Chapter 07: The Environment of Electronic Commerce: Legal, Ethical, and Tax Issues
1. Any business that uses the Web becomes an international business instantly.
a.
True
b.
False
True
1
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
2. Businesses that operate on the Web must comply with the same laws and regulations that govern the operations of all
businesses.
a.
True
b.
False
True
1
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
3. In the physical world, geographic boundaries rarely coincide with legal and cultural boundaries.
a.
True
b.
False
False
1
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
4. Physical boundaries are a convenient and effective way to announce the ending of one legal or cultural system and the
beginning of another.
a.
True
b.
False
True
1
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
5. People receive constructive notice that they have become subject to new laws and cultural norms when they cross an
international border, even if they are not specifically warned of the changed laws and norms by a sign or a border guard’s
statement.
Chapter 07: The Environment of Electronic Commerce: Legal, Ethical, and Tax Issues
a.
True
b.
False
True
1
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
6. A business cannot commit a tortious act by simply selling a product that causes harm to a buyer.
a.
True
b.
False
False
1
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
7. Non-U.S. corporations and individuals cannot be sued in U.S. courts if they conduct business or commit tortious acts in
the United States.
a.
True
b.
False
False
1
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
8. People enter into contracts on a daily, and often hourly, basis.
a.
True
b.
False
True
1
Easy
07.02
United States – BUSPROG: Analytic
Bloom’s: Knowledge
9. When a seller advertises goods for sale on a Web site, that seller is making an offer to potential buyers.
a.
True
b.
False
False
1
10. In general, contracts are invalid if they are not in writing or signed.
a.
True
b.
False
False
1
Easy
07.02
United States – BUSPROG: Analytic
11. The Statute of Frauds varies widely from state to state with regard to signed writings.
a.
True
b.
False
False
1
Easy
07.02
United States – BUSPROG: Analytic
12. Any contract for the sale of goods includes implied warranties.
a.
True
b.
False
True
1
Easy
07.02
Bloom’s: Knowledge
13. Digital signatures are not legally valid on contracts in most countries.
a.
True
b.
False
False
1
Easy
07.02
United States – BUSPROG: Analytic
Easy
07.02
Bloom’s: Comprehension
14. A click-wrap acceptance occurs when a Web site user agrees to that site’s end-user license agreements or its terms and
conditions by clicking a button on the Web site.
a.
True
b.
False
True
1
Easy
07.02
United States – BUSPROG: Technology
15. If an idea cannot be separated from its expression in a work, that work cannot be copyrighted.
True
False
True
1
Easy
07.03
Bloom’s: Comprehension
True
b.
False
True
1
Easy
07.03
United States – BUSPROG: Analytic
17. Fictional characters cannot be trademarked.
a.
True
b.
False
False
1
Easy
07.03
United States – BUSPROG: Analytic
Bloom’s: Knowledge
18. In general, trademark protection prevents another firm from using the same or a similar name, logo, or other
identifying characteristics in a way that would cause confusion in the minds of potential buyers.
a.
True
b.
False
Chapter 07: The Environment of Electronic Commerce: Legal, Ethical, and Tax Issues
True
1
Easy
07.03
Bloom’s: Knowledge
19. The first obstacle that law enforcement agencies face when combating online crime is the issue of jurisdiction.
a.
True
b.
False
True
1
Easy
07.04
United States – BUSPROG: Analytic
20. Ethics issues are significant in the area of online privacy because laws have not kept pace with the growth of the
Internet and the Web.
a.
True
b.
False
True
1
Easy
07.05
United States – BUSPROG: Ethics
21. Differences in cultures throughout the world have resulted in different expectations about privacy in electronic
commerce.
a.
True
b.
False
True
1
Easy
07.05
United States – BUSPROG: Diversity
22. Use taxes are levied by the United States and other countries on certain commodities as they are imported into the
country.
a.
True
b.
False
False
1
23. The connection between a tax-paying entity and a government is called jurisdiction.
a.
True
b.
False
False
1
Easy
07.07
United States – BUSPROG: Analytic
Bloom’s: Knowledge
24. Companies that sell through their Web sites establish nexus everywhere their goods are delivered to customers.
a.
True
b.
False
False
1
Easy
07.07
United States – BUSPROG: Analytic
25. Most states’ use tax rates are lower than their sales tax rates.
a.
True
b.
False
False
1
Easy
07.07
United States – BUSPROG: Analytic
Bloom’s: Knowledge
26. _____ mark the range of culture and reach of applicable laws very clearly in the physical world.
a.
Territorial borders
b.
Common laws
c.
Ethical standards
d.
Online restrictions
1
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
Easy
07.07
United States – BUSPROG: Analytic
Bloom’s: Comprehension
27. _____ is a form of control over physical space and the people and objects that reside in that space, and is a defining
characteristic of statehood.
a.
Ethics
b.
Potential
c.
Legitimacy
d.
Power
d
1
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
28. The ability of a government to exert control over a person or corporation is called _____.
a.
subjugation
b.
jurisdiction
c.
legitimacy
d.
notice
b
1
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
29. _____ is a country in which national culture permits the government to exert high levels of unchecked authority.
a.
Denmark
b.
Norway
c.
Singapore
d.
Sweden
1
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
30. _____ is the idea that those subject to laws should have some role in formulating them.
a.
Jurisdiction
b.
Administration
c.
Legitimacy
d.
Integrity
1
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
31. _____ is an expression of the change in rules when a physical boundary is crossed.
a.
Legitimacy
b.
Power
c.
Notice
d.
Offer
32. A _____ is an intentional or negligent action taken by a legal entity that causes harm to another legal entity.
a.
click-wrap acceptance
b.
tort
c.
fair use
d.
anticipatory repudiation
b
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
33. _____ is a court’s authority to decide a particular type of dispute.
a.
Territorial jurisdiction
b.
Personal jurisdiction
c.
Subject-matter jurisdiction
d.
Long arm jurisdiction
1
07.01
Bloom’s: Knowledge
34. In the United States, federal courts have subject-matter jurisdiction over issues related to _____.
a.
bankruptcy
b.
state tax matters
c.
professional licensing
d.
personal matters
Easy
United States – BUSPROG: Analytic
35. A(n) _____ clause is a statement that a contract will be enforced according to the laws of a particular state that then
has personal jurisdiction over the parties who signed the contract regarding any enforcement issues.
a.
forum selection
b.
choice of law
c.
after acquired property
d.
deadlock provision
Easy
United States – BUSPROG: Analytic
1
Easy
United States – BUSPROG: Analytic
Bloom’s: Knowledge
36. The details of _____ vary from state to state, but generally create personal jurisdiction over nonresidents who transact
business or commit tortious acts in the state.
a.
subject-matter jurisdiction
b.
long-arm statutes
c.
statewide jurisdiction
d.
forum selection
b
1
Moderate
07.01
United States – BUSPROG: Analytic
Bloom’s: Comprehension
37. A(n) _____ is a commitment with certain terms made to another party.
a.
award
b.
offer
c.
acceptance
d.
consideration
b
1
Easy
07.02
United States – BUSPROG: Analytic
Bloom’s: Knowledge
38. A(n) _____ is the expression of willingness to take an offer, including all of its stated terms.
a.
judicial comity
b.
tort
c.
acceptance
d.
consideration
1
Easy
07.02
United States – BUSPROG: Analytic
Bloom’s: Knowledge
39. A(n) _____ can be formed by two or more parties that act as if a contract exists, even if no contract has been written
and signed.
a.
voidable contract
b.
implied contract
c.
subordinate contract
d.
virtual contract
b
1
Easy
07.02
United States – BUSPROG: Analytic
Bloom’s: Knowledge
40. A(n) _____ refers to any symbol executed or adopted for the purpose of authenticating a writing.
Bloom’s: Knowledge
Chapter 07: The Environment of Electronic Commerce: Legal, Ethical, and Tax Issues
a.
stamp
b.
icon
c.
mark
d.
signature
d
1
Easy
07.02
United States – BUSPROG: Analytic
Bloom’s: Knowledge
41. A _____ is a statement declaring that the seller will not honor some or all implied warranties.
a.
defamatory statement
b.
forum selection clause
c.
warranty disclaimer
d.
warranty negation
1
Easy
07.02
United States – BUSPROG: Analytic
Bloom’s: Knowledge
42. Disputes that arise when one person has registered a domain name that is an existing trademark or company name are
settled by _____.
a.
the World Intellectual Property Organization
b.
common law
c.
statutory law
d.
the World Trade Organization
1
Easy
07.03
United States – BUSPROG: Analytic
Bloom’s: Knowledge
43. A _____ is an act in which a seller unintentionally provides a harmful product.
a.
fraud
b.
misrepresentation
c.
negligent tort
d.
defamation
1
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
44. A digital _____ is a digital code or stream embedded undetectably in a digital image or audio file.
a.
validation code
b.
watermark
c.
patent
d.
cookie
b
1
45. A(n) _____ statement is a statement that is false and that injures the reputation of another person or company.
a.
defamatory
b.
warranty disclaimer
c.
implied
d.
copyright
1
Easy
07.03
United States – BUSPROG: Analytic
Bloom’s: Knowledge
46. If a defamatory statement injures the reputation of a product or service instead of a person, it is called _____.
a.
negligent tort
b.
trademark dilution
c.
product disparagement
d.
per se defamation
1
Easy
07.03
United States – BUSPROG: Analytic
47. In a(n) _____ policy approach, a company that collects information does not use the information for any other purpose
unless the customer specifically chooses to allow that use.
a.
opt-out
b.
lock-in
c.
fair-use
d.
opt-in
d
1
Easy
07.06
United States – BUSPROG: Analytic
Bloom’s: Knowledge
48. If a company undertakes sufficient activities in a particular country, it establishes _____ with that country and
becomes liable for filing tax returns in that country.
a.
jurisdiction
b.
notice
c.
terms of service
d.
nexus
d
1
Easy
07.07
United States – BUSPROG: Analytic
Easy
07.03
United States – BUSPROG: Analytic
Bloom’s: Knowledge
49. A(n) _____ tax is a tax levied by a state on property used in that state that was not purchased in that state.
a.
property
b.
import
c.
use
d.
sales
1
Easy
07.07
United States – BUSPROG: Analytic
Bloom’s: Knowledge
50. A(n) _____ is collected by a seller at each stage of a transaction.
a.
value added tax
b.
import tariff
c.
property tax
d.
use tax
1
Easy
07.07
United States – BUSPROG: Analytic
Bloom’s: Knowledge
51. State courts have _____ jurisdiction over issues governed by state laws.
subject-matter
1
Easy
07.01
United States – BUSPROG: Analytic
Bloom’s: Knowledge
52. A(n) _____ refers to the issue of determining whether an individual can commit a company to an online contract.
authority to bind
1
Easy
07.02
United States – BUSPROG: Analytic
Bloom’s: Knowledge
53. In the context of online crime, in a(n) _____, the perpetrator offers to share the proceeds of some large payoff with the
victim if the victim will make a “good faith” deposit or provide some partial funding first.
advance fee fraud
1
Easy
07.04
United States – BUSPROG: Analytic
Bloom’s: Knowledge
54. Every kind of agreement or exchange between parties, no matter how simple, is a type of _____.
55. The issue of _____ can arise when an employee of a company accepts a contract and the company later asserts that the
employee did not have the authority to do so.
56. _____ is a general term that includes all products of the human mind.
57. The rules and regulations most of which are intended to limit the Web site owner’s liability for what site visitors might
do with information they obtain from the site are referred to as _____.
58. A(n) _____ is a right granted by a government to the author or creator of a literary or artistic work.
59. In a(n) _____ approach, a company collecting information assumes that a customer does not object to the company’s
use of the information unless the customer specifically chooses to deny permission.
60. An entity becomes liable for _____ infringement if it is capable of supervising the infringing activity and obtains a
financial benefit from the infringing activity.
61. A(n) _____ is an exclusive right granted by the government to an individual to make, use, and sell an invention.
62. The _____ patent protects a specific set of procedures for conducting a particular business activity.
63. A(n) _____ is used to identify services provided.
64. A(n) _____ is a distinctive mark, device, motto, or implement that a company affixes to the goods it produces for
identification purposes.
65. The name or part of that name that a business uses to identify itself is called a(n) _____.
66. _____ law arises when elected legislative bodies pass laws.
67. _____ is the practice of registering a domain name that is the trademark of another person or company in the hopes
that the owner will pay huge amounts of money to acquire the URL.
68. _____ occurs when someone other than a domain name’s owner changes the ownership of the domain name.
69. The _____ publishes regulations and investigates claims of false advertising.
70. _____ taxes are levied by states and local governments on the real estate used in a business.
71. _____ taxes are levied by national, state, and local governments on the net earnings generated by business activities.
72. _____ taxes, which include sales taxes, use taxes, and excise taxes, are levied on the products or services that a
company sells or uses.
73. _____ refers to a legal cause of action in which a court deems some types of statements to be so negative that injury is
assumed.
74. The _____ is the U.S. government agency charged with administering the country’s tax laws.
75. _____ laws, directed at large online retailers, are state laws that require online retailers to collect and remit sales taxes
on sales they make in their states, even though the online retailers do not have nexus with the state.
76. Describe a tort and identify the types of tortious acts that can be committed.
77. What is the difference between subject-matter jurisdiction and personal jurisdiction?
78. Explain the three essential elements of a contract.
79. List the guidelines that acknowledge an organization’s responsibility for respecting customer privacy and the
importance of maintaining customers’ trust.
80. Briefly discuss the application of import tariffs.