Grid Tool Company makes and sells tools. One of the tools is believed to be hazÂ-
ardous. The appropriate government agency may require Grid to
a. export the tool and sell it only abroad.
b. increase the price to cover the cost of any injuries or damage.
c. reduce the price to indicate the hazard to consumers.
d. remove the tool from the market.
Answer:
Byron agrees to sell to Charity, for $1,500, a remote parcel of land. They beÂlieve the
land to be worthless, but beneath it is a gold mine. Byron can
a. not rescind the contract.
b. rescind the contract on the basis of fraud.
c. rescind the contract on the basis of mistake.
d. rescind the contract on the basis of undue influence.
Answer:
SurgeStop Company makes electrical cords and other connectors for elecÂtronic
devices. Rollo files a product liability suit against SurgeStop, allegÂing a warning
defect. In deciding whether to hold SurgeStop liable, the court may consider
a. consumers’ general lack of desire to read the product’s warnings.
b. the plaintiff’s specific lack of desire to read the product warnings.
c. the obvious risks of other products.
d. the obvious risks of this product.
Answer:
Guitar Maker, Inc., makes guitars. The Occupational Safety and Health Administration
(OSHA) proposes a safety rule governing the handling of wood and its dust in the
workplace, including the woods that Guitar Maker uses in its operations. Guitar Maker
contends that the rule will involve subÂstantial compliance costs without significantly
increasing workplace safety. The firm sends a letter to OSHA indicating its objections
to the proÂposed rule and enclosing research reports and other data supÂporting those
objections. Does OSHA have any obligation to consider these objecÂtions? What
procedures must OSHA follow when it makes new rules, such as this one?
Answer:
Cecilia borrows $20,000 from Debit & Credit Union to repair her home and to buy a
car. She buys a laptop from eStuf Store in a transaction financed by the seller. If these
parties are subject to the Truth-in-Lending Act, Regulation Z apÂplies to
a. the car loan only.
b. the home repair loan only.
c. the retail installment sale only.
d. the car loan, the home repair loan, and the retail installment sale.
Answer:
In advertising circulars, Lo-Price Autos falsely accuses Hi-Value Vehicles, a competitor,
of selling stolen cars. Hi-Value’s sales decrease. Lo-Price has most likely committed
a. slander of quality.
b. slander of title.
c. wrongful interference with a business relationship.
d. none of the choices.
Answer:
Fact Pattern 22-1
Kyla replaces Lomax in his job at Motor Vehicle Manufacturing Corporation (MVMC).
Refer to Fact Pattern 22-1. Lomax believes that he has been discriminated against on
the basis of his age. For the Age DisÂcrimination in Employment Act of 1967 to apply
a. Kyla must be forty years of age or younger.
b. Kyla must be forty years of age or older.
c. Lomax must be forty years of age or older.
d. Lomax must have been MVMC’s employee for at least forty years.
Answer:
Thom, who works as an employee for Upstate Power Corporation, sufÂfers an injury in
an accident. Thom will be compenÂsated under state workÂers’ compensation laws
a. only if the injury occurred during working hours.
b. only if the injury occurred off the job.
c. only if the injury occurred on the job.
d. whenever and wherever the injury occurred.
Answer:
Kenneth has a periodic tenancy that requires him to pay rent weekly. Kenneth wishes to
terminate his tenancy. Under the common law, he must give his landlord notice of at
least
a. one week.
b. two weeks.
c. thirty days.
d. sixty days.
Answer:
Maxi Retail Corporation is subject to a decision by the National Labor Relations Board.
Maxi Retail appeals the decision, arguing that it is arbitrary and capricious. This could
mean that the decision
a. followed a consideration of legally appropriate factors.
b. justifiably changed the agency’s prior policy.
c. was accompanied by a rational explanation.
d. was plainly contrary to the evidence.
Answer:
Ronelle, the human resources director for Small Business Solutions, Inc., atÂtempts to
comply with the law in dealing with applicants and employÂees. One of the challenges
Ronelle faces is that the legality of an action is
a. always clear.
b. never clear.
c. only sometimes clear.
d. usually clear.
Answer:
Brady knows that the brakes on his car do not work, but he tells Celia, a potential buyer,
that there are no problems with the car. On this assurance, Celia buys the car. On
learning the truth, she may sue Brady for
a. trade libel.
b. conversion.
c. fraudulent misrepresentation.
d. appropriation.
Answer:
Bean House Coffees and Java Distributors, Inc., have a long-standing business
relationship that they would like to continue. For this reason, they may prefer to setÂtle
any dispute between them through facilitation because
a. the case will be heard by a mini-jury.
b. the dispute will eventually go to trial.
c. the process is not adversarial.
d. the resolution of the dispute will be decided an expert.
Answer:
Nora enters into a contract with Oceanic Transport, Inc., to insure and ship a painting
from France to the United States for a certain price. But Oceanic makes a mistake in
adding the costs, which results in a contract price that is $1,000 less than the true cost.
Most likely, a court would
a. allow the parties to rescind the contract.
b. award damages to Nora for the mistake.
c. award damages to Oceanic for the mistake.
d. enforce the contract as is.
Answer:
Larry enters into a contract with Motivational Education Services to host a panel
discussion at a sales conference. When the conference is postponed indefinitely, Larry
asks a court to cancel the contract and return the parties to the positions that they held
before its formation. This request involves
a. specific performance.
b. an injunction.
c. rescission.
d. an action that the court cannot order.
Answer:
Eduardo is a debtor. Furniture Mart is Eduardo’s employer. Guaranty Credit, Inc., and
the government are Eduardo’s crediÂtors. For these parties, a petition in bankruptcy for
relief through an individual’s repayment plan could be filed by
a. Eduardo alone, Furniture Mart alone, or Guaranty Credit and the government jointly.
b. Eduardo only.
c. Guaranty Credit and the government only.
d. the government only.
Answer:
Jenny Lee is an appliance salesperson. To make a sale, she asserts that a certain model
of a Kitchen Helper refrigerator is the ‘best one ever made.’ This is
a. fraud if the statement is not true.
b. fraud if Jenny Lee believes that this statement is not true.
c. fraud if Jenny Lee is stating her opinion, not the facts.
d. not fraud.
Answer:
Solar Power Panels Corporation requires its employees to have a high school diploma,
claiming a connection between a high school eduÂcaÂtion and job performance. In a
suit against Solar Power under the Civil Rights Act of 1964, this is shown to have a
discriminatory effect. Solar Power has
a. an affirmative action defense.
b. a bona fide occupational qualification defense.
c. a business necessity defense.
d. no defense.
Answer:
Bernard is an expert on exotic flowers. Custom Floral Arrangements, Inc., hires
Bernard to order exotic flowers for its arrangements. Bernard does not examine the
quality of the flowers he orders on behalf of Custom Floral. Bernard has breached
a. the duty of performance.
b. the duty of loyalty.
c. no duty.
d. the duty of notification.
Answer:
Rollo is the chief executive officer of Specialty Magazines, Inc., which is required to
file certain financial reports with the Securities and Exchange Commission (SEC).
Under the Sarbanes-Oxley Act of 2002, Rollo must
a. certify that the reports are complete and accurate.
b. designate a corporate official to assume liability for inaccuracies.
c. do nothing.
d. read the reports and be prepared to answer questions about them.
Answer:
Good Cookin’ Products Company makes heat convection ovens. Heidi discovers that
her Good Cookin’ oven is defective and sues the maker for product liabilÂity based on
strict liability. To win, Heidi must show that she
a. bought the oven from Good Cookin’.
b. did not misuse the oven.
c. suffered an injury caused by the defect.
d. did not know of the defect.
Answer:
Doctors Hospital Corporation employs seven thousand workers in seven locations.
These employees have the right to
a. demand that Doctors Hospital Corporation be a closed shop.
b. make ‘hot-cargo’ agreements.
c. organize.
d. refuse to bargain with Doctors Hospital Corporation.
Answer:
The Constitution sets forth specific powers that can be exercised by the national
government and provides that the national government has the implied power to
undertake actions necessary to carry its expressly designated powers. Under the Tenth
Amendment, all other powers are expressly reserved to
a. none of the choices.
b. the states.
c. the national government.
d. the people.
Answer:
Condos & Course Development, Inc., fills a wetlands area that it owns without a permit
from the U.S. Army Corps of Engineers. Condos & Course Development plan to build a
golf course and residences on the site. Under the Clean Water Act, this is most likely
a. a violation.
b. not a violation because a permit is not needed to fill wetlands.
c. not a violation because the area was filled before construction.
d. not a violation because there was no discharge of pollution.
Answer:
Dyan, the owner of Expert Restoration Services, Inc., adheres to the ‘principle of rights’
theory. Under this theory, a key factor in determining whether a business decision is
ethical is how that decision
a. compares to religious principles.
b. affects the rights of others.
c. effects consequences that would follow if everyone in society acted the same way.
d. supports the right to make a profit.
Answer:
Answer:
For fraud to occur, seller’s talk must be involved.
Answer:
A sanction known as counteradvertising requires a company to advertise anew to
inform the public about earlier misinformation.
Answer:
Only a defendant can file a motion to dismiss.
Answer:
An agency by estoppel arises when the principal’s actions have created the appearance
of an agency that does not in fact exist.
Answer:
A contract that prohibits its assignment cannot be assigned.
Answer:
Answer:
A misrepresentation leads another to believer in a condition that is different from the
condition that actually exists.
Answer: