Deck 18: The Law of Administrative Agencies

Question 1

The Securities and Exchange Commission was intended to be a "watchdog" agency that would ensure full disclosure of material information to the investing public.

Answer 1

True

Question 2

A substantive rule generally has an impact on the internal processes by which administrative agencies function or prescribes methods of enforcing rights.

Answer 2

False

Question 3

Which of the following is an example of a procedural rule in operation?

A) a Social Security recipient being entitled to receive a check for a large amount
B) a Medicare recipient contacting a member of Congress to complain about the confusing health care system in the United States
C) the Internal Revenue Service giving notice to all parties involved in an agency hearing
D) the U.S. Department of Health and Human Services referring a client to a state agency better suited to handle his or her problem

Answer 3

C

Question 4

In 1995, the House of Representatives and the Senate overwhelmingly passed a bill that required all administrative agencies to do a cost-benefit analysis of any proposed regulation that would cost the economy less than $25 million.

Question 5

Which of the following is an example of an independent federal administrative agency?

A) Federal Deposit Insurance Corporation (FDIC)
B) General Services Administration (GSA)
C) Securities and Exchange Commission (SEC)
D) International Development Corporation Agency (IDCA)

Question 6

An administrative agency .

A) does not have the judicial power to adjudicate individual cases
B) does not have the executive power to investigate corporate misconduct
C) includes public utilities commissions and building authorities at the state level
D) is situated wholly in the legislative branch of government

Question 7

Any rule that affects, directly or indirectly, agencies such as the Environmental Protection Agency or the Federal Trade Commission is called a(n) law.

A) executive
B) administrative
C) governing
D) presidential

Question 8

A rule that creates, defines, or regulates the legal rights of administrative agencies and the parties they regulate is called a(n) .

A) substantive rule
B) procedural rule
C) internal law
D) executive law

Question 9

Which of the following is an example of an independent federal administrative agency?

A) National Aeronautics and Space Administration (NASA)
B) Nuclear Regulatory Commission (NRC)
C) National Science Foundation (NSF)
D) Occupational Safety and Health Administration (OSHA)

Question 10

Which of the following is a difference between independent administrative agencies and executive administrative agencies?

A) Independent administrative agencies are created by private stockholders, whereas executive administrative agencies are created by the legislative branch of government.
B) The heads of independent administrative agencies cannot be removed by the president, whereas the heads of executive administrative agencies can be removed by the president.
C) Independent administrative agencies are headed by people with prior experience in private enterprises, whereas executive administrative agencies are headed by a board of commissioners.
D) The heads and members of the board have no fixed term of office in independent administrative agencies, whereas the heads and members are appointed for a specific term of years in executive administrative agencies.

Question 11

Which of the following is an example of an independent federal administrative agency?

A) National Transportation Safety Board (NTSB)
B) Office of Personnel Management (OPM)
C) Small Business Administration (SBA)
D) Veterans Administration (VA)

Question 12

Administrative agencies are generally classified as independent or executive.

Question 13

An agency whose appointed heads and members serve for fixed terms and cannot be removed by the U.S. president except for reasons defined by Congress is called a(n) administrative agency.

A) independent
B) executive
C) congressional
D) permanent

Question 14

Which of the following is true of a substantive rule?

A) It has an impact on the internal processes by which an agency functions.
B) It defines the rights of parties involved in an agency hearing.
C) It prescribes methods of enforcing rights.
D) It controls the method by which jurisdiction is balanced between federal and state agencies.

Question 15

A rule that governs the internal processes of an administrative agency is called a(n) .

A) substantive rule
B) internal law
C) procedural rule
D) executive law

Question 16

A commissioner of an independent administrative agency can be removed before serving out a full term at the whim of the president.

Question 17

The Department of Homeland Security (DHS) is an example of a(n) administrative agency.

A) independent
B) executive
C) quasi-
D) sua sponte

Question 18

Which of the following is a reason for the growth of administrative agencies?

A) Administrative agency hearings are governed by strict rules of evidence.
B) The staff of each of the agencies has technical expertise in a wide range of areas.
C) Administrative agency hearings reduce the burden on the state and federal court systems.
D) Administrative agencies promote deregulation in all industries.

Question 19

The Commodity Futures Trading Commission (CFTC) is an example of a(n) administrative agency.

A) independent
B) executive
C) quasi-
D) sua sponte

Question 20

An administrative agency can issue rules that carry civil penalties but not criminal penalties.

Question 21

Which of the following laws establishes the standards and procedures federal administrative agencies must follow in their rulemaking and adjudicative functions?

A) Federal Procedure Act
B) Administrative Procedure Act
C) Congressional Review Act
D) Small Business Regulatory Enforcement Fairness Act

Question 22

Which of the following refers to the power delegated by the U.S. Congress to an administrative agency to make rules that must be adhered to by individuals and businesses regulated by the agency?

A) fiduciary power
B) executive power
C) legislative power
D) judicial power

Question 23

The Securities and Exchange Commission (SEC), using its congressional mandate under the 1933 and 1934 Securities Acts, has prescribed rules governing the issuance of, and trading in, securities by businesses as well as by brokers and underwriters. This is an example of the SEC's power.

A) legislative
B) judicial
C) veto
D) executive

Question 24

The Securities and Exchange Commission (SEC), using its mandate under the 1933 and 1934 Securities Acts, can both fine and criminally prosecute individuals involved in insider trading. This is an example the SEC's power.

A) veto
B) judicial
C) executive
D) legislative

Question 25

An enabling statute delegates judicial power to an administrative agency to investigate potential violations of rules or statutes.

Question 26

The wide-ranging investigative powers of Securities and Exchange Commission (SEC) staff is an example of the SEC's power.

A) judicial
B) legislative
C) executive
D) fiat

Question 27

The U.S. Congress creates federal administrative agencies through statutes called regulatory legislation.

Question 28

In general, an enabling statute delegates to an administrative agency congressional executive power for the purpose of serving the "public interest, convenience, and necessity."

Question 29

Functions of administrative agencies include all but which of the following?

A) rulemaking
B) mediation of private disputes
C) informal advising of individual businesses and consumers
D) issuance of guidelines for the business community and others as to what activities are legal in the eyes of agency staff

Question 30

In 1995, the U.S. Congress overwhelmingly passed a bill that required all administrative agencies (both executive and independent) to do a cost-benefit analysis of any proposed regulation that would cost the economy more than $ million.

A) 10
B) 15
C) 20
D) 25

Question 31

Statutes that allow the U.S. Congress to create federal administrative agencies are called .

A) enabling legislation
B) substantive rules
C) procedural rules
D) ex post facto laws

Question 32

Which of the following refers to the power delegated by the U.S. Congress to an administrative agency to investigate whether the rules enacted by the agency have been properly followed by businesses and individuals?

A) executive power
B) fiduciary power
C) legislative power
D) judicial power

Question 33

Which of the following refers to the power delegated by the U.S. Congress to an administrative agency to adjudicate cases through an administrative proceeding?

A) executive power
B) fiduciary power
C) legislative power
D) judicial power

Question 34

Which of the following is true of administrative agencies?

A) An enabling statute delegates congressional executive powers to them for the purpose of serving the public interest.
B) An enabling statute delegates legislative powers to them in order to settle or adjudicate disputes with businesses.
C) All their proposed rules, whether major or minor, are subject to the review of the Office of Management and Budget.
D) They have to identify possible alternatives to a proposed regulation that would require no government action.

Question 35

Explain the legislative, executive, and judicial powers delegated to administrative agencies through enabling legislation.

Question 36

Since the Office of Management and Budget recommends annual budgets to the U.S. Congress for each administrative agency, it has influence over all rulemaking.

Question 37

Which of the following rulemaking models is most often used by administrative agencies because it is efficient in terms of time and cost?

A) formal rulemaking
B) informal rulemaking
C) hybrid rulemaking
D) independent rulemaking

Question 38

An enabling statute delegates legislative power to an administrative agency to settle or adjudicate any disputes it may have with businesses or individuals.

Question 39

Explain the reasons for the rapid growth of administrative agencies in the United States.

Question 40

Critics go so far as to claim that administrative agencies constitute a " branch of government" because of the powers delegated to them by enabling statutes.

A) first
B) second
C) third
D) fourth

Question 41

Which of the following is the first step pursued by an administrative agency in carrying out its adjudicative function in individual cases?

A) The agency against whom the complaint is made submits themselves to a hearing and decision by the administrative law judge.
B) The agency files a complaint against the party with an administrative law judge (ALJ).
C) The agency notifies the party against whom the complaint is made and conducts an investigation into the merits of the complaint.
D) The agency negotiates with the party against whom the complaint is made to see if it can get the party to voluntarily stop the violation.

Question 42

Which of the following is true of hybrid rulemaking?

A) It allows agencies to adopt regulations without inputs from the public.
B) It allows agencies to set a period for public comments and to hold a public hearing.
C) It balances the needs of federal agencies with the needs of state agencies whose jurisdictions overlap.
D) It allows agencies to adopt regulations without having to publish these regulations in the Federal Register.

Question 43

Informal rulemaking under the Administrative Procedure Act is appropriate when an agency's enabling legislation .

A) or other congressional directives do not require another form
B) states that all rules must be enacted by the agency as part of a formal hearing process that includes a complete transcript
C) or other congressional directives do not state that the agency must promulgate regulations
D) does not allow the submission of written comments by parties

Question 44

Which of the following statements is true about administrative law judges?

A) They can serve for a period of up to 10 years.
B) They usually come from within the federal administrative bureaucracy.
C) They are appointed by the U.S. Supreme Court.
D) They are appointed by governors in the respective states and confirmed by the Senate.

Question 45

A formal rulemaking by an administrative agency is appropriate when an agency's enabling legislation .

A) or other congressional directives do not require another form
B) states that all rules must be enacted by the agency as part of a formal hearing process that includes a complete transcript
C) or other congressional directives state that the agency must promulgate regulations
D) provides an opportunity for all interested parties to submit written comments

Question 46

The Department of Homeland Security (DHS) of the U.S. government promulgates a rule that allows its officials to search a private or commercial property at any time without its owner's permission and without an administrative search warrant. This rule is in violation of the Amendment.

A) First
B) Second
C) Third
D) Fourth

Question 47

Which of the following best defines a preponderance of the evidence?

A) It is a legal standard which transfers the right to adjudicate to a Supreme Court judge.
B) It is a legal standard that places the burden of proving the facts of the case on one party.
C) It is a legal standard whereby the evidence is in favor of one party.
D) It is a legal standard whereby a bare majority of the evidence is sufficient to justify a ruling.

Question 48

Public notice and comments are not required when an administrative agency is making interpretive rules or general statements of policy. This is known as rulemaking.

A) formal
B) hybrid
C) exempted
D) informal

Question 49

In order to carry out its adjudicative function in individual cases, an administrative agency is subject to guidelines stipulated by .

A) the administrative law judge hearing the case
B) a special committee set up by Congress and headed by the U.S. Secretary of State
C) the Federal Tort Claims Act
D) case law arising out of appeals of agency decisions to the U.S. Supreme Court

Question 50

rulemaking combines some of the aspects of formal and informal rulemaking.

A) Hybrid
B) Conglomerate
C) Congruent
D) Economies-of-scale

Question 51

Which of the following is the first step in an informal rulemaking process?

A) Proposed rules are published in the Federal Register.
B) Interested parties file written comments on the written draft within a 30-day period from publication in the Federal Register.
C) Agency drafts rules in consultation with interested parties.
D) Agency receives feedback from interested parties and makes a decision on whether the final draft should be rewritten.

Question 52

The procedure for formal rulemaking provides for .

A) an agency notice of proposed rulemaking to the public in the Federal Register
B) an opportunity for all interested parties to submit written comments to the agency
C) a hearing at which experts give their opinions on a rule proposed by the agency
D) the appointment of counsel for persons unable to afford representation at the formal hearing

Question 53

How can a consent order benefit a company that has been found guilty of violating an administrative law by an administrative agency?

A) It avoids an admission of guilt.
B) It can pay the cost of litigation over a period of five years.
C) It can obtain a binding cease-and-desist order against the administrative agency.
D) It avoids having to agree to anything in writing.

Question 54

Which of the following is true of an adjudicative proceeding?

A) A hearing before an administrative law judge does not take more than three months to be resolved.
B) The evidence pertaining to a case is presented by the staff of the commission and not by the accused party.
C) There is a jury of thirteen members at a hearing.
D) It is less adversarial and more investigative, or inquisitorial, than a court proceeding.

Question 55

Which of the following is required of an agency under informal rulemaking?

A) filing the notice of proposed rulemaking in an appellate court
B) providing an opportunity for all interested parties to submit written comments to the agency
C) scheduling a hearing at which experts give their opinions on a rule proposed by the agency
D) appointing a counsel for persons unable to afford representation at the formal hearing

Question 56

A consent order is .

A) an agreement on the part of a company to accept a particular administrative action or remedy imposed by an agency, after having admitted guilt
B) a court order issued by a federal district court requiring that a business cease to engage in a particular behavior
C) an agreement by a business to stop an activity an administrative agency alleges to be unlawful and to accept the remedy the agency imposes, without having to accept guilt
D) a court order issued by a federal appellate court ordering a federal district court to supervise an administrative agency's behavior

Question 57

Which of the following is the final step in an informal rulemaking process?

A) Proposed rules are published in the Federal Register.
B) Interested parties file written comments on the written draft within a 30-day period from publication in the Federal Register.
C) Agency receives feedback from interested parties during a stipulated period of time and makes a decision on whether the final draft should be rewritten.
D) Final draft of a rule is published in the Federal Register 30 days before it takes effect.

Question 58

Section 553 of the Administrative Procedure Act

Question 59

In what decade did the Administrative Procedure Act become law?

A) 1920s
B) 1930s
C) 1940s
D) 1960s

Question 60

Which of the following statements is true about the role of an administrative law judge (ALJ) during a hearing?

A) An ALJ is required to remain silent during a hearing.
B) An ALJ can intervene during a hearing to ask questions.
C) An ALJ can only take note of the evidence that both parties have introduced.
D) An ALJ must submit questions to the involved parties in writing in advance of the hearing.

Question 61

Administrative law judges are appointed by the president.

Question 62

The Government in Sunshine Act of 1976 requires each agency headed by a collegiate body to .

A) publish an annual summary of all adjudicatory decisions of the previous year
B) publish a summary of proposed procedural rules
C) hold every portion of a business meeting open to public attendance
D) hold every portion of a business meeting behind closed doors

Question 63

Emerald Consultancy, a brokerage firm, advertises that it will double its customers' money in five years. However, it fails to do so. Some of the customers file a complaint with the Federal Trade Commission (FTC). The commission's staff finds that the advertising is "deceptive" or "unfair" within the meaning of Section 5 of the Federal Trade Commission Act. How will the FTC seek to stop the advertising campaign? What is the benefit of this method?

Question 64

A party can appeal an administrative law judge's decision to the full commission or agency head and ultimately to a federal court of appeals and the U.S. Supreme Court.

Question 65

Which of the following acts was involved in allowing decision-making processes of administrative agencies to be open to the public?

A) Federal Register Act of 1933
B) Government in Sunshine Act of 1976
C) Federal Tort Claims Act of 1946
D) Congressional Review Act of 1996

Question 66

Under a consent order, a company has to admit that it is deceptive.

Question 67

Formal rulemaking is the model most often used by administrative agencies because it is efficient in terms of time and cost.

Question 68

Explain the three major rulemaking models-formal, informal, and hybrid-outlined in the Administrative Procedure Act

Question 69

List the administrative activities, in addition to rulemaking and adjudication, performed by executive and independent agencies.

Question 70

Preponderance of the evidence is a legal standard whereby a bare majority of the evidence is sufficient to justify a ruling.

Question 71

A federal circuit court of appeals that has jurisdiction in a case reviews the commission's legal findings to ensure that .

A) it acted within the scope of the Government in Sunshine Act
B) it acted in a constitutionally approved way
C) the administrative law judge actually read the submitted exhibits
D) the losing party accepts the administrative law judge's initial decision

Question 72

Which of the following is true about the review of an adjudicative proceeding by a federal court?

A) The court will review both the legal and factual findings of the agency, even if the findings are supported by substantial evidence in the record.
B) The court will review the factual findings but not the legal findings, unless the legal findings are supported by substantial evidence in the record.
C) The court will not review the factual findings as long as they are supported by substantial evidence in the record.
D) The court will conduct its own hearing and will not concern itself with the agency's legal or factual findings.

Question 73

A recommended decision of an administrative law judge becomes the final action for an agency if an appeal is taken to the full commission by either the staff or the respondent.

Question 74

Which of the following best summarizes the provisions of the Federal Register Act of 1933?

A) It mandates the publication of all notices of federal agency meetings, proposed regulations, and final regulations in the Federal Register.
B) It requires that corporations be registered with the Secretary of State in the state of their incorporation.
C) It requires each agency headed by a collegiate body to hold every portion of a business meeting open to public attendance.
D) It requires that patents and trademarks be registered in the Federal Register with the U.S. Patent Office.

Question 75

Public notice and comment are not required when an administrative agency is making interpretive rules or general statements of policy.

Question 76

Agency heads and commissions are required to defer to an administrative law judge's factual findings.

Question 77

How does a judicial review of an administrative agency action provide a check against agency excesses?

Question 78

Both the formal and informal rulemaking processes require an agency to give notice of a proposed rulemaking to the public in the Federal Register.

Question 79

The National Labor Relations Board (NLRB) is informed that Verdure Industries, a candle manufacturer, is violating a few labor laws of the United States. What steps should the NLRB take in this case?

Question 80

Julio Esteban is a U.S. citizen whose grandparents had immigrated to the United State during World War II. Last month, Julio travelled to Egypt on business. On his return to the United States, he was detained at the airport on suspicion of being an illegal immigrant. Though he showed all the relevant documents proving his U.S. citizenship to the U.S. Immigration and Customs enforcement officials, he was held in a federal immigration detention center for two days before his lawyer got him out. In this scenario, Julio can sue the U.S. Immigration and Customs enforcement agency under the .

A) Federal Register Act of 1933
B) Federal Privacy Act of 1974
C) Federal Tort Claims Act of 1946
D) Freedom of Information Act of 1966