Cengage Advantage Books Business Law Text and Exercises 7th Edition by Roger LeRoy Miller - Test Bank

Cengage Advantage Books Business Law Text and Exercises 7th Edition by Roger LeRoy Miller – Test Bank

 

Instant Download – Complete Test Bank With Answers

 

 

Sample Questions Are Posted Below

 

Chapter 5

 

 

Torts and Cyber Torts

 

 

 

N.B.:  TYPE indicates that a question is new, modified, or unchanged, as follows.   N      A question new to this edition of the Test Bank. +       A question modified from the previous edition of the Test Bank, =       A question included in the previous edition of the Test Bank.

 

true/false questions

 

1. A tort is the only type of wrong that exists in the law.

 

answer:         F                               PAGE:        63                             TYPE:         =

BUSPROG: Analytic                    LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

2. Through tort law, society compensates those who suffer injuries as a result of others’ wrongful conduct.

 

answer:         t                               PAGE:        63                             TYPE:         =

BUSPROG: Analytic                    LO: 5-1                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

3. A crime is an act so reprehensible that it is considered a wrong against society as a whole, as well as against the individual victim.

 

answer:         T                               PAGE:        63                             TYPE:         N

BUSPROG: Analytic                    LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

4. In a tort action, the state prosecutes and punishes persons who cause injury to others.

 

answer:         F                               PAGE:        63                             TYPE:         N

BUSPROG: Analytic                    LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

5. Very few states have limited the amount of damages that can be awarded in tort cases.

 

answer:         F                               PAGE:        64                             TYPE:         N

BUSPROG: Analytic                    LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Critical Thinking

 

6. Class-action lawsuits are suits in which a number of persons join together to bring an action.

 

answer:         T                               PAGE:        64                             TYPE:         N

BUSPROG: Analytic                    LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

7. To commit an intentional tort, one person must intend to harm a certain person.

 

answer:         F                               PAGE:        65                             TYPE:         =

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

8. For a tort to be considered intentional, the tortfeasor must have an evil or harmful motive.

 

answer:         F                               PAGE:        65                             TYPE:         =

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Critical Thinking

 

9. False imprisonment occurs when a person restrains another intentionally and without justification.

 

answer:         T                               PAGE:        65                             TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

 

 

10. Defense of others is a defense to an allegation of both battery and assault.

 

answer:         T                               PAGE:        65                             TYPE:         +

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

11. Defense of property is NOT a defense to an allegation of assault or battery.

 

answer:         F                               PAGE:        65                             TYPE:         N

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

12. Defense of others is a defense to an allegation of battery, but not assault.

 

answer:         F                               PAGE:        65                             TYPE:         N

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

13. Consent is a defense to an allegation of both assault and battery.

 

answer:         T                               PAGE:        65                             TYPE:         +

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

14. 14. The public disclosure of private facts about a person is an invasion of privacy.

 

answer:         T                               PAGE:        67                             TYPE:         +

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

15. Statements made by members of Congress on the floor of Congress are NOT privileged communications and may be the basis for defamation charges.

 

answer:         F                               PAGE:        67                             TYPE:         N

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

16. The use of a person’s likeness for commercial purposes without permission is appropriation.

 

ANSWER:         T                               PAGE:        67                             TYPE:         =

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

17. The courts consider legitimate competitive behavior permissible only if it does not result in the breaking of a contract.

 

answer:         F                               PAGE:        69                             TYPE:         N

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

18. A house is an example of personal property.

 

answer:         F                               PAGE:        69                             TYPE:         N

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

19. If it can be shown that a trespass to land was warranted, a complete defense exists.

 

ANSWER:         T                               PAGE:        69                             TYPE:         =

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

20. Unlawfully taking personal property is conversion.

 

ANSWER:         T                               PAGE:        70                             TYPE:         +

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

21. A failure to return personal property is disparagement of property even if the rightful owner consented to the initial taking.

 

answer:         F                               PAGE:        70                             TYPE:         +

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

22. Failure to live up to a standard of care may be an act or an omission.

 

answer:         T                               PAGE:        71                             TYPE:         N

BUSPROG: Analytic                    LO: 5-4                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

 

 

23. To determine whether a duty of care has been breached, a judge asks how a reasonable person would have acted in the same circumstances.

 

answer:         T                               PAGE:        71                             TYPE:         +

BUSPROG: Analytic                    LO: 5-4       Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

24. To avoid liability for negligence, a business owner must protect its pa­trons against all risks.

 

answer:         F                               PAGE:        71                             TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

25. Only persons who are explicitly invited onto a business’s premises are considered business invitees.

 

answer:         F                               PAGE:        71                             TYPE:         N

BUSPROG: Analytic                    LO: 5-4                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

26. Some risks are obvious but, with respect to the duty of care required to establish negligence, a warning is always necessary.

 

ANSWER:         F                               PAGE:        71                             TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

27. Under the theory of negligence, the duty of care requires a careless act.

 

answer:         F                               PAGE:        71                             TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

28. If no harm results from an allegedly negligent act, there is no liability.

 

answer:         t                               PAGE:        71                             TYPE:         =

BUSPROG: Analytic                    LO: 5-4                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

 

 

29. Proximate cause exists when the connection between an act and an in­jury is strong enough to justify imposing liability.

 

answer:         T                               PAGE:        72                             TYPE:         =

BUSPROG: Analytic                    LO: 5-4                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

30. Harm must be foreseeable to be considered the proximate cause of an injury in negligence.

 

answer:         T                               PAGE:        73                             TYPE:         =

BUSPROG: Analytic                    LO: 5-4                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

31. Self-defense is a defense to negligence.

 

answer:         f                               PAGE:        73                             TYPE:         =

BUSPROG: Analytic                    LO: 5-4                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

32. An assumption of risk defense does not require that a risk be voluntarily assumed.

 

answer:         f                               PAGE:        73                             TYPE:         =

BUSPROG: Analytic                    LO: 5-4                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

33. Under the doctrine of comparative negligence, only the plaintiff’s negligence is taken into consideration.

 

answer:         F                               PAGE:        74                             TYPE:         +

BUSPROG: Analytic                    LO: 5-4                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

34. The extreme risk of an activity is a defense against imposing strict liability.

 

ANSWER:         F                               PAGE:        74                             TYPE:         N

BUSPROG: Analytic                    LO: 5-5                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Critical Thinking

 

 

 

35. An Internet service provider cannot be held liable for disseminating others’ defamatory remarks.

 

ANSWER:         T                               PAGE:        75                             TYPE:         =

BUSPROG: Reflective                 LO: 5-5                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

 

MULTIPLE-CHOICE questions

 

1. Ike pushes Joan, who falls and breaks her arm. Ike is liable for the injury

 

1. if Ike intended to push Joan.
2. only if Ike did not intend to break Joan’s arm.
3. only if Ike had a bad motive for pushing Joan.
4. only if Ike intended to break Joan’s arm.

 

ANSWER:         A                               PAGE:        63                             TYPE:         =

BUSPROG: Reflective                 LO: 5-1                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

2. The Class Action Fairness Act of 2005

 

1. shifted jurisdiction over certain class-action lawsuits from the state courts to the federal courts.
2. shifted jurisdiction over certain class-action lawsuits from the federal courts to the state courts.
3. made forum shopping punishable by large fines.
4. limited the amount of damages that could be awarded in a medical malpractice suit.

 

ANSWER:         A                               PAGE:        64                             TYPE:         N

BUSPROG: Analytic                    LO: 5-2                Bloom’s: Knowledge

Dif: Easy                                                       AICPA: BB-Legal

 

 

 

3. Mary is angry with Julia so she waits outside Julia’s house and hits Julia with a baseball bat as Julia leaves the house. When Julia sues Mary for battery, Mary will be considered a

 

1. victim.
2. tortfeasor.
3. plaintiff.
4. unreasonable person.

 

ANSWER:         B                               PAGE:        65                             TYPE:         N

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

4. Louis—larger and stronger than Mica—threatens to hit Mica before hitting and injuring him. Mica files a suit against Louis for assault and battery. Mica will most likely recover for

 

1. assault and battery.
2. assault but not battery.
3. battery but not assault.
4. neither assault nor battery.

 

ANSWER:         A                               PAGE:        65                             TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

5. Pete takes Lauren on a date. At the end of the date, Pete asks Lauren if he can kiss her. Lauren nods and Pete kisses her. The next day Lauren is mad that Pete has not called her so she sues him for battery for kissing her. Pete’s defense to the allegation of battery will be

 

1. defense of others.
2. self-defense.
3. consent.
4. legal responsibility.

 

ANSWER:         C                               PAGE:        65                             TYPE:         N

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

6. Roger wants Andy to work late on a project. He tells Andy that the morally correct thing to do is to stay late at the office and work on the project. Andy feels obligated to stay and work late due to the moral pressure from Roger. Andy stays late at the office, even though he does not want to. Andy can sue Roger for

 

1. false imprisonment.
2. battery.
3. defamation.
4. no tort.

 

ANSWER:         D                               PAGE:        66                             TYPE:         N

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

7. Jackie distributes a handbill among her neighbors accusing one of them—Ked—of being a convicted sex offender. The statement is defamatory if

 

1. a neighbor repeats it.
2. Ked suffers emotional distress.
3. the statement is true.
4. the statement is false.

 

ANSWER:         D                               PAGE:        66                             TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

8. Glen falsely accuses Hu of stealing from Island Tours, Inc., their employer. Glen’s statement is NOT defamatory if

 

1. only Hu hears it.
2. a third party hears it.
3. the statement is published.
4. the statement is a lie.

 

ANSWER:         A                               PAGE:        66                             TYPE:         +

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

 

 

9. Liz trespasses on Mega Corporation’s property. Through the use of rea­sonable force, Mega’s security guard Ned detains Liz until the police ar­rive. Mega is liable for

 

1. assault.
2. battery.
3. false imprisonment.
4. none of the choices.

 

answer:         D                               PAGE:        66                             TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

10. Jane develops a new color of lipstick. To market her lipstick, Jane uses a computer design program to show a famous model using Jane’s lipstick. Jane does not ask the model’s permission. The model can sue Jane for

 

1. battery.
2. fraudulent misrepresentation.
3. defamation.
4. appropriation.

 

ANSWER:         D                               PAGE:        67                             TYPE:         N

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Application

Dif:  Moderate                                                      AICPA: BB-Legal

 

11. Obie accuses Portia, a broker with QT Financial Services, of fraudulently inducing him to invest in Riske Development Company, whose stock price declines in value. The reliance that gives rise to liability for fraud requires

 

1. a subjective statement.
2. misrepresentation of a fact knowing that it is false.
3. puffery.
4. seller’s talk.

 

answer:         B                               PAGE:        67                             TYPE:         =

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

 

 

12. Jim is an appliance salesperson. To make a sale, he asserts that a certain model of a Kitchen Helper refrigerator is the “best one ever made.” This is

 

1. fraud if the statement is the truth.
2. fraud if Jim believes that this statement is not true.
3. fraud if Jim is stating his opinion, not the facts.
4. not fraud.

 

ANSWER:         D                               PAGE:        67                             TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

13. Barbara is selling her car. She knows that the brakes do not work. When a potential buyer asks Barbara if there are any problems with the car, Barbara assures the buyer that there are no problems. The buyer purchases the car based on the assurance that there is nothing wrong with it. The buyer may be able to sue Barbara for

 

1. assault.
2. defamation.
3. fraudulent misrepresentation.
4. appropriation.

 

ANSWER:         C                               PAGE:        67                             TYPE:         N

BUSPROG: Analytic                    LO: 5-3                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

14. Kai files a suit against Lana based on one of Lana’s statements that Kai alleges is fraudulent. To give rise to fraud, the statement must be one of

 

1. emotion.
2. fact.
3. illusion.
4. opinion.

 

answer:         B                               PAGE:        67                             TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

 

 

15. Dom, an EZ Baked Goods salesperson, follows Flora, a salesperson for Goody Pastries, Inc., as she attempts to make sales to food stores. Dom solicits each of Flora’s customers. Dom is most likely liable for wrongful inter­ference with

 

1. a bargaining relationship.
2. a business relationship.
3. a contractual relationship.
4. a customer relationship.

 

answer:         B                               PAGE:        68                             TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

16. OK Dry-Cleaning advertises so effectively that the regular customers of its competitor Purity Cleaners patronize OK instead of Purity. This is

 

1. appropriation.
2. conversion.
3. wrongful interference with a contractual relationship.
4. none of the choices.

 

answer:         D                               PAGE:        68                             TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

17. Manuel is walking past Thomas’s house when he hears a smoke alarm going off. He also hears a child calling for help and sees smoke coming from a window. Manuel rushes into Thomas’s house, finds the child and brings it outside. If Thomas sues Manuel for trespass to land, Manuel’s defense will probably be

 

1. assisting someone in danger.
2. consent.
3. self-defense.
4. the reasonable person defense.

 

ANSWER:         A                               PAGE:        69                             TYPE:         N

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

 

 

18. Bella owns a farm in Colorado. Doyle drives his sport utility vehicle off a highway and onto Bella’s land. Doyle commits trespass if he

 

1. does not have Bella’s permission to drive on the property.
2. drives onto the property for recreational purposes.
3. harms the property in a material way.
4. harms the property in any way.

 

ANSWER:         A                               PAGE:        69                             TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

19. Susan takes her car to Ken’s repair shop and asks him to fix the car’s brakes. Ken completes the work and sends Susan a bill for $100. Susan refuses to pay so Ken refuses to return Susan’s car. Susan can probably successfully sue Ken for

 

1. battery.
2. conversion.
3. trespass to property.
4. none of the choices.

 

ANSWER:         D                               PAGE:        69                             TYPE:         N

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

20. As a joke, Jem takes Kyla’s business law textbook and hides it so that Kyla cannot find it during the week before the exam. Jem may have committed

 

1. appropriation.
2. conversion.
3. disparagement of property.
4. trespass to personal property.

 

ANSWER:         D                               PAGE:        69                             TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

 

 

21. In newspaper ads, Lo-Price Autos falsely accuses My-T Value Vehicles, a competitor, of selling stolen cars. My-T’s sales decrease. Lo-Price has most likely committed

 

1. slander of quality.
2. slander of title.
3. wrongful interference with a business relationship.
4. none of the choices.

 

answer:         B                               PAGE:        70                             TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

22. Lizzie, a clerk at a Movies Unlimited store, takes a DVD player from the store without permission. Lizzie is liable for

 

1. appropriation.
2. benefiting an employee.
3. conversion.
4. wrongful interference with a business relationship.

 

ANSWER:         C                               PAGE:        70                             TYPE:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

23. Bette backs out of City Parking Garage, colliding with Dill’s car. Dill may recover $7,500 to cover the cost of the repairs if Bette failed to act as

 

1. a blameless person.

b          a faultless person.

1. a holistic person.
2. a reasonable person.

 

answer:         D                               PAGE:        71                             TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

 

 

24. Cook’s Pantry Appliances, a retail store, must use reasonable care on its premises to warn its patrons of

 

1. all risks.
2. hidden risks.
3. obvious risks.
4. no risks.

 

answer:         B                               PAGE:        71                             TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

25. Kelly is injured when she slips and falls on Layla’s sidewalk. To determine whether Layla owed a duty of care to Kelly, Layla is subject to the standard of

 

1. a realistic person.
2. a reasonable person.
3. a recognizable person.
4. a reliable person.

 

ANSWER:         B                               PAGE:        71                             TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Legal

 

26. Margaret is walking out of a department store. She is carrying lots of packages and talking on her cell phone. She is so distracted that she forgets to open the door and walks into it. She falls and breaks her ankle. Margaret can sue the department store for

 

1. negligence.
2. battery.
3. breach of duty of care.
4. none of the choices.

 

ANSWER:         D                               PAGE:        71                             TYPE:         N

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

 

 

27. An Iowa state statute requires amusement parks to maintain equipment in specific condition for the protection of patrons. Jack’s Fun Park fails to maintain its equipment. Keely, a patron, is injured. Jack’s has committed

 

1. abuse of process.
2. battery.
3. false imprisonment.
4. negligence.

 

ANSWER:         D                               PAGE:        71                             TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

28. A Rhode Island state statute requires machinery in industrial plants to include automatic shut-off switches accessible to each employee working on the machine. Steel Company’s equipment does not have the switches. Trudy, a Steel employee, suffers an injury that an accessible shut-off switch would have prevented. Trudy’s best theory for recovery is

 

1. assault.
2. assumption of risk.
3. invasion of privacy.
4. negligence.

 

answer:         D                               PAGE:        71                             TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

29. Caleb is driving a car in which Duffy is a passenger when an accident occurs. Caleb and Duffy are emotionally rattled, but neither is physically hurt. Caleb is not liable to Dufy on a negligence theory because

 

1. both parties were emotionally rattled.
2. Caleb did not apparently intend to cause an accident.
3. Duffy must have been comparatively negligent.
4. Duffy was not injured.

 

ANSWER:         D                               PAGE:        72                             TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

 

 

30. Nico is a passenger in a car driven by Owen, whose reckless driving causes an accident, injuring himself. Nico, uninjured, accompanies Owen to Parkside Hospital in an ambulance. The ambulance is hit by a car driven by Quin, injuring Nico. Nico files a suit against Owen, alleging negligence. The element most likely to be a question for the court to decide is

 

1. causation in fact.
2. proximate cause.
3. the duty of care.
4. the injury requirement.

 

answer:         B                               PAGE:        72                             TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

31. Ralph, a van driver for Speedy Delivery Company, causes a multi-vehicle accident on a city street. Ralph and Speedy are liable to

 

1. all those who were injured.
2. only those who were uninsured.
3. only those whose injuries could have been reasonably foreseen.
4. only those whose vehicles were closest to Ralph’s van.

 

ANSWER:         C                               PAGE:        73                             TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

32. Liu enters Mountain Triathlon, an athletic competition in which Liu has never competed. Regarding the risk of injury, Liu assumes the risks

 

1. attributable to the Triathlon in any way.
2. different from the risks normally associated with the Triathlon.
3. greater than the risks normally associated with the Triathlon.
4. normally associated with the Triathlon.

 

answer:         D                               PAGE:        73                             TYPE:         =

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Comprehension

Dif: Moderate                                                       AICPA: BB-Legal

 

 

 

33. Richard is an avid baseball fan and attends baseball games whenever he can. Richard considers himself an expert on all things, including risks, related to baseball. One day a ball flies into the stands, hits Richard in the head and seriously injures him. Richard can probably successfully win a case against the sports stadium based on

 

1. negligence.
2. breach of duty of care.
3. defamation.
4. none of the choices.

 

ANSWER:         D                               PAGE:        73                             TYPE:         N

BUSPROG: Reflective                 LO: 5-4                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

34. Jean is playing a computer game on a bad disk that melts in her drive, starting a fire that injures her hands. Jean files a suit against K-Tech, Inc., the game’s manufacturer. K-Tech is held liable under the doctrine of strict liability. A significant appli­cation of this doctrine is in the area of

 

1. cyber torts.
2. intentional torts.
3. product liability.
4. unintentional torts.

 

answer:         C                               PAGE:        74                             TYPE:         =

BUSPROG: Analytic                    LO: 5-5                Bloom’s: Comprehension

Dif: Easy                                                       AICPA: BB-Critical Thinking

 

35. Oakley posts a defamatory remark about Pierre in “Roominate,” an online social network maintained by SocNet, Inc., an Internet service provider. Most likely to be held liable for the remark is

 

1. Oakley.
2. Pierre.
3. Roominate.
4. SocNet.

 

ANSWER:         A                               PAGE:        75                             TYPE:         =

BUSPROG: Technology               LO: 5-5                Bloom’s: Application

Dif: Moderate                                                       AICPA: BB-Legal

 

 

ESSAY questions

 

1. Precise Engineering Corporation has a contract with Quik Mart Stores to provide customized software for Quik’s inventory control system. Retail Outlets, Inc., Quik’s competitor, induces Sam, a Precise subcon­trac­tor who is writing code for the Quik software, to delay delivery of the code for one week. As a result, Precise’s delivery of the software is delayed, and Quik sustains $500,000 in lost profits. On what ground could Quik recover damages from Retail Outlets?

 

ANSWER:         Quik could file an action against Retail Outlets based on wrongful interference with a contractual relationship. The elements that Quik must prove are (1) a valid, enforceable contract between two parties; (2) the knowledge of a third party that this contract exists; and (3) the third party’s intentionally causing the breach of the contract for the pur­pose of advancing the interest of the third party. For a successful tort ac­tion, there must also be damages caused by the third party’s act. Facts that satisfy all of these elements are set out in the problem. There was a valid, enforceable contract between Precise and Quik. Retail Outlets knew of this contract, Retail Outlets intentionally interfered with this contract, causing its breach, for the purpose of advancing its own interest (undercutting the profit of its competitor). Quik suffered lost profits as a result of Retail Outlets’ act.

 

PAGE:  68                                                                    type:               =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Analysis

Dif: Challenging                                                    AICPA: BB-Decision Modeling

 

2. After two years of research and an investment of a substantial amount of money, Coast-to-Coast Company (CC) develops a new product that it hopes will produce substantial profits. CC learns that a competitor, National Sales, Inc., has made and begun to sell a nearly identical prod­uct. CC learns from a reliable source that National paid a CC employee to obtain the plans for CC’s product when it was in development. What legal re­course does CC have against National?

 

ANSWER:         In terms of legal recourse against National, CC might base a civil suit on charges of conversion and trespass to personal property. Conversion is any act depriving an owner of personal property without that owner’s permission and without just cause. Conversion is the civil side of crimes related to theft. When conversion occurs, trespass to per­sonal property usually occurs as well. If the initial taking of the property was unlaw­ful, there is trespass; retention of that property is conversion. CC might have a claim for wrong­ful interference with a contractual re­la­tionship for inducing the CC employee to break his or her employment contract with CC by selling company secrets.

 

PAGES: 68 & 69-70                                                                              type:         =

BUSPROG: Reflective                 LO: 5-3                Bloom’s: Analysis

Dif: Challenging                                                    AICPA: BB-Decision Modeling