Business Law, 8e (Cheeseman)
Chapter 43 Administrative Law and Regulatory Agencies
1) Administrative laws are laws enacted by governments to regulate the operation of government
employees and government-run organizations.
2) Regulatory statutes can be termed as administrative laws.
3) The legislative branch is permitted to authorize existing administrative agencies to enforce
new statutes.
4) General government regulation consists of laws that regulate the operation of the three
branches of the federal government.
5) General government regulation establishes an individual code or laws to every type of
business and industry.
6) The U.S. Equal Employment Opportunity Commission enforcing equal opportunity in
employment laws is an instance of general government regulation.
7) Operational regulation of commercial airlines by the Federal Aviation Administration is an
instance of general government regulation.
8) All federal administrative agencies answer directly to the president.
9) Cabinet members of cabinet-level federal departments are chosen directly by the president.
10) Independent federal administrative agencies are federal agencies responsible for enforcing
specific administrative statutes enacted by Congress.
11) The Department of Homeland Security is an example of a federal administrative agency.
12) The Securities and Exchange Commission (SEC), which regulates the issuance and trading
of securities, is an example of a federal independent agency.
13) The Homeland Security Act was passed following the terrorist attacks of September 11,
2001, on the World Trade Center.
14) The Congressional passing of the Due Process Clause of the 14th Amendment to the U.S.
Constitution led to the creation of the U.S. Department of Homeland Security.
15) One of the services provided by the Department of Homeland Security is emergency
preparedness and response to terrorist incidents.
16) All state regulatory laws are drafted by the federal government and then adopted by the state.
17) State administrative agencies are created by the legislative branch of the federal government.
18) Local administrative agencies are agencies created by cities, municipalities, and counties to
administer local regulatory law.
19) Substantive administrative laws enforced by administrative agencies are akin to statutes in
their legality.
20) Procedural administrative law establishes the procedure that must be followed by the federal
or state legislatures in creating an administrative agency.
21) The Administrative Procedure Act establishes procedures that industries and businesses must
follow when conducting their affairs.
22) All administrative proceedings presided by a select jury of laymen who then question the
functionality of the new proposed law.
23) The decisions issued by an administrative law judge are in the form of administrative orders.
24) Decisions reached by an administrative law judge are final and cannot be appealed.
25) The delegation doctrine only allows executive and legislative powers to administrative
agency, and not judicial.
26) It is legal for an administrative agency to act outside the scope of its delegated powers
provided that it has written consent of an administrative law judge.
27) All substantive rules are subject to judicial review.
28) A federal administrative agency that proposes to adopt a substantive rule must give interested
persons an opportunity to participate in the rule-making process.
29) A federal administrative agency that proposes to adopt a substantive rule can legally resort to
informal rule-making.
30) Administrative agencies do not have to comply with the Due Process Clause of the U.S.
Constitution when adjudicating cases of violation.
31) The power to investigate and prosecute possible violations of statutes, administrative rules,
and administrative orders is called the judicial power granted to administrative agencies.
32) Administrative subpoena refers to an order that directs the subject of the subpoena to
disclose the requested information.
33) Even in an emergency situation, a warrantless search conducted by an administrative agency
constitutes a violation of the Fourth Amendment.
34) Documents classified by the president to be in the interests of national security cannot be
accessed under the Freedom of Information Act.
35) The Government in the Sunshine Act is a federal act that opens most federal administrative
agency meetings to the public.
36) The Privacy Act provides that documents in the possession of federal administrative agencies
are confidential to the respective agencies and cannot be accessed by the public.
37) Administrative laws are also referred to as ________.
A) ordinances
B) regulatory statutes
C) default judgments
D) statements of policy
38) Which of the following is true of administrative agencies?
A) All administrative agencies directly answer to the president.
B) Administrative agencies can be created by federal, state, and local governments.
C) An existing administrative agency cannot administer a new law.
D) A separate administrative agency must be created to enforce every law.
39) When Congress enacted the Securities Act of 1933, it created the Securities and Exchange
Commission, a(n) ________, to administer and enforce those statutes.
A) law enforcement authority
B) short-term commission
C) federal administrative agency
D) intelligence agency
40) General government regulation consists of laws that regulate ________.
A) the legislative branch of the federal government
B) government-aided organizations
C) the executive branch of the federal government
D) businesses and industries
41) The federal National Labor Relations Board is empowered to regulate the formation and
operation of labor unions in most industries and businesses in the United States. Such a
regulation is an example of a(n) ________.
A) general government regulation
B) specific government regulation
C) cabinet-level regulation
D) zoning regulation
42) ________ consists of laws that regulate particular industries.
A) Independent federal administration
B) General government regulation
C) Specific government regulation
D) Statements of policy
43) The Federal Communications Commission issues licenses and regulates the operation of
television and radio stations. This is an example of a(n) ________.
A) general government regulation
B) specific government regulation
C) cabinet-level federal department
D) independent federal administrative agency
44) Federal administrative agencies are created by ________.
A) the U.S. President
B) the U.S. Congress
C) general public elections
D) the U.S. judiciary
45) ________ are federal agencies that advise the president.
A) Independent federal administrative agencies
B) State administrative agencies
C) Cabinet-level federal departments
D) Law enforcement agencies
46) Which of the following are responsible for enforcing specific administrative statutes enacted
by Congress?
A) Independent federal administrative agencies
B) State administrative agencies
C) Law enforcement agencies
D) Cabinet-level federal departments
47) The Department of Homeland Security advises the U.S. President on matters related to
internal security, external threats to the United States and potential terrorist attacks. This
department is an example of a(n) ________.
A) independent federal administrative agency
B) cabinet-level federal department
C) law enforcement agency
D) state administrative agency
48) ________ are federal agencies that have broad regulatory powers over key areas of the
national economy.
A) Independent federal administrative agencies
B) State administrative agencies
C) Law enforcement agencies
D) Cabinet-level federal departments
49) The Federal Trade Commission which enforces federal antitrust and consumer protection
laws is an example of a(n) ________.
A) independent federal administrative agency
B) government-aided organizations
C) law enforcement agency
D) cabinet-level federal departments
50) Which of the following U.S. federal agencies was created in response to the terrorist attacks
on September 11, 2001?
A) Federal Bureau of Investigation
B) Central Intelligence Agency
C) National Security Agencies
D) U.S. Department of Homeland Security
51) Which of the following is the Department of Homeland Security’s foremost responsibility?
A) to enforce laws to prevent and control civil unrest in the country
B) to enforce laws to prevent the possibility of the United States going to war
C) to enforce laws to prevent domestic terrorist attacks and related criminal activities
D) to enforce laws to prevent and control economic recession in the country
52) Which of the following is true about the Department of Homeland Security?
A) It was constituted immediately after the attack on Pearl Harbor.
B) It provides services in information analysis and infrastructure protection.
C) It protects persons from harassment by federal administrative agencies.
D) It gives the public access to documents in the possession of federal administrative agencies.
53) State administrative agencies are created by ________.
A) legislative branches of states
B) legislative branches of the federal government
C) the president of the U.S.A.
D) the U.S. Congress
54) Which of the following is true of state administrative agencies?
A) They are created by federal administrative agencies.
B) They act as advisory boards for the president.
C) Their decisions can be appealed to a state court..
D) They are not empowered to enforce statutes.
55) ________ is law that an administrative agency enforces, such as federal statutes enacted by
Congress, or state statutes enacted by state legislatures.
A) Formal ruling
B) Substantive administrative law
C) Procedural administrative law
D) Informal ruling
56) ________ establishes the protocol that must be followed by an administrative agency while
enforcing substantive laws.
A) Formal ruling
B) Substantive administrative law
C) Procedural administrative law
D) Informal ruling
57) Which of the following acts establishes procedures that federal administrative agencies must
follow in conducting their affairs?
A) APA
B) SEA
C) UCITA
D) HSA
58) Which of the following is true of the Administrative Procedure Act?
A) It was enacted following the September 11, 2001 terrorist attacks.
B) It establishes how rules and regulations can be adopted by federal administrative agencies.
C) It provides for a uniform legal and justice system across the United States.
D) It divides administrative power between the federal legislative branch and state legislatures.
59) Which of the following is true of an administrative law judge (AJL)?.
A) An AJL’s decision is issued in the form of state statutes.
B) An AJL’s decision is final with no appeal.
C) An AJL is the presider of administrative proceedings.
D) An AJL is not considered as employees of an administrative agency.
60) Which of the following is a provision in the Administrative Procedure Act (APA)?
A) It provides a procedure for receiving evidence and hearing requests for the granting of federal
licenses.
B) It allows public access to most documents in the possession of federal administrative
agencies.
C) It protects persons from harassment by administrative agencies.
D) It admits public access to administrative meetings concerning issuance of subpoenas.
61) An ALJ’s decision is issued in the form of a(n) ________.
A) jury instruction
B) petition
C) administrative procedure
D) administrative order
62) The ________ says that when an administrative agency is created, it is given certain powers;
the agency can use only the legislative, judicial, and executive powers that are allotted to it.
A) doctrine of Equity
B) delegation doctrine
C) doctrine of Promissory Estoppel
D) doctrine of privity
63) Which of the following powers allow administrative agencies to issue substantive rules?
A) rule making
B) executive power
C) judicial authority
D) licensing
64) ________ refers to a rule issued by an administrative agency that has the force of law and to
which covered persons and businesses must adhere.
A) Interpretive rule
B) Rule of Law
C) Substantive rule
D) Operational code
65) Which of the following is true of a substantive rule?
A) It interprets existing statutory language.
B) It does not have the force of law and is only issued as a guideline.
C) Substantive rules are exempt from judicial review.
D) Violators can be held criminally liable.
66) A(n) ________ refers to a rule issued by an administrative agency that defines existing
statutory language.
A) interpretive rule
B) operational code
C) substantive rule
D) statement of policy
67) A(n) ________ announces a proposed course of action that an agency intends to follow in the
future.
A) interpretive rule
B) operational code
C) substantive rule
D) statement of policy
68) A(n) ________ refers to permission that an administrative agency grants to persons or
businesses to conduct certain types of commerce or professions.
A) easement
B) license
C) letter of credit
D) arraignment
69) ________ requires the respondent to be given proper and timely notice of the allegations or
charges against him or her and an opportunity to present evidence on the matter.
A) Interpretive rule
B) Substantive due process
C) Procedural due process
D) Code of operation
70) ________ refers to the power that administrative agencies are granted, such as to investigate
and prosecute possible violations of statutes, administrative rules, and administrative orders.
A) Judicial authority
B) Legislative power
C) Executive power
D) Administrative subpoena
71) A(n) ________ refers to an order that directs the subject that has been summoned, to disclose
the requested information.
A) administrative subpoena
B) substantive due process
C) procedural due process
D) statement of policy
72) Tuff-Steele Constructions, Inc. has not been adhering to appropriate worker safety rules. As
a result, there have been an increased number of on-site accidents and several construction
workers have sustained serious injuries. Which of the following powers will allow an
administrative agency to bring agency proceedings against Tuff-Steele Constructions?
A) licensing
B) executive power
C) judicial authority
D) rule making
73) Most inspections by administrative agencies are subject to the ________ Amendment to the
U.S. Constitution.
A) Eleventh
B) Second
C) Fifth
D) Fourth
74) Which of the following is a provision of the Freedom of Information Act?
A) It allows public admission to the day-to-day workings of an administrative agency.
B) It protects persons from harassment by federal administrative agencies.
C) It opens most federal administrative agency meetings to the public.
D) It gives the public access to documents in the possession of federal administrative agencies.
75) Which of the following acts protects persons from harassment by federal administrative
agencies?
A) Freedom of Information Act
B) Government in the Sunshine Act
C) Equal Access to Justice Act
D) Privacy Act
76) The ________ is a federal act which states that federal administrative agencies can maintain
only information about an individual that is relevant and necessary to accomplish a legitimate
agency purpose.
A) Freedom of Information Act
B) Privacy Act
C) Government in the Sunshine Act
D) Equal Access to Justice Act
77) Distinguish between general government regulation and specific government regulation.
78) Explain in brief the types of federal administrative agencies with example.
79) Distinguish between substantive rules and interpretive rules. What is a statement of policy?
80) When are searches by administrative agencies considered reasonable?
81) How is the general public protected from harassment by administrative agencies?