Introduction to Business Law Practice Questions
Course Introduction
Introduction to Business Law provides an overview of the fundamental legal principles that shape the business environment. This course examines key concepts such as the structure of the legal system, contract law, torts, agency, employment law, and business organizations. Students will explore how these legal concepts apply to real-world business scenarios, gaining insight into the rights and responsibilities of individuals and entities operating in the marketplace. Through case studies and practical examples, the course equips students with an understanding of how the law impacts decision-making, risk management, and ethical practices in business.
Recommended Textbook
Contemporary Business Law 8th Edition by
Henry R. Cheeseman
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41 Chapters
4106 Verified Questions
4106 Flashcards
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Page 2
Chapter 1: Legal Heritage and the Digital Age
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Sample Questions
Q1) Laws that impose penalties for drunk driving are examples of Sociological School of jurisprudential thought.
A)True
B)False
Answer: True
Q2) The followers of Sociological School of jurisprudence are more likely to adhere to precedents.
A)True
B)False
Answer: False
Q3) ________ are empowered to issue an executive order.
A) State governors
B) State Supreme Court judges
C) Appellate court judges
D) Senators
Answer: A
Q4) Early English law courts were presided over by a Lord Chancellor.
A)True
B)False
Answer: False
Page 3
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Chapter 2: Constitutional Law for Business and E-commerce
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Sample Questions
Q1) The amended U.S.Constitution primarily focuses on ________.
A) providing all citizens with a right to vote
B) creating individual states in the country
C) protecting individual rights
D) promoting a strong economy
Answer: C
Q2) The Due Process Clause of the Fifth Amendment applies to state and local government action.
A)True
B)False
Answer: False
Q3) Under the effects on interstate commerce test,the regulated activity does not itself have to be in interstate commerce.
A)True
B)False
Answer: True
Q4) E-commerce is subject to the Commerce Clause of the U.S.Constitution.
A)True
B)False Answer: True
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Chapter 3: Courts and Jurisdiction
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Sample Questions
Q1) Quasi in rem jurisdiction is also known as ________ jurisdiction.
A) attachment
B) concealment
C) in personam
D) detachment
Answer: A
Q2) Judges of the special federal courts are appointed for a life term by the president of the United States.
A)True
B)False
Answer: False
Q3) Which of the following is true about a plurality decision of the Supreme Court?
A) It settles the case but does not set the precedent for later cases.
B) It affirms the decision of the lower court.
C) It settles the case and sets the precedent for later cases.
D) It causes the case to be reviewed again at a later date.
Answer: A
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Page 5
Chapter 4: Judicial Alternative Administrative and E-Dispute Resolution
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Sample Questions
Q1) Once an appropriate number of jurors is selected,they are impaneled to hear the case and are sworn in.
A)True
B)False
Q2) Which of the following statements best describes re-direct examination?
A) The plaintiff's attorney questions the witness who was questioned by the defendant's attorney.
B) The plaintiff's attorney questions the witness before he or she is questioned by the defendant's attorney.
C) The defendant's attorney questions the witness who was questioned by the plaintiff's attorney.
D) The defendant's attorney questions the witness before he or she is questioned by the plaintiff's attorney.
Q3) The judge sits as the trier of fact in jury trials.
A)True
B)False
Q4) A default judgment establishes the plaintiff's liability.
A)True
B)False
6
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Chapter 5: Intentional Torts and Negligence
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Q1) ________ is a doctrine that raises a presumption of negligence and switches the burden to the defendant to prove that he or she was not negligent.
A) Res ipsa loquitur
B) Negligence per se
C) Doctrine of proximate cause
D) Doctrine of comparative negligence
Q2) Which of the following best defines the tort of battery?
A) unauthorized and harmful physical contact with another person that causes injury
B) attempt to appropriate another person's identity for commercial purposes
C) oral or written defamation of another person's character
D) intentional confinement or restraint of another person without that person's consent
Q3) If a lawyer fails to file a document with the court on time,causing his client's case to be dismissed,he would be liable for ________.
A) professional malpractice
B) intentional misrepresentation
C) tort of appropriation
D) defamation
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Chapter 6: Criminal Law and Cyber Crimes
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Q1) The crime of ________ involves the obtaining of property from another,with his or her consent,induced by wrongful use of actual or threatened force,violence,or fear.
A) bribery
B) extortion
C) money laundering
D) embezzlement
Q2) Which of the following Amendments protects criminal defendants from cruel and unusual punishment,and also protects criminals from torture?
A) Fifth Amendment
B) Fourth Amendment
C) Eighth Amendment
D) Fourteenth Amendment
Q3) Explain how criminal act and criminal intent are crucial elements in intent crimes.
Q4) At least half of the jurors must agree before the accused is found guilty of the crime charged.
A)True
B)False
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8
Chapter 7: Intellectual Property and Cyber Piracy
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Sample Questions
Q1) Which of the following can be patented as a utility patent?
A) a lithograph of a court proceeding
B) a theory involving intangible abstractions
C) a sound recording of an opera
D) a schematic depiction of a motor
Q2) Which of the following is true of the registration of copyrights?
A) Registered works are not covered under the Copyright Term Extension Act of 1998.
B) Registration permits a holder to obtain statutory damages for copyright infringement.
C) Only published works can be registered at the U.S. Copyright Office.
D) All registered copyright materials must mandatorily place the word "copyright" on their copyrighted works.
Q3) Define intellectual property and elaborate on its significance and vulnerabilities.
Q4) Intellectual property falls into a category of property known as tangible rights.
A)True
B)False
Q5) Discuss the endemic nature of copyright infringement in today's digital world.
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9
Chapter 8: Ethics and Social Responsibility of Business
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Sample Questions
Q1) Which of the following is the difference between ethical fundamentalism and utilitarianism?
A) Ethical fundamentalism focuses on outside source for ethical rules, while utilitarianism focuses on rules that provide greatest good to society.
B) Ethical fundamentalism focuses on moral rules based on a social contract, while utilitarianism focuses on universal rules based on consistency and reversibility.
C) Ethical fundamentalism focuses on rules that provide greatest good, while utilitarianism focuses on outside source for rules.
D) Ethical fundamentalism focuses on rules based on individual feelings, while utilitarianism focuses on outside source for rules.
Q2) Ethical fundamentalism dictates that people must choose the action or follow the rule that provides the greatest good to society.
A)True
B)False
Q3) Discuss the major criticism against ethical fundamentalism.
Q4) Explain moral minimum theory with an example.
Q5) Differentiate between Kantian ethics and Rawls' social justice theory.
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Page 10
Chapter 9: Nature of Traditional and E-Contracts
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Sample Questions
Q1) In a unilateral contract,the offeror ________.
A) must accept the promise extended by the offeree to create the contract
B) can revoke the offer at any point of time after performance
C) will treat either a promise to perform or the actual performance of the act as acceptance of his or her offer
D) cannot revoke the offer once the offeree has begun performance or has substantially completed performance of the act
Q2) Which of the following statements best describes the Restatement of the Law of Contracts?
A) It is the supreme legal authority for contract law.
B) It is a law which has been adopted, at least in part, by every state.
C) It is a compilation of contract law principles, as agreed upon by its drafters.
D) It is a compilation of law pertaining exclusively to the Uniform Commercial Code.
Q3) A promise must be supported by a bargained-for consideration that is legally sufficient.
A)True
B)False
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Chapter 10: Agreement and Consideration
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Sample Questions
Q1) A contract that arises from a bargained-for exchange is automatically voided.
A)True
B)False
Q2) Which of the following is true of a gift promise?
A) A gift promise can be enforced in a court of law.
B) A completed gift promise cannot be cancelled for lack of consideration.
C) A gift promise contains considerations.
D) The promisee can take legal action if the promisor does not uphold the promise.
Q3) What is the key difference between an agreement and a contract?
A) A contract is always enforceable in the court of law, while an acceptance may or may not be.
B) A contract can only be between two individuals, while an acceptance can have two or more people involved.
C) A contract requires mutual assent from all parties, while an acceptance only requires a majority approval.
D) A contract need not be legally binding, while an agreement must be legally binding.
Q4) Explain,in brief,express terms and their significance.
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Chapter 11: Capacity and Legality
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Sample Questions
Q1) The duty of restoration is a rule that states that if a minor has transferred money,property,or other valuables to the competent party before disaffirming the contract,that party must place the minor in status quo.
A)True
B)False
Q2) The equitable doctrine of ________ obligates a minor to only pay reasonable value for goods or services received.
A) emancipation
B) restraint of contract
C) contract of adhesion
D) quasi-contract
Q3) Suppose a state has set a usurious rate of interest as any interest rate above ________ percent.Joseph borrows $10,000 from Derek.Derek can demand a maximum of $11,000 without violating the usury law.
A) 10
B) 100
C) 1
D) 1000
Q4) What is a noncompete clause? When is it considered to be lawful?
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Chapter 12: Genuineness of Assent and Statute of Frauds
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Sample Questions
Q1) To prove fraud,it must be shown that the wrongdoer made a False representation of material fact.
A)True
B)False
Q2) Melissa Harrison,a realtor,sells a house to the Smiths.Before the sale is finalized,Mr.Smith asks Melissa for details of repairs the house has undergone over the years.Melissa gives him details of minor repairs but hides all documents regarding a major plumbing defect that was repaired last year.Three months after the Smiths moved in,the defect reappeared that caused the first floor to flood,damaging their expensive carpet and furniture.Melissa is liable for which of the following frauds?
A) fraud in the inception
B) fraud in the inducement
C) fraud by concealment
D) fraud in the factum
Q3) ________ is an action to undo a contract.
A) Rescission
B) Recession
C) Restitution
D) Inception
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Page 14
Chapter 13: Third-Party Rights and Discharge
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Sample Questions
Q1) Nancy owes $5,000 to Kenneth and promises to pay it after two months.Kenneth assigns his right to collect the money to Delmar,who does not inform Nancy,for a payment of $3,500.After a few weeks,in need of money,Kenneth assigns the rights to Kelly,for a payment of $3,000.Kelly notifies Nancy of their agreement.According to the English rule,________.
A) Kelly can recover the money from Nancy
B) Kenneth has the right to sue Delmar for nonperformance
C) Nancy owes the money to Delmar
D) Kenneth has the right to recover the money directly from Nancy
Q2) In the United States,the contract rights for payment of money can be assigned to third parties.
A)True
B)False
Q3) Which of the following refers to an agreement that substitutes a new party for one of the original contracting parties and relieves the existing party of liability on the contract?
A) a novation
B) a substituted contract
C) a mutual rescission
D) an accord
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Page 15
Chapter 14: Breach of Contract and Remedies
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Q1) A nonbreaching party may recover actual damages if the liquidated damages clause is found to be a penalty.
A)True
B)False
Q2) ________ occurs when one contracting party informs the other that he or she will not perform his or her contractual duties when due.
A) Restitution
B) Rescission
C) Anticipatory repudiation
D) Accommodation
Q3) Liquidated damages are enforceable if ________.
A) actual damages are difficult to determine
B) they are excessive or unconscionable
C) the damage is considered to be a penalty
D) damages do not result in a loss of money to the nonbreaching party
Q4) Which of the following constitutes material breach?
A) inferior performance
B) substantial performance
C) anticipatory repudiation
D) rescission without notification
Page 16
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Chapter 15: Digital Law and E-Commerce
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Sample Questions
Q1) Which of the following domain extensions signifies a resource website,and is an unrestricted global name that may be used by businesses,individuals,and organizations?
A) .name
B) .coop
C) .mobi
D) .info
Q2) Under the E-SIGN Act,a digital e-signature can be verified by using ________.
A) a smart card
B) a domain name
C) HTTP
D) an ISP
Q3) The difference between trademark laws and the Anticybersquatting Consumer Protection Act is that,the latter ________.
A) requires famous names to be a registered trademark
B) protects nontrademarked names
C) is ineffective against cybersquatters
D) protects generic names
Q4) How does the E-SIGN Act recognize electronic contracts as equivalent to written contracts?
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Chapter 16: Formation of Sales and Lease Contracts
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Sample Questions
Q1) Which of the following is true of a finance lease?
A) It involves leasing out money to a lessee.
B) The lessor is the supplier of goods.
C) It consists of a lessor, a lessee, and a supplier.
D) The lessee acquires the title of the goods.
Q2) On July 1,Seidel Motors,an automobile dealer offers to sell a luxury vehicle to Janet for $50,000.Seidel signs a written assurance to keep the contract open till July 30.A week later Seidel sells the car to another buyer.On July 30,Janet tenders $50,000 for the car.There has been a breach of contract.Compare and contrast Seidel's liability to Janet under the common law of contracts and firm offer rule.
Q3) Oral modification of a contract is not enforceable if the parties agree that any modification of the sales or lease contract must be signed in writing.
A)True
B)False
Q4) Which of the following is an example of an irrevocable offer?
A) counteroffer
B) gift promise
C) option contract
D) accommodation
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Chapter 17: Title to Goods and Risk of Loss
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Q1) Explain how the Uniform Commercial Code (UCC)mandates the identification of goods when the parties to a contract do not agree on a time and manner to do the same.
Q2) Under the Uniform Commercial Code,the rights and obligations of the buyer,the seller,and the third parties are determined based on who held technical title to the goods.
A)True
B)False
Q3) In a shipment contract,when is the title to the goods considered to have passed to the buyer?
A) when the seller makes the offer to the buyer
B) when the goods are handed over to a common carrier
C) when the seller tenders delivery of the goods at the specified destination
D) when the goods are at the time and place of the shipment
Q4) In a lease transaction,title to the leased goods remains with the ________.
A) lessor
B) lessee
C) seller
D) buyer
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Chapter 18: Remedies for Breach of Sales and Lease Contracts
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Q1) Replevin actions can only be claimed on goods that are unique.
A)True
B)False
Q2) Which of the following is true of a buyer's revocation of acceptance?
A) It is effective even before the seller or lessor is notified of the revocation.
B) It always arises due to the conforming nature of the goods delivered.
C) It must occur after substantial change in the condition of the goods delivered.
D) It is a reversal of acceptance of a lot or commercial unit.
Q3) Damages that will be paid upon a breach of contract,but that are established in advance are defined as ________ damages.
A) punitive
B) actual
C) incidental
D) liquidated
Q4) The right to dispose of goods arises if the lessor has reacquired the goods after stopping them in transit.
A)True
B)False
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Chapter 19: Warranties and Product Liability
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Q1) A seller's or lessor's express or implied assurance to a buyer or lessee that the goods sold or leased meet certain quality standards is called a warranty.
A)True
B)False
Q2) Kicker's,Inc.released a new kind of candy bar,but failed to mention on the packaging that the bar contains gluten and nuts.Consequently,many consumers who are allergic to these items suffered from severe allergic reactions on the consumption of these bars.Which of the following can the injured customers cite as a defect in a strict liability lawsuit against Kicker's?
A) defect in design
B) defect in packaging
C) failure to warn
D) crashworthiness
Q3) All parties in the chain of distribution of a defective product are strictly liable for the injuries caused by that product.
A)True
B)False
Q4) Discuss the legal issues surrounding making a statement of opinion.
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21
Chapter 20: Creation and Transfer of Negotiable Instruments
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Q1) ________ of the UCC establishes rules for the creation of,transfer of,enforcement of,and liability on negotiable instruments.
A) Article 5
B) Article 3
C) Article 2
D) Article 2A
Q2) A ________ is an example of an order to pay.
A) lease
B) certificate of deposit
C) promissory note
D) check
Q3) The maker or drawer of an instrument is considered liable even if there is no signature on the instrument.
A)True
B)False
Q4) A(n)________ is necessary for a bearer paper to be negotiable.
A) acceleration clause
B) indorsement
C) delivery
D) specific payee or indorsee
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Chapter 21: Holder in Due Course and Liability of Parties
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Q1) Material alteration,extreme duress,forgery,and mental incapacity are examples of personal defenses.
A)True
B)False
Q2) Calvin,a college student,wants to purchase an automobile on credit from Irontilt Motors.He does not have sufficient income or the credit history to justify the extension of credit to him alone.Calvin asks his father to cosign a note to Irontilt Motors,which his father agrees to.What role does Calvin's father fulfill here so that Calvin can buy the car?
A) an accommodation party
B) an agent
C) a principal
D) a qualified indorser
Q3) Ellen draws a check on his checking account at Center Bank "payable to the order of Cary Gardner." When Cary presents the check for payment,Center Bank refuses to pay it even though there are sufficient funds in Ellen's account to pay Cary.Can Cary collect the amount of the check? If yes,how?
Q4) Give an example of a situation where a universal defense can be raised against an HDC.
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Page 23
Chapter 22: Banking System and Electronic Financial Transactions
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Q1) Describe commercial wire transfers with an example and mention the laws that govern them.
Q2) When a bank pays the holder of a properly drawn check,it is said to have ________ the check.
A) certified
B) indorsed
C) honored
D) collected
Q3) Raj receives a check for $100 from Sheldon.He signs the back of the check and turns it over to Leo to pay off the $100 he owed Leo.In this case,Raj is the ________.
A) drawer
B) drawee
C) indorser
D) indorsee
Q4) The bank where the payee or holder has an account is called the collecting bank.
A)True
B)False
Q5) When is a check said to be finally paid?
Q6) Explain in brief,the Federal Reserve System and its significance.
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Chapter 23: Credit, Real Property Financing, and Secured Transactions
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Q1) Which of the following is true of priority of claims?
A) If two or more secured parties claim an interest in the same collateral but only one has perfected his or her security interest, the perfected security interest has priority.
B) Although one of the parties to claim an interest in the collateral has perfected his or her security interest, all the parties are given fair and equal priority over the collateral.
C) If two or more secured parties claim an interest in the same collateral but neither has a perfected claim, they are given equal priority irrespective of attachments.
D) If two or more secured parties claim an interest in the same collateral but neither has a perfected claim, the first to claim has priority.
Q2) In guaranty arrangements,the guarantor is obligated to pay only if the debtor defaults.
A)True
B)False
Q3) Explain surety arrangement with an example.
Q4) Analyze the importance of the recording statute in a mortgage transaction.
Q5) Explain the difference between writ of attachment and writ of execution.
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Chapter 24: Bankruptcy and Reorganization
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Q1) Which of the following constitutes the property of a Chapter 13 estate?
A) nonexempt property of the debtor before the case is closed
B) exempt property of the debtor before the case is closed
C) debtor's income before and after the case is closed
D) property that is exempt from Chapter 7 estate
Q2) Which of the following is true of Chapter 11 discharge of debts?
A) Equal amounts of secured and unsecured debt can be discharged based on a debtor's proposal.
B) The entire unsecured debt can be discharged based on a debtor's proposal.
C) Discharge of a portion of unsecured debt by a debtor is permitted to make its plan of organization feasible.
D) Discharged debt need to be repaid from the postpetition income of a debtor.
Q3) Why is a discharge of debt granted?
A) to divide the bankruptcy estate equally among all creditors
B) to relieve the debtor of the responsibility to pay some of or all the debt
C) to divide the bankruptcy estate according to the debt owed to each creditor
D) to suspend certain legal actions by creditors against a debtor's property
Q4) A reaffirmation agreement must be entered into after discharge is granted.
A)True
B)False
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Chapter 25: Agency law
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Q1) A(n)________ is a contract a principal and agent enter into that says the principal cannot employ another agent other than the one stated.
A) exclusive principal contract
B) exclusive agency contract
C) ratified contract
D) apparent agency contract
Q2) The legal rule of imputed knowledge means that the principal is assumed to know what the agent knows.
A)True
B)False
Q3) Undisclosed agencies are usually considered unlawful.
A)True
B)False
Q4) An agency that occurs when a principal and an agent categorically agree to enter into an agency agreement with each other is known as an ________.
A) agency by ratification
B) implied agency
C) apparent agency
D) express agency
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Chapter 26: Small Business, Entrepreneurship, and Partnerships
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Q1) Which of the following is an advantage to operating a business as a sole proprietorship?
A) right to receive all of the business's profits
B) unlimited access to the capital market
C) limited liability
D) exemption from tax
Q2) How is a general partnership formed? Analyze the criteria for a business to qualify as a general partnership under the Uniform Partnership Act.
Q3) The income or loss from the sole proprietorship is reported on ________ which must be attached to the taxpayer's Form 1040.
A) Schedule B
B) Schedule C
C) Form 14
D) Form 8
Q4) A sole proprietorship is considered a separate legal entity.
A)True
B)False
Q5) Why are general partners liable for the debts and obligations of the partnership?
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Chapter 27: Corporate Formation and Financing
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Q1) Corporate shares are freely transferable by a shareholder by sale,assignment,pledge,or gift unless they are issued pursuant to certain exemptions from securities registration.
A)True
B)False
Q2) A(n)________ is a clause that can be included in the articles of incorporation that stipulates the activities that the corporation can engage in.The corporation can engage in no other purposes or activities.
A) ultra vires clause
B) dissolution clause
C) general-purpose clause
D) limited-purpose clause
Q3) A corporation in the United States that has been incorporated in another country is referred to as a(n)________ corporation.
A) foreign
B) domestic
C) onshore
D) alien
Q4) How can a corporation incorporated in one state conduct interstate commerce?
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Chapter 28: Corporate Governance and the Sarbanes-Oxley Act
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Q1) Which of the following is true of shareholders?
A) They own the corporation whose shares they also own.
B) They can bind the corporation that they own to contracts.
C) They are agents of the corporations they own.
D) They are directors of the corporations they own.
Q2) A shareholder's only management duty is to vote on matters like the election of directors and the approval of fundamental changes in the corporation.
A)True
B)False
Q3) Dean,a director of a business consultancy firm,holds a meeting of the board of directors of the company.During the voting process over a critical issue,Dean unscrupulously casts two votes instead of the one that he is entitled to.Dean's conduct is an example of a ________.
A) breach in the duty of obedience
B) denial of the right of refusal
C) piercing of the corporate veil
D) violation of the business judgment rule
Q4) Define duty of loyalty and its connection with the business judgment rule.
Q5) Explain the effect of the Sarbanes-Oxley Act on corporate governance.
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Chapter 29: Corporate Acquisitions and Multinational Corporations
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Sample Questions
Q1) Differentiate between insurgent and incumbent directors and discuss the benefits of a proxy contest involving them.
Q2) Explain the effect of Section 14(a)of the Securities Exchange Act of 1934 on proxies.
Q3) Anenta Energy is looking to take over Futurum Windpower largely in order to procure Futurum's state of the art windmill design.In an attempt to defend itself from this takeover,Futurum sells its windmill design to another company.In this scenario,the windmill design is an example of a ________.
A) greenmail
B) white knight
C) poison pill
D) crown jewel
Q4) Section 14(a)of the Securities Exchange Act of 1934 is a(n)________.
A) investment provision
B) antifraud provision
C) share exchange provision
D) antitakeover statute
Q5) Examine the need for antitakeover statutes.
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Q6) Is a hostile tender offer an ethical course of action for a company?
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Chapter 30: Limited Liability Companies and Limited Liability Partnerships
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Sample Questions
Q1) In a member-managed LLC,________ can bind the LLC to contracts.
A) all members
B) only the member with the highest capital contribution
C) non-member managers
D) every shareholder
Q2) Philip and Deborah form an LLC.Philip contributes $50,000 capital,and Deborah contributes $75,000 capital.They do not have an agreement as to how profits are to be shared.If the LLC makes $100,000 profit in its first year,how will the profit be divided among the members?
A) Philip gets $30,000, and Deborah gets $70,000.
B) Philip gets $50,000, and Deborah gets $50,000.
C) Philip gets $25,000, and Deborah gets $75,000.
D) Philip gets $35,000, and Deborah gets $65,000.
Q3) An LLC that was organized in Alabama and is operating in Texas with no operations outside the United States is considered a ________ in Texas.
A) foreign limited liability company
B) limited liability partnership
C) domestic limited liability company
D) general partnership
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Chapter 31: Franchise and Special Forms of Business
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Sample Questions
Q1) How does the Federal Trade Commission regulate projections made by franchisors to prospective franchisees?
Q2) Which of the following is true of a franchise agreement?
A) A franchise application is not necessary to qualify for entering into a franchise agreement.
B) The UFOC sets forth the terms and conditions for the franchise agreement.
C) The terms and conditions of the franchise agreement must always be first drawn by the franchisee.
D) A franchisee can only obtain a license to use the franchisor's intellectual property after entering into a franchise agreement.
Q3) A party who grants a license is called the licensee.
A)True
B)False
Q4) In an area franchise,the franchisor manufactures a product and licenses a retail dealer to distribute a product to the public.
A)True
B)False
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Chapter
32:
Investor Protection, E-Securities, and Wall Street Reform
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Sample Questions
Q1) ________ is a provision of the Securities Act of 1933 that imposes civil liability on persons who intentionally defraud investors by making misrepresentations or omissions of material facts in the registration statement.
A) Section 24
B) Section 12
C) Section 11
D) SEC Rule 506
Q2) During the ________ period,the issuer cannot offer to sell securities or sell securities.
A) prefiling
B) fixing
C) waiting
D) posteffective
Q3) Prior to the 1920s and 1930s,the securities markets in this country were regulated by the federal government.
A)True
B)False
Q4) Discuss briefly the changes brought by the JOBS Act to security law regulations governing IPO registration.
Page 34
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Chapter 33: Antitrust Law and Unfair Trade Practices
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Sample Questions
Q1) Which of the following is a defense to a charge of monopoly?
A) the Noerr doctrine
B) innocent acquisition
C) conscious parallelism
D) predatory pricing
Q2) A unilateral refusal to deal is a violation of Section 1 of the Sherman Act.
A)True
B)False
Q3) Which of the following is the only act that includes criminal sanctions for the usage of unfair trade practices?
A) the Clayton Act
B) the Sherman Act
C) the Robinson-Patman Act
D) the Federal Trade Commission Act
Q4) A merger between two or more companies that compete in the same business and geographical market is known as a ________.
A) horizontal merger
B) vertical merger
C) market extension merger
D) conglomerate merger
Page 35
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Chapter 34: Consumer Safety and Environmental Protection
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Sample Questions
Q1) The ________ requires food manufacturers and processors to disclose uniform information about serving sizes and nutrients,and establishes standard definitions for "low fat," "lean," "organic," and other terms routinely used by food processors.
A) Consumer Product Safety Act
B) Nutrition Labeling and Education Act
C) Patient Protection and Affordable Care Act
D) Health Care Reform Act
Q2) Under the Toxic Substances Control Act,pesticides must be registered with the EPA before they can be sold.
A)True
B)False
Q3) The ________ is a federal statute that authorizes the EPA to establish national primary potable water standards.
A) Comprehensive Environmental Response, Compensation, and Liability Act
B) Federal Water Pollution Control Act
C) Clean Water Act
D) Safe Drinking Water Act
Q4) Identify and discuss the act that requires the EPA to identify and regulate toxic air pollutants.
Page 36
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Chapter 35: Labor, Worker Protection, and Immigration Laws
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Sample Questions
Q1) In addition to covering physical injuries,workers' compensation insurance covers stress and mental illness that are employment related.
A)True
B)False
Q2) Which of the following is a provision of Section 8(a)of the NLRA?
A) It prohibits unions from engaging in unfair labor practices that interfere with a union election.
B) It makes it an unfair labor practice for an employer to restrain employees from forming and joining unions.
C) It enables employees to opt out of unions by organizing a decertification election.
D) It permits employees and union officials to engage in union solicitation on company property.
Q3) Enacted in 1932,the ________ is a federal statute which stipulates that it is legal for employees to organize.
A) National Labor Relations Act
B) Labor Management Relations Act
C) Taft-Hartley Act
D) Norris-LaGuardia Act
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Chapter 36: Equal Opportunity in Employment
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Sample Questions
Q1) ________ protects both sexes from pay discrimination based on sex.
A) The Lilly Ledbetter Fair Pay Act
B) Title VII of Civil Rights Act
C) The Fair Employment Practices Act
D) The Equal Pay Act
Q2) An employer must not base an employment decision on an employee's foreign accent in spite of it being a hindrance to the employee's job performance.
A)True
B)False
Q3) If an employer refuses to hire or promote all persons of a racial class,then the company has engaged in employment discrimination in violation of Title VII.
A)True
B)False
Q4) How can an individual assert that he or she has been discriminated with disparate treatment by an employer?
Q5) Explain with an example the circumstances under which the employment of a younger person over an older person does not constitute discrimination.
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Chapter 37: Personal Property, Bailment, and Insurance
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Sample Questions
Q1) What is the difference between an insurance broker and an insurance agent?
A) An insurance agent works exclusively for one company, while an insurance broker works for a number of insurance companies.
B) An agent requires a commission payment after the deal is made, while a broker requires the service charge to be paid before the deal is made.
C) An agent represents the insured, while a broker represents the company.
D) An agent is authorized to sell insurance directly, while a broker can only mediate an insurance contract.
Q2) An insurance broker is an independent contractor who represents a number of insurance companies.
A)True
B)False
Q3) Personal property that is permanently affixed to land or buildings is called a fixture. A)True B)False
Q4) Discuss the difference between mislaid and abandoned property.
Q5) Explain the accession method of acquiring ownership with an example.
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Chapter 38: Real Property, Landlord-Tenant Law, and Land Use Regulation
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Sample Questions
Q1) A person's ownership right in real property is called an ________.
A) eminent domain
B) estate in land
C) easement
D) arraignment
Q2) A ________ is an interest in real property that lasts for a specified person's lifetime.
A) life estate
B) fee simple absolute
C) life insurance
D) fee simple defeasible
Q3) The landlord can sue the sublessee to recover rent payments or enforce duties under the original lease.
A)True
B)False
Q4) A tenant's interest in the real property is called a(n)________.
A) easement estate
B) free simple absolute estate
C) gifted estate
D) leasehold estate
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Chapter 39: Family Law, Wills, and Trusts
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Sample Questions
Q1) Payments made by one divorced spouse to the other divorced spouse are collectively referred to as ________.
A) debt money
B) trust
C) estate
D) alimony
Q2) How can a court declare a marriage with a valid license nonexistent? What happens to the children born of such a marriage?
Q3) Spousal support payments typically terminate once the former spouse remarries and becomes self-sufficient.
A)True
B)False
Q4) One of the parties to a marriage must be at fault for a court to issue a decree that legally orders a marriage terminated.
A)True
B)False
Q5) Alimony is awarded only to the female spouse.
A)True
B)False
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Chapter 40: Accountants' Duties and Liability
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Q1) Mary is an accountant who was hired by Jupison,Inc.to file reports with the SEC.It is discovered that the report contains some False statements of material facts.Discuss Mary's liability under Section 18(a)of the Securities Exchange Act of 1934.How can Mary defeat the imposition of liability under this section?
Q2) Under what circumstances are Racketeer Influenced and Corrupt Organization Act (RICO)actions filed?
Q3) Most public accounting firms in the United States are organized and operated as
A) limited liability partnerships
B) corporations
C) cooperatives
D) sole traders
Q4) All the members of an audit committee must be financial experts by either education or experience.
A)True
B)False
Q5) How did the Private Securities Litigation Reform Act of 1995 change the liability of accountants and other securities professionals?
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Chapter 41: International and World Trade Law
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Sample Questions
Q1) ________ is a clause in an international contract that designates which nation's court has jurisdiction to hear a case arising out of the contract.
A) Equal protection clause
B) Supremacy clause
C) Forum-selection clause
D) Choice of law clause
Q2) Which of the following branches of the United Nations is primarily responsible for maintaining international peace and has authority to use armed force for this purpose?
A) the General Assembly
B) the Secretariat
C) the Security Council
D) the International Court of Justice
Q3) The ________ is a staff of persons that administers the day-to-day operations of the UN.
A) Council of Ministers
B) Security Council
C) General Assembly
D) Secretariat
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