a.
arbitration
b.
mediation
c.
litigation
d.
reconciliation
ANSWER:
c
18. Groot Industries Inc. requires more space in order to expand its business. Which of the following is a legal decision that Groot Industries Inc. must now undertake?
a.
who should be hired to construct a new building
b.
whether its new premises will be regulated by health and fire regulations
c.
whether to buy, build, or lease additional premises
d.
whether to obtain insurance for its new premises
ANSWER:
c
19. What are the commonly used alternative dispute resolution methods for avoiding litigation?
a.
intervention, negotiation, and reconciliation
b.
intervention, arbitration, and mediation
c.
negotiation, mediation, and adjudication
d.
direct negotiation, mediation, and arbitration
ANSWER:
d
20. Which of the following best describes the nature of the arbitration process?
a.
negotiated resolution with the assistance of a neutral person
b.
neutral party makes a decision (usually binding) that resolves a dispute
c.
submission to judge for decision-making
d.
renegotiation of the contract with the assistance of a judge
ANSWER:
b
21. What is usually the first logical step for parties involved in a legal dispute?
a.
to submit their dispute to a mediator
b.
to engage legal counsel
c.
to submit their dispute to an arbitrator
d.
to try to come to a resolution between themselves
ANSWER:
d
22. What are the standard forms of business structure available to entrepreneurs to facilitate creation of a for-profit business enterprise?
a.
sole owner, proprietor, and partnership
b.
sole proprietor, partnership, and corporation
c.
sole partnership, proprietor, and corporation
d.
sole owner, proprietor, and corporation
ANSWER:
b
23. Which statement best explains how business law guides business conduct?
a.
The law sets rules and penalties to encourage compliance.
b.
The law sets specific codes of ethics to guide conduct.
c.
The law seeks levels of compensation exceeding losses.
d.
The law limits executive compensation to guide conduct.
ANSWER:
a
24. What consequences might a business face by skirting ethical norms?
a.
bad publicity and condemnation
b.
Criminal Code conviction
c.
conflict of interest
d.
breach of contract
ANSWER:
c
25. What type of law is the vehicle for ensuring that those affected by a failed business are treated fairly, reasonably, and in accordance with agreed rules?
a.
bankruptcy
b.
contract
c.
criminal
d.
corporate
ANSWER:
a
26. How does the law impact the marketing activities of a business?
a.
It requires businesses to customize marketing to the recipient.
b.
It imposes limitations on how far a business may go in extolling the virtues of its product.
c.
It does not regulate marketing activities.
d.
It requires that marketing activities treat all individuals equally.
ANSWER:
b
27. Olivia is suing a supplier for breach of contract. Assuming she is successful, what remedy might she expect to receive from the court?
a.
restitution
b.
punitive damages based on the seriousness of the contract breach