Business Law and Ethics Flashcards
What is business law?
Business law refers to the body of law that governs business and commercial transactions.
True or False: Business law only applies to large corporations.
False
What is the primary purpose of business law?
To regulate business practices and ensure fair competition.
Fill in the blank: The _____ is a legal document that outlines the rights and responsibilities of partners in a business.
partnership agreement
What does the Uniform Commercial Code (UCC) govern?
It governs commercial transactions in the United States.
What is a contract?
A contract is a legally binding agreement between two or more parties.
True or False: An oral contract is always enforceable.
False
What are the essential elements of a valid contract?
Offer, acceptance, consideration, capacity, and legality.
What is tort law?
Tort law deals with civil wrongs and damages caused by one party to another.
Multiple Choice: Which of the following is NOT a type of business entity? A) Corporation B) Sole Proprietorship C) Partnership D) Charity
D) Charity
What is the purpose of intellectual property law?
To protect the creations of the mind, such as inventions, literary works, and symbols.
True or False: Ethics and law are the same thing.
False
What is the difference between ethics and law?
Ethics refers to moral principles, while law refers to the rules enforced by the government.
Fill in the blank: The _____ is a federal law that governs the protection of consumers.
Consumer Protection Act
What is a fiduciary duty?
A legal obligation to act in the best interest of another party.
Multiple Choice: Which of the following is a common business ethical issue? A) Fraud B) Honesty C) Transparency D) Fairness
A) Fraud
What is corporate social responsibility (CSR)?
CSR refers to a business model that helps a company be socially accountable to itself, its stakeholders, and the public.
True or False: A company can be held liable for the actions of its employees.
True
What is the Sarbanes-Oxley Act?
A federal law enacted to protect investors from fraudulent financial reporting by corporations.
Fill in the blank: The _____ is a legal principle that holds that a corporation is a separate legal entity from its owners.
corporate veil
What is antitrust law?
Antitrust law is designed to promote fair competition and prevent monopolistic practices.
Multiple Choice: Which of the following is a key principle of ethical business conduct? A) Deception B) Integrity C) Manipulation D) Coercion
B) Integrity
What is a breach of contract?
A breach of contract occurs when one party fails to fulfill its obligations under the contract.
True or False: All contracts must be written to be enforceable.
False
What is the role of the Federal Trade Commission (FTC)?
To protect consumers and maintain competition by preventing unfair or deceptive business practices.
Fill in the blank: _____ is the legal process by which a business can be dissolved.
Dissolution
What does the term ‘due diligence’ refer to in business transactions?
The investigation of a business or person prior to signing a contract or completing a transaction.
Multiple Choice: Which of the following is a type of business ownership? A) Partnership B) Friendship C) Membership D) Relationship
A) Partnership
What is the concept of ‘business judgment rule’?
A legal principle that protects corporate directors from liability for decisions made in good faith.
True or False: Insider trading is legal if the information is disclosed to the public.
False
What is the purpose of employment law?
To regulate the relationship between employers and employees.
Fill in the blank: The _____ is a law that prohibits discrimination in the workplace.
Civil Rights Act
What is a warranty?
A warranty is a guarantee that a product will meet certain standards of quality and performance.
Multiple Choice: Which of the following is an example of a regulatory agency? A) The IRS B) A bank C) A corporation D) A law firm
A) The IRS
What is the primary objective of contract law?
To enforce agreements made between parties.
True or False: A minor can enter into a legally binding contract.
False
What is the purpose of the Equal Employment Opportunity Commission (EEOC)?
To enforce federal laws prohibiting employment discrimination.
Fill in the blank: _____ is the ethical principle that emphasizes fairness and justice in business practices.
Equity
What does ‘conflict of interest’ mean?
A situation where a person or entity has competing interests or loyalties.
