Question 1

Which of the following is not an essential element in a product liability case based on negligence?

Accepted Answer

A)  The defendant manufacturer owed a duty of care to the plaintiff. 
B)  The defendant breached the duty of care. 
C)  The plaintiff suffered actual, compensable injury. 
D)  The defendant intended to cause the plaintiff harm. 
A)  The defendant manufacturer owed a duty of care to the plaintiff. 
B)  The defendant breached the duty of care. 
C)  The plaintiff suffered actual, compensable injury. 
D)  The defendant intended to cause the plaintiff harm. D

Question 2

Elimination of the privity requirement reflected a shift in .

Accepted Answer

A)  purchases toward only those products that were produced with proper care in design, manufacture, and labeling 
B)  social policy toward placing responsibility for injuries on those who market a product that could foreseeably cause harm if proper care were not taken in the manufacturing process 
C)  social policy toward placing responsibility for injuries on those who purchase a product that has a foreseeable risk 
D)  packaging strategies employed by manufacturers to begin including warnings about the potential danger of the product 
A)  purchases toward only those products that were produced with proper care in design, manufacture, and labeling 
B)  social policy toward placing responsibility for injuries on those who market a product that could foreseeably cause harm if proper care were not taken in the manufacturing process 
C)  social policy toward placing responsibility for injuries on those who purchase a product that has a foreseeable risk 
D)  packaging strategies employed by manufacturers to begin including warnings about the potential danger of the product B

Question 3

Why did some courts conclude that compliance with the Clean Air Act does not preclude oil companies from liability?

Accepted Answer

Oil companies have had mixed results in cases in which they have argued that the Clean Air Act preempts their liability for methyl tertiary butyl ether (MTBE) water contamination. In an attempt to reduce air pollution in certain areas, Congress mandated that gasoline contain an oxygenate, which allows gasoline to burn more cleanly. Congress, however, did not require that a particular oxygenate be used. Most oil companies added the oxygenate MTBE to gasoline. Unfortunately, even very small amounts of MTBE can contaminate drinking water: It affects the smell and taste of water and may cause health problems. Public water utilities and private individuals, faced with millions of dollars in cleanup costs, began suing oil companies for damages to resolve the water contamination. In response, oil companies, raising the preemption defense, argue that because the government required them to add an oxygenate to gasoline, oil companies should not be responsible for the water contamination. Plaintiffs argue that oil companies chose to use MTBE; other oxygenates, such as ethanol, were available.
Several courts have concluded that the Clean Air Act preempts oil companies' liability, but other courts have reached the opposite conclusion, emphasizing the fact that oil companies had a choice. Furthermore, these courts hold that the purpose of the Clean Air Act was to address air pollution, and the MTBE water contamination is a problem too far removed from the purposes of the Clean Air Act to preempt product liability claims associated with MTBE.

Question 4

Which of the following statements is true about malpractice suits?

Accepted Answer

A)  They are service liability suits brought against professionals. 
B)  They are service liability suits brought against manufacturers. 
C)  Strict liability is usually applied to malpractice suits. 
D)  Strict liability is generally not applied if the defendant has provided both a good and a service. 
A)  They are service liability suits brought against professionals. 
B)  They are service liability suits brought against manufacturers. 
C)  Strict liability is usually applied to malpractice suits. 
D)  Strict liability is generally not applied if the defendant has provided both a good and a service.

Question 5

Which of the following refers to a scenario in which the plaintiff is said to have assumed the risk?

Accepted Answer

A)  when the plaintiff voluntarily and unreasonably encounters a known danger 
B)  when the plaintiff encounters an unknown danger 
C)  when the plaintiff does not consider the dangers of a product 
D)  when the plaintiff does not read all of the provided warnings and instructions to prevent danger 
A)  when the plaintiff voluntarily and unreasonably encounters a known danger 
B)  when the plaintiff encounters an unknown danger 
C)  when the plaintiff does not consider the dangers of a product 
D)  when the plaintiff does not read all of the provided warnings and instructions to prevent danger

Question 6

Attempts to extend the application of market share liability theory to products other than drugs have not met with much success.

Accepted Answer

A) True 
 B)False

Question 7

The implied warranty of fitness for a particular purpose refers to .

Accepted Answer

A)  a warranty that allows the purchaser to recover the full purchase price if there is any dissatisfaction with the product 
B)  a warranty that is clearly stated by the seller or manufacturer 
C)  a warranty that arises when the seller tells the consumer that a product is fit for a specific use 
D)  a warranty that a product is reasonably fit for ordinary use 
A)  a warranty that allows the purchaser to recover the full purchase price if there is any dissatisfaction with the product 
B)  a warranty that is clearly stated by the seller or manufacturer 
C)  a warranty that arises when the seller tells the consumer that a product is fit for a specific use 
D)  a warranty that a product is reasonably fit for ordinary use

Question 8

The broadest rule to define the parameters of an accountant's liability to third parties applies in most of the states in the United States.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following statements is true about disclaimers used to limit consequential damages for injury caused by consumer goods?

Accepted Answer

A)  These disclaimers are considered unconscionable under the Uniform Commercial Code, and will not be enforced. 
B)  These disclaimers are enforceable only if the contract is in writing. 
C)  These disclaimers are enforceable whether or not the contract is in writing. 
D)  These disclaimers are not considered unconscionable, and are, therefore, not enforced. 
A)  These disclaimers are considered unconscionable under the Uniform Commercial Code, and will not be enforced. 
B)  These disclaimers are enforceable only if the contract is in writing. 
C)  These disclaimers are enforceable whether or not the contract is in writing. 
D)  These disclaimers are not considered unconscionable, and are, therefore, not enforced.

Question 10

Section 552 of the Restatement (Second) of Torts holds that an accountant owes a duty to the client and any class of persons the accountant knows is going to be receiving a copy of his or her work.

Accepted Answer

A) True 
 B)False

Question 11

A(n) warranty is one clearly stated by the seller or manufacturer.

Accepted Answer

A)  express 
B)  implied 
C)  liquidated 
D)  impact 
A)  express 
B)  implied 
C)  liquidated 
D)  impact

Question 12

In bringing an action for negligence in design, a plaintiff may prove all but which of the following?

Accepted Answer

A)  The product design is inherently dangerous. 
B)  The product design contains insufficient safety designs. 
C)  The product design does not contain the most recent consumer preferences. 
D)  The product design consists of materials that do not satisfy standards acceptable in the trade. 
A)  The product design is inherently dangerous. 
B)  The product design contains insufficient safety designs. 
C)  The product design does not contain the most recent consumer preferences. 
D)  The product design consists of materials that do not satisfy standards acceptable in the trade.

Question 13

A plaintiff often sues only the when the manufacturer is located in a foreign country.

Accepted Answer

A)  retailer and the wholesaler 
B)  manufacturer in a foreign country 
C)  retailer in a foreign country 
D)  manufacturer's legal representative 
A)  retailer and the wholesaler 
B)  manufacturer in a foreign country 
C)  retailer in a foreign country 
D)  manufacturer's legal representative

Question 14

With reference to cosmetics and over-the-counter drugs, what should the plaintiff prove for the court to conclude that the defendant is guilty of negligent failure to warn?

Accepted Answer

When a toxic or allergic reaction causes

Question 15

What are the three rules used to determine the accountant's liability to third parties?

Accepted Answer

The first, and oldest, rule is often ref

Question 16

According to the Uniform Commercial Code, to meet the standard of merchantability, the goods must pass without objection in the trade under the contract description.

Accepted Answer

A) True 
 B)False

Question 17

The is a rule making accountants liable only to those in a privity-of-contract relationship with the accountant.

Accepted Answer

A)  Doctrine of nondelegation 
B)  Ultramares Doctrine 
C)  Res ipsa loquitur Doctrine 
D)  Erie Doctrine 
A)  Doctrine of nondelegation 
B)  Ultramares Doctrine 
C)  Res ipsa loquitur Doctrine 
D)  Erie Doctrine

Question 18

Which of the following statements is true about strict liability in tort?

Accepted Answer

A)  Product liability actions based on strict liability in tort focus on the producer or manufacturer. 
B)  To succeed in a strict liability action, the plaintiff must prove that the defendant did not exercise the degree of care that is reasonably expected under those circumstances. 
C)  A failure by the manufacturer or seller to adequately warn of a risk or hazard associated with the product can be used by the plaintiff to establish that the product is defective. 
D)  To be successful in a strict liability action, the plaintiff must prove that the product developed a defect before it was sold. 
A)  Product liability actions based on strict liability in tort focus on the producer or manufacturer. 
B)  To succeed in a strict liability action, the plaintiff must prove that the defendant did not exercise the degree of care that is reasonably expected under those circumstances. 
C)  A failure by the manufacturer or seller to adequately warn of a risk or hazard associated with the product can be used by the plaintiff to establish that the product is defective. 
D)  To be successful in a strict liability action, the plaintiff must prove that the product developed a defect before it was sold.

Question 19

Which of the following is not a common negligent action leading to product liability case?

Accepted Answer

A)  negligent failure to warn 
B)  negligent intent to harm 
C)  negligent provision of an inadequate warning 
D)  negligent design 
A)  negligent failure to warn 
B)  negligent intent to harm 
C)  negligent provision of an inadequate warning 
D)  negligent design

Question 20

Which of the following refers to the state-of-the-art defense?

Accepted Answer

A)  The defendant proves that a warning on the product would not have helped. 
B)  The defendant proves that there was insufficient scientific knowledge to make a safer product at the time it was manufactured. 
C)  The defendant proves that the plaintiff had insufficient knowledge to purchase the product. 
D)  The defendant proves that the warning could have been understood by any reasonable person. 
A)  The defendant proves that a warning on the product would not have helped. 
B)  The defendant proves that there was insufficient scientific knowledge to make a safer product at the time it was manufactured. 
C)  The defendant proves that the plaintiff had insufficient knowledge to purchase the product. 
D)  The defendant proves that the warning could have been understood by any reasonable person.

Exam 12: Product and Service Liability Law

Which of the following is not an essential element in a product liability case based on negligence?

Elimination of the privity requirement reflected a shift in .

Why did some courts conclude that compliance with the Clean Air Act does not preclude oil companies from liability?

Which of the following statements is true about malpractice suits?

Which of the following refers to a scenario in which the plaintiff is said to have assumed the risk?

Attempts to extend the application of market share liability theory to products other than drugs have not met with much success.

The implied warranty of fitness for a particular purpose refers to .

The broadest rule to define the parameters of an accountant's liability to third parties applies in most of the states in the United States.

Which of the following statements is true about disclaimers used to limit consequential damages for injury caused by consumer goods?

Section 552 of the Restatement (Second) of Torts holds that an accountant owes a duty to the client and any class of persons the accountant knows is going to be receiving a copy of his or her work.

A(n) warranty is one clearly stated by the seller or manufacturer.

In bringing an action for negligence in design, a plaintiff may prove all but which of the following?

A plaintiff often sues only the when the manufacturer is located in a foreign country.

With reference to cosmetics and over-the-counter drugs, what should the plaintiff prove for the court to conclude that the defendant is guilty of negligent failure to warn?

What are the three rules used to determine the accountant's liability to third parties?

According to the Uniform Commercial Code, to meet the standard of merchantability, the goods must pass without objection in the trade under the contract description.

The is a rule making accountants liable only to those in a privity-of-contract relationship with the accountant.

Which of the following statements is true about strict liability in tort?

Which of the following is not a common negligent action leading to product liability case?

Which of the following refers to the state-of-the-art defense?

Critical Thinking and Legal Reasoning

Introduction to Law and the Legal Environment of Business

The American Legal System

Alternative Tools of Dispute Resolution

Constitutional Principles

White-Collar Crime and the Business Community

Ethics, Social Responsibility, and the Business Manager

The International Legal Environment of Business

The Law of Contracts and Sales I

The Law of Contracts and Sales Ii

The Law of Torts

Law of Property: Real and Personal

Intellectual Property

Agency Law

Law and Business Associations I

Law and Business Associations II

The Law of Administrative Agencies

The Employment Relationship and Immigration Laws

Laws Governing Labor-Management Relations

Employment Discrimination

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Rules Governing the Issuance and Trading of Securities

Antitrust Laws

Laws of Debtor-Creditor Relations and Consumer Protection

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