This document summarizes key concepts around legal aspects of business from Chapter 7, including regulations around maintaining competition through laws preventing monopolies, protecting intellectual property through patents, copyrights and trademarks, and regulations protecting consumers and different types of taxes affecting business. It discusses federal laws like the Sherman Act that promote fair competition and defines intellectual property concepts. It also outlines regulations at the state and local level through licensing, public franchises, and building codes.

1. Chapter 7 Legal Aspects of
Business
Chapter 7
©2008 Thomson/South-Western
1 Legal Aspects of Business

2. Lesson 7.1 Regulations
Maintaining Competition
Goals
 Explain how federal laws help regulate
monopolies.
 Explain how federal laws help promote fair
competition.
Chapter 7
2 Legal Aspects of Business

3.  Monopoly — exists when only one company
provides a product or service without
competition from other companies
 Natural monopoly — usually involves
providing public services, such as public
utilities, which have a fairly stable demand
and are costly to create
Chapter 7
Monopolies
3 Legal Aspects of Business

4. Promoting Fair Competition
Chapter 7
 Sherman Act
 Clayton Act
 Robinson-Patman Act
 Wheeler-Lea Act
 Federal Trade Commission
 Other federal agencies
 Bankruptcy relief
4 Legal Aspects of Business

5. Lesson 7.2 Regulations Protecting
Business and the Public
Goals
 Explain how patent, copyright, and trademark
protection benefits business.
 Describe the ways in which government
regulations protect consumers.
 Describe three methods used by state and
local governments to regulate business.
Chapter 7
5 Legal Aspects of Business

6.  Patent — agreement in which the federal
government gives an inventor the sole right for 20
years to make, use, and sell an invention or process
 Copyright — sole right to reproduce, publish, and
sell literary or artistic work for the life of the author
plus 70 years
 Trademark — distinguishing name, symbol, or mark
placed on a good or service that is legally reserved
for the sole use of the owner
Chapter 7
Intellectual Property
6 Legal Aspects of Business

7. TRADEMARKS
 Names
 Symbols
TRADEMARKS
 Names
 Symbols
Chapter 7
Intellectual Property
PATENTS
 Motors
 Mousetraps
 Games
 Computers
PATENTS
 Motors
 Mousetraps
 Games
 Computers
COPYRIGHTS
 Software
 Novels
 Histories
 Poetry
 Textbooks
COPYRIGHTS
 Software
 Novels
 Histories
 Poetry
 Textbooks
7 Legal Aspects of Business

8. Regulations Protecting the Public
 Food and drugs — Food and Drug
Administration (FDA)
 Nonfood products — Federal Trade
Commission (FTC), Consumer Product
Safety Act
 Information — Electronic Communications
Privacy Act
Chapter 7
8 Legal Aspects of Business

9. State and Local Regulations
 Licensing — a way to limit and control those
who plan to enter certain types of businesses
 Public franchise — contract that permits a
person or organization to use public property
for private profit
 Building codes (control the physical
features of structures) and zoning (specifies
which land areas may be used for homes
and for different types of businesses)
Chapter 7
9 Legal Aspects of Business

10. Lesson 7.3 Business Taxes
Goals
 Discuss the nature of taxes and the fairness
of progressive, proportional, and regressive
taxes.
 Identify and explain the most common types
of taxes that affect business.
Chapter 7
10 Legal Aspects of Business

11.  Proportional tax (also called flat tax) — tax
whose rate remains the same regardless of
the amount on which the tax is imposed
 Progressive tax — tax based on ability to
pay
 Regressive tax — tax whose rate decreases
as taxable amount increases
Chapter 7
Fairness of Taxation
11 Legal Aspects of Business

12.  Income tax — tax on the profits of businesses and
the earnings of individuals
 Sales tax — tax levied on the retail price of goods
and services at the time of sale
– Excise tax — applied only to selected goods or services
 Property tax — tax on material goods owned, such
as real property tax (real estate) and personal
property tax (movable possessions)
Chapter 7
Types of Taxes
12 Legal Aspects of Business

13. Comparative Tax Rates
Spain
Fance
Sweden
Chapter 7
60
50
40
30
20
10
0
Japan
UK
U.S.
Canada
Greece
Norway
Germany
Tax rate %
13 Legal Aspects of Business