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1. LAW 531 Final Exam Guide
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2. LAW 531 Final Exam Guide - New
1. What defense can an employer use to a charge of sexual harassment?
The harassed employee was not made aware of the company’s antiharassment
policies.
The harassed employee took advantage of the preventive measures provided by
the company but still could not avoid being harassed.
The employer does not have any complaint mechanisms for employees who are
harassed.
The employer used reasonable care to prevent and correct the sexually
harassing behavior.
2. Choose the correct statement about the Environmental Protection Agency (EPA).
It is exclusively created to regulate air pollution standards.
It has the power to initiate judicial trials in case of violation of
environmental laws.
It does not enforce environmental laws related to the protection of
wetlands.
It can enforce federal environmental regulations but cannot make regulations
on its own.
3. What is “riba” in the context of Islamic law?
It is a compilation of decisions of the prophet.
It refers to the making of unearned profits.
It is the doctrine of proper behavior.
It refers to independent reasoning.
4. The state of Oriel, Selenasia, enacts a law that imposes a 40 percent tax on
automobiles that are made outside of Selenasia and sold in the state. However,
Oriel does not impose this tax on Selenasian-made automobiles that are sold in
Oriel. This scenario resembles a violation of which clause of the U.S.
Constitution?
The Multilateral Treaty Clause
The Bilateral Treaty Clause
The Foreign Commerce Clause
The Treaty Clause
5. Teledor Inc. and Comunika Inc. are two competing cellphone manufacturers.
Jane, a customer at Teledor, is told by an employee that Comunika phones have
weak battery back-up and are very prone to damage. The employee makes these
remarks even though he knows that they are completely false. Jane, who has been
contemplating between Teledor and Comunika, is influenced by what she hears and
purchases a Teledor phone. What kind of intentional tort should be used against
Teledor in this scenario?
Malicious prosecution
Disparagement
Battery
Appropriation
6. Identify an accurate statement about res ipsa loquitur, a special negligence
doctrine.
It applies to cases in which injuries that occurred were not foreseeable.
It applies to cases in which the plaintiff also contributed to the
negligence.
It applies to cases in which it can be assumed that the defendant was in
control of the situation in which the injuries occurred.

3. It requires the plaintiff to demonstrate how exactly the situation arose out
of the negligence of the plaintiff.
7. Identify an accurate statement about the doctrine of comparative negligence.
A person who is partially responsible for causing his or her own injuries
cannot file a suit against the other party who partly caused the injuries.
A plaintiff who is partially responsible for causing his or her own injuries
cannot recover damages from the defendant.
A plaintiff who is partially responsible for causing his or her own injuries
can recover a proportion of the damages from the defendant.
A plaintiff who is partially responsible for causing his or her own injuries
can recover all the damages from the defendant.
8. What is true about the applicability of strict liability?
It cannot be applied to products that are defectively manufactured.
It can be applied to sellers who fail to warn of generally known dangers.
It can be applied to products that are defectively packaged.
It cannot be applied to products that were not supported by sufficient
instructions.
9. Which statement best describes an injunction as an equitable remedy?
It requires a breaching party to pay damages to the injured party for both
actual and foreseeable losses.
It orders a breaching party to perform the acts promised in a contract.
It prohibits a party from performing a particular act that may cause injury
to another party.
It allows a court to change the terms of a contract to make them true to the
parties’ intentions.
10. Identify the true statement in the context of a franchise arrangement.
The franchisee can sell the franchisor’s products but can never manufacture
them.
The franchisor licenses the franchisee to use the former’s trademarks.
The franchisee can manufacture the franchisor’s products but can never
distribute them directly to consumers.
The franchisor is essentially the owner of the franchisee.
11. Identify an accurate statement about distributional interest in the context
of limited liability companies (LLCs).
A transferee of a distributional interest receives all distributions from
the LLC to which the transferor belonged.
A member’s distributional interest can be transferred completely, or partly.
A transferee of a distributional interest automatically becomes a member of
the LLC.
A member who transfers his or her distributional interest will no longer be
liable for the debts and obligations of the LLC.
12. What is true about consideration in the context of contracts?
It also encompasses performances and services.
It is exclusively in the form of tangible payments such as money or
property.
It is typically included in gift promises.
It is an optional component of a written contract that parties can choose to
omit.
13. What does a current plaintiff need to prove to succeed in a malicious
prosecution lawsuit?

4. The original plaintiff did not initiate the original lawsuit.
The original lawsuit had probable cause.
The original lawsuit was initiated without malice.
The current plaintiff suffered injury because of the original lawsuit.
14. In which case will a limited partner in a limited partnership have liability
that extends beyond the contributions made by him or her?
When the limited partner provides personal guarantee for a loan taken by the
partnership
When one of the general partners withdraws from the limited partnership
When the limited partnership is involved in a tort and needs to pay
compensation as ordered by the court
When the limited partnership incurs severe losses
15. Identify a difference between publicly held and closely held corporations.
Shareholders of publicly held corporations participate in management
activities; shareholders of closely held corporations do not.
Closely held corporations are large; publicly held corporations are
comparatively smaller.
Publicly held corporations have many shareholders; closely held corporations
have fewer shareholders.
Closely held corporations trade their shares on organized security markets;
publicly held corporations do not.
16. Identify a difference between treasury shares and outstanding shares in a
corporation.
Outstanding shares are the ones that are repurchased by the corporation;
treasury shares are not.
Outstanding shares have the right to vote; treasury shares do not.
Treasury shares are issued by the corporation; outstanding shares are not.
Treasury shares cannot be reissued; outstanding shares can be.
17. What is true about the scope of Good Samaritan laws in the context of
special negligence doctrines?
They apply to professionals like lawyers and architects.
They protect professionals from liability for their ordinary and gross
negligence.
They apply to medical health professionals.
They protect manufacturers and distributors from product liability.
18. Quenchers Inc., a heath drink manufacturer, launches a new product called
Sprint. The packaging of this drink also includes a statement that says “Fifty
times healthier than Green.” Green is a product of Booster Inc., another health
drink manufacturer. Quenchers has no research data to back this claim. What type
of unfair business practice is illustrated in the scenario?
Deceptive advertising
Copyright infringement
Bait and switch
Restraint of trade
19. What statement is true about the powers of the Food and Drug Administration
(FDA) in the context of drug regulation?
The FDA can only regulate the manufacture of prescription drugs.
The FDA’s powers are restricted to the regulation of the sale of drugs.
The FDA is not authorized to revoke licenses of drugs that are in use.
The FDA has the authority to license new drugs.

5. 20. Choose the correct statement about limited liability partnerships (LLPs).
They should have one or more general partners personally liable for the
debts and obligations of the partnerships.
They do not get flow-through tax benefits.
They cannot have partners who are professionals such as doctors or lawyers.
They are created by state and not federal laws.
21. Identify an accurate statement about the Treaty Clause in the context of the
United States and foreign affairs.
It states that a treaty can be formed when one-third of Senate members agree
to it.
It states that state governments can pass laws that contradict treaties
signed by the federal government.
It states that the U.S. president is the agent of the United States in
dealing with foreign nations.
It states that local state governments can also enter into treaties with
foreign nations.
22. What is true of the Economic Espionage Act?
It criminalizes the theft of trade secrets through the use of the Internet.
It criminalizes the discovery of trade secrets through reverse engineering.
It provides federal protection exclusively to trademarks and service marks.
It relieves business owners of the obligation to protect their intellectual
property.
23. What is true of the necessary elements of an environmental impact statement
(EIS) according to the National Environmental Policy Act (NEPA)?
It must mention the environmentalist parties that challenged the proposed
action in court.
It must contain a cost-benefit analysis of the proposed federal action and
alternative actions.
It must not refer to the expert opinions of engineers, geologists, or other
professionals.
It must not mention or describe any alternate actions to the proposed
federal action.
24. Which statement is true about the different types of agency relationships?
An employer-employee relationship involves complete transfer of authority to
the employee.
A principal-agent relationship involves hiring an employee to enter into
contracts on behalf of the principal.
A principal-agent relationship involves assigning an employee a specific
physical task to perform.
An employer-employee relationship involves hiring an employee to act as an
agent of the employer.
25. Identify an accurate statement about the Equal Pay Act.
The act states that the employer can lower the wages of employees to remedy
a wage disparity.
The act states that wages may differ when shift differences are involved.
The act exclusively covers federal workers.
The act does not encompass private-sector employees.
26. What is true of a vertical merger?

6. It combines the operations of two manufacturers in the same market.
It creates increased market share.
It combines the businesses of a supplier and a customer.
It combines the operations of suppliers in the same market.
27. Tanya and Amit, married for five years, have filed for divorce. They are
being assisted by Rebecca in reaching a settlement. Rebecca is a retired judge,
who meets with them together, and individually, to discuss the strengths and
weaknesses of each of their cases. Which alternative dispute resolution method
does this scenario best exemplify?
Mini-trial
Judicial referee
Mediation
Arbitration
28. What is true about Jewish law?
It is based on the teachings in the Vedas.
It is not followed anymore in Jewish home countries.
It includes rules for religious and political aspects of life.
It excludes doctrines related to marriage and inheritance.
29. How does the Marine Protection, Research, and Sanctuaries Act, enacted in
1972, extend environmental protection to the oceans?
By requiring the Environmental Protection Agency (EPA) to create a list of
toxic air pollutants
By removing marine sanctuaries in ocean waters
By requiring industries to obtain a permit for dumping wastes into ocean
waters
By requiring industries to incur the clean up costs for contaminations
caused by them
30. Which statement about personal property is true?
It exclusively refers to tangible property.
It can be owned only by one person.
It refers to property that is movable.
It exclusively encompasses real estate property.
31. What is the primary function of the International Monetary Fund (IMF)?
To create free trade zones for member countries and thereby bring them
together
To provide long-term loans to developing countries
To ensure smooth and free trade flow among member countries by settling
disputes
To promote international fiscal stability by providing temporary monetary
assistance to member countries
32. What is a disadvantage of a sole proprietorship?
The owner has to take up legal responsibility for any torts committed in the
business.
The process of forming a sole proprietorship involves many costs.
The sole proprietorship is difficult to dissolve as many shareholders are
involved.
The owner is required to present several legal documents to obtain federal
approval to start the business.

7. 33. What must a complainant prove in a case of disparate-treatment
discrimination?
The employer cited behavioral reasons for rejecting the complainant.
The employer rejected the complainant despite the latter having the required
qualifications.
The employer sought applications from people with qualifications better than
the complainant’s.
The employer rejected others with the same qualifications.
34. What is true about Title VII of the Civil Rights Act of 1964 in the context
of gender discrimination?
It covers discrimination based on sexual orientation.
It does not prohibit discrimination based on pregnancy-related medical
conditions.
It covers only women.
It excludes sexual harassment.
35. What is a gift causa mortis?
A gift that is made in anticipation of theft.
A gift that cannot be revoked.
A gift that is made in anticipation of death.
A gift that is made involuntarily.
36. Identify a difference between tenancy by the entirety and community property
as forms of concurrent ownership.
Tenancy by the entirety allows a spouse to transfer his or her interest
without the other spouse’s consent; community property does not.
Tenancy by the entirety does not grant the rights of survivorship; community
property does.
Tenancy by the entirety passes the deceased person’s complete property to
the survivor; community property passes only one-half of the property to the
survivor.
Tenancy by the entirety applies to married couples; community property does
not apply to married couples.
37. Waves, Shimmer, and Mist are manufacturers and sellers of beauty products.
Each of these companies independently decides not to sell its products to
Redefine, a cosmetic retailer. Which form of vertical restraint does this
scenario best exemplify?
Group parallelism
Conscious parallelism
Malicious boycott
Product boycott
38. Identify the true statement about the rights and duties of partners in a
general partnership.
A partner in a general partnership has the right to have the transactions of
another partner reviewed by a court.
A partner in a general partnership has the right to compete with the
partnership by opening another business by himself or herself.
A partner in a general partnership has the right to sue the partnership or
another partner at law.
A partner in a general partnership has the right to use the facilities of
the business for personal use.
39. Which statement about strict liability is true?

8. It does not protect bystanders and other individuals who were affected by
defective products.
It does not require a contract to be present between the plaintiff and the
defendant.
It places liability only on manufacturers and not sellers.
It holds the defendant liable only to the purchaser of a defective product.
40. What is the scope of coverage of Title VII of the Civil Rights Act of 1964?
It applies to state and local governments.
It applies to labor unions with five or more members.
It applies to employers with five or more employees.
It applies to Native American tribes.
41. Identify an accurate statement about Hindu Law.
It is based on the teachings of the Torah.
It currently encompasses doctrines related to marriage.
It includes teachings of rabbis.
It is currently a combination of classical Hindu law and common law.
42. Felicia Carter, a famous singer, finds her poster on a billboard of a music
academy. Felicia sues the academy because it did not inform her or seek
permission to use her poster. What kind of intentional tort does this scenario
best exemplify?
Disparagement
Appropriation
Invasion of the right to privacy
Defamation of character
43. Identify a difference between the International Monetary Fund (IMF) and the
World Bank.
The IMF is funded by contributions of developed countries; the World Bank is
funded by developing countries.
The IMF has its headquarters in Washington, DC; the World Bank in The Hague,
the Netherlands.
The IMF has more than 180 member countries; the World Bank has 60 member
countries.
The IMF grants short-term loans to member countries; the World Bank grants
long-term loans to developing countries.
44. Tracy goes to a shopping mall, and she unknowingly drops her identity card.
After a while, she realizes that the card is missing and starts looking for it.
The card is found by Ben who is also at the mall. Ben decides to contact Tracy
and return her identity card. In this scenario, what kind of property would
Tracy’s identity card be?
Abandoned property
Real property
Mislaid property
Lost property
45. Which scenario best exemplifies race discrimination?
Sarah and Sandeep apply for the same post at Diadem Inc. The recruiter
selects Sandeep because he has more work experience than Sarah.
Sarah and Sandeep apply for the same post at Diadem Inc. The recruiter
selects Sarah because she has better qualifications and her resume is more
impressive.

9. Sarah and Sandeep apply for the same post at Diadem Inc. The recruiter
selects Sarah because Sarah is of the same ethnic group as the recruiter.
Sarah and Sandeep apply for the same post at Diadem Inc. The recruiter
selects Sandeep because he believes that a man would suit the job role better.
46. Identify a characteristic of an implied agency.
The agency relationship can be deemed void only with the consent of both the
parties.
The agreement of the agency relationship is in written form.
The agency relationship is formed after both the parties have agreed upon
common terms.
The degree of authority of an agent is defined by the circumstances and
facts of a particular scenario.
47. Identify an accurate statement about the World Trade Organization (WTO).
It has 180 member nations.
It has its headquarters in Washington, DC.
It has a seven-member appellate body that hears appeals.
It has a five-member panel that hears trade disputes.
48. Identify the true statement about the ownership of mislaid property.
The finder of mislaid property gets complete ownership of the property
against the owner of the premises in which the property was mislaid.
The original owner cannot reclaim the ownership of mislaid property if it
has been in the possession of someone else.
The finder of mislaid property can legally acquire partial ownership of the
property from the original owner.
The owner of the region where the property was mislaid is automatically
obliged to take care of the property until the rightful owner finds it.
49. What is true about a quitclaim deed?
It is most frequently used among sellers and buyers.
It provides maximum protection to the grantee as it involves complete
transfer of ownership to him or her.
It does not include an affirmation that the grantor owns the property that
is being transferred.
It is exclusively used during the sale of personal property and cannot be
used during the sale of real property.
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50. What is true of the Americans with Disabilities Act (ADA)?
An employer cannot conduct medical examinations of an employee post
employment.
An employer can ask a job applicant about the existence, nature, and
severity of his or her disability.
An employer can inquire about a job applicant’s ability to perform job-
related functions in terms of health.
An employer can conduct preemployment medical examinations.
51. Dany purchases eye drops manufactured by a pharmaceutical company. She
unknowingly leaves the bottle of eye drops on her living room table. Dany’s two-
year-old daughter finds the bottle and opens it easily. Dany realizes that the
seal on the bottle was not strong enough and was removed far too easily. What
type of product defect is illustrated in the scenario?
Inadequate instructions
Failure to warn
Defect in packaging

10. Defect in manufacture
52. Tanvi was the breaching party in a breach of contract lawsuit. The court
ordered Tanvi to pay a certain amount of damages to the plaintiff. However,
Tanvi refused to pay these damages. The court has now issued a writ that orders
the county sheriff to seize and auction the property owned by Tanvi to pay the
damages owed to the plaintiff. In this scenario, what kind of writ has been
issued in the context of remedies for a breach of contract?
Writ of attachment
Writ of quo-warranto
Writ of garnishment
Writ of payment
53. What is true of the Sherman Act?
It expressly outlaws monopolies.
It does not include criminal sanctions.
It excludes predatory pricing.
It prohibits illegal restraints of trade.
54. The country of Tahomia entered into an agreement with the federal government
of Batang to reduce trade barriers between the two countries. However, one state
in Tahomia has certain laws that prohibit the sale of Batang-made products.
According to the constitution of Tahomia, such rules made by the state will
automatically become invalid. This scenario closely resembles which clause of
the U.S. Constitution?
The Convention Clause
The Treaty Clause
The Bilateral Treaty Clause
The Foreign Clause
55. Identify the true statement about the formation of a limited partnership.
The contributions made by the partners in a limited partnership do not have
to be disclosed.
Limited partnerships can be formed informally among general and limited
partners.
Limited partnerships are required to disclose the nature of their business
to legal entities.
The name of a limited partnership should always include the surname of the
limited partner.
56. Tamara is a content developer at Moon Loop Inc., a content management
company. Her job profile involves describing diagrams and flowcharts. She is not
allowed to make decisions or sign agreements on behalf of the company. In this
scenario, what agency relationship most likely exists between Tamara and Moon
Loop Inc.?
Principal-employer relationship
Principal-agent relationship
Employee-agent relationship
Employer-employee relationship
57. What is true of the International Monetary Fund (IMF) as a United Nations
agency?
It has its headquarters in The Hague, the Netherlands.
It does not provide loans to member countries.
It is funded by contributions of member countries.
It was established before the Great Depression of the 1930s.

11. 58. StacyMiller Publishers and Scriblotts are two of the largest publishing
houses in Paramond. They decide to merge for mutual benefit. What kind of merger
does this scenario best exemplify?
Horizontal merger
Vertical merger
Upward merger
Conglomerate Merger
59. Cetria Inc. has been contracted to manufacture fighter jets for the U.S.
Army, following specific guidelines and requirements. After a week of flying the
first set of delivered jets, the jets start deteriorating and even cause
injuries to the fighter pilots. However, Cetria cannot be held liable for these
defects and injuries. What defense is most likely to protect Cetria from
liability?
Government contractor defense
Generally known danger defense
Assumption of risk defense
Supervening event defense
60. Identify an accurate statement about shareholders.
They elect the board of directors of a corporation.
They handle the daily operations of a corporation.
They have several management duties.
They are agents of a corporation.