Bruce regarding his plan to provide additional evidence to the federal court judge? a.That his plan is a good one and that the judge will consider the additional evidence. b.That judicial review will likely be confined to the record compiled before the agency. c.That he will only be allowed to present sworn affidavits for additional judicial review. d.That he will only be allowed to present additional test scores for additional judicial review.

b.That judicial review will likely be confined to the record compiled before the agency.

When filing a new lawsuit, the person (or company) is called the __________ and the documentation is called the __________. a.plaintiff, summons b.plaintiff, complaint c.respondent, service of process d.defendant, prayer

b.plaintiff, complaint

Written defamation is known as: a.libel. b.slander. c.malicious intent. d.invasion of privacy.

b.slander.

Alice typically mows her own lawn whereas her neighbor pays to have her yard mown by ABC Law Service. Alice notices one day that an apparently new employee of ABC is mowing Alice's yard by mistake. She says nothing. When the employee asks for payment, Alice refuses on the basis that the yard mowing was a mistake and that she has no contract with ABC. Which of the following is true regarding whether ABC could recover against Alice? a.ABC likely has no rights against Alice. b.ABC could recover against Alice based on breach of contract. c.ABC could likely recover on a theory of quantum merit. d.ABC could likely recover against Alice based on a negligence theory

c.ABC could likely recover on a theory of quantum merit.

The party appealing a case is generally referred to as the: a.plaintiff. b.respondent. c.appellee. d.appellant

c.Appellant

__________ gives the President a type of legal immunity which protects against the forced disclosure of Presidential communications made in the exercise of executive power. a.Immunity privilege b.Federal privilege c.Executive privilege d.Mandated privilege

c.Executive privilege

Susan, the CEO of ABC Company, which was involved in the production and sale of hair care products, decided to hire new employees to develop new product lines for a planned expansion into the dog shampoo arena. She was concerned, however, that the employees specializing in canine products might leave at some point, taking company secrets with them for use in competition with ABC. She, therefore, required that the employees sign contracts containing covenants not to compete. Susan also consulted her in-house counsel, Sam, regarding the effect of some new regulations involving the use of certain chemicals in shampoo and conditioner. Sam told her, however, to ignore the regulations until some type of investigation of the company was started. Sam says that more than likely no one will ever check to see whether or not ABC is in compliance. Susan disagrees with his advice and decides to seek other counsel. The use of covenants not to compete involves which of the following forces identified by Michael Porter and referenced in the text? a.Supplier power b.Threat of entry c.Substitution d.Buyer pow

c.Substitution

Alex and Blake got into a heated argument because Alex asked Blake's girlfriend out on a date. Blake decided that he wanted to scare Alex and drew back his fist to hit Alex. He stopped just as he was about to strike Alex in the nose. Alex yelled out, "You didn't scare me. I was ready for a fight!" Later, Alex decides that he would like to sue Blake and asks your advice on issues involving assault and battery. What would you tell Alex regarding whether he should sue Alex for committing a battery? a.That it appears that the necessary elements are present for him to succeed in an action against Blake for battery so long as he can show apprehension of being struck. b.That he could not win in an action for battery because he admitted that he was not afraid. c.That he could not win in an action for battery because Blake did not actually strike him. d.That he could not win in an action for battery because it appears that Blake's actions were justified.

c.That he could not win in an action for battery because Blake did not actually strike him

Bruce had a disagreement with a new federal agency set up to give additional funds for college to individuals with an aptitude for math. After a hearing, the agency determined that Bruce had no aptitude for math and that he would not receive any funding. Bruce, however, was not discouraged. He told his friend Laura, who just graduated from law school, that he would simply appeal the decision to federal court, have the judge do a fresh review, and provide additional information to the judge regarding his math aptitude that the agency did not have. He feels certain that he will win at the federal court level. Assuming the decision by the administrative agency was a factual finding, what should Laura tell Bruce regarding the standard of review the administrative agency will likely apply? a.That the agency will likely apply a de novo, or new, review. b.That the agency will likely apply an arbitrary and capricious standard in any review. c.That the agency will likely apply a substantial evidence standard in any review. d.That the agency will likely apply a preponderance of the evidence standard in any review.

c.That the agency will likely apply a substantial evidence standard in any review.

In a criminal prosecution, which of the following is true regarding evidence that the prosecution must share with the defendant? a.The prosecution must share evidence that the defendant requests. b.The prosecution must share any exculpatory evidence regardless of whether the defendant requested it. c.The prosecution must share evidence that the defendant requests, and the prosecution must also share any exculpatory evidence regardless of whether the defendant requested it. d.The prosecution is not required to share any evidence with the defendant.

c.The prosecution must share evidence that the defendant requests, and the prosecution must also share any exculpatory evidence regardless of whether the defendant requested it.

If the promisee entered into the contract in order to discharge a duty he or she owed the third party, then the third party is a(n) __________ beneficiary. a.express b.implied c.creditor d.donee

c.creditor

Laws that punish actions that were not illegal when performed are known as: a.bills of attainder b.proscriptive laws. c.ex post facto laws. d.criminal laws.

c.ex post facto laws.

The U.S. government has adopted __________ to facilitate seeking consensus of the most affected groups regarding the substance of new regulations, a process which arose from the Japanese style of negotiation. a.administrative review b.federal mediation c.regulatory negotiations d.rule arbitration

c.regulatory negotiations

The federal statute authorizing individuals to obtain copies of government records on any subject that is of interest is known as: a.the Federal Register. b.the Code of Federal Regulations. c.the Freedom of Information Act. d.discovery.

c.the Freedom of Information Act.

Which of the following is a type of conditional promise? a.Condition concurrent b.Condition subsequent c.Condition illusory d.Both a condition concurrent and a condition subsequent

d.Both a condition concurrent and a condition subsequent

Reasons for creating administrative agencies include: a.Congress lacks the time to address all of the areas that it controls. b.Congress lacks the necessary expertise in all of the areas it controls. c.Congress does not have the power to regulate certain areas. d.Both that Congress lacks the time to address all of the areas that it controls and that Congress lacks the necessary expertise in all of the areas it controls.

d.Both that Congress lacks the time to address all of the areas that it controls and that Congress lacks the necessary expertise in all of the areas it controls.

Bruce lived in Tennessee and had an appliance store in Tennessee. Bruce's residence and the appliance store, however, were within twenty miles of the Virginia state line. Bruce advertised heavily in both Tennessee and Virginia. Susan, one of his customers from Virginia, had an unfortunate experience with a refrigerator purchased from Bruce in that the refrigerator caught on fire and burned down Susan's house which was worth $200,000. Susan obtained proof that the refrigerator had actually been returned to Bruce because it malfunctioned and that, rather than repair the refrigerator and sell it as used, Bruce sold the refrigerator to her as new without repairs. Susan sued Bruce in federal district court in Virginia on a number of theories. Bruce opposed the lawsuit on the basis that it could only be filed in a state court and also on the basis that he was not subject to jurisdiction in Virginia. Which of the following is the most likely result in regard to Bruce's claim that he was not subject to jurisdiction in a court located in Virginia? a.Bruce would not be subject to jurisdiction in a Virginia court because he did not live there nor was his store located there. b.Bruce would not be subject to jurisdiction in a Virginia court because a consumer complaint was involved, not a dispute involving two business entities. c.Bruce would be subject to the jurisdiction of courts in Virginia because Tennessee borders Virginia, and federal courts have jurisdiction over citizens from any surrounding state. d.Bruce would be subject to the jurisdiction of courts in Virginia because his contacts with the state were such that maintenance of the suit would not offend traditional notions of fair play and substantial justice.

d.Bruce would be subject to the jurisdiction of courts in Virginia because his contacts with the state were such that maintenance of the suit would not offend traditional notions of fair play and substantial justice.

Molly, the CEO of a corporation owning a number of pet stores, calls you for advice. She tells you that she received inside information that the stock of the company was going to go down because of reports that a number of dogs sold by the store had become ill and that she, therefore, immediately sold all her stock in the company before the information became public. She tells you that she has been advised that she is going to be charged with a securities violation involving insider trading. Which of the following is true regarding her situation? a.Corporate executives may be fined but may not be sent to jail. b.Corporate executives may be sent to jail, but only for offenses endangering others. c.Corporate executives may be sent to jail, but only for fraud involving banks. d.Corporate executives may be sent to jail for violation of criminal laws.

d.Corporate executives may be sent to jail for violation of criminal laws.

Martin is a legal secretary for Allison, a partner in a large law firm in Knoxville. Allison finds Martin quite annoying. The last straw occurs when Martin tells Allison that she looks pale and appears to have been partying a bit too hard. Allison fires Martin on the spot. Martin tells Allison that he has been studying constitutional law, and that she is guilty of violating not only his due process rights but his equal protection rights as well. Martin says that he was entitled to a hearing before any disciplinary action was taken, and that the firm's practice is that all secretaries are entitled to tell attorneys when they do not appear to be functioning at their best. Martin says that he is filing suit tomorrow. Which of the following is true regarding Martin's ability to win on a claim alleging violation of the due process clause of the U.S. Constitution? a.Martin will win only if he can establish that the law firm has at least one governmental client. b.Martin will win if he can establish that all other secretaries fired within at least the last year were given a hearing before termination. c.Martin will win if he can establish that at least one secretary fired within the last year was given a hearing before termination. d.Martin will lose because no governmental action was involved.

d.Martin will lose because no governmental action was involved.

Susan, the CEO of ABC Company, which was involved in the production and sale of hair care products, decided to hire new employees to develop new product lines for a planned expansion into the dog shampoo arena. She was concerned, however, that the employees specializing in canine products might leave at some point, taking company secrets with them for use in competition with ABC. She, therefore, required that the employees sign contracts containing covenants not to compete. Susan also consulted her in-house counsel, Sam, regarding the effect of some new regulations involving the use of certain chemicals in shampoo and conditioner. Sam told her, however, to ignore the regulations until some type of investigation of the company was started. Sam says that more than likely no one will ever check to see whether or not ABC is in compliance. Susan disagrees with his advice and decides to seek other counsel. Assuming that Susan seeks to be a legally astute manager, which of the following is true regarding the advice given by Sam to ignore the regulations pending an investigation? a.Sam is correct that it is unlikely that any investigation will ever occur and that the regulations may be safely ignored. b.Sam is correct only if ABC has not had past investigations because if past investigations have occurred, it is more likely that the company will be the target of future investigations. c.Sam is incorrect but only because safety regulations are concerned. d.Sam is incorrect because a legally astute manager will take a proactive approach to regulations.

d.Sam is incorrect because a legally astute manager will take a proactive approach to regulations.

The case discussed in the text, Upjohn Co. v. United States, involved an attorney-client privilege in the corporate setting. The U.S. Supreme Court crafted the __________ test to determine whether the privilege applied. a.Confidential Memo b.Corporate Confidentiality c.Corporate Counsel d.Subject Matter

d.Subject Matter

Which of the following was the result at the U.S. Supreme Court level in Citizens United v. Federal Election Commission regarding the constitutionality of the federal law providing that televised electioneering communications funded by anyone other than a candidate must include a disclaimer setting forth identifying information as to sponsorship? a.That the law was unconstitutional only if a corporate entity, not an individual, sponsored the communication. Incorrect Response b.That the law was unconstitutional only if an individual, not a corporate entity, sponsored the communication. c.That the law was unconstitutional in that it involved small expenditures as well as larger ones. d.That the law was constitutional.

d.That the law was constitutional

In the United States v Morgan case referenced in the text, the U.S. Supreme Court ruled it __________ for a court to permit questions regarding the __________ of the agency. a.impermissible, ripeness b.impermissible, subpoena powers c.permissible, mental processes d.impermissible, mental processes

d.impermissible, mental processes

Wally, a law school student, is an intern for Rebecca, an assistant professor who is attempting to get tenure at Imperial Law School in part by getting an article published on the right to a jury trial. Rebecca asks Wally to explain to her the right to a jury trial under the U.S. Constitution as applied to jury trials involving state law. What should Wally tell Rebecca regarding whether the U.S. Constitution requires that jury trials be held in federal civil court cases involving diversity jurisdiction and applying state law (GTFM, LLC v. TKN Sales, Inc)? a.That the U.S. Constitution requires that a jury trial be held only if the controversy exceeds the amount of $75,000, and the parties involved are all residents of the same state. b.That the U.S. Constitution requires that a jury trial be held in all such trials. c.That the U.S. Constitution does not provide the right to a jury in such situations. d.when a federal court has jurisdiction in a case based solely on diversity of citizenship, the federal court should require a jury trial only if a state court in that state would require a jury trial.

d.when a federal court has jurisdiction in a case based solely on diversity of citizenship, the federal court should require a jury trial only if a state court in that state would require a jury trial.