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Terms in this set (66)
An individual makes an offer to buy an item from a company for $5,000. When is a contract for the purchase of the item created?
When the offer is accepted by the company
What are the elements that make a contract enforceable?
Agreement, consideration, capacity, legality
At what point is a contract implied?
When the conduct of the parties indicates the terms of the contract
What action by a party to a contract constitutes a breach of the contract?
One party refuses to perform one of the contract terms
Which type of remedy to breach of contract is compensatory damages?
ABC Company is dominant in a market that XYZ Company intends to enter. Which practice is a violation of antitrust laws?
ABC prevents XYZ from using local private carriers by creating exclusive contracts with the carriers
What was the purpose of the Sherman Antitrust Act of 1890?
To prevent extreme concentrations of economic power
Which business practice would be a violation of the Clayton Antitrust Act of 1914?
Companies A and B engage in exclusive talks to control prices to maintain high levels of profitability.
What laws do the Federal Trade Commission enforce?
A store advertises a certain item for a sale price of $450. A customer goes to that store on the day of the advertisement to purchase the item. The salesperson indicates that the advertised item is out of stock but a more advanced model of the item is available for $550. What practice prohibited under the Federal Trade Commission Act has the store used?
Bait and switch
Which actions of a water bottling company would be regulated by the Environmental Protection Agency?
Selling bottled water
A power company receives a yearly emissions allowance. The company is exceeding the allowable sulfur dioxide emissions under Environmental Protection Agency (EPA) regulations as authorized by the Clean Air Act, and has used its entire emissions allowance. EPA requires the company to shut down unless it takes immediate action within EPA regulations. Which action can the power company take to continue operating?
Buy more emissions allowances
What is a violation of the Clean Water Act of 1972?
A city drains water from a wetlands area to develop the land.
What is an example of alternative dispute resolution?
A meeting in which a mediator works with both parties
What is an advantage to using alternative dispute resolution rather than litigation?
It involves negotiation directly between the parties.
When is arbitration an appropriate form of dispute resolution?
When parties want a fast and final resolution
What is an activity of an appellate court?
Reviewing the record in the case
Two adjoining property owners have a dispute over the boundary line between their properties. They wish to settle the dispute so each comes away with something, and they want to enter into a voluntary agreement. What method of dispute resolution should the parties employ?
To which situation would the National Labor Relations Act of 1935 apply?
Closure of a business and laying off employees
What is the principal provision of the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA)?
Offering continued health insurance for former employees
Who is covered by the provisions of the Fair Labor Standards Act of 1938?
A child working on the family farm
What is a wrongful discharge under the law?
Discharging an employee for serving on a local jury
Which situation would be covered by Occupational Safety and Health Administration (OSHA) rules?
Wet floors in the entrance of an office building
Which situation is an example of workplace discrimination?
A female employee is refused a promotion after returning from maternity leave.
Which business practice does Title VII of the Civil Rights Act of 1964 cover?
Which action by an employer does the Age Discrimination in Employment Act of 1967 permit?
Requiring all employees under age 30 to undergo drug testing
When may an employer require a medical exam of a prospective employee under the provisions of the Americans With Disabilities Act of 1990?
When the exam is job related and all prospective employees must undergo the exam
What must an employer check before legally hiring a non-U.S. citizen?
f the applicant is a national of the U.S., a lawful permanent resident alien, or an alien with work authorization
A company that provides services for the disabled elderly received an application from a person who was African-American, 43 years old, and asthmatic. The company decided not to hire this applicant because the person was 43 years old. What makes this denial of employment illegal?
The Age Discrimination in Employment Act
A company has no employment contract in use. The Employee Handbook does state that employees could be fired only for just cause, and then only after warnings, notice, and a hearing. An employee was fired without notice. What relationship did the employer have to the employee?
A contractual employment relationship based on the Employee Handbook
A 360-degree appraisal conducted at the workplace revealed a series of weak areas in a ratee's performance. What does this denote?
The ratee needs to work on the weak areas to improve performance and to meet standards and expectations.
What is a characteristic of a progressive discipline program?
It formally communicates issues to employees in a direct and timely manner so they can improve performance.
The human resources director for a company is interviewing candidates for a customer service position. The director notices that a candidate has an accent. Which interview question would be appropriate for the customer service position?
How many days were you absent from work last year?
How is an express warranty different from an implied warranty?
An express warranty is created by what the seller says or does not say.
What must an injured party prove to prevail in a legal action for a defective product based on the issue of negligence?
Unreasonable risk in the design of the product
What must an injured party prove to recover damages on a claim of negligence in the sale of goods?
Duty to the consumer to produce a safe product as well as a breach of that duty
When is a seller held strictly liable for a defective product?
When the product is dangerously defective and the user is injured
What gave rise to the passage of the Sarbanes-Oxley Act in 2002?
In which way does the Sarbanes-Oxley Act of 2002 affect an entire business organization?
By requiring each company to adopt effective financial controls
A beverage company became a publicly-traded company in 2006. Before going public the company offered low interest loans to members of the board and employees of the company. How is this practice of offering loans affected by the Sarbanes Oxley Act of 2002?
Loans can no longer be made to directors or officers of the company.
Which financial disclosure is required by the Sarbanes-Oxley Act of 2002?
Officers must inform the company's audit committee and auditors of any concerns they have about the internal control system.
Company A, an accounting firm, has provided auditing services for Company B for six years. What is true based on the limitations imposed by the Sarbanes-Oxley Act of 2002?
The lead audit partner must rotate off the account for at least five years.
Which scenario contributes to ethical problems in the workplace?
The tension between legal requirements and accountability
How do organizational ethics contribute to the business environment?
By increasing quality and safety requirements
What will a company that practices social responsibility take into consideration when making decisions?
Economic, legal, and ethical responsibilities
A U.S. company that manufactures fertilizers offers a line of products for third world countries. The fertilizers that are sold in the third world countries have been banned in the United States because studies have shown that the products cause cancer. What is the legally required level of social responsibility for this company?
To meet U.S. legal requirements since the company is based in the U.S.
A company claims in its television advertising that tests prove its product is superior to any other product on the market. No tests have been conducted and the claim cannot be substantiated. What characterizes this unethical marketing practice?
A given business practice involves exaggerated advertising, blustering, and boasting upon which no reasonable person would rely. The practice is not actionable under the Lanham Act. What describes this business practice?
How have the ethical issues that surfaced during the Enron scandal changed accounting practice in the United States?
Congress passed the Sarbanes-Oxley Act of 2002 to provide stricter guidelines for accounting practices.
A manager is very loyal to the employer. How would the manager's loyalty affect ethical decision making?
The manager will select decision alternatives that support company goals rather than personal goals.
How would people who believe they have a great degree of internal control likely justify unethical behavior?
By believing they can influence their environment and not get caught
A corporate leader is faced with a situation in which a very successful and key member of a team has been found in collusion with a key customer. What should this leader do?
Remove the team member from a position that has contact with the customer in question.
How can management create an ethical organizational culture?
Establish a set of values, beliefs, goals, norms, and ways of solving problems for all employees.
A manufacturing worker becomes ill due to conditions in the workplace. The worker's manager determines that the production process must be fixed regardless of the cost to the company. The manager is exhibiting which type of moral principle?
How does a formal code of conduct affect the way an organization does business?
By describing organizational expectations for all employees
What is a purpose of ethics training?
To improve the employees' ability to identify ethical issues
Which method of assessment can develop benchmarks for compliance with ethical standards?
What is an essential role that top management plays in developing an effective ethics program?
Interpreting and supporting regulatory requirements for ethics programs
For an organization to develop an effective ethics program, the position of ethics officer is often created. What is a key responsibility of an ethics officer in developing an ethics program?
Developing and distributing a code of conduct
What is a benefit of an effective ethics program in the workplace?
Ensuring that employees understand the company's values
How can implementing an ethics program encourage organizational integrity?
Mid-level managers can develop departmental codes of conduct as needed.
An individual works at job A during the day and also teaches night classes at job B. While working at job A on a company computer, the individual receives instant messages from night class students and communicates with the students as requests arrive rather than waiting until the night class begins. Why is this inappropriate?
he individual is using job A's resources to perform duties for job B
Which action taken by a manager following a report of sexual harassment would make the situation worse?
Retaliate for the actions
Which employee action constitutes a misuse of company resources?
A foreman took a construction crew to work on a landscaping project at the foreman's private property after finishing a project early that had paid the labor costs for the crew
Which option is a misuse of company time by an employee?
An employee working the night shift uses spare time to surf the Internet to learn more about starting a small business.
When is it appropriate for an employer to investigate personal activities of an employee on the job?
A supervisor smells alcohol on the breath of one of the company's truck drivers