Business Ethics & Intellectual Property: Legal Principles & Ethical Dilemmas, Exams of Accounting

Download Business Ethics & Intellectual Property: Legal Principles & Ethical Dilemmas and more Exams Accounting in PDF only on Docsity! BU 206 Business Law Review Exam Q & A 2024 1. Which of the following is true regarding the ethical issues that businesses commonly encounter? a) They are only relevant in large corporations b) They have no impact on a company's bottom line c) They involve decision-making processes that may not have a clear right or wrong answer d) They are primarily related to employee satisfaction Answer: c) They involve decision-making processes that may not have a clear right or wrong answer Rationale: Ethical issues in business often involve complex decision- making processes where different stakeholders may have conflicting interests, making it difficult to determine the "right" course of action. 2. Which of the following is the foundation of the American legal system? a) The Constitution b) Common law c) Statutory law d) Executive orders Answer: a) The Constitution Rationale: The Constitution serves as the foundation of the American legal system, outlining the structure of government and the rights of individuals. 3. Business ethics are concerned with: a) Maximizing profits at all costs b) Following the law, but not necessarily acting morally c) Doing what is right, even when it is not required by law d) Utilizing unethical practices to gain a competitive advantage Answer: c) Doing what is right, even when it is not required by law Rationale: Business ethics involve making decisions based on moral principles and values, even when those decisions may not be legally required. 4. In the context of torts, which of the following is true? 11. Which of the following ethical issues commonly encountered by businesses involves conflicts of interest? a) Discrimination b) Bribery c) Insider trading d) Environmental pollution Answer: c) Insider trading Rationale: Insider trading involves using privileged, non-public information to gain an advantage in financial markets, often resulting in conflicts of interest between different stakeholders. 12. The principle of caveat emptor in business transactions suggests that: a) Buyers should be wary of sellers who engage in unfair business practices b) Sellers are responsible for disclosing all information about a product's defects to buyers c) Buyers must exercise caution and diligence when making purchases d) Sellers are responsible for ensuring a product meets all quality standards Answer: c) Buyers must exercise caution and diligence when making purchases Rationale: The principle of caveat emptor places the responsibility on buyers to carefully evaluate products before purchasing them, rather than relying on sellers to disclose all relevant information. 13. Which of the following is a common ethical issue faced by businesses in their relationships with suppliers and vendors? a) Discrimination in hiring practices b) Payment of bribes to secure contracts c) False advertising d) Improper use of customer data Answer: b) Payment of bribes to secure contracts Rationale: Payment of bribes to suppliers or vendors to secure business contracts is a common ethical issue that can harm competition and result in unfair advantages for certain companies. 14. The doctrine of fair use in intellectual property law allows for: a) Unlimited use of copyrighted material without permission b) Limited use of copyrighted material for purposes such as criticism, commentary, or parody c) Transfer of ownership of copyrighted material without consent d) Public distribution of protected works without attribution Answer: b) Limited use of copyrighted material for purposes such as criticism, commentary, or parody Rationale: The doctrine of fair use permits limited use of copyrighted material for specific purposes such as criticism, commentary, news reporting, teaching, scholarship, or research without the need for permission from the copyright owner. 15. Which of the following types of contracts is typically required to be in writing to be enforceable? a) Lease agreements b) Employment contracts c) Sales contracts for goods over a certain dollar amount d) Service agreements for less than one year Answer: c) Sales contracts for goods over a certain dollar amount Rationale: The Statute of Frauds requires that certain types of contracts, including sales contracts for goods over a specified dollar amount, must be in writing to be enforceable. 16. What is the primary purpose of criminal law in the context of business activities? a) To provide a framework for resolving disputes between private parties b) To protect public safety and regulate conduct that is harmful to society c) To enforce contracts and agreements between businesses d) To establish guidelines for intellectual property protection Answer: b) To protect public safety and regulate conduct that is harmful to society Rationale: Criminal law aims to deter and punish behavior that is considered harmful to society, such as fraud, theft, and violence, in order to maintain public order and safety. 17. Which of the following is an example of a cyber crime related to intellectual property? a) Distributing counterfeit goods online b) Operating an unlicensed business website c) Creating unauthorized copies of software for personal use d) Accessing a company's computer system without permission Answer: a) Distributing counterfeit goods online Rationale: Distributing counterfeit goods, such as counterfeit clothing or electronics, online is a form of cyber crime that violates intellectual property rights and may lead to legal consequences. 18. In contract law, what is the legal concept of consideration? a) The exchange of money or goods between parties in a contract b) A promise made by one party in exchange for a promise made by the other party c) The terms and conditions outlined in the contract d) The timeframe within which the contract must be fulfilled Answer: a) The exchange of money or goods between parties in a contract Rationale: Consideration refers to the exchange of something of value (such as money, goods, or services) between parties in a contract, which is necessary for the contract to be legally binding. 19. Which of the following is an example of a tort related to business activities? a) Breach of contract b) Libel or slander c) Non-payment of debts d) Failure to meet quality standards Answer: b) Libel or slander Rationale: Libel and slander are torts that involve defamation of a person's character or reputation through written or spoken statements, which can result in legal liability for the party making the false statements. Answer: b) They specify the obligations and rights of each party in the contract Rationale: The terms and conditions of a contract detail the specific rights, obligations, and responsibilities of each party involved in the agreement, helping to ensure clarity and enforceability of the contract. Question: What is the primary purpose of business ethics? A) To maximize profits at any cost B) To ensure legal compliance only C) To balance profitability with social responsibility D) To prioritize the interests of shareholders over stakeholders Answer: C) To balance profitability with social responsibility Rationale: Business ethics encompass the principles and standards that guide the behavior of individuals and groups in a business environment. It emphasizes the importance of not only maximizing profits but also considering the impact of business activities on various stakeholders and the society at large. Question: Which of the following is a fundamental principle of the American legal system? A) Equality before the law B) Presumption of guilt C) Excessive use of discretionary power D) Inequality based on social status Answer: A) Equality before the law Rationale: The American legal system is founded on the principle of equality before the law, ensuring that all individuals are treated fairly and equally under the law, regardless of their social status or background. Question: In the context of tort law, what does the term "negligence" refer to? A) Intentional wrongdoing B) Breach of a legal duty C) Strict liability without fault D) Immunity from civil liability Answer: B) Breach of a legal duty Rationale: Negligence in tort law refers to the failure to exercise the level of care that a reasonable person would have exercised in similar circumstances, thereby breaching a legal duty owed to another party. Question: Which of the following is an example of intellectual property? A) Land B) Copyrighted song C) Physical equipment D) Business partnership Answer: B) Copyrighted song Rationale: Intellectual property encompasses creations of the mind, such as literary and artistic works, designs, symbols, and inventions. A copyrighted song falls under the category of intellectual property. Question: What distinguishes criminal law from civil law? A) The involvement of government prosecution B) Resolution through monetary compensation C) Requirement of a preponderance of evidence D) Emphasis on private disputes between individuals Answer: A) The involvement of government prosecution Rationale: Criminal law involves acts that are considered harmful to society as a whole, with prosecution carried out by the government, while civil law deals with disputes between individuals or organizations seeking compensation or other remedies. Question: What constitutes a cyber crime? A) Unauthorized access to computer systems B) Civil contract disputes C) Ethical business practices D) Regulatory compliance violations Answer: A) Unauthorized access to computer systems Rationale: Cyber crimes encompass a range of illegal activities conducted through digital means, including unauthorized access to computer systems, hacking, identity theft, and online fraud. Question: What is an essential element of a valid contract? A) Verbal agreement without witnesses B) Consideration exchanged between parties C) Unilateral offer without acceptance D) Lack of legal capacity of the parties involved Answer: B) Consideration exchanged between parties Rationale: A valid contract requires consideration, which refers to something of value given in exchange for a promise or performance by the other party. This exchange distinguishes a contract from a mere gift or promise. Question: In the context of sales and leases, what does "F.O.B." stand for? A) Free on board B) Final order billing C) Firm offer basis D) Freight on buyer Answer: A) Free on board Rationale: "F.O.B." refers to the point at which the seller is deemed to have fulfilled their obligation in delivering the goods, with the buyer assuming responsibility for the goods from that point onward. Question: What is the primary purpose of criminalizing certain behaviors in business transactions? A) To protect the interests of competitors B) To ensure fair and ethical business practices C) To discourage international trade