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Criminal law is designed to compensate parties for money lost as a result of another's
unlawful conduct.
Amendments to the Constitution function as a protection of the citizenry from unlawful
or repressive acts of the government.
Codes of ethics are insufficient and do not serve their proper purpose if they are
intended only to ensure that company policies are legal.
Affirmative action programs are designed to remedy an actual past practice of
discrimination.
Investors holding debt instruments are primarily interested in a fixed rate of return on
their investment regardless of the profitability of the company.
Substantive due process requires that a state statute must be published for public
inspection and be clear and specific.
Once an employee has established that she or he has a covered disability, the Americans
with Disabilities Act requires that the employer make reasonable accommodations
allowing the employee to perform the essential functions of the job.
According to the Zippo standard for assessing minimal contacts by an out-of-state
Internet-based company, it is possible for a passive website to also be considered a site
integral to the company's business model.
Leon works in an office environment and, during lunch, closes his office door and uses
his personal laptop computer to search the Internet for porn, accessing the company's
server via an ethernet cable connection. The company may monitor his computer usage
even though he is using a personally owned computer.
The law tends to provide more protection to residential tenants than it does to
commercial tenants.
All states require that LLPs have a written partnership agreement.
If a written work has been completed but has not been published or otherwise put into
the public domain, fair use can never be used as a defense if the work is copied or used
by another.
There are no exemptions to the doctrine of sovereign immunity.
Generally, everything relevant to a dispute is discoverable in a civil lawsuit unless
protected by a legal privilege.
Betty Sue suspects that she was turned down for a job as a server at Hooters because
she is 40 pounds overweight. She may contact the EEOC, which will investigate her
case based on a Title VII violation.
A corporation is considered formed the moment the articles of incorporation are filed by
the principals.
The Paris Convention removes all risk for inventors regarding patents.
One significant benefit of an employer's completing an IRS Form SS-8 is that even if
the employer does, in fact, misclassify a worker, the proper completion of the form may
evidence a good faith effort by the employer, reducing or even eliminating IRS
penalties for misclassification.
If they do it properly, sellers may limit a buyer's remedies in all situations.
Justin is 17 years old and just signed a contract to buy his first car. This contract is
unenforceable.
Courts are generally inclined to be predisposed to piercing the corporate veil whenever
a corporation causes economic harm to others.
Even if a debtor's salary is more than the median income for his or her state, the debtor
is still eligible for Chapter 7.
If the plaintiff proves her or his prima facie case under the McDonnell Douglas
standard, the burden of proof shifts to the defendant to evidence a legitimate and
nondiscriminatory reason for the discriminatory action.
Zippo's is an online retailer of men's and women's clothing and fashion accessories.
Zippo's maintains a list of its customers and its customers' preferences. This list could
qualify as a trade secret.
All publicly held corporations are classified as public corporations.
White-collar crime almost always consists of nonviolent types of crimes.
If the tenant stops paying rent and ignores the landlord's demands, the landlord may
constructively evict the tenant, ending the lease agreement.
A zoning law that regulates what a landowner may or may not do with his or her
privately owned property is an example of a public law.
The centerpiece of a fiduciary relationship is the agent's duty to act with due care when
performing the responsibilities of the agency.
The 2003 revisions to the UCC have been adopted by only about half of the states.
In a bailment, the title to the goods stays with the bailor.
A promissory note securing a home mortgage is a security instrument.
Elise hires an artist to paint a portrait of her family. This contract is governed by
common law.
Citizen suit provisions are rare in federal and state environmental statutes.
The Sunshine Act requires that consultation meetings be open to the public.
Most states have separate courts of law and equity.
Mike is a limited partner in Big Blue, LP. The partnership agreement permits him to
have a say in the removal of general partners and the blocking of new partners. This
agreement will jeopardize his limited partner status.
Under concepts articulated in MacPherson v. Buick, a manufacturer of a defective
product is liable only to the purchaser of the product and not to every user.
Rule 10(b)(5) of the 34 Act is aggressively used by the SEC in terms of insider-trading
enforcement.
With regard to polygraph tests:
A. public and private employers may require that employees take no more than one test
per year as a condition of employment.
B. an employer may require mandatory tests only if every employee, both management
and nonmanagement, is required to be tested.
C. government employees may be required to take tests only if the tests are a part of an
investigation for theft or economic loss.
D. a privately owned drug company may require tests of its employees.
What evidence may a company offer in defense to allegations of an antitrust violation
under the rule of reason standard?
A. The anticompetitive harm was not harmful to the government.
B. If the company violates the standard, there is no defense.
C. Its actions were justified and necessary under the economic conditions.
D. There was no economic harm to the consumer.
One who commits a tort is called the:
A. tortmaster.
B. tortfeasor.
C. tortdoer.
D. torteffector.
As a result of the AIG bailout, the U.S. government received a(an) ________ stake in
the company.
A. 50 percent
B. 60 percent
C. 70 percent
D. 80 percent
The SEC is composed of ________ commissioners.
A. three
B. five
C. seven
D. nine
In Grimshaw v. Ford Motor Company, Ford was found liable because:
A. Ford ignored a government recall warning to the detriment of its customers.
B. Ford placed profit over the potential impact to customers, including potential loss of
customers' lives.
C. Ford improperly designed the Pinto and did few, if any, safety tests, so the flaw
wasn't uncovered until accidents started occurring.
D. Ford acted unethically by hiding the fact that lawsuits were being filed for the
Pinto's defect from the government and the general public.
The ability to flow through to the investors the tax deductions and losses that are
typically generated by an emerging company or a company with significant up-front
debt is an advantage of a:
A. corporate tax structure.
B. pass-through entity.
C. member-managed LLC.
D. manager-managed LLC.
Mike has admired Monica for a long time and has wanted to date her but is too shy
around girls to ask. He is a football player with a reputation of being the toughest player
on the team. Monica is scared of Mike because of his size and reputation. One day
Mike summons the courage and approaches Monica, who has her back to him and
doesn't know he's there. He puts his arms around her and gives her a gentle kiss before
letting go. He can't believe what he did, apologizes, and runs away. Monica is slightly
shaken but physically unharmed. Mike has committed:
A. conversion.
B. battery.
C. intentional infliction of emotional distress.
D. nothing, because he apologized and she was unharmed.
The amendment requiring that an arrest warrant may not be issued without probable
cause is the:
A. Fourth Amendment
B. Fifth Amendment
C. Sixth Amendment
D. Eighth Amendment
Chapter 13 bankruptcy filings are limited to:
A. businesses.
B. individuals.
C. farms.
D. individuals who own sole proprietorships.
The Financial Stability Oversight Board created by the Restoring American Financial
Stability Act of 2010 has the power to:
A. break up companies deemed to pose a threat to the nation's financial markets even if
the company is not insolvent.
B. compel the SEC to assume an oversight position over institutions that pose a global
risk to financial markets.
C. approve or disapprove executive compensation packages, including bonuses,
regarding companies deemed "too big to fail."
D. criminally prosecute officers and board members of companies that are found to
have committed fraud and that have harmed the public or the national economy.
Robert Hill Corp. is incorporated in the state of Delaware. If it transacts business in
Iowa, Robert Hill would be characterized in Iowa as:
A. a domestic corporation.
B. a foreign corporation.
C. an alien corporation.
D. a native corporation.
Olivetone Inc., a Florida corporation, manufactures and sells suntan products. Through
its website Olivetone sells its products in bulk to a company in Finland, which then
distributes and sells the Olivetone products to Swedish companies for retail sale to
Swedish consumers. Both Finland and Sweden are in the European Union, but the
United States is not. Should a dispute arise and Olivetone is sued, whose law will
apply?
A. Because the country of reception approach will be utilized, Finnish law will apply
since the products initially went to Finland, where the Finnish servers were located.
B. Because the country of reception approach will be utilized, Swedish law will apply
because the products were ultimately received in Sweden, where the Swedish servers
were located.
C. Because the county of origin rule will apply, U.S. law will apply because the
defendant's servers are in the United States.
D. Because the country of origin rule will apply, the International Court of Justice will
have to determine where the dispute actually arose and will award jurisdiction to that
country.
The triple bottom line in the perspective of corporate social responsibility emphasizes
each of the following except:
A. creation of profit.
B. creation or destruction of environmental value.
C. creation of social value.
D. creation of private value.
LLPs are formed with the filing of ________ with the proper public official.
A. a statement of qualification
B. a certificate of formation: LLP
C. a record of business creation
D. articles of organization
Which of the following is not a component that needs to be shown to authorize use of a
long-arm statute?
A. The defendant must transact business within the plaintiff's state borders.
B. The defendant must have violated a plaintiff's state statutory law.
C. The defendant must have committed negligence resulting in loss to the plaintiff
within the plaintiff's state borders.
D. The defendant owns property in the plaintiff's state.
A statute of limitations that most appropriately falls under the equitable maxim is:
A. the clean hands doctrine.
B. substance over form.
C. remedies at law are preferred over remedies in equity.
D. equity aids the vigilant.
The Clean Air Act (CAA) requires that ________ determine how to achieve the
National Ambient Air Quality Standards (NAAQS).
Offering or trading ownership interests in corporations is governed by:
A. state laws.
B. federal laws.
C. the Revised Model Business Corporation Act.
D. common law.
A grand jury will issue a(an) ________ if its investigation indicates that a defendant
should be held over for trial.
A. indictment
B. information
C. warrant
D. summons
Which economist/philosopher is cited in support of frequent meetings being
circumstantial evidence of anticompetitive collusion?
A. Plato
B. Socrates
C. John Locke
D. Adam Smith
Each of the following is a factor used by courts to determine whether to pierce the
corporate veil except:
A. poor management and decision making by an inadequately trained or educated
manager.
B. inadequate capitalization.
C. evidence of fraud or willful misconduct.
D. failure to follow necessary corporate formalities.
Cathy's Coaster Company uses cork in all of the protective drink coasters that it
manufactures. If Cathy's enters into an agreement with a cork exporter from Portugal to
purchase all of the cork it needs to produce its products, this would be:
A. an output contract.
B. an input contract.
C. a requirements contract.
D. a necessities contract.
Gina is the executive secretary to the CEO of a large public corporation. One day her
boss takes her into a back room containing numerous cardboard file boxes and three
shredding machines, and he orders her to shred every document and file in the room. He
then says, "We're under investigation by the SEC, and if they get their hands on
anything in this room, we're ruined." She asks what is going on and is told that the
company has been perpetrating frauds for years and needs to destroy all the evidence.
A. Since Sarbanes-Oxley does not have a whistle-blower provision, Gina has no
recourse if she wants to keep her job.
B. Since Gina didn't actually participate in the frauds and since she is only following
orders, she will have no liability.
C. Since the investigation is ongoing and no charges have been brought, shredding the
documents is not a punishable offense yet.
D. Gina could be imprisoned for up to 20 years if she shreds the documents.
In American Needle Inc. v. National Football League, the NFL had entered into an
agreement with Reebok for the manufacture of all of its teams' official goods and
claimed that all 32 teams were a single entity. American Needle sued, claiming that the
Reebok agreement was an illegal conspiracy under the Sherman Act. The U.S. Supreme
Court found that:
A. the 32 teams were a collective unit and not subject to the Sherman Act.
B. the 32 teams were not a collective unit and were subject to the Sherman Act.
C. the 32 teams were not a collective unit but were exempt from the Sherman Act
because of the economic environment of sports.
D. there was no Sherman Act violation.
Regulations that set out the average miles-per-gallon requirements for vehicles are
properly called:
A. Liquid Energy Efficiency requirements
B. Fuel Efficiency standards
C. Corporate Average Fuel Economy standards
D. Motor Vehicle standards
If Continental Tires agreed to purchase all of the rubber that a particular Brazilian
rubber plantation could produce, this would be:
A. an output contract.
B. an input contract.
C. a requirements contract.
D. a necessities contract.
Mia has written a deed that says, "To Chelsea for life, and upon her death the property
shall go back to me." What kind of interest does Mia have in the property upon
Chelsea's death?
A. a repudiation
B. a redemption
C. a reversion
D. a retention
Ben has just been diagnosed with diabetes. He has the disease under control through
diet, exercise, and drugs. He is an assistant manager at a chain department store, and he
is fully capable of performing all of his job functions and needs no accommodations.
Ben rides a bicycle over 100 miles per week, participates in half marathons, and
regularly works out at the YMCA. When he applies for a promotion to manage a store
in the chain, he is turned down because his superiors are concerned that his diabetes
could affect his job performance. Is Ben disabled, and does the Americans with
Disabilities Act afford him any protections?
The moderate view of assessing corporate citizenship holds that:
A. corporate officers and boards of directors should provide the exclusive view of
corporate responsibility.
B. corporate employees below the senior executive level should provide the exclusive
view of corporate responsibility.
C. community groups where the corporation is located should provide the exclusive
view of corporate responsibility.
D. the government should provide the exclusive view of corporate responsibility.
What is the purpose of the International Chamber of Commerce terms?
A. to standardize contractual terms and avoid confusion due to language barriers
B. to provide basic contract law for international sales of goods
C. to standardize the monetary units used in international contracts
D. to provide a forum for arbitration of CISG contracts
Under the Revised Model Business Corporation Act, if a promoter acts on behalf of a
corporation knowing that incorporation has not yet been completed and liability
occurs:
A. the corporation becomes liable once formed, with the promoter shielded from
liability.
B. the principals of the forming corporation are liable, with the promoter shielded from
liability.
C. the promoter is jointly and severally liable for the liability incurred even after the
corporation is formed.
D. the promoter is personally liable, with the principals shielded from liability.
A complaint will contain each of the following except:
A. a statement of the plaintiff's version of the facts of the case.
B. a statement of the damages suffered.
C. a statement of why the plaintiff believes the defendant is guilty.
D. a statement of the evidence that the plaintiff will produce and a list of potential
witnesses to be called.
Workers at Jones Corporation have been on strike for three months due to an impasse
based on salary and benefits. When the strike is concluded:
A. the workers must all be rehired but they are not entitled to back pay.
B. the workers must be rehired and they are entitled to back pay.
C. the employer is not required to rehire the employees as long as back pay is paid as
severance.
D. the employer is not required to rehire the employees and no back pay is required to
be paid.
Casey's identity was stolen. The thieves stole lots of money and took out a loan in
Casey's name. She notified all the necessary banks and agencies as soon as she
discovered the identity theft. Is Casey's credit protected in this situation?
To have __________ assent, there must be an offer and agreement between the parties.
What is the role of a trustee in bankruptcy?
What is the essential similarity and what are the differences among statutes, ordinances,
and regulations?
What are the three purposes or aims of imposing punishment for criminal acts?
Stella is an agent for Howard. It has come to Howard's attention that Stella has
breached the duty of loyalty and has used information that Stella should have passed on
to Howard for her own personal dealings. What remedies does Howard have if he
chooses to end the agency relationship?
Two car manufacturers entered into a joint venture to consolidate their efforts to create
more fuel-efficient vehicles. The manufacturers agreed to split the expenses and profits
from the joint venture equally. If an antitrust violation is alleged, what standard would
be used to evaluate the manufacturers' actions?
Citizen suits may be brought against an agency but may not be brought against a private
party.
The Sherman Act prohibits ________ by a business to gain monopoly power.
A short-term strike called without union authorization is called a ________ strike.
Marcia is an accountant for a large corporation, and after meeting with the company's
CFO, she has falsified records by inflating the company's quarterly profits, making
them acceptable to the bank that the corporation has applied to for a commercial loan.
Under the tenets of the Model Penal Code, what must be proved for her company to be
criminally liable?
A significant change or deviation from the terms of a contract is called a ________
change.
A _____________ is a business entity that has a proven track record of success and
sells the right to operate the business and use the business's trade secrets, trademarks,
products, and so on.
What procedures or policies should employers implement to protect themselves from
charges of discrimination even when firing an employee for misconduct?
Assume that you have money you'd like to invest in stock. Would you prefer to invest in
a company that evidences values based on the invisible hand theory, the government's
hand theory, or the management's hand theory of operations? Explain reasons for your
choice, and indicate why the rejected choices were not chosen.
The reason and outcome of the contract must be a ___________ purpose.
Name and discuss the fiduciary duties owed by general partners to the partnership as set
out in the Revised Uniform Partnership Act.
________ is the common law doctrine basis for modern environmental protection laws.
A person who receives nonpublic confidential information regarding a company and
uses that information to realize a profit is called a _______.
