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Business Law: Principles for Today's Commerical Environment: Principles Volume 3rd Edition Test Bank

Business Law: Principles for Today's Commerical Environment: Principles Volume 3rd Edition Test Bank offers expert-reviewed explanations and practice questions to boost your exam performance.

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    Chapter 1 — THE NATURE AND SOURCES OF LAW TRUE/FALSE 1. The pattern of rules that society uses to control the conduct of individuals in their relationships is called law. ANS: T MSC: AACSB Analytic 2. The law works to cause our society to operate in an inefficient manner. ANS: F MSC: AACSB Analytic 3. Law is often defined as the body of principles that courts will enforce. ANS: T MSC: AACSB Analytic 4. Jane asserts she has a legal right. Jane is really saying she has an obligation to perform or refrain from performing an act. ANS: F TOP: MSC: AACSB Analytic 5. Rights always stand alone, without any duties. ANS: F MSC: AACSB Analytic 6. Rights guaranteed in the United States Constitution are not accompanied by duties. ANS: F MSC: AACSB Analytic 7. Court decisions and statutes can take away rights created by the United States Constitution. ANS: F MSC: AACSB Analytic 8. One of our most important rights is the right of privacy. ANS: T MSC: AACSB Analytic 9. The right to be secure against unreasonable searches and seizures conducted by the police is guaranteed by state statute. ANS: F MSC: AACSB Analytic 10. The United States Constitution provides that we have a right to be free from intrusions by others. ANS: T MSC: AACSB Analytic 11. The private life of a nonpublic citizen is subject to public scrutiny. ANS: F MSC: AACSB Analytic

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    12. One advantage of our current legal system is that the growth of technology has not created many new laws. ANS: F MSC: AACSB Analytic 13. The right of privacy does not apply to intrusions into our privacy by means of new technology. ANS: F MSC: AACSB Analytic 14. Several layers of law are enacted at different levels of government to provide the framework for business and personal rights and duties. At the base of this framework of laws is constitutional law. ANS: T MSC: AACSB Analytic 15. A constitution is a body of principles that establishes the structure of a government and the relationship of that government to the people who are governed. ANS: T MSC: AACSB Analytic 16. Statutes are the only source of law. ANS: F MSC: AACSB Analytic 17. Within each state in the United States, only one constitution is in force. ANS: F MSC: AACSB Analytic 18. In addition to state legislatures and the United States Congress, all cities, counties, and other governmental subdivisions have some power to adopt ordinances within their sphere of operation. ANS: T MSC: AACSB Analytic 19. State legislatures, not Congress, enact statutory law. ANS: F MSC: AACSB Analytic 20. Administrative regulations are a type of law. ANS: T MSC: AACSB Analytic 21. Administrative regulations generally do not have the force of a statute. ANS: F MSC: AACSB Analytic 22. Courts can create law. ANS: T MSC: AACSB Analytic 23. When a court decides a new question or problem, the decision is called a precedent. ANS: T MSC: AACSB Analytic

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    24. The group of time - honored rules that courts have used to solve similar problems for decades is called stare decisis . ANS: T MSC: AACSB Analytic 25. Treaties made by the United States are not deemed part of the law. ANS: F MSC: AACSB Analytic 26. Uniform State Law generally is not applicable to business. ANS: F MSC: AACSB Analytic 27. Those uniform state laws that have been adopted by individual states were first written by Congress. ANS: F MSC: AACSB Analytic 28. Substantive law creates rights and duties. ANS: T MSC: AACSB Analytic 29. Law may be classifie d in terms of principles of law and principles of equity. ANS: T MSC: AACSB Analytic 30. In the United States today, we generally have one law court and one equity court. ANS: F MSC: AACSB Analytic MULTIPLE CHOICE 1. Law is: a. a body of religious principles held by all members of society. b. a body of principles that society establishes to keep things running smoothly. c. always the result of case - law decisions. d. derived solely from the United States Constitution. ANS: B MSC: AACSB Analytic 2. Law consists of: a. principles that govern conduct. b. mere guidelines. c. arbitrary rules. d. none of the above. ANS: A TOP: MSC: AACSB Analytic 3. The law could best be described as: a. only statutory in nature. b. only the creation of our courts. c. a multitude of rights and corresponding duties . d. none of the above . ANS: C MSC: AACSB Analytic

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    4. Our rights flow from: a. the Constitution. b. federal statutes. c. city ordinances. d. all of the above. ANS: D MSC: AACSB Analytic 5. A right can exist: a. by itself. b. only if created by a court. c. only if there is a corresponding duty. d. only under local law. ANS: C MSC: AACSB Analytic 6. A right is defined as: a. an obligation. b. a legal capacity to require another party to perform. c. any written promise. d. none of the above. ANS: B MSC: AACSB Analytic 7. Individual rights guaranteed in the United States Constitution: a. have no accompanying duties. b. apply only to a small number of individuals. c. are subject to state legislative laws. d. generally have accompanying duties. ANS: D MSC: AACSB Analytic 8. Rights guaranteed in the United States Constitution: a. cannot be taken away by statutes or court decisions. b. can be taken away by statutes. c. can be taken away by court decisions. d. can be taken away by local ordinances. ANS: A MSC: AACSB Analytic 9. The right of privacy consists of: a. the right to be secure against unreasonable searches by the government only. b. the right to protection against intrusions by others only. c. both the right to be secure against unreasonable searches by the government and the right to protection against intrusions by others. d. none of the above. ANS: C MSC: AACSB Analytic 10. Sheriff Jane desires to search your home. What law requires that the sheriff obtain a search warrant? a. the Fourth Amendment of the United States Constitution b. the Equal Protection Clause c. state statute d. local uniform police ordinances

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    ANS: A MSC: AACSB Analytic 11. The right to privacy applies to protect you from unreasonable searches: a. to you personally. b. to your home. c. to your business. d. all of the above. ANS: D MSC: AACSB Analytic 12. Your private life is protected from intrusions by other people by: a. the Fourth Amendment of the United States Constitution. b. the Equal Protection Clause. c. court decisions of the United States Supreme Court. d. local ordinance. ANS: C MSC: AACSB Analytic 13. Interpretations of aspects of the right to privacy are often found in: a. statutes. b. customs. c. societal guidelines. d. none of the above. ANS: A MSC: AACSB Analytic 14. Technology: a. has not created situations that require the application of new rules of law. b. has indeed created situations that require the application of new rules of law. c. has done away with the right of privacy. d. has made it easier to identify when one's privacy has been invaded. ANS: B MSC: AACSB Analytic 15. Several layers of law are enacted at different levels of government to provide the framework for business and personal rights and duties. At the base of this framework of laws is/are: a. statutory law. b. case law. c. constitutional law. d. all of the above. ANS: C MSC: AACSB Analytic 16. Sources of American law include: a. state constitutions. b. statutes enacted by state legislatures. c. court decisions. d. all of the above. ANS: D MSC: AACSB Analytic 17. ____ is a body of principles that establishes the structure of a government and the relationship of that government to the people. a. A constitution b. State statute c. Stare decisis

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    d. The common law ANS: A MSC: AACSB Analytic 18. Statutory law is created by: a. Congress. b. state legislatures. c. local governments. d. all of the above. ANS: D MSC: AACSB Analytic 19. Administrative regulations: a. are essentially industry advisories. b. are case - law precedents. c. have the force of statute. d. are Constitutional principles. ANS: C MSC: AACSB Analytic 20. Legal principles expressed for the first time in court decisions are called: a. statutory law. b. stare decisis. c. common law. d. precedent. ANS: D MSC: AACSB Analytic 21. Statutes which are drafted from Uniform State Laws are often used to regulate: a. business. b. foreign countries. c. criminal behavior. d. none of the above. ANS: A MSC: AACSB Analytic 22. Uniform State Laws are used as a basis for laws by which of the following entities? a. Congress b. international trade associations c. state legislatures d. local governmental entities ANS: C MSC: AACSB Analytic 23. Substantive law: a. specifies the steps to follow to enforce legal rights. b. concerns equitable relief only. c. creates, defines, and regulates rights and duties. d. draws solely on English legal principles. ANS: C MSC: AACSB Analytic 24. Laws can be classified in terms of: a. Roman and English law. b. substantive and procedural law. c. law and equity.

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    d. all of the above. ANS: D MSC: AACSB Analytic CASE 1. Jacob just won the state lottery. Discuss his right to privacy. ANS: Within the context of the Fourth Amendment, Jacob continues to be protected to the same extent he was prior to winning. Regarding his right to be protected from intrusions by others, however , he most likely will have to give up some privacy rights because of his good fortune; that is, although he remains a private citizen, he will not have quite the same degree of privacy protection in this arena as he had before winning the lottery. MSC: AACSB Reflective Thinking | AACSB Analytic 2. A new state law mandates that all employers must prohibit smoking on employer premises. The law further provides that any employer who allows an employee or a client/ customer to smoke on its premises is subject to a court order requiring the employer to enforce the law. Describe this statute in terms of all possible classification methods. ANS: The law is substantive because it define s rights and liabilities of business owners. The law is also equitable, based on the remedy of specific performance, since it subjects the employer to a court order requiring the employer to actually do something; i.e., forbid smoking on its premises. MSC: AACSB Reflective Thinking | AACSB Analytic

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    Chapter 2 — THE COURT SYSTEM AND DISPUTE RESOLUTION TRUE/FALSE 1. The power of a court to decide certain types of cases is called jurisdiction . ANS: T MSC: AACSB Analytic 2. All courts have original jurisdiction. ANS: F MSC: AACSB Analytic 3. A court with limited jurisdiction can only hear certain types of cases. ANS: T MSC: AACSB Analytic 4. Reversible errors are commonly made by supreme courts. ANS: F MSC: AACSB Analytic 5. The federal court system consists of three levels. ANS: T MSC: AACSB Analytic 6. All federal courts are expressly created by the United States Constitution. ANS: F MSC: AACSB Analytic 7. The United States Supreme Court can never function as a court of original jurisdiction. ANS: F MSC: AACSB Analytic 8. A probate court is an example of a general trial court. ANS: F MSC: AACSB Analytic 9. A family law court is an example of a specialty court. ANS: T MSC: AACSB Analytic 10. State supreme courts generally hear all cases appealed to them. ANS: F MSC: AACSB Analytic 11. The defendant in a civil case is the party who is suing. ANS: F MSC: AACSB Analytic 12. To begin a lawsuit, both parties must appear in person and state their claims and defenses in court. ANS: F MSC: AACSB Analytic

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    13. If questions of fact are involved, the court will decide the case based on the pleadings alone. ANS: F MSC: AACSB Analytic 14. Documents filed by both parties at the beginning of a lawsuit are called the pleadings . ANS: T MSC: AACSB Analytic 15. Depositions are usually taken in the courtroom. ANS: F MSC: AACSB Analytic 16. A peremptory challenge to a prospective juror generally can be exercised without giving a reason. ANS: T MSC: AACSB Analytic 17. A motion for a directed verdict occurs immediately after the last pleading is filed. ANS: F MSC: AACSB Analytic 18. Once a lawsuit is commenced, the case must go to the jury. ANS: F MSC: AACSB Analytic 19. Generally, the prevailing party in a lawsuit will be awarded the costs of the action, including witness fees and jury fees. ANS: T MSC: AACSB Analytic 20. Garnishment is a procedure accomplished only by attorneys. ANS: F MSC: AACSB Analytic 21. Mediation is a generally accepted method of resolving disputes. ANS: T MSC: AACSB Analytic 22. Arbitration procedures occur in a court of law. ANS: F MSC: AACSB Analytic 23. The Uniform Arbitration Act requires a written agreement to arbitrate an issue. ANS: T MSC: AACSB Analytic 24. When arbitration is mandatory under a statute, the losing party generally can appeal from such arbitration to a court. ANS: T MSC: AACSB Analytic 25. A mediator has the power to actually make a decision in a dispute. ANS: F MSC: AACSB Analytic

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    26. Mediation tends to keep discussions between parties proceeding. ANS: T MSC: AACSB Analytic 27. If there is a reference to a third party to determine a dispute, most often the loser is not allowed to appeal the third party's decision. ANS: T MSC: AACSB Analytic 28. A "rent - a - judge" serves as a referee. ANS: T MSC: AACSB Analytic 29. A person who hears summary jury trials is called an ombudsman . ANS: F MSC: AACSB Analytic 30. The Seventh Amendment to the United States Constitution provides for a federal ombudsman. ANS: F MSC: AACSB Analytic MULTIPLE CHOICE 1. A court is a tribunal established by: a. the parties to a lawsuit. b. the government. c. the parties to a contract. d. none of the above. ANS: B MSC: AACSB Analytic 2. The power given to courts to hear certain types of cases is called: a. jurisdiction. b. mediation. c. arbitration. d. summary judgment. ANS: A MSC: AACSB Analytic 3. Original jurisdiction courts are generally what type of courts? a. supreme courts b. appellate courts c. trial courts d. limited courts ANS: C MSC: AACSB Analytic 4. An example of limited or special jurisdiction courts would include: a. probate courts. b. juvenile courts. c. equity courts. d. all of the above.

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    ANS: D MSC: AACSB Analytic 5. The federal court system consists of ____ level(s) of courts. a. one b. two c. three d. four ANS: C MSC: AACSB Analytic 6. The types of civil cases that can be brought in federal district court s include: a. the probate of an estate. b. cases between citizens of different states that involve damages of $75,000 or more . c. cases brought by the citizen of one state against the state government of the same state. d. none of the above. ANS: B MSC: AACSB Analytic 7. The United States Supreme Court was created by: a. Congress. b. the President. c. the Uniform State Law Commission. d. none of the above. ANS: D MSC: AACSB Analytic 8. State supreme courts primarily have what type of jurisdiction? a. appellate b. limited trial court c. general d. none of the above ANS: A MSC: AACSB Analytic 9. The person who initiates a lawsuit is called the: a. defendant. b. moving party. c. plaintiff. d. none of the above. ANS: C MSC: AACSB Analytic 10. "Service of process" refers to: a. a demand letter sent by the plaintiff to the defendant. b. a reply sent to the plaintiff by the defendant. c. giving the defendant proper notice that a legal action is pending. d. a record of the court's preliminary hearing. ANS: C MSC: AACSB Analytic 11. The answer to the complaint is filed by the: a. defendant. b. moving party. c. plaintiff. d. none of the above.

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    ANS: A MSC: AACSB Analytic 12. A motion to dismiss a lawsuit on the basis that, even if everything in the complaint were true, the plaintiff would not be entitled to relief is called a motion : a. to compel b. to dismiss c. for summary judgment d. none of the above ANS: B MSC: AACSB Analytic 13. Who is entitled to file a motion to dismiss? a. defendant only b. plaintiff only c. both plaintiff and defendant d. none of the above ANS: A MSC: AACSB Analytic 14. A deposition: a. is the testimony of a witness taken under oath. b. is conducted outside of the courtroom. c. can be used to impeach a witness. d. all of the above. ANS: D MSC: AACSB Analytic 15. Voir dir e examination is used in connection with: a. determining whether the pleadings are valid. b. jury selection. c. deciding whether to appeal a trial court decision. d. none of the above. ANS: B MSC: AACSB Analytic 16. The _____ rule(s) on the admissibility of evidence. a. judge b. jury c. attorneys d. court clerk ANS: A MSC: AACSB Analytic 17. A motion for a directed verdict is appropriate: a. immediately after the pleadings are filed. b. immediately after discovery is concluded. c. immediately after the presentation of all evidence at trial. d. on appeal. ANS: C MSC: AACSB Analytic 18. One of the motions that can be made after a verdict has been entered is a motion for a: a. voluntary nonsuit. b. compulsory nonsuit. c. directed verdict. d. judgment notwithstanding the verdict.

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    ANS: D MSC: AACSB Analytic 19. Costs generally are awarded to the prevailing party in litigation . Those costs usually include: a. filing fees. b. service - of - process fees. c. deposition transcript costs. d. all of the above. ANS: D MSC: AACSB Analytic 20. Garnishment applies to the judgment debtor’s: a. wages. b. attorney fees. c. land and home. d. cars. ANS: A MSC: AACSB Analytic 21. Which is not considered an alternate means of dispute resolution? a. civil lawsuit b. arbitration c. association tribunals d. minitrial ANS: A MSC: AACSB Analytic 22. In mediation, the mediator acts as a: a. judge. b. attorney. c. messenger. d. expert witness. ANS: C MSC: AACSB Analytic 23. A summary jury trial is: a. binding on the parties. b. a mock trial. c. a full and complete hearing of all evidence pertaining to the case . d. a shortcut to establishing judicial precedent. ANS: B MSC: AACSB Analytic 24. In a minitrial: a. only three jurors are used. b. the trial addresses only portions of the case or certain issues related to the case. c. the decision is always fully binding on the parties. d. none of the above. ANS: B MSC: AACSB Analytic 25. An ombudsman: a. is usually a government official. b. is often appointed by a judge. c. receives a l arge amount of judicial power. d. none of the above.

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    ANS: A MSC: AACSB Analytic CASE 1. Chandr a sues Martin for breach of contract. Both parties have completed discovery. Chandra now wants her attorney to file a motion to have the judge rule in her favor without having to proceed further. Chandra does not know whether the motion to dismiss or the motion for a summary judgment is proper. Which motion is proper and why? ANS: As between the motion to dismiss and the motion for summary judgment, Chandra’s attorney should file a motion for summary judgment, since the parties are beyond the pleadings stage of litigation, and since they have completed discovery. Using evidence gathered during discovery, such as affidavits and/or deposition testimony, Chandra’s attorney could argue that there are no material issues of fact disputed by the parties, and that Chandra is entitled to judgment as a matter of law. MSC: AACSB Reflective Thinking | AACSB Analytic 2. Billy has a dispute with Sleepdigit Bedspring Company over a number of bed s Billy recently purchased from Sleepdigit for use in his hotel. Billy needs to decide whether to pursue litigation or employ an alternative means of dispute resolution. What advantages are most often associated with alternative dispute resolution? Which choice would be most appropriate in this case? ANS: The most frequently cited advantages of alternative dispute resolution, compared to litigation, are a) cost savings and b) time savings . As far as a specific method of alternative dispute resolution, a rbitration might be the best approach for Billy in his commercial dispute with Sleepdigit; in addition to the cost - saving and time - saving advantages of alternative dispute resolution, arbitration has a long history of success in the area of commercial contracts. MSC: AACSB Reflective Thinking | AACSB Analytic

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    Chapter 3 — BUSINESS ETHICS, SOCIAL FORCES, AND THE LAW TRUE/FALSE 1. Ethics is a philosophical concept that deals with values related to the nature of human conduct. ANS: T MSC: AACSB Analytic 2. The field of business ethics recognizes that social values typically must yield to the profitability motive. ANS: F MSC: AACSB Analytic 3. Moral standards based on positive law may allow businesses to conduct themselves unfairly so long as their actions are not illegal. ANS: T MSC: AACSB Analytic 4. Civil disobedience is the remedy natural law proponents use to change positive law. ANS: T MSC: AACSB Analytic 5. Situational ethics is a moral system whose rigidity makes it unnecessary to examine motivation behind conduct in order to label it right or wrong. ANS: F MSC: AACSB Analytic 6. In applying the stakeholder model of business ethics, only the interests of important constituencies affected by an action need to be satisfied. ANS: F MSC: AACSB Analytic 7. There is often a conflict between the goal of making money for shareholders and the goal of solving social problems through business. ANS: T MSC: AACSB Analytic 8. In addition to issues of social responsibility, business values and ethics play an important role in the success or failure of a business. ANS: T MSC: AACSB Analytic 9. Trust is a fundamental basis of the capitalist system that is central to the expectations of investors, customers, and other firm stakeholders. ANS: T MSC: AACSB Analytic 10. Ethical conduct is desirable but not necessary; business should be conducted through sole reliance on positive law and its enforcement in the courts. ANS: F MSC: AACSB Analytic

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