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Business Law
Q:
A franchisor's decision to terminate a franchise may be made in the normal course of business operations.
Q:
The termination provision of a franchise contract is usually more favorable to the franchisor.
Q:
Much franchise litigation involves claims of wrongful termination.
Q:
Most franchise agreements provide that notice of termination of a franchise is not necessary.
Q:
The duration of a franchise is a matter to be determined between the parties.
Q:
A franchisor can require a franchisee to purchase certain supplies from the franchisor at an established price.
Q:
A franchisor can set the retail prices for the goods that a franchisee sells.
Q:
The validity of a provision permitting the franchisor to establish and enforce certain quality standards is questionable.
Q:
A franchise agreement may specify that the premises for the business must be leased.
Q:
Normally, a franchisee determines the territory that it will serve.
Q:
A franchisee normally pays an initial lump sum for a franchise license.
Q:
A franchisee may be required to pay for certain of the franchisor's administrative expenses.
Q:
A franchisee normally does not pay a fee for a franchise license until after the first year of using it.
Q:
If a party to a franchise contract fails to perform, he or she may be subject to a suit for breach of contract.
Q:
Some states require that a franchisor submit advertising aimed at prospective franchisees to the state for approval.
Q:
Some states require franchisors to provide presale disclosures to prospective franchisees.
Q:
The laws governing franchising are primarily designed to protect franchisors from dishonest franchisees.
Q:
In a manufacturing arrangement, a franchisor transmits to a franchisee the ingredients to make a particular product.
Q:
A franchise is a contractual arrangement.
Q:
Laws governing franchising are designed in part to prevent franchisors from terminating franchises without good cause.
Q:
A franchise exists when the owner of a trademark licenses its use to another party to sell goods or services.
Q:
A franchise exists when the owner of a copyright licenses its use to another party to sell goods or services.
Q:
A franchisee can operate as an independent businessperson but still obtain the advantages of a national organization.
Q:
A franchisor is the purchaser of a franchise.
Q:
A sole proprietorship lacks continuity on the death of the proprietor.
Q:
In raising capital, a sole proprietor is limited to his or her personal fundsa loan is not possible.
Q:
A sole proprietor has unlimited liability for all obligations that arise in doing business.
Q:
A sole proprietor must create a separate business organization to create a sole proprietorship.
Q:
In a sole proprietorship, the owner receives 90 percent of the profits and the government receives 10 percent.
Q:
In a sole proprietorship, the proprietor shares the burden of any losses or liabilities incurred by the business enterprise with the government.
Q:
A sole proprietor may own and manage any type of business.
Q:
The simplest form of business is a sole proprietorship.
Q:
In choosing a form of business organization for a new enterprise, important factors include the liability of the owner.
Q:
In choosing a form of business organization for a new enterprise, important factors include the ease of creation.
Q:
Doc's Sports Club enters into a franchise agreement with Elite Fitness Centers that provides for termination at any time for "cause." Doc's fails to meet Elite's "Friends and Family" membership sales quota. Is this "cause" for termination? Explain.
Q:
Owen plans to open Owen's Pets Store, a pet sales and pet supplies outlet, and to hire Quimby and Ruth. Owen will invest only his own money. He does not expect to make any profit for at least two years and to make almost no profit for the first three years, but he hopes to expand eventually. Which form of business organization would be most appropriate? What are the chief characteristics, advantages, and disadvantages of this form of business organization? If Owen wants to obtain additional capital to expand the business, but does not want to lose control of the firm, what is his best option?
Q:
For twenty years, Ozzie works for Players Paradise, a destination for vacationers from across the United States, maintaining golf carts. After a steady stream of positive job evaluations and merit pay raises, Ozzie is promoted to the position of supervisor of golf-cart maintenance at three of Players's courses. Five years later, a new employee, Quentin, is hired to oversee operations at all ten of Players's courses. Quentin demotes Ozzie, who is now over the age of forty, to running only one of the three cart facilities, and freezes his salary. Quentin demotes five other employees over the age of forty and places one of Ozzie's former facilities under the supervision of Richie, who is twenty-three. Ozzie overhears Richie say, "We"re going to have to do away with these old, senile men." Less than a year later, Quentin reconsolidates the three cart facilities' operations under Richie's charge. Ozzie quits and files a suit against Players for employment discrimination. Should he prevail? Explain.
Q:
Gelato Cheese Company, a major processor of cheese sold throughout the United States, employs one hundred workers at its principal processing plant. The plant is located in Heartland Corners, which has a population that is 50 percent white and 25 percent African American, with the balance Hispanic American, Asian American, and others. Gelato requires a high school diploma as a condition of employment for its cleaning crew. Three-fourths of the white population completed high school, compared with only one-fourth of those in the minority groups. Gelato has an all-white cleaning crew. Has Gelato violated the Civil Rights Act of 1964? Explain.
Q:
Jason and Katrina work on the loading dock for Longhaul Transport Company. Jason has a disability. Katrina has seniority. Jason asks for a transfer, which would represent an accommodation for his disability. Longhaul gives the transfer to Katrina on the basis of her seniority. Jason files a suit against Longhaul for discrimination on the basis of his disability. The court is most likely to rule that
a. Katrina's seniority is a good defense.
b. Jason's disability is a sufficient basis for relief.
c. Longhaul's action was a business necessity.
d. Longhaul's action was a reasonable accommodation.
Q:
Valerie is a pilot for Wayfarer Airlines. Wayfarer's policy is to restrict Valerie and its other pilots from flight responsibilities after a certain age. This is most likely
a. a legitimate bona fide occupational qualification.
b. discrimination on the basis of age.
c. reverse discrimination.
d. discrimination on the basis of disability.
Q:
Machine Corporation requires its employees to have a high school diploma, claiming a definite connection between a high school education and job performance. In a suit against Machine Corporation under Title VII, this requirement is shown to have a discriminatory effect. The employer has
a. no defense.
b. a bona fide occupational qualification defense.
c. a business necessity defense.
d. a seniority systems defense.
Q:
Silky Coordinates, a women's clothing store, employs female attendants to assist customers in the dressing rooms. Radley, a forty-one-year-old male, applies for an attendant's job, but is not hired. In Radley's suit against Silky for employment discrimination under Title VII, the store has
a. no defense.
b. a bona fide occupational qualification defense.
c. a business necessity defense.
d. a seniority systems defense.
Q:
Flynn is a drug addict who has completed a supervised drug-rehabilitation program. Gert used drugs casually in the past. Heath reports to work while under the influence of alcohol. Considered to have a disability under the Americans with Disabilities Act of 1990 is
a. Flynn.
b. Gert.
c. Heath.
d. all of the choices.
Q:
Beth, who has a disability, is an employee of Corporate Office Company (COC). After the installation of new doors on COC's building, Beth finds it nearly impossible to get in and out. For repeatedly failing to be on time, COC replaces Beth with Dian, who does not have a disability.
To successfully defend against Beth's claim, COC will have to show that
a. Beth consistently failed to meet the essential requirements of her job.
b. COC cannot make changes to the doors without undue hardship.
c. Dian is qualified for Beth's position.
d. the doors were not installed as an act of intentional discrimination.
Q:
Beth, who has a disability, is an employee of Corporate Office Company (COC). After the installation of new doors on COC's building, Beth finds it nearly impossible to get in and out. For repeatedly failing to be on time, COC replaces Beth with Dian, who does not have a disability.
To succeed with a claim against COC under the Americans with Disabilities Act, Beth will have to show that
a. Beth consistently met the essential requirements of her job.
b. COC refused to make reasonable accommodation for Beth.
c. Dian is unqualified for Beth's position.
d. the doors were installed as an act of intentional discrimination.
Q:
Dick works for First City Bank. When his spouse Elin is diagnosed with Lou Gehrig's disease, Dick asks to take temporary leave to care for her. First City discharges him. He files a suit against the bank under the Americans with Disabilities Act of 1990. Most likely, Dick can
a. recover for association discrimination.
b. recover for reverse discrimination.
c. recover for disparate-impact discrimination.
d. not recover.
Q:
Paula, a disabled person, applies for a job at Quantity Corporation for which she is well qualified, but for which she is rejected. Quantity continues to seek applicants and eventually fills the position with a person who is not disabled. Paula is most likely to succeed in a suit against Quantity for discrimination under the Americans with Disabilities Act of 1990 if she can show that
a. she was not hired solely because of her disability.
b. she can function well with corrective devices or on medication.
c. her disability causes her undue hardship.
d. she could not perform the job even with reasonable accommodation.
Q:
Eton files a suit in a federal district court against Florida, alleging employment discrimination under the Age Discrimination in Employment Act of 1967. The state asks the court to dismiss the suit. The court is most likely to rule that
a. the state is immune from the suit.
b. the suit can proceed.
c. Eton is immune from any defense the state might offer.
d. the court is immune from such request.
Q:
Lita replaces Manny in his job at Neighborly Business Corporation (NBC).
To succeed with an age-discrimination claim against CBC, Manny will have to show that
a. Lita is not qualified for Manny's job.
b. Manny is qualified for his job.
c. NBC's qualifications for Manny's job are too high.
d. no one could do Manny's job as well as he could.
Q:
Lita replaces Manny in his job at Neighborly Business Corporation (NBC).
Manny believes that he has been discriminated against on the basis of his age. For the Age Discrimination in Employment Act of 1967 to apply
a. all parties must be forty years of age or younger.
b. Lita must be forty years of age or older.
c. Manny must be forty years of age or older.
d. NBC must have been in existence for at least forty years.
Q:
Svetlana, a fifty-five-year-old member of a racial minority with a disability, believes that she is a victim of employment discrimination. Potentially the most widespread form of discrimination is based on
a. age.
b. disability.
c. gender.
d. race.
Q:
Lisa brings a lawsuit against her employer for unlawful discrimination. Lisa is successful in proving that she was unlawfully discriminated against by her employer. Lisa may be awarded
a. back pay, but not retroactive promotions.
b. retroactive promotions, but not back pay.
c. damages, but not back pay.
d. back pay, retroactive promotions and damages.
Q:
Pikabo files an employment discrimination suit against Quantitative Analysis, Inc., under the Civil Rights Act of 1964, based on its discharge of Pikabo. Possible relief includes
a. imprisonment.
b. reinstatement.
c. fines.
d. an order to shutdown the employer's business.
Q:
Vinnie, the owner of Caf Rico, knows about, but does not take any action to prevent, the sexual harassment of employees. Vinnie and the caf may be liable for such harassment by
a. an employee's previous employer.
b. a customer or a co-worker.
c. an employee's spouse or other close relative.
d. none of the choices.
Q:
Elsa participates in a Title VII investigation at the firm where she works. As a result, Elsa's employer demotes her. Elsa can file a
a. harassment complaint.
b. retaliation claim.
c. constructive discharge claim.
d. disparate-impact discrimination claim.
Q:
The standard for determining whether constructive discharge has occurred is whether or not
a. a reasonable person in the employee's position would feel compelled to quit.
b. the employee's annual wage rate is fair.
c. a person of another race in the employee's position would feel compelled to quit.
d. a person of the opposite gender in the employee's position would feel compelled to quit.
Q:
Ruth is a supervisor for Subs & Suds, a restaurant. Tim is a Subs employee. The owner announces that some employees will be discharged. Ruth tells Tim that if he has sex with her, he can keep his job. This is
a. harassment on the basis of sexual orientation.
b. not harassment.
c. quid pro quo harassment.
d. same-gender harassment.
Q:
Greta is the only female employee in the maintenance department of Hydraulics Inc. Greta's supervisor and co-workers tease and play tricks on her so relentlessly that she feels compelled to quit. This is
a. a constructive discharge.
b. a destructive discharge.
c. an instructive discharge.
d. not a discharge.
Q:
Conrad and Delilah are employees of AgriBio Feed & Seed Corporation. Under the Equal Pay Act of 1963, AgriBio can legitimately pay different wages on the basis of
a. seniority.
b. job descriptions.
c. substantial equality of skill, effort, and responsibility.
d. gender.
Q:
Erasmus files a suit against Drain-Pro Plumbing & Repair LLC under the Civil Rights Act of 1964, claiming reverse discrimination. To support this claim, Erasmus must show that he is a member of
a. a protected class.
b. a majority group.
c. an employers' association.
d. a union.
Q:
Olivia applies for a job with Petro Company. Petro does not hire Olivia because of her ethnicity, or national origin. This is
a. reverse discrimination.
b. disparate-impact discrimination.
c. disparate-treatment discrimination.
d. not discrimination.
Q:
Melanie files an employment discrimination suit against Natural Gas Industries Corp. under Title VII on a disparate-impact theory. To succeed, Melanie must show that a protected group of people are adversely affected by any of the following except the employer's
a. practices.
b. procedures.
c. tests.
d. seniority system.
Q:
Lew, a member of a protected class, applies for a job with Mit-E Construction Company, but fails Mit-E's employment test and is not hired. Lew believes that the test has an unintentionally discriminatory effect. If so, this is
a. reverse discrimination.
b. disparate-impact discrimination.
c. disparate-treatment discrimination.
d. not discrimination.
Q:
Truman applies for a job at Skylight Canopy Corporation for which he is well qualified, but for which he is rejected. Skylight continues to seek applicants and eventually fills the position with a person who is not a member of a minority. Truman is most likely to succeed in a suit against Skylight for discrimination if he is a member of
a. a protected class.
b. a majority group.
c. an employers' association.
d. a union.
Q:
Sarah believes that she was rejected for a position at Trekking Travel Agency due to her race. Sarah files a suit against Trekking Travel Agency under Title VII on the basis of disparate-treatment discrimination. Sarah must show all of the following except that
a. she is a member of a protected class.
b. she applied and was qualified for the job in question.
c. she was rejected by Trekking Travel Agency.
d. other people of her race hold similar positions with other employers.
Q:
Cody believes that Delta Corporation has discriminated against him on the basis of gender. Cody files a suit against Delta under Title VII. To establish a prima facie case of employment discrimination, Cody must show that
a. Cody is a member of a protected class.
b. Delta has no legal defenses against the claim.
c. discriminatory intent motivated Delta's act.
d. other firms in Delta's industry have committed discriminatory acts.
Q:
Dakota believes that Credit Services Corporation (CSC) has discriminated against her on the basis of gender. She files a suit against CSC under the Civil Rights Act of 1964. To establish a prima facie case of employment discrimination, Dakota must show that
a. she is a member of a protected class.
b. CSC has no legal defenses against the claim.
c. discriminatory intent motivated CSC's act.
d. no other firm in CSC's industry has committed a discriminatory act.
Q:
Origami Paper Products Corporation meets all of the requirements to be subject to the federal employment discrimination laws. These laws restrict the ability of employers to discriminate against workers on the basis of
a. experience.
b. gender.
c. intelligence.
d. skill.
Q:
Hu believes that he is a victim of a form of employment discrimination that falls under Title VII of the Civil Rights Act. Compliance with this statute is monitored by
a. employees and job applicants, not an administrative agency.
b. employers and businesses, not an administrative agency.
c. the courts and Congress, not an administrative agency.
d. the Equal Employment Opportunity Commission.
Q:
Title VII of the Civil Rights Act of 1964 applies to which of the following?
a. An employer with five employees
b. An employer with ten employees
c. A labor union with twenty-five members
d. A labor union with twelve members
Q:
Personnel Staffing Corporation meets all of the requirements to be subject to the federal employment discrimination laws. Among these, the most important statute prohibiting discrimination against members of protected classes is
a. the Age Discrimination in Employment Act of 1967.
b. the Americans with Disabilities Act of 1990.
c. the National Labor Relations Act of 1935.
d. Title VII of the Civil Rights Act of 1964.
Q:
Erica is sixty-year-old woman with cerebral palsy. Erica is a member of
a. one protected class.
b. two protected classes.
c. three protected classes.
d. no protected classes.
Q:
Lee is seventy years old and Mira is gay. Based on this information, members of protected classes include
a. Lee and Mira.
b. Lee only.
c. Mira only.
d. neither Lee nor Mira.
Q:
Under Title VII of the Civil Rights Act of 1964, most private firms are required to implement affirmative action policies.
Q:
An employer may defend against a claim of unintentional discrimination by asserting that a practice that has a discriminatory effect is a business necessity.
Q:
Gender can be a bona fide occupational qualification.
Q:
Employers who do not accommodate the needs of persons with disabilities must demonstrate that the accommodations would cause undue hardship.
Q:
The Americans with Disabilities Act of 1990 requires that employers accommodate the needs of applicants or employees with disabilities who are not otherwise qualified for the work
Q:
If a job applicant or an employee with a disability, with reasonable accommodation, can perform essential job functions, the employer must make the accommodation.
Q:
Employers can consider mitigating measures or medications when determining if an individual has a disability that fits the definition in the Americans with Disabilities Act of 1990.