Test Bank For Business Law: Text And Cases, 13th Edition

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HighlightsofTest Bank BTest BankBcontains more than2,100questionsEach Chapter ofTest BankBincludesTrue-FalseQuestionsandMultiple-ChoiceQuestions, includingHypotheticals & Fact Patterns with series of questions, andEssayQuestionsAnswersto all questionsReferencesto the specific pages of the text that discuss the lawrelating to the questions & answersAnAnnotation Systemthat reveals when a question is:new (N),revised from the last edition (+), or the same as in the last edition (=).AnAnnotation Systemthat tells you whichAACSB Skill,Tier IStandard,LearningObjective,Bloom’sTaxonomy,Difficulty Level,andAICPA Skilleach question fulfills.Unit Appendices with questions onfeatures&“Focus on Ethics”sectionsTest Bank Ais also available onExamView® Pro, the acclaimedcomputerized testing system.WithExamView® Pro, instructors canSet upthePageLayoutfor testsAdd or Editquestions & answers andSelectquestions at random orby numberViewsummaries of the test orTest BankBchapters

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1©2015Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publiclyaccessible website, in whole or in part.Chapter 1Law andLegal ReasoningN.B.:TYPEindicates that a question is new, modified, or unchanged, as follows.NAquestionnewto this edition of the Test Bank.+A questionmodifiedfrom the previous edition of the Test Bank.=A questionincludedin the previous edition of the Test Bank.TRUE/FALSE QUESTIONSB1.Laws and government regulations affect almost all business activities.ANSWER:TPAGE:2TYPE:NBUSPROG:AnalyticAICPA: BB-LegalB2.The U.S. Constitution is thebasis of alllawinthe United States.ANSWER:TPAGE:4TYPE:+BUSPROG: AnalyticAICPA: BB-LegalB3.TheU.S.Constitutionreservestothefederalgovernmentallpowersnotgranted to the states.ANSWER:FPAGE:4TYPE:NBUSPROG: AnalyticAICPA: BB-Critical ThinkingB4.TheUniform Commercial Codehas been adopted in all fifty states.ANSWER:TPAGE:5TYPE:+BUSPROG:ReflectiveAICPA: BB-Critical Thinking

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2TEST BANK BUNIT ONE: THE LEGAL ENVIRONMENT OF BUSINESS©2015Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publiclyaccessible website, in whole or in part.B5.Federalagency regulations take precedenceover conflictingstateagencyregulations.ANSWER:TPAGE:5TYPE:+BUSPROG: AnalyticAICPA: BB-LegalB6.Common lawis a term for the laws that are familiar to most of us.ANSWER:FPAGE:6TYPE:=BUSPROG: AnalyticAICPA: BB-Critical ThinkingB7.Decisionsbyhighercourtsarenotbinding onlowercourts.ANSWER:FPAGE:8TYPE:+BUSPROG: AnalyticAICPA: BB-LegalB8.Stare decisisis a doctrine obligating judges to help persons who have failed toprotect their own rights.ANSWER:FPAGE:8TYPE:=BUSPROG: AnalyticAICPA: BB-LegalB9.Courts arenotobligated to follow precedents.ANSWER:FPAGE:9TYPE:NBUSPROG:ReflectiveAICPA: BB-Critical ThinkingB10.In most legal controversies, there is one single correct result.ANSWER:FPAGE:10TYPE:NBUSPROG: AnalyticAICPA: BB-Critical ThinkingB11.Although cases may be similar, no two cases are ever identical in all respects.ANSWER:TPAGE:10TYPE:NBUSPROG: AnalyticAICPA: BB-Critical ThinkingB12.Each judge had his or her personal beliefs and philosophy, which shape thelegal reasoning process.

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CHAPTER 1: LAW AND LEGAL REASONING3©2015Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publiclyaccessible website, in whole or in part.ANSWER:TPAGE:10TYPE:NBUSPROG:ReflectiveAICPA: BB-Critical ThinkingB13.Clearly, a judge’s function is tomakethe laws.ANSWER:FPAGE:11TYPE:NBUSPROG: AnalyticAICPA: BB-Critical ThinkingB14.The courts, in interpreting statutory law,often rely on the common law as aguide towhat the legislators intended.ANSWER:TPAGE:11TYPE:NBUSPROG: AnalyticAICPA: BB-Critical ThinkingB15.A jury’s good sense and carefulconsideration of consequences is known asjurisprudence.ANSWER:FPAGE:11TYPE:=BUSPROG:ReflectiveAICPA: BB-Critical ThinkingB16.Procedural law consists of all laws that outline the methods of enforcing rights.ANSWER:TPAGE:12TYPE:NBUSPROG: AnalyticAICPA: BB-LegalB17.A citation identifies the publication in which a legal authority can be found.ANSWER:TPAGE:13TYPE:NBUSPROG: AnalyticAICPA: BB-ResearchB18.The decisions made by the courtsestablish the boundaries of the law as itapplies to almost all business relationships.ANSWER:TPAGE:15TYPE:NBUSPROG: AnalyticAICPA: BB-Critical ThinkingB19.The party against whom a lawsuit is brought is theplaintifforpetitioner.ANSWER:FPAGE:20TYPE:NBUSPROG: AnalyticAICPA: BB-Critical Thinking

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4TEST BANK BUNIT ONE: THE LEGAL ENVIRONMENT OF BUSINESS©2015Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publiclyaccessible website, in whole or in part.B20.When all the judges (or justices) agree on a decision, amajority opinioniswritten for the entire court.ANSWER:FPAGE:20TYPE:NBUSPROG:ReflectiveAICPA: BB-Critical ThinkingMULTIPLE-CHOICE QUESTIONSB1.Data Analytics, Inc., is a corporation engaged in the business of compiling,analyzing, and marketing data. To accomplish its purposes, Data Analyticsobtainsfinancing,andhiresandfiresemployees.Lawsandgovernmentregulations affect such business activities asa.hiring and firing decisions.b.the manufacturing and marketing of products.c.business financing.d.all of the choices.ANSWER:DPAGE:2TYPE:NBUSPROG:ReflectiveAICPA: BB-Critical ThinkingB2.The U.S. Congress enacts a new federal statute that imposes liability onbusinesseshiring employees without verifying their citizenship status. Thisstatute appliesa.only tobusinessesnot covered by state law.b.only to those states thatconsent to apply it.c.to all of the states.d.to none of the states.ANSWER:CPAGE:4TYPE:+BUSPROG:ReflectiveAICPA: BB-LegalB3.A provision in the California state constitution conflicts with aprovision in theU.S. Constitution. If challengeda.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.

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CHAPTER 1: LAW AND LEGAL REASONING5©2015Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publiclyaccessible website, in whole or in part.ANSWER:DPAGE:4TYPE:+BUSPROG:ReflectiveAICPA: BB-LegalB4.ThePennsylvanialegislatureenactsastatelawthatviolatestheU.S.Constitution. This law can be enforced bya.no one.b.thefederal government only.c.the state of Pennsylvania only.d.the United States Supreme Court only.ANSWER:APAGE:4TYPE:NBUSPROG:ReflectiveAICPA: BB-LegalB5.The Bay City Planning Department, the Coastal County ZoningCommission,the Delaware Environmental Quality Agency, and the U.S. Bureau of LandManagement issue regulations.These rules constitutea.administrative law.b.case law.c.stare decisis.d.statutory law.ANSWER:APAGE:5TYPE:NBUSPROG:ReflectiveAICPA: BB-Critical ThinkingB6.Charles is a federal judge whose judicial decisions are part of case law, whichdoesnotinclude interpretations ofa.regulationscreated by administrative agencies.b.constitutional provisions.c.statutes enacted by legislatures.d.sound bites in the media.ANSWER:DPAGE:5TYPE:NBUSPROG:ReflectiveAICPA: BB-LegalB7.Much of American law is based ona.theEnglish legal system.

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6TEST BANK BUNIT ONE: THE LEGAL ENVIRONMENT OF BUSINESS©2015Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publiclyaccessible website, in whole or in part.b.the French legal system.c.Greekcivil law.d.ancient Chinese law.ANSWER:APAGE:6TYPE:NBUSPROG:ReflectiveAICPA: BB-LegalB8.Bob’s Big Burgers n’ Shakes Restaurant brings a suit, seeking a remedy at law.Aremedy at lawisa.monetary damages.b.a decree of specific performance.c.ajudicial proceeding for the resolution of a dispute.d.an injunction.ANSWER:APAGE:6TYPE:NBUSPROG:ReflectiveAICPA: BB-Critical ThinkingB9.Larry enters into a contract with Motivational Education Services to host apaneldiscussion at a sales conference. When the conference is postponedindefinitely, Larry asks a court to cancel the contract and return the parties tothe positions that they held before its formation. This request involvesa.specific performance.b.aninjunction.c.rescission.d.an action that the court cannot order.ANSWER:CPAGE:7TYPE:NBUSPROG:ReflectiveAICPA: BB-LegalB10.Maggie and Nate enter into a contract for the sale of a car, but Nate laterrefuses to deliver the car. Maggie asks a court to order Nate to perform aspromised. Ordering a party to perform what was promised isa.specific performance.b.damages.c.rescission.d.beyond the court’s authority.ANSWER:APAGE:7TYPE:N

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CHAPTER 1: LAW AND LEGAL REASONING7©2015Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publiclyaccessible website, in whole or in part.BUSPROG:ReflectiveAICPA: BB-Decision ModelingB11.Jane enters into a contract with Jill to provide 100 roses for a dinner party. Jillfails to deliver the roses. Jane initiates a suit against Jill, asking the court toorder Jill to refund Jane’s payment. Jane isa.theplaintiff.b.the defendant.c.the binding authority.d.the persuasive authority.ANSWER:APAGE:7TYPE:NBUSPROG:AnalyticAICPA: BB-LegalB12.Sara believes that she has a strong case against Tom for the breach of anemployment contract. Despite this belief, Sara cannot file a suit against Tomafter the expiration of the time allowed for the filing undera.astatute of limitations.b.the doctrine of laches.c.anequitablemaxim.d.theremedyat law.ANSWER:APAGE:7TYPE:NBUSPROG:ReflectiveAICPA: BB-LegalB13.In the case ofRetail Sales Corp. v. Trucking Delivery Co., the courtmay rulecontrary to a precedent if the court decides that the precedenta.is incorrect or inapplicable.b.isnot 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:APAGE:9TYPE:NBUSPROG:ReflectiveAICPA: BB-LegalB14.Karen is a judge hearing the case ofLocal Dispatch Co. v. National TransportCorp.Applying the relevant rule of law to the facts of the case requires Karento find cases on pointpreviously decided cases that, in relation to the caseunder consideration, are

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8TEST BANK BUNIT ONE: THE LEGAL ENVIRONMENT OF BUSINESS©2015Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publiclyaccessible website, in whole or in part.a.as different as possible.b.as similar as possible.c.at odds.d.exactly identical.ANSWER:BPAGE:10TYPE:NBUSPROG:AnalyticAICPA: BB-LegalB15.Juanis a judge. HowJuanand the judges in other courts interpret aparticularstatute determinesa.how that statute will be applied.b.how the law needs to be changed.c.how the common law should be codified.d.nothing.ANSWER:APAGE:11TYPE:=BUSPROG:AnalyticAICPA: BB-LegalB16.ToSam, the written lawof a particular society at a particular time is mostsignificant.Samisaa.legal positivist.b.person who adheres to the historical school of legal thought.c.legal realist.d.person who adheres to the natural law tradition.ANSWER:APAGE:12TYPE:+BUSPROG:AnalyticAICPA: BB-Critical ThinkingB17.Dave and Ellen enter into a contract via e-mail. When a dispute arises over theperformance of the deal, Dave files a suit against Ellen. The emerging body oflaw that governstransactions conducted via the Internet is referred to by theterma.cyberlaw.b.civil law.c.equitable maxims.d.IRAC.

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CHAPTER 1: LAW AND LEGAL REASONING9©2015Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publiclyaccessible website, in whole or in part.ANSWER:APAGE:13TYPE:NBUSPROG:ReflectiveAICPA: BB-Critical ThinkingB18.Beth is a victim of Carl’s violation of acriminal law. Criminal law is concernedwitha.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:DPAGE:13TYPE:NBUSPROG:ReflectiveAICPA: BB-ResearchB19.TheNebraskaSupreme Courtissues an opinion that can be found at 285 Neb.88, 825 N.W.2d 429. “285” isa.thenumber of the volume in the official reports of the court’s decisions.b.the number of the volume in Thomson Reuter’s unofficial publication ofthe court’s decisions.c.a page number in the appropriate volume.d.the number of the case in the sequence decided by the state’s highestcourt.ANSWER:APAGE:17TYPE:NBUSPROG:ReflectiveAICPA: BB-ResearchB20.Operational Processes, Inc., appeals a decision against it, in favor of PrecisionManufacturing Corporation, from a lower court to ahigher court. OperationalProcessesisa.the appellant.b.the appellee.c.the defendant.d.the respondent.ANSWER:APAGE:20TYPE:+BUSPROG:ReflectiveAICPA: BB-Legal

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10TEST BANK BUNIT ONE: THE LEGAL ENVIRONMENT OF BUSINESS©2015Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publiclyaccessible website, in whole or in part.ESSAY QUESTIONSB1.In a lawsuit betweenCloud ComputingCorporation andDigital Enterprises,Inc., the court applies the doctrine ofstare decisis.What is this doctrine? Whatdoes this doctrine have to do with the American legal system?ANSWER:In a common law legal system, past judicial decisions arebindingin current disputes with similar facts. This feature of the common law, which isthe basis of the American legal system, is unique because, unlike the law inother legal systems, it is judge-made law. Within the common law system,when possible, judges attempt to be consistent and to base their decisions onthe principles suggested by earlier cases. The body of principles and doctrinesthat form the common law emerged over time as judges applied the principlesannounced in earlier cases to subsequent legal controversies.The practice of deciding cases with reference to former decisions, orprecedentsthecornerstoneoftheAmericanlegalsystemiscalledthedoctrine ofstare decisis. Under this doctrine, judges are obligated to follow theprecedents established within their jurisdictions. This helps courts to be moreefficient and makes the law more stable and predictable.PAGES:810TYPE:=BUSPROG:ReflectiveAICPA: BB-Critical ThinkingB2.For a business law class,Sierrareads and briefs several court opinions usingthe IRAC method of legalreasoning. What do the letters I, R, A, and Cabbreviate? What are the steps in the IRAC method?ANSWER:The letters I, R, A, and Care the first letters of“Issue,” “Rule,”Application,” and “Conclusion.”TheIRACmethodoflegalreasoningrequiresSierraoranyotherstudent or reader to first summarize the important facts of a legal case andstate the salient issue or issues. The second step is to determine and set outthe rule of law that applies to the facts to resolve the issue. The third step is toapply that rule to those facts. The application of the rule requires an answer tothe question posed by the issue. This answer may involve one or more differenttypesoflegalreasoning,butthosereasonsshouldbethoughtoutandexpressed clearly. Finally, the conclusion derived from the application of therule to the facts is stated. This is sometimes referred to as the result or theoutcome in a casewho won;who lost;what the award, if any, consists of;orwhat the parties are, or are not, required to do next.

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CHAPTER 1: LAW AND LEGAL REASONING11©2015Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publiclyaccessible website, in whole or in part.PAGES:910TYPE:=BUSPROG:ReflectiveAICPA: BB-Legal

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1©2015Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publiclyaccessible website, in whole or in part.Appendix A for Unit OneQuestions on the FeaturesN.B.:TYPEindicates that a question is new, modified, or unchanged, as follows.NAquestionnewto this edition of the Test Bank.+A questionmodifiedfrom the previous edition of the Test Bank.=A questionincludedin the previous edition of the Test Bank.CHAPTER 3INSIGHT INTO SOCIAL MEDIA:TO TWEET OR NOT TO TWEET INSIDE THE COURTROOMB1.GingerandHollyarejournalists in acourtroomhearinga case. The judgeinstructs themnot touse social media until the court is adjourned. Despite thisinstruction, during the trialGinger and Hollytweet play-by-play commentary forthe public as events unfold. Possiblesanctions that the judge might imposeincludea.fines and imprisonment.b.fines but not imprisonment.c.imprisonment but not fines.d.none of the choices.ANSWER:APAGE:64TYPE:NBUSPROG:ReflectiveAICPA: BB-LegalCHAPTER 4INSIGHT INTO E-COMMERCE:DOCOMPUTERS HAVE FREE SPEECH RIGHTS?

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2TEST BANK BUNIT ONE: THE LEGAL ENVIRONMENT OF BUSINESS©2015Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publiclyaccessible website, in whole or in part.B2.FastBreak Inc. is dissatisfied with its ranking in Google Inc.’s search results.FastBreak files a suit against Google, seeking an injunction. Google arguesthat its search results are constitutionally protected speech. FastBreak’s bestargument against Google’s positionisthata.the First Amendmentprotects humansagainst state censorshipandprotecting a computer’s speech is not related to that purpose.b.thetrillionsofdecisionsmadebycomputerseachdaydonotallconstituteprotected speech.c.computerized algorithms, which generate computer language,donotconstitutespeech.d.searchresultsconstitutecommercialspeech,forwhichtheFirstAmendment provides only limited protection.ANSWER:APAGE:81TYPE:NBUSPROG:ReflectiveAICPA: BB-LegalCHAPTER 5INSIGHT INTO THE GLOBAL ENVIRONMENT:BRIBERY AND THE FOREIGN CORRUPT PRACTICES ACTB3.Mexican employees ofFarmacosLtd., a subsidiary ofGlobal Pharmaceuticals,Inc., a U.S. firm, offer cash and gifts to regional Mexican government officials toobtain their approval of favorable contracts.Steps thatcompanymanagersmight take to end the practice and to influence other employees not to engagein similar conduct includea.termination of the employees who offered the bribes.b.mandatory antibribery training for all employees.c.audit of companyexpensesto expose illegal and unethical payments.d.all of the choices.ANSWER:DPAGE:109TYPE:NBUSPROG:EthicsAICPA: BB-Critical ThinkingUNIT ONEFOCUS ON LEGAL ETHICS:ETHICS AND THE LEGAL ENVIRONMENT OF BUSINESSB4.Energy Resources Company develops its marketing strategies in terms of whatits management perceives as its ethical obligations, whichrepresent its
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