Creating the Enterprise 1st Edition by William B. Gartner - Test Bank

Creating the Enterprise 1st Edition by William B. Gartner – Test Bank

 

Instant Download – Complete Test Bank With Answers

 

 

Sample Questions Are Posted Below

 

Chapter 5    The Legal and Regulatory Environment of Business

 

TRUE/FALSE

 

1. Price discrimination is an illegal activity that prevents a customer from buying goods from a competitor.

 

ANS:  F                    PTS:   1

 

2. A tying contract is an illegal activity that requires a customer to purchase unwanted products to get the ones it needs.

 

ANS:  T                    PTS:   1

 

3. The Clayton Act bars price discrimination.

 

ANS:  T                    PTS:   1

 

4. The Robinson-Patman Act of 1936 prohibits companies from acquiring a company by purchasing its assets if the resulting merger or acquisition restricts trade.

 

ANS:  F                    PTS:   1

 

5. A tort is a criminal act.

 

ANS:  F                    PTS:   1

 

6. A tort involves the breach of a contract.

 

ANS:  F                    PTS:   1

 

7. Compensatory damages are payments to a victim for actual loss and suffering.

 

ANS:  T                    PTS:   1

 

8. Intentional torts occur when the wrongdoer deliberately undertakes an action that could injure another party.

 

ANS:  T                    PTS:   1

 

9. Most torts fall into the negligence category.

 

ANS:  T                    PTS:   1

 

10. Strict liability does not apply if the defendant used a reasonable amount of care to protect others from injury.

 

ANS:  F                    PTS:   1

 

11. The Uniform Commercial Code is a standard set of laws that apply to business transactions.

 

ANS:  T                    PTS:   1

 

12. Implied warranties are statements by the seller that the buyer can interpret as fact, such as indications of quality and performance.

 

ANS:  F                    PTS:   1

 

13. Express warranties can be limited or full.

 

ANS:  T                    PTS:   1

 

14. Under the Magnuson-Moss Warranty Act, express warranties for consumer goods valued at more that $10 must clearly state whether they are full or limited.

 

ANS:  T                    PTS:   1

 

15. Implied warranties are unwritten but specified by law.

 

ANS:  T                    PTS:   1

 

16. A principal acts on behalf of another party.

 

ANS:  F                    PTS:   1

 

17. A document that gives an agent the authority to act on behalf of a principal is a power of right.

 

ANS:  F                    PTS:   1

 

18. Land and buildings are examples of personal property.

 

ANS:  F                    PTS:   1

 

19. Personal property includes land.

 

ANS:  F                    PTS:   1

 

20. Intellectual property arises from a person’s creative activities.

 

ANS:  T                    PTS:   1

 

21. In property law, title passes upon partial payment.

 

ANS:  F                    PTS:   1

 

22. Copyrights extend for the life of the author plus 70 years.

 

ANS:  T                    PTS:   1

 

23. Trademarks include words, names, slogans, packaging, colors, and symbols.

 

ANS:  T                    PTS:   1

 

24. Chapter 7 bankruptcies involve the liquidation of assets.

 

ANS:  T                    PTS:   1

 

25. To be valid, a contract must involve consideration.

 

ANS:  T                    PTS:   1

 

MULTIPLE CHOICE

 

1. Organizations created by governments to develop, implement, and enforce regulations are called

a.	Enforcement agencies
b.	Mutual agencies
c.	Protective agencies
d.	Administrative agencies

 

 

ANS:  D                    PTS:   1

 

2. The Clayton Act covers

a.	Insider trading in securities
b.	Price discrimination
c.	Breach of contract
d.	Full and implied warranties

 

 

ANS:  B                    PTS:   1

 

3. The Robinson Patman Act of 1936 covers

a.	Mergers and acquisitions
b.	Insider trading
c.	Quantity discounts
d.	Bankruptcy proceedings

 

 

ANS:  C                    PTS:   1

 

4. The Celler-Kefauver Act of 1950 covers

a.	Mergers and acquisitions
b.	Bankruptcy proceedings
c.	Insider trading
d.	Price discrimination

 

 

ANS:  A                    PTS:   1

 

5. Torts involve

a.	Criminal acts
b.	Breach of contract
c.	Both a. and b,
d.	Neither a. nor b.

 

 

ANS:  D                    PTS:   1

 

6. Monetary payments that punish the wrongdoer and deter others by imposing fines that greatly exceed the actual losses are called

a.	Compensatory damages
b.	Punitive damages
c.	Liability damages
d.	Excessive damages

 

 

ANS:  B                    PTS:   1

 

7. A form of liability in which a manufacturer or seller can be held liable for any defects in a product, even if these parties exercised reasonable care is

a.	Strict liability
b.	Full liability
c.	Chargeable liability
d.	Imposed liability

 

 

ANS:  A                    PTS:   1

 

8. Warranties that are unwritten but specified by law are called

a.	Silent warranties
b.	Intentional warranties
c.	Implied warranties
d.	Understood warranties

 

 

ANS:  C                    PTS:   1

 

9. A principal transfers authority to an agent using a document called a

a.	Power of attorney
b.	Grant agreement
c.	Change of venue agreement
d.	Power of appeal

 

 

ANS:  A                    PTS:   1

 

10. Which of the following includes land

a.	Real property
b.	Personal property
c.	Both a. and b.
d.	Neither a. nor b.

 

 

ANS:  A                    PTS:   1

 

11. Which is not a form of intellectual property

a.	Copyright
b.	Trademark
c.	Patent
d.	Lease

 

 

ANS:  D                    PTS:   1

 

12. A patent gives the owner exclusive rights for a period of how many years

a.	5
b.	10
c.	20
d.	70

 

 

ANS:  C                    PTS:   1

 

13. Involuntary bankruptcy petitions are filed by

a.	Creditors
b.	Debtors
c.	Shareholders
d.	Judges

 

 

ANS:  A                    PTS:   1

 

14. Which form of bankruptcy involves a liquidation

a.	Chapter 7
b.	Chapter 11
c.	Chapter 13
d.	Chapter 15

 

 

ANS:  A                    PTS:   1

 

15. The exchange of value that makes a contract valid is called

a.	Compensation
b.	Consideration
c.	Value added
d.	Formal payment

 

 

ANS:  B                    PTS:   1

 

16. The ability of the parties to legally enter into a contract is called

a.	Contractual capacity
b.	Contractual compensation
c.	Contractual consideration
d.	Contractual congruency

 

 

ANS:  A                    PTS:   1

 

17. If one party does not perform as required under the terms of the contract, what has occurred?

a.	Destruction of contract
b.	Betrayal of contract
c.	Disavowal of contract
d.	Breach of contract

 

 

ANS:  D                    PTS:   1

 

18. The method of alternative dispute resolution in which an impartial third party hears the evidence and makes a ruling is

a.	Negotiation
b.	Arbitration
c.	Mediation
d.	Affirmation

 

 

ANS:  B                    PTS:   1

 

19. Which is not one of the questions of the three-question test of ethical behavior?

a.	Is it condoned?
b.	Is it legal?
c.	Is it balanced?
d.	How does it make me feel?

 

 

ANS:  A                    PTS:   1

 

20. Which of the below has to do with bankruptcies by individuals

a.	Chapter 7
b.	Chapter 11
c.	Chapter 13
d.	Chapter 15

 

 

ANS:  C                    PTS:   1

 

21. A contract requiring a customer to purchase unwanted products to get the ones in needs is called

a.	A reciprocal contract
b.	A tying contract
c.	A double bind contract
d.	A payoff contract

 

 

ANS:  B                    PTS:   1

 

22. Placing board members on boards of competing firms creates

a.	Interlocking directorates
b.	Reciprocal directorates
c.	Compound directorates
d.	Multiform directorates

 

 

ANS:  A                    PTS:   1

 

23. The payments for actual loss and suffering are called

a.	Tort damages
b.	Quantifiable damages
c.	Accountable damages
d.	Compensatory damages

 

 

ANS:  D                    PTS:   1

 

24. The standard set of laws that apply to business transactions is called the

a.	Codified Rules of Conduct
b.	Uniform Commercial Code
c.	Manual of Business
d.	Business Activity Rules

 

 

ANS:  B                    PTS:   1

 

25. Property arising from a person’s creative activities is called

a.	Artistic property
b.	Intelligence property
c.	Creative property
d.	Intellectual property

 

 

ANS:  D                    PTS:   1

 

ESSAY

 

1. What is the difference between an express warranty and an implied warranty?

 

ANS:

An express warranty is a statement by the seller that the buyer can interpret as fact with respect to quality and performance (e.g. full or partial repair or replacement of a defective product within a specified period of time); an implied warranty is unwritten but specified by law (e.g. the product will perform as advertised).

 

PTS:   1

 

2. What are the three ways by which intellectual property may be protected?

 

ANS:

Copyrights protect authors of written material by giving them exclusive rights to publish, perform, copy, or sell and original work. The copyright period extends for the life of the author plus 70 years; patents are legal rights granted to an inventor giving the owner exclusive rights to make, use or sell the product or process for 20 years from the date the patent application was filed; and trademarks are the words, names, slogans, packaging, colors or symbols that identify a company and its goods, and, if granted, can be used exclusively by the owner for an initial period of 20 years.

 

PTS:   1

 

3. What is the difference between Chapter 7 and Chapter 11 bankruptcy protection?

 

ANS:

Under a Chapter 7 filing, the business is liquidated and no longer operates. The unencumbered assets of the business are sold and the proceeds are used to repay creditors; under a Chapter 11 filing, the business reorganizes and continues to operate while paying a portion of its debts according to a plan filed with the court.

 

PTS:   1

 

4. What is the difference between arbitration and mediation as far as a means of resolving disputes outside of the courtroom?

 

ANS:

Arbitration involves the use of an impartial third party who hears the evidence and makes a ruling. The ruling of the arbitrator may be binding or non-binding on the parties depending upon the understanding beforehand. Mediation is a process by which the parties work together, with the assistance of a trained mediator to arrive at a mutually agreeable solution. The mediator only makes recommendations and the parties are under no obligation to accept them

 

PTS:   1