Business Ethics and Law
Pre-Test Questions
Course Introduction
Business Ethics and Law explores the complex interplay between ethical principles and legal frameworks in the modern business environment. The course examines foundational theories of ethics, stakeholder responsibilities, corporate social responsibility, and the regulatory landscape governing business conduct. Through real-world case studies and critical analysis, students learn to identify ethical dilemmas, consider diverse viewpoints, and apply legal concepts in decision-making processes. By integrating ethical reasoning with legal compliance, the course prepares students to address contemporary challenges in corporate governance, workplace practices, consumer protection, and global business operations.
Recommended Textbook
Business Law and the Legal Environment Standard Volume 23rd Edition by David P. Twomey
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Page 2
Chapter 1: The Nature and Sources of Law
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Q1) Statutory law can be created by all of the following except:
A)Congress.
B)state legislatures.
C)local governments.
D)by the courts.
Answer: D
Q2) Our rights flow from all the following sources except:
A)the Constitution.
B)federal statutes.
C)city ordinances.
D)ethical values.
Answer: D
Q3) A right is an obligation of law imposed on a person to perform or refrain from performing a certain act.
A)True
B)False
Answer: False
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Page 3
Chapter 2: The Court System and Dispute Resolution
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Q1) Chandra 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?
Answer: 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.
Q2) A summary jury trial is a mock trial before a judge.
A)True
B)False
Answer: False
Q3) State supreme courts generally hear all cases appealed to them.
A)True
B)False
Answer: False
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Chapter 3: Business Ethics, Social Forces, and the Law
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Q1) Positive law:
A)is enacted by government authority.
B)ensures that businesses will follow a high level of ethical standards.
C)is also known as natural law.
D)is moral-based law.
Answer: A
Q2) In addition to issues of social responsibility, business values and ethics play an important role in the success or failure of a business.
A)True
B)False
Answer: True
Q3) The field of business ethics recognizes that social values typically must yield to the profitability motive.
A)True
B)False
Answer: False
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Chapter 4: The Constitution As the Foundation of the Legal Environment
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Q1) Which of the following is true about administrative agencies?
A)Administrative agencies exercise powers guaranteed to them in the U.S. Constitution.
B)Administrative agencies exercise powers allocated to them by the president.
C)Administrative agencies make decisions that are rarely reviewed by the courts.
D)Administrative agencies make decisions that are effectively reviewed by voters.
Q2) Within the past five years, the U.S Supreme Court has:
A)placed some limitations on the commerce clause.
B)increased Congressional authority for all activities that have economic impact.
C)given states the ability to override the federal government on interstate commerce issues.
D)become more conservative.
Q3) Which of the following powers is not reserved solely to the national government?
A)power to regulate interstate commerce
B)power to tax
C)power to coin money
D)power to borrow money on the credit of the United States
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6
Chapter 5: Government Regulation of Competition and Prices
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Q1) The Sherman Act does not prohibit:
A)a company from engaging in purposeful conduct to exclude competitors.
B)a seller from dominating a market because of superior product or business.
C)competitors from agreeing not to deal with certain buyers.
D)contracts to fix prices.
Q2) Under the Clayton Act, when large-scale enterprises plan to merge, they must in advance:
A)notify the New York Stock Exchange.
B)notify the President of the United States.
C)complete the necessary financing arrangements.
D)notify the Antitrust Division of the Department of Justice.
Q3) The Robinson-Patman Act:
A)prohibits charging different prices to different buyers when the margin costs are the same.
B)allows sellers to offer incentives and bonuses to certain customers.
C)allows sellers to refuse to deal with anyone for any reason.
D)prohibits boycotts among competitors.
Q4) Governments may regulate prices but not credit terms.
A)True
B)False
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Chapter 6: Administrative Agencies
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Q1) A court will not reverse an agency's decision merely because the court would have made a different decision based on the same facts.
A)True
B)False
Q2) Regulations properly adopted by agencies are important, but they do not have the full force of law, as do statutes.
A)True
B)False
Q3) Which of the following is true about judicial review of agency action?
A)Judges tend to substitute their own judgment for that of the agency.
B)Courts will reverse agency decisions merely because the court would have made a different decision based on the same facts.
C)Courts will reverse a decision if they disagree with the legal interpretation.
D)There is a right to a trial by jury before an agency.
Q4) In reviewing agency action, courts generally apply the:
A)"beyond a reasonable doubt" standard.
B)"preponderance of the evidence" standard.
C)"arbitrary and capricious" standard.
D)"rational relationship" standard.
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Chapter 7: Crimes
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Q1) A computer crime generally requires that:
A)the criminal possess a computer.
B)the victim possess a computer.
C)the criminal have some knowledge of computers.
D)the victim have some knowledge of computers.
Q2) A crime generally consists of:
A)an act or omission.
B)a mental state.
C)a mental state and an act or omission.
D)a mental state, an act or omission, and harm.
Q3) "Mental state" does not require an awareness of guilt.
A)True
B)False
Q4) In a prosecution for unauthorized use of computers, unsecure _______ has proven to be a challenge in prosecution for unauthorized use of computer information.
A)economic espionage
B)diverted delivery
C)computer raiding
D)wi-fi networks
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Chapter 8: Torts
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Q1) A trespass to personal property is any unpermitted entry below, on, across, or above the land of another.
A)True
B)False
Q2) Libel is the printed equivalent of the spoken form of defamation known as slander.
A)True
B)False
Q3) When contributory negligence is proven, damages awarded are reduced based on the plaintiff's degree of fault but the plaintiff can still recover some damages.
A)True
B)False
Q4) The tort of intentional infliction of emotional distress requires proof of outrageous conduct and resulting emotional distress in the victim.
A)True
B)False
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Chapter 9: Intellectual Property Rights and the Internet
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Q1) If other persons are permitted to use a trademark, it will lose its exclusive character and become generic.
A)True
B)False
Q2) Written computer programs are not given the same protection as other copyrighted material.
A)True
B)False
Q3) Under the Semiconductor Chip Protection Act's _______, competitors may not only study mask works but may also use the results of that study to design their own semiconductor chip products embodying their own original masks.
A)fair use exemption
B)statutory damages waiver
C)reverse engineering exemption
D)semiconductor mask product exemption
Q4) Trade dress can be any word, name, symbol, device, or combination of these used to identify a product.
A)True
B)False
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Chapter 10: The Legal Environment of International Trade
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Q1) A direct sale to customers in a foreign country is a(n):
A)foreign distributorship.
B)agency arrangement.
C)licensed sale.
D)export sale.
Q2) A 'choice-of-law' provision in an international contract set's forth whether the CISG will govern the contract.
A)True
B)False
Q3) Three defenses are commonly raised to the extraterritorial application of U.S.antitrust laws.They are:
A)act-of-state, sovereign compliance, and sovereign immunity doctrines.
B)jurisdictional rule of reason, effects doctrine, and comity.
C)foreign legislation, sovereign compliance, and comity.
D)foreign antitrust laws, sovereign immunity doctrine, and International Monetary Fund applications.
Q4) The use of import quotas represents the most common form of tariff barrier.
A)True
B)False
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Chapter 11: Nature and Classes of Contracts: Contracting
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Q1) A person who makes a promise is the promisor, while a person to whom the promise is made is the promisee.
A)True
B)False
Q2) The subject matter of a contract may relate to:
A)the performance of personal services.
B)the construction of a house.
C)the transfer of ownership of property.
D)All of these
Q3) An implied contract is shown by:
A)a writing.
B)the acts and conduct of the parties.
C)statements made in open court.
D)an exchange of oral promises.
Q4) The plaintiff in a quasi-contractual action can recover:
A)lost profits.
B)damages for mental distress.
C)the reasonable value of the benefit conferred upon the defendant.
D)for all the damages sustained.
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Chapter 12: Formation of Contracts: Offer and Acceptance
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Q1) An offer gives the offeror the power to bind the offeree by contract.
A)True
B)False
Q2) Arthur made a bid at an auction by calling out the amount of $250.The auctioneer acknowledged Arthur's bid.There were no higher bids, and before the fall of the auctioneer's hammer, Arthur announced that he was withdrawing the bid.The auctioneer said that it was too late for Arthur to withdraw his bid, because the bid had already been acknowledged.What is the result?
A)Arthur's bid is an ordinary offer that can be revoked.
B)Arthur's bid is firm and cannot be withdrawn.
C)Since the auctioneer had in fact acknowledged Arthur's bid, the bid became an option exercisable at the election of the seller.
D)Since the auctioneer had in fact acknowledged Arthur's bid, a contract had been formed by way of offer and acceptance; accordingly, Arthur's subsequent attempt to withdraw his bid was ineffective.
Q3) An acceptance must be absolute and unconditional.
A)True
B)False
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Chapter 13: Capacity and Genuine Assent
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Q1) A finding of undue influence would most likely not occur in a contract between:
A)parent and child.
B)attorney and client.
C)neighbor and neighbor.
D)guardian and ward.
Q2) Factual incapacity is imposed because of the class or group to which a person belongs.
A)True
B)False
Q3) All of the following statements refer to an element of fraud except:
A)the defendant desired to obtain a financial benefit.
B)the defendant made a false statement.
C)the defendant knew that the statement was false or was recklessly indifferent regarding its truth.
D)the defendant intended for the other party to rely on the false statement.
Q4) Contractual capacity can exist even though a party does not understand every provision of the contract.
A)True
B)False
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Chapter 14: Consideration
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Q1) An illusory promise creates a bilateral contract.
A)True
B)False
Q2) Past benefits already received by a promisor cannot be consideration for a later promise.
A)True
B)False
Q3) What damages are recoverable in a case of promissory estoppel?
A)profits that the promisor expected
B)profits that the promisee expected
C)an amount necessary to restore the promisee to the position he or she would have been in had the promisee not relied on the promise
D)an amount necessary to restore the promisor to the position he or she would have been in had the promisor not relied on the promise
Q4) When there is no consideration for a promise, the agreement is:
A)a quasi contract.
B)equitable.
C)not binding.
D)unethical.
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Chapter 15: Legality and Public Policy
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Q1) A take-it-or-leave-it contract of adhesion is an example of substantive unconscionability.
A)True
B)False
Q2) In an employment contract, agreements not to compete are:
A)illegal
B)uniformly held to be in the public interest and therefore legal
C)valid only if the restriction protects the employee
D)valid, if the restriction is reasonable and necessary for the protection of the former employer
Q3) Substantive unconscionability has to do with matters of freedom of assent.
A)True
B)False
Q4) The failure to have a license will not render agreements void if the license:
A)is based on formal education
B)is required for engaging in a particular business or trade
C)is a regulatory license
D)is readily obtainable by anyone who offers payment of a required fee
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Chapter 16: Writing, Electronic Forms, and Interpretation of Contracts
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Q1) When persons enter into an agreement, it is presumed that they intent the agreement to have some effect.
A)True
B)False
Q2) Parol evidence generally is admissible to explain:
A)ambiguous terms.
B)why signatures are missing.
C)why a contract was not performed.
D)implied terms.
Q3) If words and numbers contradict each other in a contract, the rule of construction favors the words.
A)True
B)False
Q4) The parol evidence rule generally excludes words spoken before or at the time a written contract was executed from contradicting the terms of the contract.
A)True
B)False
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Chapter 17: Third Persons and Contracts
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Q1) Which of the following duties would most likely not be delegable?
A)Joe has a contractual duty to pay Izzie $50.
B)Ken has a contractual duty to deliver 50 bushels of corn to Martin by October 1.
C)Andy has a duty to teach an accounting class at a community college during the fall semester.
D)Josh has a duty to mow Genelle's lawn at least once a week.
Q2) When a buyer assigns the right to goods under a contract, the buyer's liability to make payment to the seller is:
A)transferred to the third party.
B)terminated.
C)still in effect.
D)shared equally with the third party.
Q3) An assignment is a transfer of duties, and a delegation is a transfer of rights.
A)True
B)False
Q4) Only parties who actually signed a contract may sue on it.
A)True
B)False
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Page 19
Chapter 18: Discharge of Contracts
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Q1) Payment by check is a conditional payment.
A)True
B)False
Q2) When a debtor makes a payment to a creditor specifying how it should be applied, the creditor must apply the payment:
A)as directed by the debtor.
B)to the oldest outstanding debt.
C)to the most recent outstanding debt.
D)to the largest outstanding debt.
Q3) Contracts may be discharged by the joint action of both contracting parties or, in some cases, by the action of one party alone.
A)True
B)False
Q4) The phrase "time is of the essence" means that:
A)the court is in a hurry to dispose of the case.
B)performance under the contract at the times specified in the contract is vital or essential.
C)the contract expressly states that time is of the essence.
D)the price stated in the contract is subject to change without notice.
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Chapter 19: Breach of Contract and Remedies
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Q1) The "American rule" states that the losing party in a lawsuit is responsible for all attorney fees.
A)True
B)False
Q2) Consequential damages are those that necessarily flow from the breach.
A)True
B)False
Q3) The innocent party in a breach of contract, has the duty to mitigate damages at maximum efforts.
A)True
B)False
Q4) The party that breaks a contract may be required to pay damages to the other party to compensate for:
A)losses that could have been avoided by hiring someone else to perform the contract.
B)emotional disturbance caused by the breach of contract.
C)a heart attack induced by the emotional disturbance caused by the breach of contract.
D)damages resulting necessarily and directly from the breach of contract.
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Chapter 20: Personal Property and Bailments
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Q1) Transfer or possession and use of bailed property without compensation is called a constructive bailment.
A)True
B)False
Q2) Title to abandoned property is acquired by the first person who obtains possession and control of the property.
A)True B)False
Q3) A bailee's duty of care for bailed property depends on the type of bailment.
A)True B)False
Q4) Nelson took her computer to ABC Computer for repairs.ABC repaired the computer at a cost of $350 and informed Nelson that her computer was ready.Before Nelson came to pick up her computer, ABC was burglarized and Nelson's computer was taken.ABC had a commonly-used alarm system that was operating properly on the night of the burglary, and all the doors and windows were properly secured.Nelson sued ABC for the cost of the computer.ABC denied any liability and counterclaimed for the $350 in repairs.Who will win?
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Page 22
Chapter 21: Legal Aspects of Supply Chain Management
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Q1) The rights and duties of warehousers are regulated by the UCC.
A)True
B)False
Q2) A transferor of a bill of lading makes all of the following implied warranties to the transferee, except:
A)the transferor has no knowledge of defects.
B)the transfer is rightful.
C)the bill of lading is genuine
D)the goods are market value.
Q3) The rights of a transferee of a negotiable bill of lading are defeated if the goods have been stopped in transit.
A)True
B)False
Q4) When a carrier accepts goods for land shipment, it ordinarily issues to the shipper a(n):
A)bill of lading.
B)intent to transport memorandum.
C)warehouse receipt.
D)trust receipt.
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Chapter 22: Nature and Form of Sales
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Q1) An output or requirement contract is not enforceable unless the parties include an estimate of prospective amounts.
A)True
B)False
Q2) The provisions of Article 6 concerning bulk transfers are designed to protect creditors.
A)True B)False
Q3) Consumer leases:
A)must always be evidenced by a writing.
B)are always three- party transactions.
C)require the lessor to make all usual warranties made by a seller in a sale of goods.. D)all of these.
Q4) When an oral contract is made to sell a 75-inch LED LCD TV for $6,800, payment and acceptance of part of the purchase price avoids the bar of the statute of frauds.
A)True
B)False
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24
Chapter 23: Title and Risk of Loss
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Q1) A __________ is a completed sale with an option for the buyer to return the goods.
A)conditional sale
B)contingency sale
C)sale or return
D)sale on approval
Q2) When particular goods have been selected by either the buyer or the seller, or both, as being the goods called for by the sales contract, the goods are said to be
A)identified.
B)actualized.
C)realized.
D)materialized.
Q3) Once goods in a contract have been identified the buyer holds an insurable interest in them.
A)True
B)False
Q4) Future goods can always be identified before they are manufactured.
A)True
B)False
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Chapter 24: Product Liability: Warranties and Torts
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Q1) Plaintiffs suing for damages caused by a defective product are limited to claims against the manufacturer(s) of such goods.
A)True
B)False
Q2) Any warranty that does not provide the complete protection of a full warranty is called a warranty in breach.
A)True
B)False
Q3) A disclaimer or exclusion of the warranty of merchantability will be invalid if:
A)the goods cost $500 or more.
B)the defects in the goods are obvious to all buyers.
C)it is made at the time of the sale.
D)it is not conspicuously set forth in a writing.
Q4) An examination of goods excludes any implied warranty with respect to a defect that:
A)is apparent after a reasonable examination is made.
B)will not be apparent without chemical analysis.
C)will not be apparent until the goods are processed or used in manufacturing.
D)is unknown to all parties and is not detectable by reasonable examination.
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Chapter 25: Obligations and Performance
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Q1) The obligations of the parties to a sales contract include:
A)the seller's duty to deliver the goods to the buyer's place of business.
B)the buyer's duty to always accept the goods.
C)the seller's duty to arrange for appropriate transport.
D)the buyer's duty to pay for the goods.
Q2) When a contract to sell identified goods does not specify a place of delivery, the goods are considered delivered at the seller's place of business.
A)True
B)False
Q3) Upon a seller's tender of nonconforming goods and the buyer's rejection of them, the transaction has ended.
A)True
B)False
Q4) If a contractually-specified mode of transportation is not available, the:
A)contract is automatically voided.
B)seller must make delivery by a commercially-reasonable substitute.
C)buyer must arrange to pick up the goods.
D)seller must make personal delivery.
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Chapter 26: Remedies for Breach of Sales Contracts
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Q1) Consumer protection law prohibits the waiver of defenses in consumer contracts.
A)True
B)False
Q2) When a sales contract is broken by the buyer, the seller has only the remedies of lien and resale available.
A)True
B)False
Q3) On January 15, 2012, Anders brought an action against Barnes for breach of a contract for the sale of electronic parts.The breach occurred on January 10, 2008, and Anders discovered the breach on January 20, 2008.The state statute of limitations for contract actions is five years.Barnes raised the UCC statute of limitations as a defense to the action.Is this defense valid?
Q4) In the case of a breach of warranties, the buyer:
A)should not notify the seller.
B)is required to notify the seller.
C)does not have the option to resell the goods.
D)is not able to recover consequential damages.
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Chapter 27: Kinds of Negotiable Instruments and Negotiability
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Q1) If an instrument states no time for payment, the note is payable on demand. A)True
B)False
Q2) The payee has no rights in an instrument until the drawer or the maker has delivered it to the payee.
A)True
B)False
Q3) A certificate of deposit is a written promise made and signed by the maker to pay a sum certain in money to the holder of the instrument.
A)True
B)False
Q4) The person to whom the order in a draft is addressed is known as the: A)payee. B)drawee.
C)drawer.
D)maker.
Q5) Article 2 of the Uniform Commercial Code governs negotiable instruments. A)True B)False
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Chapter 28: Transfers of Negotiable Instruments and
Warranties of Parties
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Q1) When the indorser merely signs a negotiable instrument, the indorsement is called a __________ indorsement.
A)special
B)qualified
C)blank
D)restrictive
Q2) The order or bearer character of the paper determines how it may be:
A)assigned.
B)sold.
C)negotiated.
D)accepted.
Q3) The transferring of an instrument in such a way as to make the transferee the holder of the paper is termed:
A)an assignment.
B)a conversion.
C)a sale.
D)a negotiation.
Q4) An instrument may be transferred only by negotiation.
A)True
B)False
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Chapter 29: Liability of the Parties Under Negotiable
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Q1) Manuel sued Patricia on a promissory note.Patricia admitted signing the note, but raised the defense that Manuel was not a holder in due course.Can Manuel recover without proving that he is a holder in due course?
Q2) To have the status of a holder in due course, a person must first be a holder.
A)True
B)False
Q3) An instrument is said to "run" to a holder if it contains any of the following attributes, except:
A)payable to his or her order.
B)bearer paper.
C)indorsed to him or her.
D)universal defenses.
Q4) A holder through a holder in due course is subject to only certain, limited defenses. A)True B)False
Q5) Drawers are secondary parties on a note.
A)True
B)False
31
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Chapter 30: Checks and Funds Transfers
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Q1) The standard form of a check is automatically payable on demand.
A)True
B)False
Q2) A bank must be given a reasonable amount of time to put a stop payment order into effect.
A)True
B)False
Q3) The Electronic Fund Transfers Act (EFTA) covers all transactions, including those that originated by commercial paper.
A)True
B)False
Q4) All of the following statements is incorrect concerning stale checks except: ______.
A)A check is stale when dated more than six (6) months before presentation to the bank.
B)Banks are required to pay stale checks unless a stop payment order has been issued.
C)Banks can pay in good faith after three (3) months.
D)Stale checks do not have to be verified with the bank's customer.
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Chapter 31: Nature of the Debtor-Creditor Relationship
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Q1) Under the independence rule banks cannot, except in limited circumstances, delve into the underlying contract issues and must only focus on the terms of the letter of credit.
A)True
B)False
Q2) Consideration is not required to establish or modify a letter of credit.
A)True
B)False
Q3) Under an indemnity contract, one person pays another consideration in return for a promise to pay a specified sum of money in the event that a specified loss is suffered.
A)True
B)False
Q4) The amount of credit specified in a letter of credit must be taken by the beneficiary in the form of a lump-sum payment.
A)True
B)False
Q5) A letter of credit must be in writing and signed by the issuer.
A)True
B)False
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Chapter 32: Consumer Protection
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Q1) Under the Equal Credit Opportunity Act, it is unlawful to discriminate against an applicant because all or part of the applicant's income is obtained from a public assistance program.
A)True
B)False
Q2) If you allow another person to use your credit card but the person uses the card for a purpose other than the one you specified:
A)an unauthorized usage has occurred.
B)an authorized usage has occurred.
C)you will not be responsible for more than $50 of the amount charged.
D)you are not liable for any of the amount charged.
Q3) Antitrust statutes that prohibit anticompetitive behavior give consumers the right to collect treble punitive damages for a violation.
A)True
B)False
Q4) A consumer may waive all defenses otherwise provided for by law.
A)True
B)False
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Chapter 33: Secured Transactions in Personal Property
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Q1) Claim in a changing or shifting stock of the buyer's goods is known as after-acquired goods.
A)True
B)False
Q2) Under Revised UCC Article 9, a debtor may authorize a financing statement by acquiring the collateral that is subject to the security agreement.
A)True B)False
Q3) Upon a default by a buyer, the secured seller may resell the collateral:
A)not less than three (3) months after the buyer's default.
B)not less than six (6) months after the buyer's default.
C)only at a public sale.
D)at either a public or a private sale.
Q4) Property that is subject to a security interest is called collateral.
A)True B)False
Q5) Under Revised UCC Article 9, a financing statement must be signed by the debtor. A)True B)False
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Chapter 34: Bankruptcy
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Q1) Where the debtor has fewer than twelve (12) creditors, how many must sign an involuntary petition?
A)one (1), assuming that the creditor's unsecured claim is at least $15,325
B)one (1), assuming that the creditor's secured claim is at least $15,575
C)three (3), assuming that the creditors' unsecured claims total at least $14,425
D)three (3), assuming that the creditors' secured claims total at least $15,575
Q2) Certain transfers of property by the debtor to a creditor within 90 days of filing may be set aside by the bankruptcy trustee as __________ transfers, and the transferred property recovered by the trustee.
A)predetermined
B)preternatural
C)preordained
D)preferential
Q3) Under the Bankruptcy Reform Act, the "mansion loophole" increases the homestead exemption for debtors.
A)True
B)False
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Chapter 35: Insurance
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Q1) A homeowner's policy typically does not provide for losses caused by theft, unless there is a specific rider to the policy.
A)True
B)False
Q2) Insurance designed to protect an insured driver or owner from the claims of others is called:
A)collision insurance.
B)financial responsibility insurance.
C)liability insurance.
D)comprehensive insurance.
Q3) An application for insurance: ______.
A)may be oral.
B)generally is attached to the policy and becomes a part of the insurance contract.
C)must be prepared by an attorney.
D)has no binding effect on the applicant.
Q4) Any false statement in an application binds only the insured.
A)True
B)False
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Chapter 36: Agency
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Q1) A principal may ratify an action taken by an agent that the principal would not have been capable of authorizing at the time that the action was taken.
A)True
B)False
Q2) An agent is under a duty to obey: ______.
A)all instruction given by the third party.
B)all lawful instructions given by the principal.
C)all instructions given by the principal.
D)none of these, since "obedience" is not an obligation of the agent.
Q3) The term apparent authority is used when there is: ______.
A)no interaction between the principal and third persons.
B)actual authority.
C)only the appearance of authority and that appearance of authority was created by the principal.
D)only the appearance of authority and that appearance of authority was created by the agent.
Q4) The scope of an agent's authority is always known by the third party.
A)True
B)False
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Chapter 37: Third Persons in Agency
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Q1) Statements by an agent ______ bind the principal unless ________.
A)will not, the principal is disclosed.
B)will, they were made at the time of performance.
C)will not, they were made at the time of performance.
D)will not, the principal is disclosed.
Q2) In general, a principal is liable for crimes of the agent committed while acting within the scope of the agency, even if the principal did not authorize commission of the crimes.
A)True
B)False
Q3) In which of the following situations is the principal - and not the agent - liable to a third party for breach of contact?
A)signature by partially disclosed principal
B)signature by undisclosed principal
C)ratification by disclosed principal
D)ratification by undisclosed principal
Q4) Agents may intentionally make themselves contractually liable to third persons.
A)True
B)False
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Chapter 38: Regulation of Employment
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Q1) Public policy exceptions to the employment-at-will doctrine apply only to "whistleblowing" situations.
A)True
B)False
Q2) Under the modern trend of the employment-at-will doctrine, the employer is allowed to terminate the employment contract at any time for any reason or for no reason.
A)True
B)False
Q3) A dispute arose in a small factory and the workers decided to strike concerning the firing of an employee for union-organizing activity.As the strike wore on without resolution, the employer hired what the employer called permanent replacements for the strikers.Eventually, the strike was settled.Are the fired workers entitled to getting their jobs back?
Q4) The NLRA prohibits discrimination against employees for engaging in union activities even if they are warned of the possible consequences of their union activities.
A)True
B)False
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Chapter 39: Equal Employment Opportunity Law
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Q1) Unless justified by business necessity, physical standards such as height requirements that tend to exclude people of certain national origins violate Title VII.
A)True
B)False
Q2) Title VII protects members of which racial grouping(s)?
A)black only
B)black, Native American, and Asian-Pacific
C)white only
D)all racial groupings
Q3) Pay raises based on seniority generally are considered lawful.
A)True
B)False
Q4) Which of the following scenarios would not qualify as a BFOQ exception to Title VII?
A)a religious school hiring only members of that religion to teach religion
B)a women's store that sells wedding gowns hiring only women to measure and fit customers
C)an airline hiring only female flight attendants
D)a men's store not hiring men with earrings.
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