Test Bank For Business Law A Storytelling Approach, 1st edition Michael Fricke Chapter 1-39 Chapter 1 Sources of Laws 1) Multiple individuals and entities create the laws that govern American businesses. Answer: TRUE Explanation: The United States has shared governance between federal and state authorities. The courts also set out law through case law. Learning Objective: 1.1 Skill: Comprehension AACSB: Application of Knowledge 2) A state law that contradicts the U.S. Constitution is valid because the states have the right to regulate their own citizens. Answer: FALSE Explanation: The Constitution is the supreme Law of the Land and overrides all lower laws. Learning Objective: 1.1 Skill: Comprehension AACSB: Application of Knowledge 3) A federal treaty has the force of law throughout the country. Answer: TRUE Explanation: Federal treaties are fully binding on the states. Learning Objective: 1.1 Skill: Comprehension AACSB: Application of Knowledge 4) U.S. law is an example of a purely common law system. Answer: FALSE Explanation: The United States blends statutory and common law. Learning Objective: 1.1 Skill: Comprehension AACSB: Application of Knowledge 5) The concept of judicial review, which stems from the case Marbury v. Madison, allows the Supreme Court to provide a check on congressional action, but not executive action. Answer: FALSE Explanation: Judicial review allows the courts to evaluate both legislative and executive action for constitutionality. Learning Objective: 1.1 Skill: Comprehension AACSB: Application of Knowledge
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