Exam 16: The Legal and Regulatory Environment of Business

Laws and regulations influence almost all areas of business.

As business partners, Peggy and Maria have a legal relationship where either one of them is authorized to act for the other and under that person's control. This is called _____.

Briefly discuss the differences between criminal and civil law.

In the United States, as in all complex societies, we've entrusted the responsibility for adopting and enforcing legal rules and principles to _____.

If an Act is passed by the U.S. Congress, it will become a federal statute.

A manufacturer can be found negligent if they knew or should have known that their product was defective and they failed to warn customers.

Agency law is actually a mixture of contract law and tort law.

Respondeat superior translates as _____.

It takes only a small increase in the price of cigarettes to reduce demand by a significant amount.

In law, a product is defective if, despite any warnings, the risk of harm outweighs its usefulness in doing what it's designed to do. This is called negligence per se.

The U.S. legal system has always been successful in guaranteeing equal treatment under the law.

If a LuLu's Diner employee spills scalding hot coffee on a customer causing third degree burns, the owner of LuLu's Diner is held responsible for the employee's actions.

John Parrimore and Mary Gonzales have entered into a _____. The legal and enforceable agreement between the two parties creates an obligation or duty to either do or not to do something specific.

The person who acts for the other is called the agent; the person the agent acts for is called the principal.

An express warranty is created when a seller _____.

Productliability lawsuits against businesses that sell "unreasonably dangerous" products went up a hundredfold between 1950 and 2001, to a total of $205 billion.

The law assumes that, when performing employment duties, an employee is under the control of the employer.

The distinction between what's inherently bad and what's bad because we declare it bad isn't always clear.

_____ are the building blocks of a modern economy.

Punitive damages are monetary awards intended to meet the primary goal of legal action in tort cases.