Essentials of Business Law Anthony Liuzzo 10th Edition- Test Bank

 

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Sample Test

Essentials of Business Law, 10e (Liuzzo)

Chapter 3   Criminal Law

 

1) The law assures only corporations, not persons, certain rights and assigns them certain duties.

 

Answer:  FALSE

Explanation:  The law assures each person certain rights and assigns each person certain duties.

Difficulty: 1 Easy

Topic:  Crime

Learning Objective:  03-01 Define crime and distinguish between crimes and torts.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

2) An offense against the public at large is called a tort.

 

Answer:  FALSE

Explanation:  A private wrong that causes injury to another person’s physical well-being, property, or reputation is called a tort.

Difficulty: 1 Easy

Topic:  Crime

Learning Objective:  03-01 Define crime and distinguish between crimes and torts.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

3) A crime is an offense against the public at large.

 

Answer:  TRUE

Explanation:  A crime is an offense against the public at large, punishable by the official governing body of a nation or state.

Difficulty: 1 Easy

Topic:  Crime

Learning Objective:  03-01 Define crime and distinguish between crimes and torts.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

4) An offense can be a tort or a crime, but it can also be both.

 

Answer:  TRUE

Explanation:  It is important to note that a certain action can be both a crime and a tort.

Difficulty: 1 Easy

Topic:  Crime

Learning Objective:  03-01 Define crime and distinguish between crimes and torts.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

5) Crimes are typically classified into three groups: (1) treason, (2) misdemeanor, and (3) contract breaches, according to the seriousness of the offense.

 

Answer:  FALSE

Explanation:  Crimes are classified into three groups according to the seriousness of the offense:  (1) treason, (2) felony, and (3) misdemeanor.

Difficulty: 1 Easy

Topic:  Classification of Crimes

Learning Objective:  03-02 Identify the three major classifications of crimes.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

6) Treason is a “non criminal” minor offense defined by the Constitution of the United States.

 

Answer:  FALSE

Explanation:  Treason is a major crime defined by the Constitution of the United States as follows: “Treason against the United States shall consist only in levying War against them, or in adhering to their Enemies, giving them Aid and Comfort.”

Difficulty: 1 Easy

Topic:  Classification of Crimes

Learning Objective:  03-02 Identify the three major classifications of crimes.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

7) A felony is a crime punishable by death or imprisonment in a federal or state prison for a term exceeding one year.

 

Answer:  TRUE

Explanation:  A felony is a serious crime against society, such as murder, arson, larceny, bribery, and embezzlement.  It may be punished by execution, by a prison sentence of more than a year, or by a fine.

Difficulty: 1 Easy

Topic:  Classification of Crimes

Learning Objective:  03-02 Identify the three major classifications of crimes.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

8) A misdemeanor has more serious punishments associated with it than a felony.

 

Answer:  FALSE

Explanation:  A misdemeanor is an offense less serious than a felony and has punishments associated with it less severe than a felony.

Difficulty: 1 Easy

Topic:  Classification of Crimes

Learning Objective:  03-02 Identify the three major classifications of crimes.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

9) A misdemeanor is a crime punishable by a prison sentence of no more than one year.

 

Answer:  TRUE

Explanation:  A misdemeanor is a less serious crime than a felony and is generally punishable by a fine and/or a prison sentence of no more than one year.

Difficulty: 1 Easy

Topic:  Classification of Crimes

Learning Objective:  03-02 Identify the three major classifications of crimes.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

10) A category of illegal activity that includes embezzlement, stock swindles, fraud against insurance companies, credit card fraud, computer fraud, and theft of computer programs is generally known as white-collar crime.

 

Answer:  TRUE

Explanation:  White-collar crime is a category of illegal activity that covers a wide range of crimes, including embezzlement, stock swindles, frauds against insurance companies, credit card fraud, income tax evasion, cyberspace fraud and theft of computer programs, and agreements with competitors to fix prices.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

11) White-collar crime is the term used to describe the intentional murder of an individual.

 

Answer:  FALSE

Explanation:  White-collar crime is the term used to describe various crimes committed by and against businesses that typically do not involve force or violence.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

12) The willful or malicious act of causing the burning of property belonging to another person is known as larceny.

 

Answer:  FALSE

Explanation:  The crime of arson is the willful or malicious act of causing the burning of property belonging to another person.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

13) Burning of property to defraud an insurance company is a special category of crime under murder.

 

Answer:  FALSE

Explanation:  Burning to defraud is a special category of crime under arson providing for the punishment of persons who burn their own property with the aim of collecting insurance money.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

14) Defamation is defined as the taking of property in the possession of another person against that person’s will and without the threat of bodily harm.

 

Answer:  FALSE

Explanation:  Robbery is defined as the taking of property in the possession of another person against that person’s will and under threat of bodily harm.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

15) The crime of larceny includes the various forms of theft, robbery, hijacking, embezzlement, and shoplifting.

 

Answer:  TRUE

Explanation:  Larceny is a broad term that includes most forms of theft – that is, robbery, hijacking, embezzlement, and shoplifting.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

16) Only the giver of a bribe can be charged with the offense of bribery.

 

Answer:  FALSE

Explanation:  Both the giver and the receiver of a bribe can be charged with bribery.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

17) The crime of murder consists of wrongfully making or altering the writings of another with the intent to defraud.

 

Answer:  FALSE

Explanation:  The crime of forgery consists of wrongfully making or altering the writings of another with the intent to defraud.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

18) Law enforcement authorities of federal, state, and local governments enforce specific laws called ________.

1.   A) by-laws

2.   B) statutes

3.   C) enforcements

4.   D) judicial notices

 

Answer:  B

Explanation:  Law enforcement authorities of federal, state, and local governments enforce specific laws called statutes that are designed to protect the public at large.

Difficulty: 1 Easy

Topic:  Crime

Learning Objective:  03-01 Define crime and distinguish between crimes and torts.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

19) A private wrong that causes injury to the physical well-being, property, or reputation of another person is called a(n) ________.

1.   A) incorporation

2.   B) contract breach

3.   C) tort

4.   D) whistleblowing

 

Answer:  C

Explanation:  A private wrong that causes injury to the physical well-being, property, or reputation of another person is called a tort.

Difficulty: 1 Easy

Topic:  Crime

Learning Objective:  03-01 Define crime and distinguish between crimes and torts.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

20) If a corporation is found guilty of committing a crime and assessed a fine, who typically ends up being punished?

1.   A) the owners of the corporation, the shareholders

2.   B) the judicial system, the court

3.   C) taxpayers

4.   D) local government officials

 

Answer:  A

Explanation:  When corporations do pay fines, it is the shareholders who are ultimately the ones being punished.

Difficulty: 1 Easy

Topic:  Crime

Learning Objective:  03-01 Define crime and distinguish between crimes and torts.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

21) ________ determine(s) what is and what is not a crime.

1.   A) Opinions of legal scholars

2.   B) Corporate by-laws

3.   C) Public opinion

4.   D) Statutory law

 

Answer:  D

Explanation:  Statutory law determines what is and what is not a crime.

Difficulty: 1 Easy

Topic:  Crime

Learning Objective:  03-01 Define crime and distinguish between crimes and torts.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

22) A violation of a statute is a(n) ________.

1.   A) enforceable act

2.   B) contract acceptance

3.   C) crime

4.   D) contract breach

 

Answer:  C

Explanation:  The violation of a statute is typically a crime.

Difficulty: 1 Easy

Topic:  Crime

Learning Objective:  03-01 Define crime and distinguish between crimes and torts.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

23) Crimes are classified into three groups according to the seriousness of the offense. They are ________.

1.   A) treason, felony and misdemeanor

2.   B) bilateral, unilateral and personal

3.   C) offer, acceptance and consideration

4.   D) formal, informal and hybrid

 

Answer:  A

Explanation:  Crimes are classified into three groups according to the seriousness of the offense:  (1) treason, (2) felony, and (3) misdemeanor.

Difficulty: 1 Easy

Topic:  Crime

Learning Objective:  03-02 Identify the three major classifications of crimes.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

24) A ________ is a crime that is punishable by a fine or imprisonment for no more than one year.

1.   A) felony

2.   B) misdemeanor

3.   C) tort

4.   D) contract breach

 

Answer:  B

Explanation:  A misdemeanor is a less serious offense than a felony, and is usually punished by a fine and/or imprisonment for no more than one year.

Difficulty: 1 Easy

Topic:  Classification of Crimes

Learning Objective:  03-02 Identify the three major classifications of crimes.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

25) Treason against the United States includes levying ________.

1.   A) actions that constitute a breach of contract against another individual

2.   B) slanderous acts against a domestic corporation

3.   C) civil action in court against a state or local government entity

4.   D) war against the U.S.

 

Answer:  D

Explanation:  Treason against the United States shall consist only in levying “War against them, or in adhering to their Enemies, giving them Aid and Comfort.”

Difficulty: 1 Easy

Topic:  Classification of Crimes

Learning Objective:  03-02 Identify the three major classifications of crimes.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

26) Examples of misdemeanors include all of the following except ________.

1.   A) murder

2.   B) thefts of small amounts of money

3.   C) traffic offenses

4.   D) use of illegal measuring devices

 

Answer:  A

Explanation:  Examples of misdemeanors include certain traffic offenses, thefts of small amounts of money, use of illegal measuring devices, and other relatively minor infractions of statutes.

Difficulty: 2 Medium

Topic:  Classification of Crimes

Learning Objective:  03-02 Identify the three major classifications of crimes.

Bloom’s:  Understand

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

27) Which of the following determine the classification of crimes on individuals?

1.   A) CEOs of public corporations

2.   B) federal and state laws

3.   C) shareholders of corporations

4.   D) legal scholars

 

Answer:  B

Explanation:  Federal law and laws of the states determine the classification of crimes.

Difficulty: 2 Medium

Topic:  Classification of Crimes

Learning Objective:  03-02 Identify the three major classifications of crimes.

Bloom’s:  Understand

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

28) A felony is a classification of a type of ________.

1.   A) crime

2.   B) tort

3.   C) contract

4.   D) divorce

 

Answer:  A

Explanation:  A felony is a serious crime against society.

Difficulty: 1 Easy

Topic:  Classification of Crimes

Learning Objective:  03-02 Identify the three major classifications of crimes.

Bloom’s:  Understand

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

29) Originally, white-collar crime related only to nonviolent crimes against businesses, usually committed by the:

1.   A) employees of businesses.

2.   B) federal government.

3.   C) consumer.

4.   D) state government.

 

Answer:  A

Explanation:  Originally white-collar crime related only to nonviolent crimes against business, usually committed by their own employees.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

30) White-collar crimes typically involve:

1.   A) neither force nor violence.

2.   B) murder.

3.   C) assault.

4.   D) kidnapping.

 

Answer:  A

Explanation:  White-collar crime typically does not involve force or violence and is committed by and against businesses.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

31) Some states have broadened the definition of the crime of arson to include the burning of a house by its owner and the destruction of property by other means, such as by:

1.   A) enhancement.

2.   B) vandalism.

3.   C) conversion.

4.   D) explosion.

 

Answer:  D

Explanation:  Some states have broadened the definition of arson to include the burning of a house by its owner and the destruction of property by other means, such as by explosion.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

32) Securities fraud also encompasses the crime of:

1.   A) assault.

2.   B) insider trading.

3.   C) murder.

4.   D) kidnapping.

 

Answer:  B

Explanation:  Securities fraud encompasses theft of an investor’s assets, stock trading based on nonpublic information (“insider trading”), and the wrongful manipulation of financial statements.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

33) Larceny is often classified as petty or grand, depending upon the:

1.   A) time when the crime was committed.

2.   B) person from whom the property was stolen.

3.   C) court to which the case was referred.

4.   D) value of the stolen property.

 

Answer:  D

Explanation:  Larceny is often classified as petty (small) or grand (large), depending upon the value of the stolen property.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

34) The various forms of theft, robbery, hijacking, embezzlement, and shoplifting are types of:

1.   A) murder.

2.   B) assault.

3.   C) plundering.

4.   D) larceny.

 

Answer:  D

Explanation:  Larceny is a broad term that includes most forms of theft – that is, robbery, hijacking, embezzlement, and shoplifting.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

35) The taking of property in the possession of another person against that person’s will is:

1.   A) arson.

2.   B) murder.

3.   C) robbery.

4.   D) plotting.

 

Answer:  C

Explanation:  Robbery is defined as the taking of property in the possession of another person against that person’s will and under threat of bodily harm.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

36) The illegal entering of another person’s premises for the purpose of committing a crime is:

1.   A) arson.

2.   B) burglary.

3.   C) assault.

4.   D) murder.

 

Answer:  B

Explanation:  Burglary is the illegal entering of another person’s premises for the purpose of committing a crime.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

37) Stealing merchandise from a retail store is an example of:

1.   A) shoplifting.

2.   B) hijacking.

3.   C) murder.

4.   D) burglary.

 

Answer:  A

Explanation:  Shoplifting is the stealing of merchandise from a retail store.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

38) The crime of bribery consists of giving or taking money or property of value with the intent of:

1.   A) influencing someone.

2.   B) assaulting someone.

3.   C) kidnapping someone.

4.   D) murdering someone.

 

Answer:  A

Explanation:  The crime of bribery consists of giving or taking money or property of value with the intent of influencing someone (usually a public official) in the performance of his or her duty.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

39) The category of crime that involves activities intended to deceive others is called:

1.   A) battery.

2.   B) assault.

3.   C) murder.

4.   D) false pretenses.

 

Answer:  D

Explanation:  The term false pretenses describes a broad category of crimes that involves activities intended to deceive others by making false claims, or to obtain goods by using false pretenses. A number of federal and state statutes govern activities that are considered false pretenses.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

40) A person who makes false statements to a bank for the purpose of obtaining a loan can be prosecuted for the offense of:

1.   A) false pretenses.

2.   B) embezzlement.

3.   C) murder.

4.   D) perjury.

 

Answer:  A

Explanation:  A person who makes false statements to a bank for the purpose of obtaining a loan can be prosecuted under the appropriate statute governing false pretenses.

Difficulty: 2 Medium

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Understand

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

41) The act of signing another person’s name to a credit card charge slip without his permission is an example of:

1.   A) perjury.

2.   B) murder.

3.   C) forgery.

4.   D) robbery.

 

Answer:  C

Explanation:  The act of signing another person’s name to a credit card charge slip without that person’s permission is an act of forgery.

Difficulty: 2 Medium

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Understand

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

42) The act of giving false information on a government form can be an example of:

1.   A) perjury.

2.   B) murder.

3.   C) battery.

4.   D) slander.

 

Answer:  A

Explanation:  In some instances, giving false information on a government form is considered perjury.

Difficulty: 2 Medium

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Understand

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

43) The act of wrongfully making or altering the writings of another with the intent to defraud is:

1.   A) forgery.

2.   B) murder.

3.   C) slander.

4.   D) libel.

 

Answer:  A

Explanation:  The crime of forgery consists of wrongfully making or altering the writings of another with the intent to defraud.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

44) The act of wrongfully taking money or other property that has been entrusted to a person as a part of his or her employment is referred to as:

1.   A) embezzlement.

2.   B) bribery.

3.   C) forgery.

4.   D) slander.

 

Answer:  A

Explanation:  The crime of embezzlement may be defined as the wrongful taking of money or other property that has been entrusted to a person as a part of his or her employment.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

45) Frequently, persons with knowledge of computers access the credit card numbers of consumers who have made purchases on the Internet and use these credit card numbers without authorization. This act constitutes the crime of:

1.   A) credit card fraud.

2.   B) liable.

3.   C) slander.

4.   D) securities fraud.

 

Answer:  A

Explanation:  Persons with knowledge of computers who access the credit card numbers of consumers who have made purchases on the Internet and use these credit card numbers without authorization commit the crime of credit card fraud.

Difficulty: 1 Easy

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Remember

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

46) When an unscrupulous individual steals the name and personal information of someone else by stealing private mail, the individual has committed:

1.   A) identity theft.

2.   B) battery.

3.   C) slander.

4.   D) libel.

 

Answer:  A

Explanation:  Identity theft occurs when an unscrupulous individual steals the name and personal information of someone else by stealing private mail, by obtaining personal data on the Internet, or by soliciting personal information from an unwitting victim over the telephone.

Difficulty: 2 Medium

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Understand

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

47) What 1970 law is the main tool used against racketeering in the United States?

1.   A) EEOC

2.   B) FSLA

3.   C) FLMA

4.   D) RICO

 

Answer:  D

Explanation:  The Racketeer Influenced and Corrupt Organizations Act of 1970, also known as RICO, is one of the most successful laws used to combat white collar crime. RICO prohibits an organization’s employees from engaging in a pattern of racketeering activity.

Difficulty: 2 Medium

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Understand

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

48) What is the name of a specific type of securities fraud where large gains are promised to investors, but newer investments are being used to provide returns on the older investments?

1.   A) Ponzi Scheme

2.   B) Derivative Action

3.   C) Insider Trading

4.   D) Napoleon Complex

 

Answer:  A

Explanation:  A Ponzi Scheme is a specific type of securities fraud where large gains are promised to investors but newer investments are being used to provide returns on the older investments.

Difficulty: 2 Medium

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Understand

AACSB:  Reflective Thinking

Accessibility:  Keyboard Navigation

 

 

49) Define the term “crime,” and identify and explain the three classifications of crime.

 

Answer:  A violation of a statute is a crime. Crimes are classified as treason, felonies, and misdemeanors. Federal and state law determine and specify the punishment. Treason is a major crime defined by the Constitution of the United States. A felony is a serious crime against society with a prison sentence of more than a year, or a fine. A misdemeanor is an offense that is less serious than a felony and is punishable with a fine and/or imprisonment for no more than one year.

Explanation:  A violation of a statute is a crime. Crimes are classified as treason, felonies, and misdemeanors. Federal and state law determine and specify the punishment. Treason is a major crime defined by the Constitution of the United States. A felony is a serious crime against society with a possibility of a prison sentence of more than a year, or a fine. A misdemeanor is an offense less serious than a felony and is punishable with a fine and/or the possibility of imprisonment for no more than one year.

Difficulty: 2 Medium

Topic:  Crime

Learning Objective:  03-01 Define crime and distinguish between crimes and torts.

Bloom’s:  Understand

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

50) Define “embezzlement.”

 

Answer:  The wrongful taking of money or other property that has been entrusted to a person as part of his or her job.

Difficulty: 2 Medium

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Understand

AACSB:  Written and oral communication

Accessibility:  Keyboard Navigation

51) White-collar crimes are often committed against businesses but are sometimes committed by firms. Give an example of the latter.

 

Answer:  Crimes committed by business firms typically include insider trading, price fixing, conspiracy in restraint of trade, and monopolization.

Difficulty: 3 Hard

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Apply

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

 

 

52) Define “perjury.”

 

Answer:  Perjury is the crime of intentionally giving false oral or written statements under oath in a judicial proceeding after having sworn to tell the truth.

Difficulty: 2 Medium

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Understand

AACSB:  Written and oral communication

Accessibility:  Keyboard Navigation

 

53) Explain larceny.

 

Answer:  Larceny is a broad term that includes most forms of theft, such as robbery, hijacking, embezzlement, and shoplifting. Larceny is often classified as petty or grand, depending upon the value of the stolen property.

Difficulty: 2 Medium

Topic:  Crimes in the Business World

Learning Objective:  03-03 Discuss several common crimes of particular concern to business and employees.

Bloom’s:  Understand

AACSB:  Written and oral communication

Accessibility:  Keyboard Navigation

 

Essentials of Business Law, 10e (Liuzzo)

Chapter 5   Constitutional Law

 

1) The Canadian Constitution forms the basis for all American Law.

 

Answer:  FALSE

Explanation:  The United States Constitution, although relatively brief, forms the basis for all American law.

Difficulty: 1 Easy

Topic:  The United States Constitution

Learning Objective:  05-01 Explain the difference between express and implied powers, describe the process used to amend the U.S. Constitution, and explain judicial review and the doctrine of preemption.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

2) In the United States, power for the federal and state governments come from the U.S. Constitution and state constitutions.

 

Answer:  TRUE

Explanation:  The federal Constitution and state constitutions confer express and implied powers on the governments.

Difficulty: 1 Easy

Topic:  The United States Constitution

Learning Objective:  05-01 Explain the difference between express and implied powers, describe the process used to amend the U.S. Constitution, and explain judicial review and the doctrine of preemption.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

3) Express powers are those that are specifically stated in the U.S. Constitution.

 

Answer:  TRUE

Explanation:  Express powers are those that are specifically stated. For example, the federal Constitution grants the federal government the explicit powers to raise an army and to impose taxes.

Difficulty: 1 Easy

Topic:  The United States Constitution

Learning Objective:  05-01 Explain the difference between express and implied powers, describe the process used to amend the U.S. Constitution, and explain judicial review and the doctrine of preemption.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

4) The process of a court deciding whether a law is contrary to the Constitution is known as the doctrine of judicial review.

 

Answer:  TRUE

Explanation:  The process of deciding if a law is contrary to the Constitution is known as judicial review.

Difficulty: 1 Easy

Topic:  The United States Constitution

Learning Objective:  05-01 Explain the difference between express and implied powers, describe the process used to amend the U.S. Constitution, and explain judicial review and the doctrine of preemption.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

5) Each amendment of the federal Constitution needs to be ratified by the legislatures of half of the 50 states.

 

Answer:  FALSE

Explanation:  Each amendment to the United States Constitution must be proposed by a two-thirds vote of Congress and ratified, or approved, by the legislatures of three-fourths of our 50 states.

Difficulty: 1 Easy

Topic:  The United States Constitution

Learning Objective:  05-01 Explain the difference between express and implied powers, describe the process used to amend the U.S. Constitution, and explain judicial review and the doctrine of preemption.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

6) Since its inception, the Constitution of the United States has been amended many times.

 

Answer:  TRUE

Explanation:  The Constitution has been amended, or changed, 27 times, and it will probably continue to be amended.

Difficulty: 1 Easy

Topic:  The United States Constitution

Learning Objective:  05-01 Explain the difference between express and implied powers, describe the process used to amend the U.S. Constitution, and explain judicial review and the doctrine of preemption.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

 

7) The commerce clause is a provision of the U.S. Constitution that grants Congress the power to regulate trade with foreign nations, and among the several states, and with the Indian tribes.

 

Answer:  TRUE

Explanation:  The commerce clause is a provision of the Constitution that grants Congress the power to regulate trade with foreign nations, and among the several states, and with the Indian tribes.

Difficulty: 1 Easy

Topic:  The Commerce Clause, The Full Faith and Credit Clause, and the Supremacy Clause

Learning Objective:  05-02 Discuss the main provisions of the commerce clause, the full faith and credit clause, and the supremacy clause.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

8) It is impermissible under the U.S. Constitution for a municipality to pass a law limiting what a journalist can write or say about a political candidate or issue.

 

Answer:  TRUE

Explanation:  It is unconstitutional, based on the First Amendment, for a state or municipality to pass a law limiting what a journalist can write or say about a political candidate or issue.

Difficulty: 1 Easy

Topic:  The First Amendment

Learning Objective:  05-03 Describe three provisions of the First Amendment.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

9) The right to bear arms as articulated in the Second Amendment has limitations.

 

Answer:  TRUE

Explanation:  The right to bear arms is not unlimited. Some 21st-century weapons were never imagined by the framers of the Constitution. Once again, interpreting the Constitution is a matter of drawing a line between what is and what is not permissible, balancing rights versus responsibilities.

Difficulty: 1 Easy

Topic:  The Second Amendment

Learning Objective:  05-04 Discuss the current state of constitutional law with respect to the Second Amendment.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

 

10) Under the Fourth Amendment police officers and other government officials must have probable cause to conduct a personal or property search.

 

Answer:  TRUE

Explanation:  The Fourth Amendment requires that police officers and other government officials have probable cause to conduct a personal or property search.

Difficulty: 1 Easy

Topic:  The Fourth Amendment

Learning Objective:  05-05 Describe the requirement of probable cause under the Fourth Amendment.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

11) If Owen refused to testify on the premise that the information he would divulge would self-incriminate him, he can legally do so under the First Amendment.

 

Answer:  FALSE

Explanation:  Self-incrimination: the Fifth Amendment gives individuals the right to refuse to divulge information that could later be used against them in a criminal proceeding.

Difficulty: 1 Easy

Topic:  The Fifth Amendment

Learning Objective:  05-06 Identify and explain four protections provided by the Fifth Amendment.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

12) The Eighth Amendment ensures that people in the United States who are accused of a crime will not be subject to excessive bail.

 

Answer:  TRUE

Explanation:  The Eighth Amendment mandates that people accused or convicted of crimes are not to be subject to excessive bail.

Difficulty: 1 Easy

Topic:  The Eighth Amendment

Learning Objective:  05-07 Provide examples of cases that are addressed by the Eighth Amendment.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

 

13) The Eighth Amendment prevents the government from imposing an unjustly harsh fine on a person convicted of a crime.

 

Answer:  TRUE

Explanation:  The Eighth Amendment prevents the government from imposing an unjustly harsh fine on a person convicted of a crime.

Difficulty: 1 Easy

Topic:  The Eighth Amendment

Learning Objective:  05-07 Provide examples of cases that are addressed by the Eighth Amendment.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

14) The Fourteenth Amendment, which guarantees due process and equal protection to all citizens, applies to actions of all state governments.

 

Answer:  TRUE

Explanation:  The Fourteenth Amendment reads, in part, as follows: “No State shall . . . deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.” Thus, the Fourteenth Amendment applies directly to the 50 states.

Difficulty: 1 Easy

Topic:  The Fourteenth Amendment

Learning Objective:  05-08 Explain the due process and equal protection clauses of the Fourteenth Amendment.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

15) Under the Fourteenth Amendment, if a state law discriminates on the basis of race or national origin, or if the law infringes on a fundamental constitutional right, the state must show that the law passes the rational basis test.

 

Answer:  FALSE

Explanation:  Under the Fourteenth Amendment, if a state law discriminates on the basis of race or national origin, or if the law infringes on a fundamental constitutional right, the state must show that the law passes the strict scrutiny test.

Difficulty: 1 Easy

Topic:  The Fourteenth Amendment

Learning Objective:  05-08 Explain the due process and equal protection clauses of the Fourteenth Amendment.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

 

16) The rational basis test is a standard that courts use to measure whether a legislature had a compelling interest for enacting a particular statute that infringes on an individual’s rights.

 

Answer:  FALSE

Explanation:  The strict scrutiny test is a standard that measures whether the state legislature had a compelling interest for enacting a particular statute.

Difficulty: 1 Easy

Topic:  The Fourteenth Amendment

Learning Objective:  05-08 Explain the due process and equal protection clauses of the Fourteenth Amendment.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

17) The Sixteenth Amendment grants the federal government the power to impose and collect a tax on individuals’ incomes.

 

Answer:  TRUE

Explanation:  The Sixteenth Amendment grants the federal government the power to impose and collect a tax on individuals’ incomes.

Difficulty: 1 Easy

Topic:  The Sixteenth Amendment

Learning Objective:  05-09 Discuss how the Internal Revenue Service administers the collection of income taxes pursuant to the Sixteenth Amendment.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

18) The Internal Revenue Service (IRS) is a federal agency established by Congress and tasked with administering and collecting federal income tax under the Sixteenth Amendment.

 

Answer:  TRUE

Explanation:  The Internal Revenue Service (IRS) is a federal agency established by Congress and tasked with administering and collecting federal income tax under the Sixteenth Amendment.

Difficulty: 1 Easy

Topic:  The Sixteenth Amendment

Learning Objective:  05-09 Discuss how the Internal Revenue Service administers the collection of income taxes pursuant to the Sixteenth Amendment.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

 

19) One of the functions of the IRS is to educate and improve citizens’ understanding of the nation’s tax laws.

 

Answer:  TRUE

Explanation:  The IRS creates and enforces tax laws and improves taxpayers’ understanding of tax laws.

Difficulty: 1 Easy

Topic:  The Sixteenth Amendment

Learning Objective:  05-09 Discuss how the Internal Revenue Service administers the collection of income taxes pursuant to the Sixteenth Amendment.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

20) The U.S. Constitution confers express and ________ powers on the government.

1.   A) implied

2.   B) corporate

3.   C) unlimited

4.   D) criminal

 

Answer:  A

Explanation:  The federal Constitution and state constitutions confer express and implied powers on the governments.

Difficulty: 1 Easy

Topic:  The United States Constitution

Learning Objective:  05-01 Explain the difference between express and implied powers, describe the process used to amend the U.S. Constitution, and explain judicial review and the doctrine of preemption.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

 

21) Each constitutional amendment must be proposed by a:

1.   A) two-thirds vote of Congress.

2.   B) one-fourth vote of Congress.

3.   C) one-third vote of Congress.

4.   D) three-fourths vote of Congress.

 

Answer:  A

Explanation:  Each amendment to the United States Constitution must be proposed by a two-thirds vote of Congress and ratified, or approved, by the legislatures of three-fourths of our 50 states.

Difficulty: 1 Easy

Topic:  The United States Constitution

Learning Objective:  05-01 Explain the difference between express and implied powers, describe the process used to amend the U.S. Constitution, and explain judicial review and the doctrine of preemption.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

22) Under the doctrine of preemption, if there is a conflict of laws which law must be followed?

1.   A) state law

2.   B) municipal law

3.   C) federal law

4.   D) international law

 

Answer:  C

Explanation:  If a state or local law is inconsistent with the federal law, the state or local law may be declared unconstitutional, and the federal law must be followed.

Difficulty: 1 Easy

Topic:  The United States Constitution

Learning Objective:  05-01 Explain the difference between express and implied powers, describe the process used to amend the U.S. Constitution, and explain judicial review and the doctrine of preemption.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation

 

 

23) The Constitution is divided and subdivided into all of the following EXCEPT:

1.   A) articles.

2.   B) sections.

3.   C) clauses.

4.   D) papers.

 

Answer:  D

Explanation:  The Constitution is divided into major divisions, called articles; subdivisions, called sections; and in some cases sub-subdivisions, called clauses.

Difficulty: 1 Easy

Topic:  The Commerce Clause, The Full Faith and Credit Clause, and the Supremacy Clause

Learning Objective:  05-02 Discuss the main provisions of the commerce clause, the full faith and credit clause, and the supremacy clause.

Bloom’s:  Remember

AACSB:  Knowledge Application

Accessibility:  Keyboard Navigation