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Cengage Advantage Books: Essentials of the Legal Environment, 4th Edition Test Bank

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     Highlights  of this Test Bank  This Test Bank contains more than 1,4 00 questions  Each Chapter of this Test Bank includes —  True - False Questions and Multiple - Choice Questions, including Hypotheticals & Fact Patterns with series of questions, and Essay Questions  Answers to all questions  References to the specific pages of the text that discuss the law relating to the questions & answers  An Annotation System that lets you know when the question is: new (N), revised from the last edition (+), or the same as in the last edition (=).  An Annotation System that tells you which AACSB Skill , Tier I Standard , Learning Objective , Bloom’s Taxonomy , Difficulty Level , and AICPA Skill each question fulfills.  Each Unit of this Test Bank includes —  A special appendix with questions on all in - chapter features  This Test Bank is also available on ExamView® Pro , the acclaimed computerized testing system . W ith ExamView® Pro , instructors can —  Set up the Page Layout for tests  Add or Edit questions & answers and Select questions at random or by number  View summaries of the test or the Test Bank chapters

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     Print tests in a variety of formats

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    vii PREFACE The following test bank contains approximately 70 true/false and multiple choice ques tions along with two es say ques tions for each chapter for a total of over 1,400 questions. The answer is given underneath each question. A page reference number is supplied. This page reference number indicates where in Essentials of the Legal Environment, Fourth Edition you can direct the student to find the answer to each question. In addition you will also find an annotation system which lets you know when the ques tion is: new (N), revised from the last edition (+), or the same as in the last edition (=). The test bank is tagged to reflect the skills and competencies highlighted by the AACSB and the AICPA. This test bank is available as part of the Instructor’s Resource CD - ROM (IRCD) and the companion website ( www.cengagebrain.com ). The Remainder of the Essentials of the Legal Environment, Fourth Edition Teaching/Learning System E LECTRONIC S UPPLEMENTS AND R ESOURCES Electronic supplements and resources represent an important part of the Essentials of the Legal Environment teach ing/learning package. We offer adopters and students a wide variety of electronic supplements. Instructor’s Resource CD - ROM (IRCD) Included on this CD - ROM are the following supplements: Instructor’s Manual, Answers Manual, Test Bank, PowerPoint slides, ExamView, Instructor’s Manual for the Drama of the Law video series, Handbook of Landmark Cases and Statutes in Business Law and the Legal Environment, Handbook on Critical Thinking in Business Law and the Legal Environment, and A Guide to Personal Law . Instructor’s Manual The Instructor’s Manual has the following format: • An introductory section, which highlights the main concepts and importance of the law covered in the chapter.

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    viii PREFACE • A detailed, explanatory outline of the chapter contents, which is keyed closely to the text. • Answers to all of the Learning Objective/For Review questions and Critical Analysis questions. • Synopses of all cases, often accompanied by additional notes and comments, as well as questions to ask in class and suggested answers to these questions. • Additional background on significant persons, statutes, and especially Restatements that are men tioned or referred to within the text. • Additional cases on relevant points of law. • Features on applications of the law to “Enhance Your Lectures” • Suggested answers to all video questions. • Teaching suggestions, including points to be stressed, hypothetical questions to elicit class discussion, and discussion questions keyed closely to the text and based on information contained within the text. • Suggested activities and research assignments. An electronic version of the Instructor's Manual is also available both on the IRCD and the companion Web site ( www.cengagebrain.com ). Answers Manual The complete Answers Manual is available to all adopters. Each answer to the chapter - ending Questions and Case Problems is presented in a standard format: • Point of Law and Page Reference — The point of law to which the problem relates is first stated in bold - face, followed by the page number or numbers at which the point of law is discussed in the par ticular chapter. • Answers to question or problem. In addition, for your convenience you will find the following: • Answers to Learning Objectives/For Review Questions at the Beginning and End of the Chapter • Answers to Critical Analysis Questions found at the end of In - Chapter Features • Answers to Critical Analysis Questions found at the end of In - Chapter Cases • “What If the Facts Were Different?” Questions at the ends of selected Cases in nearly every chapter. • Questions in the Reviewing Feature at the end of each chapter. • Answers to Issue Spotters in the ExamPrep Feature at the end of each chapter. • Questions and Case problems including Critical Thinking and Writing Assignments at the end of each chapter. This Answers Manual is available both on the Instructor’s Resource CD - ROM (IRCD) and the companion website ( www.cengagebrain.com ) . ExamView® Pro The ExamView® Pro is program that enables instructors to quickly and easily create tests, enter their own questions, and customize the appearance of the tests they create. The program has the following features: • Add or edit questions, instructions, and answers. • Select questions by previewing the question on the screen. • Let the system select questions randomly.

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    PREFACE ix • Select questions by criteria. • The ability to import and export graphs • Formatting options, such as borders, fonts, styles, etc. • Set up the page layout for tests. • Print tests in a variety of formats. • The ability to link groups of questions to common narratives. • Online and Internet testing capabilities. • Password protection. This is available as part of the Instructor’s Resource CD - ROM (IRCD) . PowerPoint Slides These slides are available as part of the Instructor’s Resource CD - ROM (IRCD) and can be downloaded from the companion website ( www.cengagebrain.com ). Essentials of the Legal Environment, Fourth Edition Home Page A variety of Web - based study materials can be found at: www.cengagebrain.com Business Law Digital Video Library Essentials of the Legal Environment includes Video Questions at the end of selected chapters that can be used as homework assignments, discussion starters, or classroom demonstrations. Tied to our dynamic Business Law Digital Video Library, featuring more than 90 video clips that spark class discussion and clarify core legal principles, these questions direct students to view a video relevant to a topic covered in the chapter. Students are then directed to a series of questions based on the video. An access code is required to view the videos and can be packaged with each new copy of this textbook for no additional charge. Students who buy used texts can purchase an access code online at www.cengagebrain.com . WESTLAW WestLaw, the premiere computerized legal - research system, is renowned for its ability to help law pro - fessors, law students, attorneys, and paralegals do research in the law. Qualified adopters of Essentials of the Legal Environment are allowed ten free hours of WestLaw. Contact your South - Western/Cengage Learning repre sen tative for more details. CourseMate CourseMate for business law brings business law concepts to life with interactive learning, study, and exam preparation tools that support the printed textbook. Built - in engagement tracking tools allow you to assess the study activities of your students. Additionally, business law CourseMate includes an interactive online

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    x PREFACE textbook, which contains the complete content of the print textbook enhanced by the many advantages of a digital environment.

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    Test Bank to Accompany Essentials of the Legal Environment Fourth Edition ROGER L e ROY MILLER Institute for University Studies Arlington, Texas Prepared by William Eric Hollowell Member of U.S. Supreme Court Bar Minnesota State Bar Florida State Bar Roger LeRoy Miller Institute for University Studies Arlington, Texas

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    Test Bank to Accompany Essentials of the Legal Environment, Fourth Edition, by Roger LeRoy Miller Editorial Director: Jack Calhoun Editor - in - Chief: Rob Dewey Senior Acquisitions Editor: Vicky True - Baker Senior Developmental Editor: Jan Lamar Director, Marketing Development Manager: Lisa L. Lysne Senior Brand Manager: Kristen Hurd Senior Marking Communications Manager: Sarah Greber Production Editor: Bill Stryker Manufacturing Planner: Kevin Kluck Senior Media Editor: Kristen Meere Senior Art Director: Michelle Kunkler COPYRIGHT © 2014 by South - Western Cengage Learning, a division of Cengage Learning. Cengage Learning TM is a trademark used herein under license. ISBN 10: 1 - 133 - 59031 - 4 ISBN 13: 978 - 1 - 133 - 59031 - 4 Printed in the United States of America 1 2 3 4 5 6 7 16 15 14 13 12 For more information contact South - Western Cengage Learning, 5191 Natorp Boulevard, Mason, Ohio 45040. Or you can visit our Internet site at: www.cengage.com The text of this publication, or any part thereof, may be reproduced for use in classes for which Essentials of the Legal Environment , Fourth Edition, by Roger LeRoy Miller is the adopted text book. It may not be reproduced in any manner whatsoever for any other pur pose without written permission from the publisher. For permission to use material from this text or product, submit your requests online at www.cengage.com/permissions . Australia • Brazil • Japan • Korea • Mexico • Singapore • Spain • United Kingdom • United States

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    v Table of Contents Preface ................................ ................................ ................................ ................................ ...... vii UNIT ONE: The Foundations 1 Business and Its Legal Environment ................................ ................................ .............. 1 2 The Courts and A lternative Dispute Resolution ................................ .......................... 21 3 Ethics and Business Decision Making ................................ ................................ .......... 41 4 Constitutional A uthority to Regulate Business ................................ ........................... 61 Appendix A f or Unit One Feature Questions ................................ .............................. 81 UNIT TWO: The Public Environment 5 Administrative Law ................................ ................................ ................................ ...... 87 6 Torts and Product Liability ................................ ................................ ........................ 107 7 Criminal Law and Cyber Crime ................................ ................................ .................. 127 8 Intellectu al Property and Internet Law ................................ ................................ ..... 147 9 Interna tional Law in a Global Economy ................................ ................................ .... 167 Appendix B for Unit Two Feature Questions ................................ ............................ 187 UNIT THREE : The Commercial Environment 10 Business Organizations ................................ ................................ .............................. 193 11 Formation of Traditional and E - Contracts ................................ ................................ 213 12 Contract Perfo rmance, Breach, and Remedies ................................ ......................... 233 13 Sales and Leases ................................ ................................ ................................ ........ 253 14 Creditors’ Rights and Bankruptcy ................................ ................................ .............. 273 15 Mortgages and Foreclosures after the Recession ................................ ..................... 293 Appendix C for Unit Three Feature Questions ................................ .......................... 315 UNIT FOUR : The Employment Environment 16 Employment , Immigration, and Labor Law ................................ ............................... 321 17 Employment Discrimination ................................ ................................ ...................... 341 Appendix D for Unit Four Feature Questions ................................ ............................ 361 UNIT FIVE : The Regulatory Environment

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    vi vi 18 Environmental Law ................................ ................................ ................................ .... 365 19 Antitrust L aw and Promoting Competition ................................ ............................... 385 20 Investor Protect ion and Corporate Governance ................................ ....................... 405 Appendix E for Unit Five Feature Questions ................................ ............................. 425

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    1 © 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 1 Bu siness and Its Legal Environment N.B.: TYPE indicates that a question is new, modified, or unchanged, as follows. N A question new to this edition of the Test Bank. + A question modified from the pr evious edition of the Test Bank. = A question included in the previous edition of the Test Bank. TRUE/FALSE QUESTIONS 1. The law establishes rights, duties, and privileges that are consistent with the values of society. ANSWER: T PAGE: 2 TYPE: = BUSPROG: Reflective LO: 1 - 1 BLOOM’S : Comprehension DIF: Easy AICPA: BB - Critical Thinking 2. Law includes enforceable rules governing relationships between individuals and their society. ANSWER: T PAGE: 2 TYPE: = BUSPROG: Analytic LO: 1 - 1 BLOOM’S : Knowledge DIF: Easy AICPA: BB - Legal 3. A federal law that conflicts with the U.S. Constitution will be deemed unconstitutional.

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    2 UNIT ONE: THE FOUNDATIONS © 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ANSWER: T PAGE: 6 TYPE: = BUSPROG: Analytic LO: 1 - 1 BLOOM’S : Comprehension DIF: Moderate AICPA: BB - Legal 4. Constitutional law includes only the U.S. Constitution. ANSWER: F PAGE: 6 TYPE: = BUSPROG: Analytic LO: 1 - 1 BLOOM’S : Knowledge DIF: Easy AICPA: BB - Critical Thinking 5. A state law that conflicts with the U.S. Constitution will be deemed unconstitutional. ANSWER: T PAGE: 6 TYPE: = BUSPROG: Analytic LO: 1 - 1 BLOOM’S : Comprehension DIF: Moderate AICPA: BB - Legal 6. The U.S. Constitution is the supreme law of the United States. ANSWER: T PAGE: 6 TYPE: = BUSPROG: Analytic LO: 1 - 1 BLOOM’S : Knowledge DIF: Easy AICPA: BB - Legal 7. Whether a law is constitutional depends on its source. ANSWER: F PAGE: 6 TYPE: = BUSPROG: Analytic LO: 1 - 1 BLOOM’S : Comprehension DIF: Easy AICPA: BB - Legal 8. A state constitution is supreme within the state’s borders so long as it does not conflict with the U.S. Constitution or a federal law. ANSWER: T PAGE: 6 TYPE: = BUSPROG: Analytic LO: 1 - 1 BLOOM’S : Comprehension DIF: MODERATE AICPA: BB - Legal 9. Federal statutes apply to all states. ANSWER: T PAGE: 6 TYPE: =

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    CHAPTER 1: BUSINESS AND ITS LEGAL ENVIRONMENT 3 © 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. BUSPROG: Analytic LO: 1 - 1 BLOOM’S : Comprehension DIF: Easy AICPA: BB - Legal 10 . No state has adopted the Uniform Commercial Code in its entirety. ANSWER: F PAGE: 6 TYPE: + BUSPROG: Reflective LO: 1 - 1 BLOOM’S : Knowledge DIF: Easy AICPA: BB - Legal 11. Uniform laws apply in all states, including those in which the laws have not been adopted. ANSWER: F PAGE: 6 TYPE: = BUSPROG: Analytic LO: 1 - 1 BLOOM’S : Comprehension DIF: Moderate AICPA: BB - Legal 12. Administrative agencies are established to perform specific functions. ANSWER: T PAGE: 7 TYPE: N BUSPROG: Analytic LO: 1 - 1 BLOOM’S : Knowledge DIF: Easy AICPA: BB - Legal 13. Rules issued by administrative agencies now affect almost no aspect of a business’s operations. ANSWER: F PAGE: 7 TYPE: N BUSPROG: Analytic LO: 1 - 1 BLOOM’S : Application DIF: Moderate AICPA: BB - Legal 14. The basis for the U.S. legal system is the natural law school. ANSWER: T PAGE: 7 TYPE: N BUSPROG: Ethics LO: 1 - 2 BLOOM’S : Knowledge DIF: Easy AICPA: BB - Critical Thinking 15. Courts can rely on the common law as a guide to interpreting legislation. ANSWER: T PAGE: 7 TYPE: N BUSPROG: Analytic LO: 1 - 2 BLOOM’S : Comprehension

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    4 UNIT ONE: THE FOUNDATIONS © 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. DIF: Moderate AICPA: BB - Legal 16. Common law is a term for the law that is known to most of us. ANSWER: F PAGE: 7 TYPE: = BUSPROG: Analytic LO: 1 - 2 BLOOM’S : Knowledge DIF: Easy AICPA: BB - Critical Thinking 17. A decision on a given issue by a court is not binding on an inferior court. ANSWER: F PAGE: 9 TYPE: = BUSPROG: Analytic LO: 1 - 3 BLOOM’S : Comprehension DIF: Easy AICPA: BB - Legal 18. Judges use precedent when deciding a case in a common law legal system. ANSWER: T PAGE: 9 TYPE: = BUSPROG: Analytic LO: 1 - 3 BLOOM’S : Knowledge DIF: Easy AICPA: BB - Legal 19. Stare decisis is a doctrine obligating judges to help persons who have failed to protect their own rights. ANSWER: F PAGE: 9 TYPE: N BUSPROG: Analytic LO: 1 - 3 BLOOM’S : Knowledge DIF: Easy AICPA: BB - Legal 20. Courts do not depart from precedents. ANSWER: F PAGE: 9 TYPE: = BUSPROG: Reflective LO: 1 - 3 BLOOM’S : Comprehension DIF: Easy AICPA: BB - Critical Thinking 21. A court may depart from a precedent if the court decides that the precedent should no longer be followed. ANSWER: T PAGE: 9 TYPE: = BUSPROG: Reflective LO: 1 - 3 BLOOM’S : Comprehension DIF: Moderate AICPA: BB - Critical Thinking

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