ETH 321 Final Exam Answers / Ethical and Legal Topics in Business
1. The determination that a crime has been committed and that evidence is sufficient to warrant the accused standing trial is known as:
• double jeopardy
• probable cause.
• nolo contendere
2. Article 6 of the Treaty on European Union, called the Maastricht Treaty, states the EU is founded on:
• rule of law
• specific performance
• stare decisis
• private markets
3. The crucial issue with the continuity factor of a business’s organizational form is _______.
• profit distribution
• the method of customer service observed
• the method by which the business can be dissolved
• management style
4. The classification of crime is based on ________.
• the judge’s prerogative
• prior record
• punishment imposed if convicted
5. Myra offers to sell her home to Hanna for “about $100,000 plus closing costs.” Hanna accepts Myra’s offer, but later a dispute arises concerning the precise dollar amount of the purchase price. How will a court resolve this dispute?
• The court will appoint a licensed real estate appraiser to determine the price to be paid by Hanna.
• The court will declare the purchase price and terms too indefinite to create a binding contract.
• The court will require Hanna to pay the average of her price and Myra’s price
• The court will determine a reasonable price to be paid by Hanna.
6. The ___________ holds that contracts or conspiracies in restraint are illegal only if they constitute undue or unreasonable restraints of trade and that only unreasonable attempts to monopolize are covered by the Sherman Act.
• duty to deal doctrine
• Parker v. Brown doctrine
• rule of reason
• rules of per se legality
7. A 911 emergency response service needs operators who are bilingual in English and Spanish. A few applicants of Spanish origin are rejected due to poor English-speaking skills. They file a complaint on the grounds of discrimination based on nationality. Their complaint is squashed. Here, the defense of the federal government is on the grounds of _______.
• circumstantial evidence
• inculpatory evidence
• bona fide occupational qualifications
• exclusionary rule
8. Interest-based negotiations are superior to position-based negotiations because:
• position-based negotiation is often only concerned with preparing for litigation.
• interest-based negotiations allow room for consideration of non-factual concerns, such as relationships and long-term interests.
• the difference between the interests of the parties is often large.
• interest-based negotiation requires the presence of a judge or magistrate.
9. _____________ jurisprudence supports the idea that law can and should change to meet new developments in society.
• Positive law
10. Hillward Bakers has been using a blue HB logo with a baker’s hat on the HB since their inception ten years ago. Hobart Bakers, a newly opened bakery and confectionary chain, has used the same logo. Hillward has not registered its logo, but it chooses to sue Hobart anyway. Which of the following is true of this case?
• Hillward cannot sue Hobart because logos cannot be patented or trademarked.
• Hillward can sue Hobart since the logo has been used by Hillward and is associated with it.
• Hillward cannot sue Hobart since the logo has not been registered as a trademark.
• Hobart can defend that Hillward created something that lacks utility and cannot be trademarked.
11. Ethical formalists maintain that:
• harm to an individual is allowable as long as it serves a greater good.
• values are situational and change based on circumstance.
• harm to individual rights is never justified by an increase in organizational or common good.
• the good of the many always supersedes the good of the few.
12. Interpreting Congressional intent, which of the following is never a bona fide occupational qualification (BFOQ)?
• National origin
13. Which of the following is true of tort law?
• Tort law typically deals with breach of contract.
• It sets limits on how people can act and use their resources.
• It protects people from being tried twice for the same crime.
• It provides compensation to those workers who have been injured on the job.
14. In a(n) ___________, the shareholders are taxed only on income distributed.
• limited partnership
• sole proprietorship
• limited liability company
15. The ideas and philosophies that explain the origin of law and its justification are called:
• stare decisis
• rule of law
16. Fred takes Betty to dinner at a very expensive and exclusive restaurant. The menu does not mention prices. The server takes their order and both Betty and Fred enjoy the meal immensely. When the bill comes, Fred refuses to pay because the menu had no prices and because he and the server never engaged in language indicating and offer and acceptance. The server said, “Are you ready to order?” and when Fred said “Yes,” the server merely asked “What may I get you tonight?” Which of the following is true?
• Fred is correct because no contract was formed.
• Fred must pay based on expressed contract theory.
• Fred must pay based on an implied-in-fact contract theory.
• Fred must pay based on a promissory estoppel theory.
17. Which of the following issues of administrative agencies relates to the substantive outcome of agencies’ rule-making and adjudicating authority?
• The reward system usually does not make a significant distinction between excellent, mediocre, and poor performance.
• It is very difficult to discharge unsatisfactory employees.
• The administrative process is overwhelmed with paperwork and meetings.
• Enforcement of some laws varies over time.
18. Civil enforcement powers regarding federal antitrust matters belong to _______.
• the Treasury Department
• the FTC and the Department of Justice
• the Department of Labor
• the Department of Revenue and Taxation
19. Finishing the construction of a home two days after the contract called for completion (no injury occurs) most likely will be considered _______.
• breach of contract
• substantial performance
• significant performance
• implied performance
20. Which of the following states that parties to a written contract may not introduce oral evidence to change written terms?
• The statute of frauds
• Concurrent conditions
• The parol evidence rule
• Conditions subsequent
21. Which of the following is true of the use of alternative dispute resolution (ADR) techniques?
• Disputing parties can agree to use an ADR technique after the dispute arises.
• ADR techniques are ineffective once the pretrial process has begun.
• Disputing parties cannot use an ADR technique not specified in the original agreement.
• Disputing parties must begin a lawsuit to use any form of ADR.
22. Which of the following is true under the regulations of interstate commerce?
• Intrastate activities affecting interstate commerce can be regulated only by the state governments.
• Regulation on any activity is appropriate if it aids interstate commerce.
• Activities affecting interstate commerce do not come under the power of the federal government.
• The states have the exclusive power to commerce that passes across their lines.
23. Which of the following is true of a violation of trade secrets’ rights?
• One must use another’s information without permission.
• One must misappropriate another’s information.
• Stealing another’s intellectual property violates trade secrets’ rights.
• Unauthorized use of another’s information constitutes a violation of trade secrets’ rights.
24. ____________ is a court created rule that limits when courts can review administrative decisions.
• The doctrine of exhaustion of remedies
• The doctrine of lapse
• The doctrine of estoppel
• The doctrine of primary jurisdiction
25. Which of the following is true in cases where only one party drafts the contracts that contain terms that appear vague and ambiguous to the other party?
• The court will interpret the terms as they mean in the common language.
• The court will reject the non-drafting party’s attempt to reinterpret the terms after the contract has been signed.
• The court will interpret the ambiguous and vague terms against the party that drafts them.
• The court will declare the drafting party’s behavior as a tort due to intentional ambiguity of terms.
26. Frequent, abusive, threatening phone calls by creditors are most likely to provoke the basis for a claim of _____________.
• false imprisonment and malicious prosecution
• intentional infliction of emotional distress
• malicious representation
27. Which of the following is true of the assumption of risks during delivery of goods?
• The seller is liable for any damages incurred to the goods during shipment.
• The buyer is responsible for damages to goods when the seller is about to transfer for shipment.
• The buyer is liable for any damages incurred to the goods during shipment.
• The seller is always responsible for shipping the goods to the buyer.
• An employee at-will can be fired for which of the following?
28. An employee at-will can be fired for which of the following?
• Making public the fact that the employer was cheating the government on a defense contract.
• Making public statements about the hazardous working conditions in a company.
• Taking time off from work to serve on jury duty after the boss asked the employee to request a waiver.
• Taking time off from work to care for a dependent without informing the employer.
29. Which of the following statements is true of the WARN Act?
• It requires employers to give notice of a scheduled mass layoff.
• It requires employers to give notice to an “at will” employee that he/she is being fired.
• It requires employers to give notice to employees that an unscheduled drug test will be conducted for all employees.
• It requires employers to give notice to employees that they are being subjected to polygraph tests.
30. Federal law and business leaders alike favor ____________ as a means of governing private business ethics.
• self-regulation by companies
• creating uniform statutes of business ethics
• giving the federal government exclusive jurisdiction regarding ethics and ethics violation enforcement
• establishment of federal regulators in all private companies to establish and enforce ethical standards