Appendix C for Unit Three
Questions on the Features
N.B.: TYPE indicates that a question is new, modified, or unchanged, as follows.
N A question new to this edition of the Test Bank.
+ A question modified from the previous edition of the Test Bank.
= A question included in the previous edition of the Test Bank.
CHAPTER 10—INSIGHT INTO ETHICS:
IS IT RIGHT FOR A COMPANY TO CHANGE THE PRIZE OFFERED IN A
CONTEST?
B1. GPS Devices Inc. sponsors a “Finders Keepers!” contest in which Erwin and other
entrants agree to race to certain locales to win small prizes and collect clues that lead
to the “Grand Lost Treasure,” which the first finder will be awarded. GPS reserves the
right to cancel the contest or change its terms at any time. If Erwin challenges this
reservation in court, the court will most likely hold that GPS can
a. cancel the contest or alter its terms at any time.
b. not modify the terms of the contest after it begins.
c. reduce the amount of the small prizes but not the grand prize.
d. reduce the amount of the grand prize but not the small prizes.
CHAPTER 14—INSIGHT INTO ETHICS:
HOW MUCH COMPANY INFORMATION MUST EMPLOYERS DISCLOSE TO
PROSPECTIVE EMPLOYERS?
B2. Barrie is induced to leave a sales position with Car Town Auto Dealership due to a
false promise by Delacroix, a sales supervisor at Rev Up Motors, as to the amount of
compensation Barrie would earn at Rev Up. Barrie is most likely a victim of
a. fraud.
b. mistake.
c. nothing.
d. puffery.
CHAPTER 17—INSIGHT INTO ETHICS:
WHEN IS IMPOSSIBILITY OF PERFORMANCE A VALID DEFENSE?
B3. Leticia contracts with Mariana to sell land that, unknown to either party, has
groundwater contaminated from adjacent land that was occupied several decades
earlier by a chemical manufacturing plant. When this is discovered, Leticia asserts the
doctrine of commercial impracticability. This doctrine applies only when, with respect
to an event that renders performance impossible, at the time the contract was
formed the parties
a. could not have reasonably foreseen the supervening event.
b. could have reasonably foreseen the supervening event.
c. should have foreseen the supervening event, reasonable or not.
d. should not have foreseen any supervening events.
UNIT THREE—FOCUS ON ETHICS:
CONTRACT LAW AND THE APPLICATION OF ETHICS
B4. Ray and Strip Mines, Inc., enter into a contract for a sale of the coal beneath Ray’s
land for a fraction of the value of the coal and the cost to restore the land. A court is
most likely to determine that this deal is unfair under
a. the concept of unconscionability.
b. the doctrine of promissory estoppel.
c. the principle of freedom of contract.
d. the Statute of Frauds.
B5. To bid on a job, Budget Construction Company relies on the oral promise of Coldwater
Plumbing, Inc., to perform certain work at a certain price. Coldwater fails to perform.
Budget can
a. not recover due to the principle of freedom of contract.
b. not recover due to the Statute of Frauds.
c. recover under the concept of unconscionability.
d. recover under the doctrine of promissory estoppel.