Legal Environment of Business
True/False
1. Wrongs and compensation are the two notions that serve as the basis of all torts,
2. Battery is the completed action whereas assault is a threat of harm in the law of torts.
3. According to the court in Blake vs. Giustibelli, libel is a false publication which causes injury.
4. Blasting and storing explosives do not constitute abnormally dangerous activities.
5. A product liability action based on negligence requires privity of contract.
6. The court in Schwark vs. Arctic Cat ruled that a plaintiff must show foreseeability on behalf
of a defendant.
7. International customs, treaties and international agreements, and international organizations
are the three primary sources of international law.
8. European nations are usually common law systems while the United States is a civil law
system.
9. The principle of comity refers to legal reciprocity.
10. Contracts are determined by a subjective theory.
11. A voidable contract is no contract at all.
12. In Lucy va. Zehmer, intoxication was no defense.
Multiple Choice
13. The tort of _________ occurs when someone suffers injury because of another’s failure to
live up to a required duty of care.
A. Disparagement
B. Negligence
C. Conversion
D. Slander of Title
14. In Bogenberger vs. Pi Kappa Alpha, the court held that if an individual creates a
foreseeable risk of injury, he has a ___________ others from such injury.
A. Duty to warn
B. Duty to assume
C. Duty to protect
D. None of the above
15. In Taylor vs. Baseball Club of Seattle, the plaintiff could not recover because she:
A. Created a superseding cause
B. Violated a dram shop act
C. Committed a trespass to land
D. Assumed the risk
16. The test for determining design defects includes:
A. A reasonable alternative design was available
B. Misrepresentation
C. Danger beyond expectation
D. Privity of contract
17. In Stange vs. Janssen, the court determined that the pharmaceutical company committed
the tort of :
A. Design defect
B. Failure to warn
C. Market share liability
D. Abnormally dangerous activity
18. According to VeRost vs. Mitsubishi, the manufacturer of a safe product will not be
responsible for injuries caused by that product if:
A. A better design was available
B. A third party modifies the product
C. The manufacturer sells its business
D. Risk is assumed
19. Under the Doctrine of __________, foreign nations may be exempt from the jurisdiction of
U.S. courts.
A. Sovereign immunity
B. Expropriation
C. Act of state
D. Confiscation
20. In Changzhou Trina Solar Energy vs. United States International Trade Commission, the
court held that _____________ duties were appropriate.
A. Normal trade
B. Free trade
C. Antidumping
D. Tariff
21. The Supreme Court, in Daimler vs. Bauman, Justice Ginsburg wrote that absent a
California connection to the alleged atrocities, a California federal court had no jurisdiction in a
case alleging violations of the:
A. NAFTA
B. New York Convention
C. COPUOS
D. Alien Tort Statute
22. A ________ is a rejection of the original offer and the simultaneous making of a new offer.
A. Revocation
B. Repudiation
C. Termination
D. Counteroffer
23. In Hinkal vs. Pardoe, one who is about to sign a contract has a duty to ______ the contract.
A. Read
B. Counter
C. Reject
D. Accept
24. According to Chief Justice Roberts in Already vs. Nike, a ___________ will be enforced if
the proper burdens are met.
A. Release
B. Accord and Satisfaction
C. Covenant not to Sue
D. Illusory promise
25. In Kennedy vs. Shave Barber Co., the _________ was found to be valid.
A. Covenant not to compete
B. Licensing statute
C. E contract
D. Usurious interest rate
