Full file at
The Legal Environment of Business, 6e (Kubasek/Brennan/Browne)
Chapter 2 Introduction to Law and the Legal Environment of Business
1) Each of the following countries is a member of the North American Free Trade Agreement (NAFTA) EXCEPT for which one?
A) United States
B) Brazil
C) Canada
D) Mexico
Answer: B
Diff: 1
Topic: Introduction
2) Each of the following considerations that arise within the legal environment of business are address in this book EXCEPT for which ones?
A) Legal
B) Economic
C) Political
D) None of the above; all are addressed in the text
Answer: D
Diff: 1
Topic: Introduction
3) The primary purpose of NAFTA is to do which of the following?
A) Codify international treaties
B) Increase immigration quotas
C) Lower trade barriers
D) Defend coastal borders
Answer: C
Diff: 1
Topic: Introduction
4) One purpose of the WTO is to do which of the following?
A) Codify international treaties
B) Increase immigration quotas
C) Lower trade barriers
D) Defend coastal borders
Answer: C
Diff: 1
Topic: Introduction
5) How many Pacific Rim countries participate in the Asian-Pacific Economic Cooperation (APEC) forum in addition to the United States?
A) 5
B) 10
C) 17
D) 27
Answer: C
Diff: 1
Topic: Introduction
6) Which of the following is a true statement about the legal literacy of Americans as found by the Hearst Corporation?
A) 90% of Americans understood that a defendant is presumed innocent until proven guilty.
B) 90% of Americans could identify the Chief Justice of the Supreme Court.
C) Fewer than 50% of Americans knew that Sandra Day O'Connor was the first woman to be appointed to the Supreme Court .
D) Fewer than 50% of Americans knew that legal literacy referred to their ability to understand "legalese."
Answer: C
Diff: 2
Topic: Definition of the Legal Environment of Business
7) How many member nations does the European Union have?
A) 5
B) 17
C) 27
D) 144
Answer: C
Diff: 1
Topic: Introduction
8) How many member nations does the WTO have?
A) 27
B) 50
C) 127
D) 144
Answer: D
Diff: 1
Topic: Introduction
9) The Asian-Pacific Economic Cooperation (APEC) forum is discussing the creation of an economic free trade zone that would extend where?
A) From Chile to China
B) From the United States to China
C) From China to Singapore
D) From Japan to China
Answer: A
Diff: 1
Topic: Introduction
10) Our study of the legal environment of business is characterized by which of the following?
A) It develops an understanding that the law is dynamic, not static.
B) It is designed to maximize enrollment at schools of law throughout the United States.
C) It encourages the search for the "one true answer" to each legal question.
D) It is based on the Platonic system of social control.
Answer: A
Diff: 1
Topic: Definition of the Legal Environment of Business
11) Our study of the legal environment of business is characterized by which of the following?
A) It is arbitrary and capricious.
B) It is interdisciplinary.
C) It excludes ethical considerations.
D) It considers issues of a financial nature rather than human resources nature.
Answer: B
Diff: 1
Topic: Definition of the Legal Environment
12) Each of the following is one of the "Top Ten Reasons for Studying the Legal Environment" EXCEPT for which one?
A) Becoming aware of the rules of conducting business.
B) Being able to communicate with your lawyer
C) Understanding estate planning in areas relating to corporate acquisitions.
D) Forming an awareness of the potential misconduct of competitors.
Answer: C
Diff: 1
Topic: Definition of the Legal Environment of Business n
13) Which of the following can be said about the rate of globalization in the twenty first century?
A) It is accelerating
B) It is slowing down.
C) It seems to be occurring at roughly the same pace as in previous centuries.
D) It is completely unpredictable.
Answer: A
Diff: 2
Topic: Introduction
14) Each of the following is one of the "Top Ten Reasons for Studying the Legal Environment" EXCEPT for which one?
A) Appreciating the limits of entrepreneurship.
B) Determining the right moment to downsize a business.
C) Making you a more informed citizen.
D) Providing a heightened awareness of business ethics.
Answer: B
Diff: 1
Topic: Definition of the Legal Environment of Business
15) A study of the legal environment of business includes all EXCEPT of the following?
A) The study of the legal process and our present legal system,
B) The study of the administrative law process and the role of businesspeople in that process.
C) The study of selected areas of public and private law, such as securities regulation.
D) None of the above; all are addressed in the text as part of our study of the legal environment of business.
Answer: D
Diff: 1
Topic: Legal Environment of Business
16) Of the following, which is the BEST definition of "jurisprudence"?
A) Jurisprudence is a legal conclusion based on the facts.
B) Jurisprudence is the organization of attorneys and judges who handle a particular legal case.
C) Jurisprudence is the science or philosophy of law.
D) Jurisprudence consists of the legislative, executive, and judicial branches of government.
Answer: C
Diff: 2
Topic: Definition of Law and Jurisprudence
17) Which of the following is TRUE about administrative agencies?
A) Their purpose is to create regulations that guide the functions of the executive branch
B) Their authority to issue regulations comes from the President
C) They regulate business in areas such as employment, trade and safety
D) All of the above are true
Answer: C
Diff: 2
Topic: Sources of Law
18) What is TRUE about federal statutes enacted by Congress:
A) Once the entire Congress passes a bill and the President signs it into law, it cannot be overturned
B) The authority for judicial review of the constitutionality of federal law was established in the case Marbury v. Madison
C) The history of the intentions and debates of Congress when they were drafting and discussing a proposed law can be found in the Federal Register
D) All of the above are true.
Answer: B
Diff: 2
Topic: Sources of Law
19) The President has all of the following powers EXCEPT which one of the following?
A) Negotiating a treaty with Brazil
B) Issuing an executive order nationalizing the steel industry
C) Vetoing a bill a second time after both the House and Senate have successfully voted to override the President's first veto
D) Signing a bill into law
Answer: C
Diff: 2
Topic: Sources of Law
20) The various Restatements of the Law:
A) Have the full force and effect of any other federal statute or regulation
B) Are often relied upon by the courts when rendering legal judgments
C) Are based on previous case decisions issued by the US Supreme Court
D) Cover only the legal subjects of contracts, torts and agency
Answer: B
Diff: 2
Topic: Sources of Law
21) Once the full House and Senate have each passed a version of a bill, what happens next?
A) If the House and Senate versions are substantially similar, the Senate version goes to the President for his signature or veto.
B) The two versions of the bill go back to the applicable subcommittees in both the House and Senate to reconcile the differences and create a single version for signature or veto by the President.
C) The House and Senate versions are both sent to the President for signature or veto of the version s/he finds best suited to meeting the needs of the country.
D) Both the House and Senate versions are sent to a Senate-House Conference Committee for reconciliation and then a single version is returned to the full House and Senate for a vote.
Answer: D
Diff: 2
Topic: Sources of Law
22) If the President negotiates a trade treaty with Ireland, what is TRUE about that agreement?
A) The treaty becomes law as soon as the US and Irish Presidents both sign a document containing the final terms and conditions of the treaty.
B) The treaty can be amended or modified by state and local laws as necessary to meet the needs of the various regions of the country.
C) The treaty does not become law unless approved by the House of Representatives.
D) The treaty cannot become law without the advice and consent of the Senate.
Answer: D
Diff: 2
Topic: Sources of Law
23) Which of the following is the best example of a substantive law?
A) A lawsuit must be filed within one year of when the injury occurred.
B) The defendant must respond to the plaintiff's complaint within 15 days.
C) A hearing on the merits of the case must be held within 60 days.
D) For a contract to exist, the parties must exchange valuable consideration.
Answer: D
Diff: 2
Topic: Classifications of Law
24) Which of the following is the best example of private law?
A) A law requiring that the parties to a contract exchange valuable consideration for the contract to be enforceable.
B) A law requiring a local zoning board to conduct a hearing before approving a request to change the zoning assigned to a particular parcel of land.
C) A law defining burglary as the breaking and entering of the property of another with the intent to commit a felony therein.
D) A law requiring police officers to have probable cause when requesting a search warrant.
Answer: A
Diff: 2
Topic: Classifications of Law
25) All of the following are true about criminal law EXCEPT:
A) The government is always a party to a criminal lawsuit
B) If found guilty, the defendant may be fined or sentenced to prison or both
C) The burden of proof is preponderance of the evidence
D) Examples include fraud, forgery and extortion
Answer: C
Diff: 2
Topic: Classifications of Law
26) Bubba pointed a gun at Richie Rich and took Richie's wallet which contained $10,000. Bubba has been accused of robbery (the taking of the property of another by force or fear). What is TRUE about Bubba's situation?
A) Bubba will be the defendant in a civil suit brought by the government.
B) Bubba has the burden of proving his innocence.
C) Bubba will be charged with robbery by the Richie Rich, the victim of the robbery.
D) The government will charge Bubba with robbery and they must prove his guilt beyond a reasonable doubt.
Answer: D
Diff: 2
Topic: Classifications of Law
27) Which of the following is a true statement about the Natural Law School?
A) It has existed since 300 B.C. and bases law on certain unchanging value judgments.
B) It focuses on environmental concerns, such as toxic waste and air quality.
C) It is founded on the writings of Cicero and Hobbes.
D) None of the above are true statements about the Natural Law School.
Answer: A
Diff: 2
Topic: Natural Law School
28) Which of the following is a true statement about the Natural Law School?
A) It teaches that the legislature is the primary source of all law.
B) It teaches that certain moral and religious principles supersede any form of human law.
C) It teaches that "might makes right."
D) It bases its teachings on the writings of Plato.
Answer: B
Diff: 2
Topic: Natural Law School
29) Which of the following is a true statement about the Natural Law School?
A) It teaches that good laws depend on good judges.
B) It teaches that law, ethics, and morality should remain separate.
C) It teaches that one may have a moral responsibility to disobey an unjust law.
D) It teaches that the U. S. Constitution is the highest legal authority in the United States.
Answer: C
Diff: 2
Topic: Natural Law School
30) Which of the following is an argument raised by critics of the Natural Law School?
A) It requires sophisticated quantitative methodology, relying too heavily upon statistical methods.
B) It is based primarily upon European rather than American legal thinking.
C) It is overly subjective in a nation of differing cultures and moral values.
D) It is designed for Communist and Socialist political systems.
Answer: C
Diff: 2
Topic: Natural Law School
31) Which of the following schools of law would a person probably adhere to if he said that he believes God is the source of the law?
A) Natural Law
B) Positivist
C) Sociological
D) American Realist
Answer: A
Diff: 1
Topic: Definition of Law and Jurisprudence
32) Which of the following schools of law would a person probably adhere to if he said that he believes that the legislature is the source of the law?
A) Natural Law
B) Positivist
C) Sociological
D) American Realist
Answer: B
Diff: 1
Topic: Definition of Law and Jurisprudence
33) Which of the following schools of law would a person probably adhere to if he said that he believes most court decisions and legal doctrine should support an efficient allocation of resources in society?
A) Natural Law
B) Positivist
C) Sociological
D) Law and Economics
Answer: D
Diff: 1
Topic: Definition of Law and Jurisprudence
34) Which of the following schools of law would a person probably adhere to if he said that he believes contemporary community standards and custom are the most important sources of the law?
A) Natural Law
B) Positivist
C) Sociological
D) American Realist
Answer: C
Diff: 1
Topic: Definition of Law and Jurisprudence
35) Which of the following schools of law would a person probably adhere to if she said law is a cluster of legal and nonlegal beliefs that must be critiqued to bring about social and political change?
A) Feminist
B) American Realist
C) Critical Legal Studies
D) Law and Economics
Answer: C
Diff: 1
Topic: Definition of Law and Jurisprudence
36) Which of the following schools of law would a person probably adhere to if she said cost-benefit analysis is useful in understanding our legal system?
A) Feminist
B) American Realist
C) Critical Legal Studies
D) Law and Economics
Answer: D
Diff: 2
Topic: Definition of Law and Jurisprudence
37) Which of the following schools of law would a person probably adhere to if she said that our jurisprudence reflects a male legislature and judicial system where female views are underrepresented?
A) Feminist
B) Positivist
C) Critical Legal Studies
D) Law and Economics
Answer: A
Diff: 1
Topic: Definition of Law and Jurisprudence
38) The posted speed limit on the interstate near Brian's house is 60 miles per hour, but no one ever gets a ticket unless they drive over 70 miles per hour. One lovely spring day, Brian is ticketed for going 68 miles per hour. He is the most likely to feel outraged that a true injustice has occurred if he adheres to which legal philosophy?
A) Feminist
B) Sociological
C) Positivist
D) Law and Economics
Answer: B
Diff: 3
Topic: Definition of Law and Jurisprudence
39) The posted speed limit on the interstate near Brian's house is 60 miles per hour, but no one ever gets a ticket unless they drive over 70 miles per hour. One day he is ticketed for going 68 miles per hour. He is the least likely to feel outraged that a true injustice has occurred if he adheres to which legal philosophy?
A) Feminist
B) Sociological
C) Positivist
D) Law and Economics
Answer: C
Diff: 3
Topic: Definition of Law and Jurisprudence
40) Martin Luther King would be most likely associated with which school of legal philosophy?
A) Natural Law
B) American Realist
C) Sociological
D) Law and Economics
Answer: C
Diff: 1
Topic: Natural law
41) Which of the following schools of law is criticized for leading to a static jurisprudence because it does not take into account social and ethical factors ?
A) Sociological
B) American Realist
C) Positivist
D) Natural Law
Answer: C
Diff: 2
Topic: Positivist School
42) Disciples of the Positivist School would argue which of the following?
A) Social and community standards are an important source of international law.
B) The U. S. Supreme Court should respect the will of Congress when it comes to interpreting legislation.
C) Positive arguments should carry more weight than negative ones.
D) The U. S. Constitution should be viewed with skepticism by members of the judicial branch of government.
Answer: B
Diff: 2
Topic: Positivist School
43) When criticizing the Positivist School, legal scholars have made which of the following arguments?
A) It is impossible to remain positive about everything when there is so much negativity in the world.
B) The Positivist School is irrational and not founded in logic.
C) The Positivist School ignores the importance of precedence.
D) The Positivist School adopts a view that is too narrow and literal-minded.
Answer: D
Diff: 2
Topic: Positivist School
44) Followers of the Sociological School propose that judges should take which of the following steps when determining law?
A) Use an inventory of community interests to familiarize themselves with the community's standards and mores.
B) Carefully separate morality from law, using only legal precedents to guide decisions.
C) "Follow the money" by determining which groups will benefit financially from a particular legal decision.
D) Reach decisions through strict neutrality, without bias of any kind.
Answer: A
Diff: 2
Topic: Sociological School
45) Why does the philosophy of the Sociological School contrast sharply with the Positivist School?
A) The Positivist School relies heavily on "hard" quantitative data instead of "soft" social science.
B) The Positivist School takes an optimistic view of civilization in contrast to the Sociological School's pessimistic approach.
C) The Sociological School looks at actual human behavior and values, while the Positivist School insists that the focus should remain on statutes and precedents.
D) The Sociological School actually takes a more optimistic view of civilization than does the misnamed Positivist School.
Answer: C
Diff: 2
Topic: Sociological School
46) Critics of the Sociological School have made which of the following arguments?
A) Many smaller universities lack sociology departments.
B) The Sociological School has proposed a view of law that is rigid and uncompromising.
C) The Sociological School places too great an emphasis on quantitative data rather than experienced "gut reactions."
D) The Sociological School would make the law unpredictable, since community standards change over time.
Answer: D
Diff: 2
Topic: Sociological School
47) Which of the following would be most helpful to a disciple of the American Realist School?
A) Copies of the past several opinions a particular judge had written.
B) A comparison of the Code of Hammurabi with the Ten Commandments.
C) A quantitative analysis of statistical data about county government expenditures.
D) None of the above.
Answer: A
Diff: 2
Topic: American Realist School
48) Which of the following BEST characterizes the views expressed by the Critical Legal Studies School?
A) In order to understand law, it is necessary to understand the interlocking system of beliefs that reinforces established wealth and privilege.