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Student name:__________
TRUE/FALSE – Write ‘T’ if the statement is true and ‘F’ if the statement is false.
1) Civil law is the most widespread system in use globally.
⊚ true
⊚ false
2) Common law relies on codification.
⊚ true
⊚ false
3) Customary international law draws on practices that have been followed often for
centuries.
⊚ true
⊚ false
4) The U.S. enforcement of Equal Employment Opportunity Commission (EEOC) law in
U.S. companies operating abroad is an example of extraterritoriality.
⊚ true
⊚ false
5) A choice-of-law clause in a contract specifies where the dispute will be settled.
⊚ true
⊚ false
6) The UN Convention on the International Sale of Goods (CISG) has established legal
rules and outlined the rights and obligations of the buyer and seller.
⊚ true
⊚ false
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7) Companies are agreeable to entering litigation efforts because they are quick and
inexpensive.
⊚ true
⊚ false
8) Arbitration tends to be less private than litigation.
⊚ true
⊚ false
9) Intellectual property includes patents and trademarks, but not copyrights.
⊚ true
⊚ false
10) The European Patent Organization (EPO) makes filing for a patent in all 28 EU member
states more difficult than it was previously.
⊚ true
⊚ false
11) The logo that allows consumers to identify a company or product is an example of a
trademark.
⊚ true
⊚ false
12) Global standardization of trade-related law is progressing slowly.
⊚ true
⊚ false
13) Incoterms are established by the UN Commission on International Trade.
⊚ true
⊚ false
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14) International Organization for Standardization (ISO) is the only international
standardizing organization.
⊚ true
⊚ false
15) Under U.S. law, price fixing is illegal per se, while in other countries, damage or harm
has to be done; this is the case in the EU.
⊚ true
⊚ false
16) When first introduced in Japan, antitrust legislation honored the existing zaibatsu.
⊚ true
⊚ false
17) Competition laws are another term for antitrust laws.
⊚ true
⊚ false
18) The EU does NOT apply its competition policy beyond the EU.
⊚ true
⊚ false
19) The United States avoids trade barriers on imports in support of free trade principles.
⊚ true
⊚ false
20) Product liability is an area of torts in which the U.S. courts can make large awards, unlike
in other countries.
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⊚ true
⊚ false
MULTIPLE CHOICE – Choose the one alternative that best completes the statement or
answers the question.
21) In Sharia law, interest is forbidden, which results in
A) severe limitations on working capital.
B) equity partnerships, where business risk is shared.
C) interest that is usually paid but termed something else.
D) limits in the development of international businesses.
22) During the trial, the judge openly questioned the defendant and her lawyers and often
challenged the presented evidence. There wasn’t a jury and the judge made the final decision.
Which type of legal system would include this scenario?
A) common
B) civil
C) religious
D) criminal
23) The three main approaches to law are
A) civil, common, and religious.
B) civil, Sharia, and court-based.
C) Sharia, Talmudic, and Napoleonic.
D) criminal, civil, and common.
24) Civil law is based on
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A) a collection of codes.
B) precedents found in judgments made by judges.
C) the assumption of innocence.
D) religious law associated with the area.
25) The legal system of a country is composed of
A) the collection of governing principles, and the legislation and regulations enacted to
provide for the welfare of the country.
B) the laws and their interpretation by citizens, but not noncitizens.
C) local laws that are interpreted for federal use.
D) a collection of folkways, rules, and regulations whose goal is to support civil
harmony.
26) The Qur’an is associated with Islam and indicates the presence of which form of law?
A) international
B) civil
C) religious
D) common
27) At the end of the trial, the judge stated that his decision for the case was based on a
decision made in a similar case twenty years ago. Which form of law is indicated by the use of
previous cases?
A) international
B) civil
C) religious
D) common
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28) International law that is used to govern the transactions between companies that cross
international borders is called
A) public international law.
B) jurisdiction law.
C) private international law.
D) territorial law.
29) The most important sources of international law are
A) the UN International Court of Justice.
B) the U.S. Supreme Court and the EU Court of Justice.
C) bilateral and multilateral treaties, along with customary law.
D) common and civil law.
30) An agreement between nations is called a
A) treaty.
B) constitution.
C) demographic.
D) regulation.
31) If the United States and Italy fell into a trade dispute, which form of international law
would govern the situation?
A) litigation
B) public
C) civil
D) private
32) Extraterritoriality refers to
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A) a nation’s attempt to enforce its law beyond its borders.
B) added territory as a result of dispute settlements in wars, such as the Sakalin Islands.
C) a citizen’s claim to government assistance in a foreign environment.
D) a taxable condition most international firms attempt to avoid.
33) The Alien Tort Statute allows non-U.S. nationals to
A) sue in the United States courts for residency in the United States.
B) file lawsuits in the United States courts for alleged violations of international law,
including human rights violations, even when the defendant has no ties to the United States.
C) file claims in the United States courts for alleged violations of domestic laws.
D) file claims against other foreign nationals for violation of U.S. EEOC law.
34) If two English multinational companies had a dispute arising in New York City, and there
were no choice of law or choice of forum clauses in their contract, it is likely that
A) a New York court would hear their complaint.
B) they would bring their dispute to an English court.
C) the dispute would not get heard in court, but rather, in the boardrooms.
D) they would reach an agreement informally and develop an off-the-books settlement.
35) Arbitration is often preferred when the contract stipulates U.S. law and one of the
litigants is foreign because it is
A) easier to influence an arbiter than a judge.
B) quicker, cheaper, and more private than litigation.
C) more discreet, although more costly than litigation.
D) less bureaucratic than litigating in any country.
36) CISG has been ratified by many countries and provides a set of uniform rules governing
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A) foreign direct investment.
B) sales contracts.
C) foreign exchange rates.
D) advertising and promotion.
37) During the pretrial period, the law firm worked to find facts relevant to the litigation.
What is this process called?
A) discovery
B) arbitration
C) consolidation
D) accommodation
38) Kylie is a U.S. citizen currently living and working in France. She will have to pay U.S.
taxes on her earnings since she is a citizen even though she is not currently a resident. What
concept is illustrated by this example?
A) arbitration
B) extraterritoriality
C) intellectual property
D) litigation
39) Arbitration is a private solution that is
A) more private than litigation.
B) considered a last resort when settling a dispute.
C) only used in common law cases.
D) common in religious law systems.
40) A patent gives the inventor
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A) property rights for 10 years.
B) the right to use the invention until development costs are recouped.
C) exclusive right to manufacture, exploit, use, and sell the invention for a given time
period.
D) the right to keep the patented process but not the product for five years.
41) Patent treatment is becoming standardized owing to
A) the WTO.
B) the UN Commission on Patents.
C) domestic laws in various nations.
D) WIPO, TRIPS, and the Paris Union.
42) Smaller nations would like patent protection to be
A) extended, to allow for them to build their competitive advantage.
B) extended, so that they can recoup development costs.
C) reduced, so that they can make money sooner.
D) dissolved, so that they can increase their profits.
43) WIPO is a
A) UN agency that administers an intellectual property system.
B) WTO group opposed to patent extension and pro-generic.
C) part of the Club of Rome that lobbies for longer patent periods.
D) research arm of the Fuel Cartel that has been advocating longer patent protection for
biofuel processing systems.
44) Patent trolls are
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A) a record of all patents, recorded by the UN.
B) the numerical controls issued on patents, standardized by the Paris Convention.
C) the organizing system for patent review that is kept internationally by OECD.
D) modern highway robbers who exploit loopholes in IP protection.
45) Trademarks are defined as
A) a shape, color, design, sound, phrase, abbreviation by which a product is designated.
B) long-standing businesses that represent the hallmarks of an industry.
C) new products that have never been placed on the market before.
D) the key products that make the most money for a company.
46) Intellectual property includes
A) intangibles, which is why it is a difficult area.
B) thoughts and ideas, but not tangible products.
C) anything that is a result of a creative process that does not have material qualities.
D) anything that is the result of creative work that can be protected by legal means.
47) Patents are government grants that give the owner
A) exclusive rights to use, sell, manufacture, or exploit the invention or process.
B) the exclusive right to use the fundamental ideas on which the invention is based.
C) the rights to sell the invention, but only beyond the patent-granter’s borders.
D) rights to the invention but does not prevent others from copying the invention.
48) Shayna and her husband have developed a pizza pan that is guaranteed to keep the crust
from sticking to the pan and washes clean with just water. They have applied to have exclusive
rights to this product. What did they apply for?
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A) a patent
B) a copyright
C) a trademark
D) a trade name
49) WIPO and TRIPS represent
A) patent harmonization agreements in SE Asia and the EU, respectively.
B) anti-counterfeiting agreements in Korea and North America, respectively.
C) WTO and UN agreements on corruption.
D) UN and WTO agencies or programs that focus on IP.
50) Patent trolling is a process of
A) looking for loopholes in patent protection and exploiting them.
B) recording and registering of patents in foreign countries to protect the firm’s IP.
C) searching out patents that have expired and negotiating their replacements.
D) legal research that uncovers obscure, deceased patent holders and liberates their
inventions.
51) Trade names are protected under
A) national laws in all UN member countries.
B) WIPO and TRIPS.
C) many local laws in most countries, so that illegal trademark use is a local issue.
D) the United Nations.
52) Nora knew her package had arrived because she saw the truck with the Amazon logo pull
into her driveway. The logo she recognized is an example of a
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A) patent.
B) trademark.
C) trade name.
D) copyright.
53) Sudsy Soap Company sells face soap in the United States as “Fresh Face” but in Europe
the same soap is sold as “Shiny Clean.” These two different soaps represent types of
A) trademarks.
B) trade names.
C) patents.
D) copyrights.
54) Sanjay has written a cookbook. What form of legal protection can he obtain for his book?
A) copyright
B) patent
C) trademark
D) arbitration
55) Keith’s favorite restaurant sells sandwiches that have a “kicker sauce.” Everyone loves
the sauce, but the company won’t reveal what’s in it. This sauce is an example of a
A) trade secret.
B) trademark.
C) patent.
D) copyright.
56) Incoterms attempt to standardize shipping agreements, and include
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A) FAS and CIF.
B) CED and COD.
C) descriptions of portside processes.
D) insurance arrangements for international shipments.
57) The ISO and the IEC both promote
A) harmonization in international accountancy.
B) standardization in technology-related fields through specifications.
C) union membership in fields that are technology intensive.
D) shared bankruptcy standards across the globe.
58) Actions that involve antitrust laws usually involve
A) government against citizens.
B) government against business.
C) country against country.
D) citizen against citizen.
59) The concept of strict liability, as found in the U.S. legal system, applies
A) to harm done by the designer/manufacturer without the need to prove negligence.
B) to harm done within narrow limits, considering the design of the product.
C) to children harmed by products in both the United States and the EU.
D) strictly to harm caused by the designer/manufacturer, so no penalties outside of
damages can be awarded.
60) Punitive damages in product liability cases can be awarded in
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A) Japan.
B) Japan and the EU.
C) the United Kingdom.
D) the United States.
61) The Chinese Anti-Monopoly Act seems to support
A) the consumer.
B) local businesses.
C) reducing competition.
D) political sovereignty.
62) The Foreign Corrupt Practices Act (FCPA) is U.S. legislation that
A) outlines bribery practices that are allowed abroad but not in the United States.
B) prohibits bribery by American companies abroad.
C) allows bribery in foreign dealings when culturally sanctioned.
D) outlines and prohibits foreign bribery practices by foreign nationals in foreign
nations.
63) FCPA includes
A) uncertainties that make its application problematic.
B) specific explicit rules with clear definitions of terms that U.S. companies must follow
in their foreign operations.
C) all accounting processes, including the accounting of transfer payments.
D) foreign tax liabilities and other adjustments specific to business outside of the home
country.
64) What effect has the FCPA had on American business?
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A) It has hurt American business because managers cannot use bribes anymore.
B) It has challenged the creativity of American managers and consultants to develop
ways to work around the FCPA.
C) It has brought the discussion of bribery into the open, which has, overall, been
positive.
D) It has resulted in American foreign business going to Japanese and German
businesses.
65) Under the FCPA, facilitating payments are allowed for
A) patent approvals.
B) import approvals.
C) building construction.
D) production standards.
66) Critics of the FCPA believed that it would
A) harm U.S. companies’ credibility.
B) eliminate necessary competition.
C) increase environmental waste.
D) lower the costs of production.
67) Madison Foods Corp. is frustrated in its efforts to sell products in Europe because several
countries are demanding that the company label products in the specific language associated with
the country. These demands are examples of a
A) trade name.
B) trade obstacle.
C) trademark.
D) trade role.
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68) The per se concept of U.S. law means that a situation is
A) only illegal in the United States.
B) illegal in and of itself.
C) legal regardless of judicial decree.
D) only legal outside of the United States.
69) The EU applies its competition policy
A) extraterritorially.
B) only within EU.
C) within the EU and applicant states.
D) within the EU and other European nations.
70) One major difference between U.S. and Japanese trust-busting is
A) who initiates it.
B) who is at fault.
C) why it occurs.
D) where it takes place.
71) Butter Babies Inc. was held responsible in court for failing to indicate on their labels that
their baby bath wash contained traces of mercury and could potentially harm infants. Which type
of law is playing a part in this scenario?
A) patent
B) product liability
C) common
D) trade name
72) Trade obstacles are considered to be legal forces because
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A) customs is controlled by a country’s national police or army.
B) their compliance is costly to the firm and the consumer.
C) they are protected by the courts.
D) they often are based on legislation.
73) The end result of legal trade obstacles is often
A) limited trade, with the recipient of the trade obstacles withdrawing.
B) political negotiations between the two countries, to smooth relations and reduce
costs.
C) higher costs to consumers.
D) lower taxes to citizens in the tariff-imposing country due to tariff revenues.
74) In the United States court system, tort claims may result in
A) exceedingly large awards.
B) lower liability insurance.
C) a reduction in strict liability.
D) reduced liability insurance costs for foreign companies.
75) The settlement awarded $2 million to each of the four hundred individuals harmed by the
effects of groundwater emissions created by manufacturing processes at Mission Corp. The
award money is an example of
A) a voluntary restraint agreement.
B) punitive damages.
C) antitrust law.
D) product liability.
76) The Foreign Corrupt Practices Act has
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A) moved the discussion of transparency and corruption out into the open.
B) impaired American competitiveness abroad.
C) jailed legions of corrupt foreign executives in the United States.
D) introduced clear, concise terminology into the discussion of corruption.
77) If the Securities and Exchange Commission learns that a business might be involved in
corruption, it will look at other businesses in the same industry to assess if they might also be
involved. What is this process called?
A) phishing
B) ghosting
C) tagging
D) sweeping
78) Which area of the U.S. government enforces U.S. antitrust laws?
A) State Department
B) Department of Justice
C) House of Representatives
D) Senate
79) One characteristic of the United States Foreign Corrupt Practices Act is that it
A) clearly stipulates terminology and behavior that is illegal on the part of U.S.
businesses and foreign business operating in the United States.
B) includes uncertainties such as terminology, definitions, accounting standards, and
behavior standards.
C) applies to only international transactions that occur within the territorial borders of
the United States.
D) is an attempt to support U.S. businesses by exporting U.S. values that indirectly aid
business.
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80) Trade obstacles are viewed as
A) political, financial, and legal.
B) political and legal.
C) only financial.
D) only legal.
81) The Sarbanes-Oxley Act was passed in the United States in response to
A) consumer requests for cleaner air standards.
B) human rights violations in Europe.
C) deceptive marketing practices in the service industry.
D) accounting scandals in the corporate world.
82) In Japan, antitrust legislation
A) was introduced by the United States and did not harmonize well with Japanese
values.
B) developed out of a samurai code of ethics.
C) has been influenced by Chinese and Korean approaches to monopoly markets.
D) does not exist.
83) When a government sets a quota on the amount of sugar that can be imported, it is
implementing a
A) trade obstacle.
B) copyright.
C) trademark.
D) qualitative tariff.
84) Japan has established trade barriers in the form of tariffs against
A) Chinese vegetables and fruits, but not rice.
B) U.S. beef, citrus, and dairy products.
C) European electrical goods.
D) European automakers.
85) U.S. responses to foreign tariffs are likely to
A) raise the cost of the imported goods for U.S. consumers.
B) force a reduction in tariffs.
C) create equity across markets, which is the goal.
D) establish the fundamental rule of power rather than principle.
86) One area of concern for international businesses is that U.S. tort cases may result in
A) large monetary awards.
B) malfeasance claims against the business.
C) personal embarrassment to corporate officers and require apologies.
D) exorbitant legal fees that stem from long-term court cases.
87) Strict liability requires
A) no need for a plaintiff to prove manufacturer negligence.
B) the manufacturer to know that the design or manufacture is inferior.
C) the buyer to take risks on the purchase of a newly designed product.
D) responsibility for the product throughout its life cycle.
88) Punitive damages are found