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Business Law
Q:
There is federal regulation of employers' retirement plans for employees.
Q:
All unemployed workers who are willing and able to work are eligible for unemployment compensation.
Q:
The basis for an employee's contribution to Social Security is the employee's age.
Q:
Both employers and employees contribute to help pay for benefits that will partially make up for the employees' loss of income on retirement.
Q:
An employee can usually recover workers' compensation for injuries occurring on the commute to and from work.
Q:
Only the federal government sets safety standards governing workplaces.
Q:
If an employee dies in a work-related incident, the employer must notify OSHA within eight hours.
Q:
State workers' compensation laws establish a procedure for employees injured on the job to sue their employers.
Q:
A key employee is defined as an employee whose pay falls within the top 10 percent of the firm's workforce.
Q:
Under federal law, only key employees who take temporary family or medical leave are entitled to job reinstatement.
Q:
All employers must provide their employees with up to twelve months of family or medical leave.
Q:
Employees are entitled to overtime pay only at their employer's discretion.
Q:
Employees who receive tips on the job cannot be paid less in direct wages than the federal minimum wage.
Q:
Children must be at least thirteen years old to work in hazardous occupations.
Q:
Whistleblower statutes protect employers who report their employees' wrongdoing.
Q:
Whistleblower statutes protect employees from retaliatory discharge.
Q:
A whistleblower is an employee who reveals confidential information about a fellow employee to an employer.
Q:
An employee who is fired outside of the terms of an implied employment contract may succeed in an action for breach of contract.
Q:
A promise that an employer makes in an employee handbook regarding discharge will not be considered part of an implied contract.
Q:
Under the employment-at-will doctrine, an employer can end an employment relationship at any time.
Q:
A disclosed principal is a principal whose identity is not known by the third party at the time the contract is made by the agent.
Q:
If a principal does not ratify an unauthorized contract, the principal is not bound.
Q:
If a principal ratifies a contract without knowing all of the facts, the principal can rescind the contract.
Q:
If a principal does not ratify an authorized contract, the principal is not bound.
Q:
For an agent's implied authority to be effective, a principal must ratify it.
Q:
The equal dignity rule requires that a principal and agent treat each other with "equal dignity."
Q:
Giving an agent a power of attorney confers implied authority.
Q:
Authority declared in clear, direct, definite terms is express authority.
Q:
A principal owes an agent a duty of compensation.
Q:
If a principal cannot be contacted in an emergency situation, an agent cannot deviate from previously given instructions.
Q:
An agent has a duty to keep and make available to the principal an account of all property and funds received and paid out on behalf of the principal.
Q:
It is basic tenet of agency law that notice to the agent is notice to the principal.
Q:
Remedies of the agent for breach of duty by the principal arise out of contract and tort law.
Q:
Generally, the agent owes the principal no duties.
Q:
An agency relationship may occur by operation of law in a family.
Q:
A principal who causes a third person to believe that another person is the principal's agent can be estopped from denying the agency relationship.
Q:
An agency relationship cannot exist in the absence of a formal agreement.
Q:
An agency relationship must be based on an express or implied agreement that the agent will act for principal and that the principal agrees to have the agent so act.
Q:
An agency relationship created for an illegal purpose is enforceable.
Q:
A person must have contractual capacity to be an agent.
Q:
An agency relationship can only be formed with a written agreement.
Q:
An independent contractor is an employer who controls his or her agent's performance.
Q:
The relationship between a principal and an independent contractor always involves an agency relationship.
Q:
An independent contractor is an employee.
Q:
Real estate brokers are independent contractors.
Q:
An employer has no control over an employee's work.
Q:
Employees who deal with third parties are agents of their employers.
Q:
In a principal-agent relationship, the parties agree that the principal will act on behalf and instead of the agent in negotiating and transacting business with third persons.
Q:
Through agents, a principal can conduct multiple business operations simultaneously.
Q:
A principal has the right to control an agent's conduct in matters entrusted to the agent.
Q:
Brenda is a purchasing agent for Commodities Exchange Corporation. Dennis, a Commodities corporate officer, gives Brenda written authority to buy for the firm as many computers and peripheral devices as necessary. The next day, Dennis calls Brenda and tells her to buy only fifty notebook computers and nothing else. Brenda shows the written authority to E-Products, Inc., and enters into a contract with E-Products to buy sixty notebook computers and a selection of printers, scanners, and extra storage media. E-Products ships the order to Commodities. Is Commodities liable to E-Products under the contract? Is Brenda liable? In each case, if so, why? If not, why not?
Q:
Principal Resources Corporation contracts with Quality Construction to build an addition to Principal's corporate office building. Quality contracts with Rite Supply Company for materials for the addition but refuses to pick up the materials. Meanwhile, Principal hires Skye, a certified public accountant, to work in its cost-accounting division as an employee, with no authority to hire or supervise others. Skye asks Theo, an outside experienced accountant, to advise her on certain accounting procedures but fails to pay Theo for the service. Principal also contracts with Uma, a salesperson, to solicit orders for its products in a designated territory. Uma obtains an order from Verity Industries, Inc., which is assured the order will be filled soon. But Uma does not follow through with the paperwork and fails to submit the order to Principal. Verity suffers a loss. Rite Supply, Theo, and Verity Industries claim Principal is liable under agency law. Discuss fully whether an agency relationship was created by Principal with Quality Construction, Skye, or Uma.
Q:
Treadwell Tire Manufacturing Company employs Uri as an agent. To terminate Uri's authority, Treadwell must notify
a. only third parties who are aware of the agency relationship.
b. the public generally.
c. Uri and any third parties who are aware of the agency relationship.
d. Uri only.
Q:
Frida hires Gert, a real estate broker, to act as her agent to sell her house. The house burns down before being sold. The agency agreement is likely
a. still in force if Frida gives Gert additional consideration.
b. still in force if Gert does not tell prospective customers.
c. terminated by mutual consent of the parties.
d. terminated by operation of law.
Q:
Miklos employs Nathalie to handle a list of financial transactions on Miklos's behalf. This power will terminate on
a. any transaction causing a loss to Miklos.
b. Miklos's death or incapacity.
c. Miklos's sixty-fifth birthday.
d. Nathalie's handling of one of each stipulated transaction.
Q:
Bayou Development Corporation (BDC) hires Gulfview Brokerage Associates to sell the condominiums in a building at BDC's coastal resort. The agency will terminate
a. after the condos have been sold.
b. if the prices of the condos must be reduced to sell them.
c. once BDC obtains insurance to cover the property.
d. when BDC pays Gulfview its first commission.
Q:
Picabo drives a truck as an employee for Quik Delivery, Inc. Picabo would most likely be considered acting outside the scope of her employment if she
a. crashed into a car at the airport while off duty.
b. hit a pedestrian in a parking lot during a "working" lunch.
c. ran over an attendant at Quik's gas station while refueling the truck.
d. smashed into a store-front while intoxicated on-duty.
Q:
Brad is an employee of Custodial Service, Inc. In deciding whether Brad acts within the scope of his employment when he commits a tort against Didi, a court will not consider whether
a. Brad was acting within the scope of the agency.
b. Brad was acting within the scope of his employment.
c. Custodial authorized the act.
d. Custodial was personally at fault.
Q:
Joli, acting within the scope of her authority for the Cake Bake Shop, contracts with Valley View Berry Farms to buy an assortment of fruit. Cake Bake is liable on the contract, and Joli is not, if Cake Bake is
a. a disclosed principal.
b. a partially disclosed principal.
c. an undisclosed principal.
d. an apparent agent.
Q:
Iggy hires Joy to act as his agent to purchase Kup-a-Koffee Company. Iggy tells Joy to reveal only that she is buying the firm on behalf of a third party, without telling Kup-a-Koffee's seller who that third party is. Iggy is
a. a disclosed principal.
b. an implied principal.
c. an undisclosed principal.
d. a partially disclosed principal.
Q:
Bud approves on behalf of Codybut without authorizationa contract with Dik to build a new silo. Cody does not ratify the contract. Later, Dik tries to enforce the deal. This attempt will be
a. partly successful.
b. partly unsuccessful.
c. totally successful.
d. totally unsuccessful.
Q:
Without authorization, Rolf contracts on behalf of Sari to have Tige paint the interior and exterior of Sari's house. Sari ratifies the contract. Later, Sari tries to rescind the part of the contract relating to the exterior. This attempt will be
a. partly successful.
b. partly unsuccessful.
c. totally successful.
d. totally unsuccessful.
Q:
Based on Nan's conduct, Odel reasonably believes that Poppy has the authority to act on Nan's behalf even though Poppy does not have the actual authority to do so. In this circumstance, Poppy has
a. apparent authority.
b. express authority.
c. implied authority.
d. no authority.
Q:
Sonia manages a Tasty Pastry store for United Food Company. To manage the business, Sonia's authority can be implied by
a. an inference from the position Sonia occupies.
b. any inference a reasonable customer or supplier would make.
c. any inference Sonia chooses to make.
d. no inference.
Q:
Geoff serves in a representative capacity for Huck. To accomplish the objectives of this relationship, Geoff's authority can be implied
a. by contradiction.
b. by custom.
c. by lack of reason.
d. under no circumstances.
Q:
Cory employs Daily Delivery Agency as an agent under a written agreement that describes the rights and duties of both parties. This is
a. apparent authority.
b. equal authority.
c. express authority.
d. implied authority.
Q:
Lather Up Soap Products Company grants its agent Kathy an exclusive territory in which to sell Lather Up products. The firm cannot compete with Kathy in that territory under the principal's duty of
a. avoidance.
b. cooperation.
c. indemnification.
d. reimbursement.
Q:
Rangle contracts with Siena to buy a certain horse for her. Rangle makes a deal with Timberline Stables, the owner of the horse, and makes a down payment. Siena fails to pay the rest of the price. Timberline sues Rangle for breach of contract. His right to hold Siena liable for any damages that he has to pay is the right of
a. avoidance.
b. cooperation.
c. indemnification.
d. reimbursement.
Q:
Julia is an agent who purchases wool for Kara's Knitting Company. In the course of her performance for Kara's Knitting Company, Julia pays for the gas for the company car and for some storage boxes for the wool. Kara's Knitting Company must reimburse Julia because of the principal's
a. duty of performance.
b. duty of loyalty.
c. duty of compensation.
d. duty of reimbursement.
Q:
Will is an agent for MaryElise. MaryElise gives Will clear instructions to only enter into contracts on Mondays, Wednesdays, or Fridays. Will enters into a contract on MaryElise's behalf on Tuesday. Will has breached
a. the duty of performance.
b. the duty of loyalty.
c. no duty.
d. the duty of obedience.
Q:
Bob, a salesperson at a Carpets Galore store, tells Dita, a customer, "Buy your carpet here, and I"ll install it for half of what the store would charge." Dita buys the carpet, which Bob installs for half the store's price. Bob keeps the money. Bob has breached
a. no duty.
b. the duty of loyalty.
c. the duty of notification.
d. the duty of obedience.
Q:
Mackenzie, an agent for Lindsay, signs an agreement with Kirk on Lindsay's behalf but neglects to tell her that the agreement requires the payment of a certain tax. The government prosecutes Lindsay for failing to pay the tax. She is
a. liable, because notice to Mackenzie is notice to Lindsay.
b. liable, because notice to Kirk is notice to Lindsay.
c. not liable, because Mackenzie did not tell Lindsay about the tax.
d. not liable, because Kirk did not tell Lindsay about the tax.
Q:
Rita is appointed as an agent for Superior Sales, Inc. The agency agreement is silent as to the level of sales that Rita is expected to achieve. She must
a. achieve nothing because the agreement says nothing on the issue.
b. attain the level that Rita achieved with her previous employer.
c. maintain the level Superior attained before Rita became an agent.
d. use reasonable diligence and skill in selling.
Q:
Bernard is an expert on exotic flowers. Fine Floral Fixtures, Inc. (FFF) hires Bernard to order exotic flowers from various greenhouses. Bernard does not bother to examine the quality of the flowers he purchases on behalf of FFF. Bernard has breached
a. the duty of performance.
b. the duty of loyalty.
c. no duty.
d. the duty of notification.
Q:
Dizzy is not Edwina's agent but enters into a contract with Frida on Edwina's behalf. Edwina later contacts Frida to affirm the contract. This is
a. an agency by agreement.
b. an agency by estoppel.
c. an agency by ratification.
d. not the creation of an agency relationship.
Q:
Carol is married to Andy. Carol buys food for their children's lunches and charges the cost to Andy's account. This is
a. an agency by operation of law.
b. an agency by estoppel.
c. an agency by ratification.
d. not the creation of an agency relationship.
Q:
Gayla asks Jessie to contract with Jessie's high school classmates to babysit for Gayla's new baby. Jessie orally agrees to do so. This is
a. an agency by agreement.
b. an agency by estoppel.
c. an agency by ratification.
d. not the creation of an agency relationship.
Q:
Sela agrees to act on Thom's behalf, subject to Thom's control, and Thom trusts Sela to so act. They set out the terms in a written document, which they both sign. This is
a. an agency by agreement.
b. an agency by estoppel.
c. an agency by ratification.
d. not the creation of an agency relationship.
Q:
Jim agrees to act on Kit's behalf, subject to Kit's control, and Kit trusts Jim to so act. This describes a relationship between
a. a business and its competitors.
b. a government and its governed.
c. a parent and a child.
d. a principal and an agent.
Q:
George and James create an agency relationship to facilitate the sale of illegal narcotics. This agency relationship
a. is illegal.
b. is legal.
c. will be recognized by some states, but not others.
d. can exist, but will be subject to sanctions for illegal activity.