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ETH 321 Final Exam Guide NEW

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1
Which of the following statements is true of a
grand jury?

A grand jury has the authority to subpoena


business records relevant to a lawsuit.

A grand jury determines whether the accused in a


lawsuit is innocent or guilty.

At least 20 members should be present on a grand


jury to examine evidences and vote on a case.

For an indictment to be returned, only one-third of


a grand jury needs to agree that a crime has been
committed.
2
Alan and Miriam are engaged in a debate on the
importance of intellectual property rights. While
Alan holds the view that intellectual property
protection safeguards the interests of businesses,
Miriam thinks that it ultimately puts businesses at
a disadvantage by hampering the dissemination of
information. Which of the following arguments is
most likely to be raised by Alan to strengthen his
proposition?

Intellectual property rights reduce the pace of


research and development drastically.

Intellectual property rights result in an increased


availability of products.

Intellectual property rights reduce businesses’


market share by facilitating competition.

Intellectual property rights allow businesses to


charge premium prices for their products.
3
According to the __________, the acceptance of an
offer results in a binding contract only if it exactly
matches the terms of the offer.
mirror image rule

parol evidence rule

exclusive remedy rule

mailbox rule
4
The __________ enacted in 1938 established
minimum wage, overtime pay, and record-keeping
requirements.

Uniformed Services Employment and


Reemployment Rights Act

Family and Medical Leave Act

Fair Labor Standards Act

Worker Adjustment and Retraining Notification


Act
5
The term __________ refers to the placing of an
individual in immediate apprehension for his or
her physical safety.

defamation
conversion

assault

battery
6
The term __________ refers to any change in the
ownership of a business organization that would
alter its legal existence.

dissolution

consideration

rescission

conversion
7
Which of the following statements is true of the
Securities and Exchange Commission?

Its members are appointed by the senate for a


term of four years.

It is responsible for implementing the federal


securities laws.
It lacks the authority to frame rules regarding
transactions of securities.

Its members are either lawyers or security


analysts.
8
A system of equally applied law is a necessity for
the foundation of a strong, productive economy
because it:

allows economically strong nations to exploit the


resources of weaker nations.

incentivizes private businesses to restrict job


opportunities for well-educated people.

encourages strangers to make agreements on


certainty and trust.

prohibits individuals from trading in modern


private markets.
9
Which of the following scenarios illustrates a
formalist approach to business decisions?

Selling products by deceiving customers about


possible negative aspects of the products

Monitoring employee browsing history without


their consent to curb non-productive activities

Informing new customers about delays in


production schedules

Assigning significantly high productivity targets to


reduce costs
10
A(n) __________ refers to the individual or business
entity offering a security for sale to the public.

controlling person

seller

issuer

underwriter
11
Windy and Ruby plan to present a paper on
intellectual property rights. They decide that
Windy will present the arguments in favor of
intellectual property rights and that Ruby will
argue how intellectual property rights could be
detrimental to businesses and their customers.
Which of the following is most likely to be Ruby’s
argument?

Intellectual property rights reduce businesses’


prospects of economic return on investment.

Intellectual property rights reduce the pace of


research and development drastically.

Intellectual property rights result in a decrease in


the availability of products.

Intellectual property rights do not allow


businesses to charge premium prices for their
products.
12
Which of the following statements is true of white-
collar crimes?

They are usually committed for personal financial


gain.

They rarely affect consumers of a business.

They rarely occur in business environments.


They are dependent on the threat of physical force.
13
Which of the following scenarios illustrates a
bilateral contract?

Grapevine Inc. follows a five-day workweek system


and also offers a compressed workweek option.

Sameera, a writer, signs a contract with her


publisher to publish her book.

Helen, a painter, signs a contract with an art


gallery that agrees to purchase her painting for
$2000.

The management of Uno Inc. offers additional


benefits to its employees annually.
question14
The Equal Employment Opportunity Commission
was created through the __________.

National Labor Relations Act

Civil Rights Act

Age Discrimination in Employment Act


Americans with Disabilities Act
15
Concerted efforts to lobby government officials,
irrespective of their anticompetitive purposes, are
given an exception from the Sherman Act under
the __________.

overbreadth doctrine

Colgate doctrine

Noerr-Pennington doctrine

incorporation doctrine
16
A __________ is the simplest and least expensive
business institution to create.

limited liability company

partnership

sole proprietorship

corporation
17
In a state court system, lawsuits filed by parties
typically begin at the __________.

federal district court level

appellate court level

trial court level

supreme court level


18
According to the Commerce Clause, the power to
regulate interstate commerce is vested with
__________.

state governments

state-level courts

the federal government

the U.S. Supreme Court


19
A business decision maker’s decision is more likely
to raise ethical concerns in a society where:

there is an increase in demand for public


education.
the family structure is stable.

the news media and the Internet have significant


influence.

there is a decrease in economic interdependence.


20
How does law hold diverse people of different
backgrounds into large, organized groups?

It prevents enforcement institutions from


enforcing written rules on strangers.

It tells the members of a society what they can and


cannot do.

It discourages people from making agreements


based on certainty and trust.

It allows strangers to adopt rules that support


their beliefs.
21
Courts determine whether the language of an offer
was clear enough to result in a contract by:

examining the objective intent of the offeror.


investigating whether an offeree actually accepted
the offer.

examining the adequacy of the consideration


offered.

analyzing whether the terms of the acceptance


matches the terms of the offer.
22
Who among the following individuals commits a
battery?

Amanda, who fires her employee Trevor without


any notice and causes him severe mental distress

Yuki, who injures her boss Reese with a knife and


inflicts serious injuries on him

Joan, the customer care manager in a retail store,


who verbally threatens a customer who calls to
complain about a faulty product

Vincent, the CEO of Gregon Inc., who pays media


firms to circulate false information about Gregon’s
chief competitor
23
Fuzo Inc., a manufacturer of leather bags, enters
into a contract with a firm regarding the
installation of a machine in Fuzo’s factory. Fuzo
agrees to pay $1000 for the machine and another
$200 as the installation charge. In this scenario,
the terms of the sale will be covered under
__________.

the Federal Arbitration Act

the Uniform Commercial Code

the Foreign Corrupt Practices Act

the Internal Revenue Code


24
The term __________ refers to the act of referring a
matter to arbitration.

submission

settlement

litigation

conflict
25
__________ is a legal remedy to a breach of contract by
which each party to the contract returns the
consideration offered by the other.

Arbitration

Specific performance

Negotiated settlement

Rescission
26
Which of the following statements is true of
alternative dispute resolution (ADR) systems?

ADR systems increase the costs incurred during


the litigation process.

The parties to a dispute need not present the case


to a jury before opting for ADR systems to settle
the dispute.

ADR systems cannot be used for dispute resolution


in contractual relationships unless they are
specified in the contract.

The litigation process precludes the use of ADR


systems.
27
The __________ is the constitutional provision that
details the federal government’s power to regulate
business activities.

Commerce Clause

liquidated damages clause

equal protection clause

supremacy clause
question
28
Which of the following legal remedies to a breach
of contract allows the parties to the contract to
agree to abide by the decision of a third party or
parties?

Arbitration

Specific performance

Negotiated settlement

Rescission
29
__________ refers to an agreement made between
competitors in an industry to fix prices of their
products.

Horizontal price fixing

Resale price fixing

Indirect price fixing

Vertical price fixing


30
The petition for a writ of certiorari by the losing
party of a litigation will be reviewed by the U.S.
Supreme Court:

if the winning party agrees to subsequent reviews.

if the federal district courts and the courts of


appeal correct the judicial errors charged against
the state court.

if at least one of the nine justices vote to take the


case.

if there is a major conflict between the trial and


appellate courts on the interpretation of federal
law.