Deck 15: Legal and Ethics

Question 1

In the event the seller delivers goods or the tender of delivery fails in any way to conform to the contract,the buyer has the option to:

A)reject the whole shipment.
B)accept the whole shipment.
C)accept part of the shipment and reject the balance.
D)reject the whole shipment or accept the whole shipment.
E)reject the whole shipment,accept the whole shipment or accept part of the shipment and reject the balance.

Answer 1

E

Question 2

A company's boilerplate or framework agreement includes the complete terms and conditions that apply to any transaction.

Answer 2

True

Question 3

The acts that the agent is directly authorized to perform,come under what type of authority?

A)apparent authority.
B)implied authority.
C)express authority.
D)direct authority.
E)implicit authority.

Answer 3

C

Question 4

People within an organization who spend company money on the basis of apparent authority are commonly referred to as maverick buyers.

Question 5

An offer:

A)cannot be modified or revoked before acceptance.
B)may be made by either a buyer or a seller.
C)generally includes advertisements and price lists.
D)cannot be modified or revoked before acceptance and generally includes advertisements and price lists.
E)may be made by either a buyer or a seller and generally includes advertisements and price lists.

Question 6

U.S.publicly traded companies are required to confirm that their supply chains are free of conflict minerals or to confirm due diligence on conflict minerals' source and chain of custody.

Question 7

A valid contract is based on:

A)competent parties.
B)legal subject matter or purpose.
C)an offer and an acceptance.
D)competent parties and legal subject matter or purpose.
E)competent parties,legal subject matter or purpose,and an offer and an acceptance.

Question 8

Sustainability performance is measured by compliance with legal obligations and compliance with environmental regulations.

Question 9

According to the law of agency,the legal authority of a buyer:

A)is the same as that of a salesperson.
B)includes apparent authority.
C)includes implied authority.
D)includes apparent authority and includes implied authority.
E)is the same as that of a salesperson,includes apparent authority and includes implied authority.

Question 10

Acceptance of goods occurs when:

A)the buyer behaves as if the seller no longer owns the goods.
B)the buyer fails to reject after a reasonable opportunity to inspect.
C)the goods have been in possession of the buyer for 30 days.
D)the buyer behaves as if the seller no longer owns the goods and the buyer fails to reject after a reasonable opportunity to inspect.
E)the buyer behaves as if the seller no longer owns the goods,the buyer fails to reject after a reasonable opportunity to inspect and the goods have been in possession of the buyer for 30 days.

Question 11

Under U.S.product liability law,relevant product defects are:

A)sourcing defects,design defects,and manufacturing defects.
B)sourcing defects,manufacturing defects,and marketing defects.
C)design defects,specification defects,and manufacturing defects.
D)design defects,manufacturing defects,and marketing defects.
E)specification defects,sourcing defects and marketing defects.

Question 12

Electronic or digital signatures for contractual purposes:

A)are valid in very few countries.
B)are valid in most countries.
C)are legal in the European Union (EU)and apply across all boundaries.
D)are invalid because they cannot be authenticated with current technology.
E)are invalid in the U.S.because the UCC expressly prohibits them.

Question 13

The U.S.Sarbanes-Oxley Act:

A)has no impact on the supply management process.
B)affects internal accounting procedures of privately-held companies.
C)requires the Chief Purchasing Officer to sign off on every contract.
D)requires listing off-balance sheet items such as long-term purchase agreements.
E)requires supply management to report directly to the Chief Financial Officer.

Question 14

When there are no liens against the goods and no violation of a patent,there is a(n):

A)warranty of title and against infringement.
B)express warranty.
C)implicit warranty.
D)implied warranty of merchantability.
E)implied warranty of fitness for a particular purpose.

Question 15

The legal issues of who actually owns intellectual capital are:

A)of great concern to creators of intellectual capital,but few other people.
B)of little concern because international intellectual property laws already apply.
C)of great concern globally because there is no uniform body of law.
D)are eased by advancements in the duplication and transfer of information.
E)have been eased by the passage of World Trade Organization directives.

Question 16

Organizations manage supplier sustainability practices through the use of:

A)corporate codes of conduct.
B)industry standards.
C)supplier audits.
D)third-party certifications.
E)corporate codes of conduct,industry standards,supplier audits and third-party certifications.

Question 17

Arbitration is when opposing parties in a contractual dispute between buyer and seller are brought together to attempt to work out a settlement or agreement that both parties accept or reject.

Question 18

Which two of the following are necessary for a valid contract? I.A description of the scope of work.
II.An offer.
III.Legal subject matter and purpose.
IV.A counteroffer.

A)I and II.
B)I and III.
C)I and IV.
D)II and III.
E)II and IV.

Question 19

According to the UCC,an oral agreement:

A)is never legally binding.
B)normally must include some written notation if the price of the order exceeds the limit established by the statute of frauds.
C)may be revoked if the buyer sends a notice of objection within 30 days of receipt of the goods.
D)that is partially performed (for example,one of ten lots is delivered)is automatically canceled under the doctrine of force majeure.
E)is not valid unless and until some form of documentation is signed by both parties.

Question 20

Gifts and gratuities:

A)given to buyers by suppliers may lead to the perception of bias or subjectivity in the supply process.
B)of even a nominal nature inevitably lead to commercial bribery.
C)no matter how small,cannot be justified in a well-run supply organization,and should never be accepted.
D)are acceptable if the buyer receives them from an international supplier rather than a domestic one.
E)can be accepted as long as the buyer's supervisor is informed of the action.

Question 21

Reciprocity,the practice of requiring a supplier to purchase a set amount from the buying firm,is legal in the U.S. ,but is illegal in almost every country in the world.

Question 22

The authority of the sales representative is the same as that of a supply manager.

Question 23

Common law governs the purchase of services,including (1)contracts solely for services and (2)contracts wherein services and goods are bundled and the service portion equals more than 50 percent of the value of the contract.

Question 24

In many organizations,standards of conduct for purchasing personnel stress the need to avoid all appearances of impropriety.

Question 25

If a supplier fails to deliver goods which meet the contract agreement,the buyer must accept or reject the whole shipment.

Question 26

One services contracting method is a Service Level Agreement (SLA)which is a document that details the means,method,organization,and processes along with material requirements.

Question 27

Implied authority includes the acts that the agent is expressly and directly authorized to perform.

Question 28

When an employee who is not a legal agent of the company agrees to buy something from a salesperson and the item is received and the company pays the invoice,the employee is exercising apparent authority.

Question 29

Payment made to a supplier automatically constitutes an acceptance of the goods.

Question 30

The EPA's Environmentally Preferable Purchasing (EPP)Program supports the development of standards for the manufacture and purchase of goods and services that are environmentally preferable and the use of those standards in federal procurement.