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106. What is the effect of a consent decree?
a. The agency's charges are dismissed with no sanctions.
b. The party makes no admissions as to conduct.
c. There is still judicial appeal from a consent decree.
d. It is no longer available under the Regulatory Flexibility Act.
e. none of the above
107. Which law simplified rulemaking for businesses?
a. Regulatory Flexibility Act
b. Freedom of Information Act
c. Administrative Procedures Act
d. both a and b
e. none of the above
108. Zero-base budgeting:
a. means the Congress has “sunseted” an agency.
b. means that an agency does not automatically receive its previous year’s base budget.
c. is unconstitutional.
d. none of the above
109. Where could a business find notices of proposed rules?
a. The Code of Federal Regulations
b. The Federal Register
c. industry trade publications
d. both b and c
110. The FDA had approved a new diet drug for the market. The agency pulled the approval and the drug off the
market because a staff member said, “This drug didn’t work for me.” The manufacturer of the drug could
challenge the FDA action:
a. as arbitrary and capricious.
b. on the basis of a failure to follow ADA procedures.
c. lack of substantial evidence.
d. any of the above
111. John Forsyth is the head of the Securities Exchange Commission. There are new rules pending before the SEC that
would require lawyers to blow the whistle on their clients. The American Bar Association, which is opposed to the
legislation, has just offered Mr. Forsyth’s son a full scholarship to the law school of his choice.
a. The in-kind contribution to his son is a violation of the law.
b. A scholarship to Mr. Forsyth would be illegal, but not to his son.
c. The ABA has not violated any law if there is no connection between the proposed rule and the scholarship.
d. none of the above
112. Choose the one with the correct ordering of rulemaking functions from among the following:
a. enabling statute, comment period, studies of issues, promulgation
b. enabling statute, studies of issues, promulgation, comment period
c. enabling statute, studies of issues, comment period, promulgation
d. None of the above is in correct order.
113. If a company challenges a penalty imposed by an administrative agency, which of the following is the correct order
for its appeal?
a. ALJ, agency commissioners, judicial challenge
b. judicial challenge, ALJ, agency commissioners
c. agency commissioners, ALJ, judicial challenge
d. None of the above is in the correct order.
114. The Federal Maritime Commission approved the charter for an inter-island ferry service in Hawaii but did so
without a study of the environmental impact of adding the ferry service. Federal agencies are required to determine
environmental impacts of all actions. The airlines that fly between the islands wish to challenge the ferry approval
by the Maritime Commission. What grounds could they use?
a. arbitrary and capricious
b. failure to comply with statutory procedures
c. favoritism
d. none of the above
115. The Department of Homeland Security has been given the responsibility for the construction of a fence along the
border between the United States and Mexico. The Department has not followed the 30-day comment rule on the
composition and location of the proposed fence. Secretary Chertoff says that the fence is a matter of national
security. The Department:
a. has not complied with the rulemaking requirements and cannot proceed with the fence.
b. is using the emergency exception for the time waiver on rulemaking.
c. does not have the authority to waive the time requirements.
d. both a and c
116. Who did President Obama appoint to oversee the spending under the American Reinvestment and Recovery Act?
a. Hillary Clinton
b. Mike Espy
c. Earl Devaney
d. Richard Scrushy
117. The FTC has proposed a series of regulations to require disclosure of repair/accident history in the sale of used
cars. The Classic Car Club believes that historical vehicles (1960 and earlier) should be exempt from the
requirements. What can the club do to voice its concerns?
118. Why is the Code of Federal Regulations not solely online to save money and time?
119. Benzene is a colorless, aromatic liquid used in manufacturing a variety of products including motor fuels, solvents,
detergents, pesticides, and other organic materials. Benzene is a toxic substance and rapid inhalation can be fatal.
Exposure has also been shown to lead to various types of nonmalignant diseases such as blood disorders (including
leukemia).
OSHA passed a regulation limiting maximum benzene exposure for employees. OSHA set a 1 ppm maximum, even
though the medical evidence only discussed exposures at 10 ppm and more. The petroleum industry wishes to
challenge the regulation. Can they do so? On what basis?
120. Given deregulation in several major industries, why has the total amount of regulations still increased virtually every
year?
121. Discuss the Administrative Procedures Act and its amendments and purpose.
122. The FTC regulates advertising and has discovered a company advertising a diet pill that, when swallowed, breaks
into "thousands of particles, each acting like a tiny magnet" to which fat cells are instantly attracted. The magnets
are then eliminated through the digestive system. The FTC has brought a complaint against the company, and the
company wants to know what action the FTC can take against it.
123. Name the three government publications covered under the Federal Register Act.
124. The FDA has proposed rules that would classify cigarettes as a medical device and thereby severely restrict the
types of advertising that could be used. What forms and types of feedback would the tobacco companies have
during the rule-making process by the FDA?
125. Discuss the ways a business could challenge a promulgated agency rule.
126. Describe the roles of administrative agencies.
127. Discuss what made Earl Devaney such an ethical standout in the federal government.
128. The National Park service withdrew its proposed rules on the use of snowmobiles in national parks. Describe any
legal issues that might exist in its withdrawal of the rules.
129. What is an ultra vires act?
130. The Department of Homeland Security has asked the Internal Revenue Service for the tax returns of U.S. citizens
who have been identified as having ties to terrorist organizations. The IRS has declined to turn over the tax returns.
Discuss the rights of the individuals and the authority of the two agencies.
131. The Nursing Mothers Law:
a. is the enabling legislation.
b. must be enforced by Congress.
c. must first be published in the Federal Register before any rules can be proposed.
d. is part of the Government in the Sunshine Act.
132. Where else would the proposed regulations need to be published?
a. The only requirement is that the regulations be published in the Federal Register.
b. They must be published in any trade magazine of affected industries.
c. They must be published in the Congressional Record.
d. They must be published first in the Code of Federal Regulations.
133. What is the minimum time period for comments that the Department of Labor must allow?
a. 180 days
b. 120 days
c. 60 days
d. 30 days
134. Who is allowed to submit comments on the proposed rules?
a. Only employers
b. Only employers affected by the rules
c. Only nursing mothers
d. none of the above
135. How can comments be submitted?
a. By letter
b. Only by testimony at a public hearing
c. Only by Congressional testimony
d. Only through depositions
136. If the Department of Labor decides to change the content and approach of the proposed rules based on feedback,
which of the following is correct?
a. The Department must return to Congress to get approval for the proposed changes to the original rules.
b. The Department must allow 90 days for comments on the proposed changes to the original rules.
c. The Department must publicize the proposed changes in the original rules and allow a comment period.
d. Because the rules could not be promulgated, Congress can revoke the Nursing Mothers Law.
The U.S. Lacey Act prohibits U.S. businesses from importing products from other countries when those products
are illegal in that country. For example, when it was originally passed, U.S. hat manufacturers were importing
feathers from countries where the harvesting of those resources was illegal. Based on an investigation, the U.S.
federal government believed that Gibson Guitar has imported ebony wood from Madagascar, and the harvesting of
ebony wood is prohibited in Madagascar. The U.S. Fish & Wildlife Service arrived at Gibson Guitar headquarters
and requested access to all of its records. The next two questions are based on this fact scenario.
137. Under federal law, Gibson is:
a. Not subject to searches and seizures by a federal regulatory agency, only law enforcement officials.
b. Required to allow entry or can demand a search warrant and then must allow entry.
c. Not subject to federal law enforcement because the wood is imported from another country.
d. Required to allow the search and no warrant is required.
138. What remedies would the U.S. Fish & Wildlife Service have available for violations of the Lacey Act?
a. Injunctions
b. Fines
c. Penalties
d. all of the above
