Indicate whether each of the following statements is true or false. 7. Both breach of warranty and product liability lawsuits are based on tort law rather than contract law. 8. The four elements of a product liability lawsuit are duty, breach, proximate cause, and damages. 9. A design defect is a hazardous condition that exists throughout an entire product line. 10. An alteration that a buyer makes in a product is known as a product flaw. 11. Manufacturers and retailers have a duty to warn users of dangerous or hazardous characteristics of products. 12. Only manufacturers can be held liable in product liability lawsuits. 13. The manufacturer is in a better position than the user of a product to prevent injuries because the company has the opportunity to design safe products. 14. One consequence of strict liability is that companies are sometimes hesitant to introduce new or innovative products because of the fear of liability lawsuits. 15. In Phase II of the drug-testing process, the effectiveness of the drug is measured by comparing subjects who receive the drug to those who receive a placebo. 16. It is perfectly safe to purchase prescription drugs over the Internet. 17. Advertising of drugs is legal so long as detailed information about the drug being advertised is disclosed. 18. The Consumer Product Safety Commission regularly conducts tests of consumer products sold in the United States. 19. Under the terms of the Master Settlement Agreement, cigarette packages must contain a warning from the surgeon general regarding the dangers of smoking. 20. The National Highway Traffic Safety Administration has the responsibility of controlling automobile emissions.
> Stotts was employed as a technician in the engineering department of Raytron Corporation. All the engineers on staff were required to sign agreements that they would not accept employment with another company in the industry within three years of leaving
> The law in a particular state provided that the commissioner of insurance had the authority to approve or not approve the rates charged consumers for automobile insurance. The managers of a particular insurance company believed that the services they pro
> Siwek took his new Buick to his dealer for minor repairs. While the car was in the dealer’s repair shop, the dealer informed Siwek that the car was equipped with a Chevrolet engine. The standard engine for a car of the model and year in question was a 2.
> Dasey was employed as a state trooper by the Massachusetts Department of State Police. In his employment application, Dasey stated that he had not used illegal drugs during the previous five years. Later, during an unrelated homicide investigation, a vid
> The GDGS Corporation adopted an arbitration policy and announced it to its employees via e-mail. The policy stated that arbitration was the exclusive means of resolving legal disputes between employees and the company. When Campbell, one of the employees
> Ayer, an engineer with product development responsibilities, was confronted with an ethical dilemma. He knew that a product being manufactured by the firm was unsafe for consumer use as a result of cost cutting. He also believed that if he complained to
> Distinguish between the two most commonly used advance directives—the living will and the durable power of attorney for health care.
> Packerd owned a restaurant that employed several employees as servers. When sales began to decline, Packerd decided to fire three servers. He selected Artemuk, who had numerous complaints about her service; Bednerz, who would soon be leaving for jury dut
> Zanucky was employed by a furniture store as a driver of a delivery truck. While making a delivery, he negligently drove through a red light, and the delivery truck struck a vehicle operated by Gittins, who was injured in the accident. a. Can Gittins sue
> What are the three major classifications of crimes?
> What is the difference between a tort and a crime?
> Explain why legislatures establish regulatory agencies.
> Discuss several responses by businesses to ethical issues.
> Discuss the relationship between ethics and the law.
> Suggest several unfavorable consequences facing a business firm that consistently engages in unethical practices.
> Discuss and provide examples of values that are highly regarded in our society.
> Identify some typical issues for people who are ethically concerned with the environment.
> Discuss five exceptions to foreign sovereign immunity pursuant to the Foreign Sovereign Immunities Act.
> Describe the two broad categories of ethical reasoning, including the similarities and differences between the two.
> Define negligence and distinguish between the different types of negligence.
> Describe conversion and explain its main purpose.
> Explain the two common defenses to charges of defamation.
> Explain the differences between libel and slander.
> Describe defamation.
> Explain the nature of torts and identify some common torts.
> Discuss several common crimes of particular concern to businesses and employees.
> Identify the three major classifications of crimes.
> Define crime and distinguish between crimes and torts.
> Discuss the goals of NAFTA and the means it uses to achieve these goals.
> Discuss some ways businesses can ensure ethical practices.
> Discuss the relationship between law and ethics.
> Cite several influences on group and individual values.
> Distinguish moral law from legal obligations.
> Cite and describe the major classifications of law.
> Explain the reasons for the preparation of the Uniform Commercial Code.
> Identify the principal sources of law in the United States.
> Distinguish among ethics, morals, and values.
> Discuss the application of law in today’s world.
> Indicate whether each of the following statements is true or false. 11. Fraud may be committed either by spoken or written words or by acts or conduct. 12. Intentional concealment of material facts is just as fraudulent as making false statements. 13. A
> Explain some provisions of the Master Settlement Agreement.
> Indicate whether each of the following statements is true or false. 11. In order for an offer to be valid, it must be definite and certain. 12. The person who makes a proposal to enter into a contract is the offeror. 13. In order for an acceptance to be
> Indicate whether each of the following statements is true or false. 16. All agreements between two competent parties are contracts. 17. Written contracts must be handwritten to be legally enforceable. 18. Implied contracts are those dealing only with per
> Indicate whether each of the following statements is true or false. 6. Each level of government usually has three branches: executive, legislative, and judicial. 7. Executives at all levels of government are elected by the voters. 8. The heads of adminis
> Indicate whether each of the following statements is true or false. 16. The federal Constitution has been amended more than 100 times. 17. Both federal and state courts have the power to determine whether laws enacted by legislatures or decisions made by
> Indicate whether each of the following statements is true or false. 11. A tort is a violation of the rights of a particular person. 12. Tort law is concerned with compensation for losses suffered by injured parties. 13. Defamation includes both libel and
> Indicate whether each of the following statements is true or false. 11. When a patient consults with a physician, the two parties are entering into a legally binding contract. 12. When a physician or other health care provider acts negligently, the patie
> Indicate whether each of the following statements is true or false. 11. The United States lacks the abundance of natural resources that many other countries have. 12. Environmental regulation is not yet a distinct area of the law. 13. The Clean Air Act o
> Indicate whether each of the following statements is true or false. 13. International law is the broad study of the legal systems of major countries, treaties, practices, tariffs and nontariff trade barriers, and import and export quotas. 14. There is li
> Indicate whether each of the following statements is true or false. 6. While the term malpractice is usually applied to physicians, dentists, attorneys, and accountants, it may be applied to all professionals. 7. Good Samaritan laws provide medical profe
> Summarize the testing procedure required by the Food and Drug Administration in order to gain approval to sell a drug.
> Indicate whether each of the following statements is true or false. 8. Acts of an employee while performing duties of employment are considered the acts of the employer. 9. Workers’ compensation laws are designed to ensure that all employees are paid fai
> Indicate whether each of the following statements is true or false. 6. An employee may sue a third party for a work-related injury or illness, even if the injury or illness occurred while the employee was on the job. 7. Federal law requires that employer
> Indicate whether each of the following statements is true or false. 6. The Securities and Exchange Commission requires that prospective investors review all of a firm’s financial information prior to purchasing any stock in the company. 7. Touting occurs
> Indicate whether each of the following statements is true or false. 9. Employers in all states are prohibited from asking for social media passwords. 10. Defamatory social media speech is a tort. 11. Employers are not allowed to implement any restriction
> Indicate whether each of the following statements is true or false. 11. The purpose of criminal law is to compensate injured parties for their losses. 12. If a person’s reckless driving results in an automobile accident, he or she can be charged with bot
> Indicate whether each of the following statements is true or false. 6. Individuals making statements in chat rooms have an absolute right to privacy. 7. There are currently no laws prohibiting the use of cookies in the case of adult computer users. 8. Em
> Indicate whether each of the following statements is true or false. 6. A contract in which an employee agrees not to work for a competitor for a reasonable period of time is unenforceable. 7. A buyer who purchases a business from a seller receives title
> Indicate whether each of the following statements is true or false. 16. The probate court is responsible for supervising the operation of a will and the settling of an estate. 17. When a person dies intestate, the court appoints an executor to settle the
> Indicate whether each of the following statements is true or false. 16. A tenant can legally occupy a landlord’s property only with the consent of the landlord. 17. The tenant’s rights in rented property are superior to those of the landlord. 18. The lan
> Indicate whether each of the following statements is true or false. 11. A bailment requires that title pass at the time the bailment is created. 12. Bailments can be express or implied. 13. Anyone in possession of goods can create a bailment relationship
> Explain the legal reasoning behind the concept of strict liability and weigh its consequences for businesspeople and consumers.
> Indicate whether each of the following statements is true or false. 16. “Property” refers to both personal and real property. 17. Fixtures are additions to personal property. 18. Personal property can be either tangible or intangible. 19. There is no dis
> Indicate whether each of the following statements is true or false. 16. The writing a holder puts on the back of a negotiable instrument is known as a negotiation. 17. An endorsement of an instrument must be for the entire amount. 18. The Uniform Commerc
> Indicate whether each of the following statements is true or false. 16. The law presumes that commercial paper was issued for value. 17. A subsequent holder of commercial paper can have no greater rights than the original holder. 18. The words “pay to th
> Indicate whether each of the following statements is true or false. 16. Persons familiar with good accounting practices recognize that assets should never exceed liabilities. 17. In most instances, when bankruptcy is filed, the debtor’s assets are sold a
> Indicate whether each of the following statements is true or false. 11. The great majority of small businesses in the United States are organized as limited liability companies. 12. The major disadvantage of a sole proprietorship is the fact that the own
> Indicate whether each of the following statements is true or false. 8. Unethical behavior has not been a problem in society until recent times. 9. Generally, what is unethical is also illegal. 10. The term values relates to the price of merchandise on sa
> Indicate whether each of the following statements is true or false. 15. A general agent is a person authorized to assume complete charge of his or her principal’s business. 16. A competent party may delegate his or her service on a jury to another by app
> Indicate whether each of the following statements is true or false. 11. Warranties are promises or statements made by manufacturers or sellers. 12. While the law dealing with warranties is intended to protect the general public, it often has the effect o
> Indicate whether each of the following statements is true or false. 11. Contracts for sale can be oral or written, express or implied. 12. A contract for sale differs from a contract to sell primarily in the point at which title passes. 13. In most cases
> Indicate whether each of the following statements is true or false. 13. A bill of sale must be prepared on a specific legal form. 14. Title is proof of ownership as shown by a bill of sale. 15. Personal property is land and anything attached to it. 16. A
> Fiscus, age 23, entered into an oral contract with Badger, a 30-year-old bricklayer, for the construction of a backyard barbecue for a fee of $300. The work was completed in two weeks, as agreed. a. Is there an offer and an acceptance? b. Is this a valid
> Indicate whether each of the following statements is true or false. 11. A contract can be terminated in accordance with provisions in the contract itself. 12. A consumer can terminate a contract made in the home with a door-to-door salesperson within thr
> Indicate whether each of the following statements is true or false. 11. A third-party beneficiary has a legal right to receive the benefits of a contract if it is the intent of the contract to benefit the third party. 12. A third party who benefits incid
> Indicate whether each of the following statements is true or false. 11. Some types of contracts must be in writing to be enforceable. 12. The parol evidence rule affects the enforceability of contracts that include oral or written changes in the terms of
> Indicate whether each of the following statements is true or false. 11. A contract is always legal and enforceable as long as the parties are competent and they have a mutual understanding. 12. An agreement to perform an illegal act is void and unenforce
> Indicate whether each of the following statements is true or false. 11. A person’s legal birthday is the same as the day on which his or her birthday is celebrated. 12. An emancipated minor’s contracts for necessaries are valid. 13. A contract with a min
> Indicate whether each of the following statements is true or false. 11. Consideration is one of the elements of a contract. 12. The courts generally do not rule on the adequacy of consideration. 13. A promise of inaction, or forbearance, can be valid con
> Indicate whether each of the following statements is true or false. 16. In our country, the principles and ideals guarding our individual liberty and freedom are presented in the common law. 17. Amendments to the federal Constitution require approval, or
> Should the law distinguish between a reasonable basis for a warranty disclaimer and one that attempts to substantially negate the warranty?
> What is the primary objective of warranty disclaimers?
> In the case of a vague or indefinite written warranty, how can a court determine what such a warranty usually means in similar transactions?
> For more than 20 years, Harlick, a 38-year-old female, suffered from anorexia nervosa, an eating disorder. She was covered by her employer’s health insurance plan through Blue Shield, and was treated for her disorder through this plan. Her doctors then a
> Is it fair for a buyer to ask a seller to hold merchandise while the buyer shops for a better price?
> How might a buyer avoid pitfalls in buying from unknown sellers?
> How might a seller avoid pitfalls in selling to unknown buyers?
> Compare and contrast online auctions with actual live auctions.
> A contract for labor and materials need not be in writing, even if it is over $500. Does the buyer of the labor and materials enjoy the same level of legal protection as if the contract were in writing?
> Is it ethical for a person who is not a titleholder to act as one who has title to goods, thereby misleading a prospective buyer?
> How can a buyer in a store know whether he or she is dealing with a titleholder or a remote party? Does it make a difference? Generally, whom does a buyer hold responsible for problems?
> It seems that passage of title by estoppel might deny the rights of an innocent though inattentive property owner. Should a legitimate titleholder lose title because of his or her inattention?
> A contract stipulates that certain conditions must be met before title can pass. A seller might wish to hasten the passage of title to minimize the risk of loss and the cost of insurance to indemnify such losses. Consider a typical sales transaction and
> An important application of the concept of title relates to who is holding title when a loss occurs. Are there other ways of determining who should bear a loss in a business transaction?
> Quinlan, a 22-year-old female, specifically made known her wish not to have her life maintained indefinitely by the use of a breathing machine. After an apparent overdose of alcohol and drugs, Quinlan fell into a coma, suffering severe brain damage. Upon
> To protect consumers against their own impulsiveness and various questionable sales techniques, a number of federal, state, and local laws and regulations allow consumers to terminate a contract under certain conditions. Is it ethical for a consumer to t
> Death or disabling illness of a party to a personal service contract requiring a special skill or talent terminates the contract. How would a concert promoter, who had sold tickets and rented a hall, protect against a loss that would likely result from t
> The law provides a remedy for a party injured by the breach of a contract. But the usual remedy, a lawsuit that awards money damages, does not always give the injured party the level of redress appropriate to the situation. What other remedies are availa
> At times, one of the parties to a contract terminated by impossibility of performance suffers some injury or loss as a result. Should the law recognize this possibility and provide some form of redress?
> Contract termination by performance seems so final. Do you think that the parties to a contract should be given an opportunity to change their minds if circumstances change after the required performance? Why or why not?
> Under the law, a bankrupt person is allowed to retain certain property—including his or her residence. Is it ethical for a bankrupt person to use the law to avoid payment on his or her legitimate debts and still retain some, often valuable, property?
