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This Document Contains Chapters 3 to 4 Chapter 3 Business Ethics True/False 1. Business ethics is not more complicated than personal ethics. A. True B. False Answer: False 2. Ethics is concerned with the fairness or justness of an action. A. True B. False Answer: True 3. Adhering strictly to all business laws is all that is necessary to fulfill all business ethics obligations. A. True B. False Answer: False 4. Business ethics focuses on ethical behavior in the business world. A. True B. False Answer: True 5. Ethics is less certain than law. A. True B. False Answer: True 6. Compliance with the law does not necessarily fulfill all ethical obligations. A. True B. False Answer: True 7. Focusing on a firm's short-term profits without considering the company’s long-term needs may be acting unethically. A. True B. False Answer: True 8. The legality of an action is always clear. A. True B. False Answer: False 9. To be a “good citizen,” hen making decisions a business should not evaluate the public relations impact. A. True B. False Answer: False 10. Ethics can be highly subjective and subject change over time. A. True B. False Answer: True 11. Acting in good faith gives a business firm a better chance of defending its actions in court. A. True B. False Answer: True 12. An ethical code of conduct typically outlines a company’s policies. A. True B. False Answer: True 13. There is no debate that employees have an absolute right to free expression to make negative posts in social media about other employees and managers. A. True B. False Answer: False 14. Many companies have provided guidelines about what is appropriate when making posts on social media accounts. A. True B. False Answer: True 15. No one believes that judging a job candidate based on what he or she does outside the work environment is ethical. A. True B. False Answer: False 16. A company can broadly prohibit its employees from criticizing the company via social media. A. True B. False Answer: False 17. Ethical reasoning is the process through which an individual links his or her moral convictions or ethical standards to the particular situation at hand. A. True B. False Answer: True 18. Duty-based ethical standards often come from religious precepts or through philosophical reasoning. A. True B. False Answer: True 19. According to German philosopher Immanuel Kant, individuals should evaluate their actions in light of the consequences that would follow if they were the only members of society that acted in that way. A. True B. False Answer: False 20. Absolute mandates such as the commandment “Thou shalt not steal” can be justifiably broken if there is a benevolent motive. A. True B. False Answer: False 21. The categorical imperative cannot be applied to many business actions. A. True B. False Answer: False 22. In ethical terms, a cost-benefit analysis is an assessment of the negative and positive effects of alternative actions on individuals. A. True B. False Answer: True 23. According to utilitarianism, it matters how many people suffer a negative effect from an act. A. True B. False Answer: True 24. According to utilitarianism, an action that affects the majority adversely is morally wrong. A. True B. False Answer: True 25. Corporations can be good citizens by promoting goals that society deems worthwhile. A. True B. False Answer: True 26. Corporations can be perceived as owing ethical duties to groups other than their shareholders. A. True B. False Answer: True 27. If the interests of different stakeholders conflict, it can be difficult to determine which group’s interest should receive greater weight. A. True B. False Answer: True 28. A business firm's profits may suffer if the firm is not a “good corporate citizen.” A. True B. False Answer: True 29. Management’s behavior sets the ethical tone of a firm. A. True B. False Answer: True 30. Setting realistic workplace goals can increase the probability that employees will act unethically. A. True B. False Answer: False 31. Managers should apply the same ethical standards to themselves and to their employees. A. True B. False Answer: True 32. An ethics program can clarify what a company considers to be unacceptable conduct. A. True B. False Answer: True 33. The effectiveness of a company’s code of ethics is determined by the commitment of the company leadership to enforcing the code. A. True B. False Answer: True 34. Some companies set up confidential systems for employees to “raise red flags” about suspected unethical practices. A. True B. False Answer: True 35. Bribery of foreign government officials is both an ethical and a legal issue. A. True B. False Answer: True Multiple Choice 36. Any decision by the management of Fast-Food Franchise Corporation may significantly affect its A. operators only. B. operators, owners, suppliers, the community, or society as a whole. C. owners only. D. suppliers, the community, or society as a whole only. Answer: B 37. Lia works for Media Marketing Company. Her job includes putting “spin” on the firm’s successes and failures. In this context, ethics consist of A. “bad” versus “good” publicity. B. questions of rightness and wrongness. C. the firm’s quarterly revenue. D. whatever is legal. Answer: B 38. John is sales manager for Kleen ‘N Brite Products, Inc. Compared to John’s personal activities, his business activities most likely involve A. more complex ethical issues. B. no ethical issues. C. simpler ethical issues. D. the same ethical issues. Answer: A 39. Mary works in the public relations department of New Trends Sales Company. Her job includes portraying New Trends’s activities in their best light. In this context, ethics consist of A. a different set of principles from those that apply to other activities. B. the same moral principles that apply to non-business activities. C. those principles that produce the most favorable financial outcome. D. whatever saves New Trends’s “face.” Answer: B 40. Flexo Trucking Company transports hazardous waste. Garn is a Flexo driver, whom the company knows drives longer hours than federal regulations permit. One night, Garn exceeds the limit and has an accident. Spilled chemicals contaminate Hill City’s water source, forcing the residents to move away. Flexo acted unethically because A. Flexo showed reckless disregard for Hill City’s residents and others. B. Garn exceeded the federal time limit. C. harm was caused by an unfortunate accident. D. Hill City should have better protected its water source. Answer: A 41. In studying the legal environment of business, Professor Dooley’s students also review ethics in a business context. Ethics includes the study of what constitutes A. fair or just behavior. B. financially rewarding behavior. C. legal behavior. D. religious behavior. Answer: A 42. Peak & Vale Accountants provides other firms with accounting services. Questions of what is ethical involve the extent to which Peak & Vale has A. a legal duty beyond those duties mandated by ethics. B. an ethical duty beyond those duties mandated by law. C. any duty beyond those mandated by both ethics and the law. D. any duty when it is uncertain whether a legal duty exists. Answer: B 43. According to the view that New Allied Manufacturing Corporation is a “citizen,” New Allied is expected to A. participate in bettering communities and society. B. primarily generate revenue for its owners. C. have no responsibility other than profit maximization. D. efficiently allocate scarce resources. Answer: A 44. Destiny and Eduardo, investors in Competitive Acquisitions Corporation, are dissatisfied with the profit-maximization theory of corporate objectives. These investors and others who look beyond profits and dividends may consider the triple bottom line, which does not include a corporation’s A. impact on people. B. profits. C. impact on the planet. D. congressional lobbying activities. Answer: D 45. Precision Engineering Inc., like other corporations, is subject to laws that are broad in their purpose and their scope. Compliance with these laws is not always sufficient to determine “right” behavior because A. the law does not codify all ethical requirements. B. company codes are also sources of law. C. business decisions can have negative impacts. D. ethical problems occur in business. Answer: A 46. David, the chief accounting officer of Tension Fencing Corporation, wants to be sure that all the company’s accounts are legal and ethical. Sometimes, however, he is unsure exactly what is legal and what is illegal. David should A. not worry about what is legal or illegal as long as the corporate executives benefit in the short run. B. try his best to not do anything illegal and keep documentation showing that he always acts in good faith. C. not worry about what is legal or illegal as long as it benefits the shareholders. D. not worry about what is legal or illegal as long as it benefits the chief executive of the corporation. Answer: B 47. Eden, the chief executive officer of Flo-Thru Piping Corporation, wants to ensure that Flo-Thru’s activities are legal and ethical. The best course for Eden and Flo-Thru is to act in A. good faith. B. ignorance of the law. C. regard for the firm’s shareholders only. D. their own self interest. Answer: A 48. With respect to the potential for American Discount Stores, Inc., and any other major corporation to suffer damage to its reputation or loss of profits through negative publicity, the Internet has A. increased the potential. B. decreased the potential. C. had no impact. D. allowed a company to keep negative information or opinions hidden. Answer: A 49. Ridgeline Excavation & Construction, LLC, creates an internal code of ethics. Like the codes of other firms, Ridgeline’s company code is not A. law. B. a set of rules that the company can enforce. C. an outline of the company’s policies. D. a guide for decision makers facing ethical questions. Answer: A 50. Price Less Retail Corporation specifies that its employees should not use social media to damage the company, harm another person’s reputation, or violate company policies. An employee who violates these rules may be subject to discipline and could be fired. According to the National Labor Relations Board, this social media policy A. violates federal labor law. B. is too lenient toward employees. C. is too stringent toward management. D. is necessary to prevent inaccurate statements from being spread across the Internet. Answer: A 51. In business deals, Fiona, the chief executive officer of Snacks n’ Bites, Inc., follows duty-based ethical standards. These are most likely derived from A. a corporate ethics code. B. a cost-benefit analysis. C. philosophical reasoning. D. the law. Answer: C 52. Lyle, vice-president of sales for Mi-T Electric, Inc., adheres to Judeo-Christian religious ethical standards. With respect to their application, these standards are A. absolute. B. analytical. C. discretionary. D. utilitarian. Answer: A 53. Julia, the head executive of Fine Woolen Sweaters, Inc., is a committed Christian who strongly adheres to the Ten Commandments. One of Julia’s employees is found to be stealing sweaters and giving them to a local homeless shelter. Julia is likely to A. punish the employee for stealing even though the employee’s motive was benevolent. B. view the employee’s actions as justified because the employee was clothing the poor. C. contribute more sweaters to the homeless shelter. D. gently reprimand the employee without suggesting that the employee’s actions were unethical. Answer: A 54. Carrie Ann works at Paper Products, Inc. She considers taking home a few sheets of stationery so she can write letters to her ailing grandmother. Since Paper Products produces thousands of sheets of stationery every day no one will miss the few sheets she takes and company profits will not be affected. Carrie Ann then considers what would happen if every employee took some stationery home and decides not to take any. Carrie Ann is being influenced by A. the categorical imperative. B. the principle of rights. C. a cost-benefit analysis. D. outcome-based ethics. Answer: A 55. In making business decisions, Glenda, personnel manager for HVAC Maintenance, Inc., applies her belief that all persons have fundamental rights. This is A. a religious rule. B. the categorical imperative. C. the principle of rights. D. utilitarianism. Answer: C 56. Ryan, the owner of Super Mart Stores, Inc., adheres to the “principle of rights” theory. Under this theory, a key factor in determining whether a business decision is ethical is how that decision affects A. the right determination under a cost-benefit analysis. B. the rights of others. C. the “right” thing to do. D. the right to make a profit. Answer: B 57. In making decisions for Smartt Investments, Rita uses a cost-benefit analysis. This is a part of A. duty-based ethics. B. Kantian ethics. C. rights-based ethics. D. utilitarian ethics. Answer: D 58. Hailey, a lawyer on the staff of International Group, always considers the consequences of an action rather than the nature of the action itself when making ethical decisions in a business context. Hailey is applying A. the utilitarian theory of ethics in business contexts. B. religious beliefs in business contexts. C. Kantian ethics in business contexts. D. the principle of rights theory of ethics in business contexts. Answer: A 59. Bob, research manager for Corn Agri Products, Inc., ap-plies utilitarian ethics to determine that an action is morally correct when it produces the greatest good for A. Bob. B. Corn Agri. C. the fewest people. D. the most people. Answer: D 60. In deciding questions of corporate social responsibility, Valley Disposal & Recycling, Inc., is concerned with A. how the corporation can best fulfill any ethical duty to society. B. the effect on corporate profits of ignoring any ethical duty to society. C. whether the corporation owes any ethical duty to society. D. all of the choices. Answer: D 61. Meat Men, Inc. spends a great deal of money and effort to ensure that all employees are safe on the job, that all products are safe for consumers, and that the environmental impact of the corporation is minimal. Meat Men appears to strongly believe in the concept of A. the moral minimum. B. corporate social responsibility. C. “grey areas” in the law. D. government oversight. Answer: B 62. Applied Business Corporation makes and markets its products nationwide. Under the stakeholder approach, to be considered socially responsible when making a business decision, Applied must take into account the needs of A. its consumers, the community, and society only. B. its employees and owners only. C. its employees, owners, consumers, the community, and society. D. no one. Answer: C 63. A common ethical dilemma faced by the management of Spencer Hydraulics Corporation involves the effect that its decision will have on A. one group as opposed to another. B. the firm's competitors. C. the government. D. the U.S. Chamber of Commerce. Answer: A 64. Margaret is the top manager of Pecans, Inc. She sets strict ethical standards for all employees. Margaret, however, often takes some of the company’s best nuts and sells them from her house. The ethical tone at Pecans, Inc. is A. likely to be good because Margaret has set such strict standards for her employees. B. not likely to be good because although Margaret sets strict ethical standards for the other employees, she does not follow them. C. not related to either Margaret’s ethical standards or her own unethical behavior. D. not likely to be good because employees tend to resent strict ethical standards. Answer: B 65. Strait way Company encourages its managers to behave ethically, reasoning that the employees will take their cues from management. One of the most important ways to create and maintain an ethical behavior workplace is for management to A. demonstrate a commitment to ethical decision making. B. discreetly engage in unethical or illegal acts. C. look the other way when an employee engages in an unethical act. D. direct employees to “do as we say, not as we do.” Answer: A 66. Ergonomic Corporation convenes its employees for its managers to announce (1) a new company-wide ethical code of conduct, (2) an ad campaign to publicize the new code, and (3) the discharge of employees who do not adhere to the code. One of the most effective ways to set a tone of ethical behavior within a business organization is A. to create an ethical code of conduct. B. to discharge employees who create the appearance of impropriety. C. to post a marketing campaign online touting the firm’s ethical tone. D. for management to direct employees to “do as we say, not as we do.” Answer: A 67. Richard suspects his supervisor of unethical accounting practices. However, he does not want to lose his job if he reports the supervisor and the supervisor finds out who reported him. An important feature of online reporting systems like NAVEX Global is A. the employee reporting the unethical behavior can do so anonymously. B. the employee reporting the unethical behavior is financially compensated if he loses his job as a result of the report. C. the employee reporting the unethical behavior must give his full name when making the report. D. the employee reporting the unethical behavior must have another employee supporting him. Answer: A 68. At a meeting of employees, Fuel Injection Design & Manufacturing, Inc.’s managers announce the creation of a new company-wide code of ethical conduct and the initiation of an ad campaign to publicize the new code. They also say that any employees who do not adhere to the code will be discharged. The effectiveness of this code will be determined by A. the commitment of company leadership to enforcing the code. B. the extent to which the employees comply with the code. C. a marketing campaign posted online to tout the firm’s ethical tone. D. management directing employees to “do as we say, not as we do.” Answer: A 69. Ethical standards would most likely be considered violated if Team Logos Merchandising Corporation deals with a company in a developing nation that A. agrees to produce goods at Team Logos’s desired price. B. goes unnoticed by “corporate watch” groups. C. routinely violates labor and environmental standards. D. pays its workers less than the U.S. minimum wage. Answer: C 70. To assist in detecting illegal bribes, International Civil Engineers, Inc., and all other U.S. companies must A. conceal financial records that reveal past bribes. B. keep records that “accurately and fairly” reflect their financial activities. C. make bribes through third parties rather than directly to officials. D. permit payments to foreign officials that are unlawful in that country. Answer: B Essay 71. Recreation & Sports Equipment Corporation sells a product that is capable of seriously injuring consumers who misuse it in a foreseeable way. Does the firm owe an ethical duty to take this product off the market? What conflicts might arise if the firm stops selling this product? Answer: Ethical behavior can sometimes generate sufficient good will to warrant practicing it out of a desire for increased profits. By the same to-ken, unethical behavior can sometimes generate enough bad publicity to warrant avoiding it out of the same desire. A business firm’s activities that are perceived as ethical and receive wide publicity can benefit the firm’s owners in the short run-and even in the long run if the firm’s enhanced public image continues to attract more consumers to its products. There is nothing unethical about making a profit. It is the behavior that generates the profit that can be questionable. Business ethics thus has a practical element. A business firm should act in its best interest. A firm interested in profits should also be interested in the public’s opinion. Of course, it is not a company’s fault when consumers mis-use its product. If continuing to sell a product is not a strict violation of the law, stopping its sale would likely reduce profits. This could impact the firm’s owners, employees, and others. But suspending sales could reduce injuries, and it could lead to increased profits from the sales of other products, if the suspension stops negative publicity. When a business entity decides to respond to what it sees as a moral or ethical obligation by removing a product from the market, an ethical conflict is raised be-tween the firm and its employees and between the firm and its share-holders. This conflict arises directly out of the impact that the decision has on the firm’s profits. If meeting this perceived obligation in-creases the firm’s profitability, then all parties “win” and the dilemma would be easily re-solved in favor of “doing the right thing.” 72. Olaf, an executive with Pharma Product Distribution, Inc., has to decide whether to market a product that might have undesirable side effects for a small per-centage of users. How should Olaf decide whether to sell the product? How does the standard of ethics that is applied affect this answer? Answer: When a corporate executive has to decide whether to market a product that might have undesirable side effects for a small percentage of users but that would be beneficial for most users, the decision turns on the benefit to the many versus the harm to the few. Of course, all possible pre-cautions should be taken to protect the few. A more specific answer depends on which system of ethics is applied. From a religious duty-based perspective, the answer might be absolute: do not sell the product because some would be harmed, sell the product only to those who would not be harmed, or sell the product with clear warnings of the possible harm. Similar conclusions might be reached through a philosophical, “categorical imperative,” duty-based approach, which would consider the result if every corporation chose to sell the product. A principle-of-rights duty-based approach might likewise come to the same conclusions, reasoning that all persons have a right to life, for example, and that the corporation has an ethical duty to respect that right and act accordingly. From a utilitarian perspective, under a cost-benefit analysis, if the product were sold, it could benefit the greatest number of persons—future and cur-rent employees, as well as shareholders, and most consumers. If there was “bad” publicity, and it was adverse enough to reduce sales, however, more persons could benefit from the decision not to market the product. Under any of the different corporate social responsibility theories, the decision whether to market the product would acknowledge the firm’s duty to act ethically and be accountable to society. There might be a balancing of the interests of competing stakeholder groups or a shouldering of the responsibility to behave in a socially beneficial way as a good corporate citizen. Of course, the firm would likely have to accept any legal liability that would arise from its sale of the product. To apply any of these approaches, the executive might evaluate the situation according to the six guidelines for making ethical business decision. Is the action legal? Is it in line with the company’s rules? If so, is it in accord with the “spirit” of the law, those policies, and one’s conscience? Could it withstand the glare of publicity and satisfy promises made to others? It seems probable that sales of the product would violate the company’s rules—at the least because in the long run the sales could negatively impact corporate profits when some are harmed by the product’s use—and that, thus, the sales could not withstand publicity, promises to others, or any individual’s conscience. Under the five-step procedure to review the ethical conflicts, the first step is to specify the facts, the problem, and the ethical principles at issue. The second step is to discuss potential actions and their effects. The third step is to come to a consensus as to what to do. This consensus should withstand moral scrutiny (the fourth step) and fulfill corporate, community, and individual values (the fifth step). It seems unlikely that a proposed sale of the product would survive the fourth step, under either a duty-based or an outcome-based ethical standard. Chapter 4 Business and the Constitution True/False 1. A confederal form of government is a confederation of independent states with a central government of very limited powers. A. True B. False Answer: True 2. In a country with a federal form of government, the national government and the states share sovereign power. A. True B. False Answer: True 3. All powers not specifically delegated to the federal government are reserved to the states. A. True B. False Answer: True 4. The checks and balances in the U.S. Constitution prevent any one branch of government from exercising too much power. A. True B. False Answer: True 5. Under the Constitution, the judicial branch interprets the laws. A. True B. False Answer: True 6. Under the Constitution, the judicial branch is responsible for foreign affairs. A. True B. False Answer: False 7. The President determines the jurisdiction of the federal courts. A. True B. False Answer: False 8. The President appoints federal judges with the advice and consent of the Senate. A. True B. False Answer: True 9. The judicial branch has the power to hold actions of the other branches of government unconstitutional. A. True B. False Answer: True 10. Article I, Section 8, of the U.S. Constitution permits Congress to regulate interstate commerce. A. True B. False Answer: True 11. At least in theory, Congress can regulate every commercial enterprise in the United States. A. True B. False Answer: True 12. Under their police powers, states can regulate only public activities, such as political demonstrations. A. True B. False Answer: False 13. When there is a direct conflict between a federal and a state law, the state law is rendered invalid. A. True B. False Answer: True 14. Preemption occurs when Congress chooses to act exclusively in a concurrent area and a valid federal statue or regulation takes precedence over a conflicting state or local law. A. True B. False Answer: True 15. The Second Amendment to the U.S. Constitution reserves all powers not delegated to the national government to the states. A. True B. False Answer: False 16. The Bill of Rights protects individuals against types of interference by the federal government. A. True B. False Answer: True 17. The Fifth Amendment prohibits unreasonable searches and seizures of persons or property. A. True B. False Answer: False 18. The Eighth Amendment prohibits excessive bail and fines, as well as cruel and unusual punishment. A. True B. False Answer: True 19. Symbolic speech is defined as nonverbal expressions of belief and is protected by the First Amendment. A. True B. False Answer: True 20. A restriction on commercial speech is valid as long as it forbids only the expression of views on controversial issues. A. True B. False Answer: False 21. The First Amendment protects corporate political speech. A. True B. False Answer: True 22. The First Amendment requires a complete separation of church and state. A. True B. False Answer: False 23. The Children’s Internet Protection Act requires public schools and libraries to use filtering software to block children’s access to adult contact on Web sites. A. True B. False Answer: True 24. The First Amendment requires a complete separation of church and state. A. True B. False Answer: False 25. The establishment clause of the U.S. Constitution prohibits the federal government from establishing a state-sponsored religion. A. True B. False Answer: True 26. A law that has any impact on religion is unconstitutional. A. True B. False Answer: False 27. The Fourteenth Amendment guarantees a right to due process of law. A. True B. False Answer: True 28. Procedural due process requires that any government decision to take a person’s property must be made fairly. A. True B. False Answer: True 29. Substantive due process focuses on the substance of legislation. A. True B. False Answer: True 30. The terms “due process” and “equal protection” mean the same thing. A. True B. False Answer: False 31. A law that limits only some persons’ exercise of a fundamental right is valid under any circumstances. A. True B. False Answer: False 32. A law that limits the liberty of all persons may violate substantive due process. A. True B. False Answer: False 33. A law that restricts people of a certain national origin from doing something will be carefully examined to make sure it promotes a compelling government interest before it is allowed to stand. A. True B. False Answer: True 34. Because the Constitution does not specifically a right to privacy, this right is denied to people. A. True B. False Answer: False 35. Individuals have a right to obtain access to information about them collected in government files. A. True B. False Answer: True Multiple Choice 36. The Financial Institutions Association would like a certain law enacted, administered, interpreted, and enforced in the best interest of its members, which include banks. Under the Constitution, Congress A. administers the laws. B. enforces the laws. C. interprets the laws. D. makes the laws. Answer: D 37. The Constitution sets out the authority and the limits of the branches of the government. The term checks and balances means that A. Congress writes checks and the other branches balance the budget. B. each branch has some power to limit the actions of the others. C. the courts balance their authority to the other branches’ checklists. D. the president “checks” the courts, which “balance” the laws. Answer: B 38. Antonin, a federal judge, retires. The vacant position will be filled by a judge A. appointed by the United States Supreme Court. B. elected by voters. C. appointed by the President. D. appointed by Congress. Answer: C 39. The commerce clause of the U.S. Constitution is found in A. Article I, Section 8. B. Article I, Section 2. C. Article VIII, Section 1. D. Article II, Section 8. Answer: A 40. South Dakota, like other states, may regulate private activities to protect or promote the public order, health, safety, and general welfare under A. the state’s police powers. B. the dormant commerce clause. C. the due process clause. D. the free exercise clause. Answer: A 41. Tami’s Tasty Tacos, a fast food outfit, files a suit against the state of Texas, claiming that a Texas state law violates the commerce clause. The court will agree if the statute imposes a substantial burden on A. a local government. B. interstate commerce. C. noneconomic activity. D. the state. Answer: B 42. The commerce clause’s express grant of exclusive authority to regulate commerce that substantially affects trade and commerce among states is referred to as the A. dormant aspect of the commerce clause. B. positive aspect of the commerce clause. C. negative aspect of the commerce clause. D. exclusive aspect of the commerce clause. Answer: B 43. Savers Mart, Inc., distributes its merchandise to retail outlets on an inter-state basis. Under the commerce clause, Congress has the power to regulate A. any commercial activity in the United States. B. only activities that are in intrastate commerce. C. only activities that are in local commerce. D. only activities that are not in commerce. Answer: A 44. Congress enacts a law that sets out a rigorous medical-device premarket approval process for the U.S. Food and Drug Administration to follow. The law includes a preemption provision. Moe is injured by a device that underwent the process and files a claim under New Hampshire state law to recover for the injury. The court will most likely rule that A. Moe’s state law claim preempts the federal law. B. the federal law and state law claim are concurrent. C. the federal and state law claim cancel each other out. D. the federal law preempts Moe’s state law claim. Answer: D 45. Congress enacts a law prohibiting toys made in China from being sold in the United States. The Hawaii state legislature enacts a law allowing the sale of Chinese-made toys. Hawaii’s law will most likely be struck down under A. the commerce clause. B. the equal protection clause. C. the due process power. D. the supremacy clause. Answer: D 46. A federal law regarding the labeling of pesticides directly conflicts with a state law. The state law will be rendered invalid due to the A. the supremacy clause. B. the commerce clause. C. the federal spending power. D. the First Amendment. Answer: A 47. Don, a U.S. citizen, is the owner of Egrets Unlimited, Inc. Egret’s competitors include Feathered Friends Company (FFC), which is owned by Greg and Huey. The Bill of Rights embodies a series of protections for Don against types of interference by A. FFC and its other competitors only. B. FFC, Greg, Huey, others, and the government. C. Greg, Huey, and other private individuals only. D. the government only. Answer: D 48. Martin, a U.S. citizen, feels that a recently enacted federal law is unfair. He assembles a group of friends and they write a petition to the government. Martin and friends then stand quietly in front of the White House with signs declaring their belief that the law is unfair. Under the First Amendment, Martin has a right to A. petition the government, but not to assemble a group peaceably. B. assemble peaceably, but not to petition the government. C. both petition the government and assemble peaceably. D. neither petition the government nor assemble peaceably. Answer: C 49. The police obtain a search warrant and search Dave’s apartment. After yelling obscenities at the officers, Dave confesses to a crime and implicates his friends. The Constitution protects against A. obscene speech only. B. others’ implication only. C. unreasonable searches only. D. obscene speech, others’ implication, and unreasonable searches. Answer: C 50. Bailey, the president of Carmichael Commodities Company, claims that certain actions by the federal government and by the state of Delaware infringe on rights guar-anteed by the Bill of Rights. All of these rights limit A. neither Delaware nor the federal government. B. the federal government only. C. Delaware and the federal government. D. Delaware only. Answer: B 51. Mary creates a t-shirt design that expresses her support for a presidential candidate and distributes t-shirts to all her friends. The t-shirts are an example of A. unprotected speech. B. controlled speech. C. symbolic speech. D. illegal speech. Answer: C 52. Serenity City enacts an ordinance that bans the use of “sound amplifying systems” on public streets. Tyler wants to campaign for a seat on the city council by broadcasting his message through speakers mounted on a truck. In Tyler’s suit against the city, a court would likely hold the ordinance to be A. an unconstitutional restriction of speech. B. constitutional under the First Amendment. C. justified by the need to protect individual rights. D. necessary to protect national interests. Answer: B 53. George burns an American flag in his backyard. He films his actions and posts the video on YouTube.com. George’s actions are A. expressly prohibited by the U.S. Constitution. B. protected by the First Amendment of the U.S. Constitution. C. considered to be a form of treason. D. illegal in some states. Answer: B 54. Beachside City enacts an ordinance that bans the distribution of all printed materials on city streets. Carl opposes the city’s latest “revenue-enhancing” measure and wants to protest by distributing handbills. In his suit against the city, a court would likely hold the printed-materials ban to be A. an unconstitutional restriction of speech. B. constitutional under the First Amendment. C. justified by the need to protect individual rights. D. necessary to protect national interests. Answer: A 55. Reusable Energy Corporation regularly expresses opinions on political issues. Under the First Amendment, corporate political speech is A. discouraged. B. forbidden. C. protected. D. required. Answer: C 56. California enacts a statute to ban advertising in “bad taste.” This statute would likely be held by a court to be A. an unconstitutional restriction of speech. B. constitutional under the First Amendment. C. justified by the need to protect individual rights. D. necessary to protect national interests. Answer: A 57. Machismo Motor Sales Corporation regularly advertises its off-the-road vehicles, all-terrain vehicles, and other products. Under the First Amendment, these ads and other commercial speech are given A. less extensive protection than non-commercial speech. B. more extensive protection than symbolic speech. C. no protection. D. the same protection as defamatory speech. Answer: A 58. Violent Video Games, Inc. markets a variety of shooting, fighting and hunting video games. A state statue is enacted that requires all video game manufacturers to label any games with an option to kill something as “excessively violent.” A court would likely hold this regulation to be A. an unconstitutional restriction of speech. B. constitutional under the First Amendment. C. justified by the need to protect individual rights. D. necessary to protect national interests. Answer: A 59. In 2015, Congress enacts the Act to Restrict Commercial Speech (ARCS). The ARCS will be considered valid if it directly advances a substantial government interest A. but goes no further than necessary to achieve its purpose. B. without regard to how “far” it goes. C. and the parties affected by it can elect how “far” to go in applying it. D. and goes further than necessary to ensure full coverage. Answer: A 60. Julia is a U.S. citizen. She establishes a website that posts threatening messages about celebrities. Her website is A. protected by the First Amendment. B. not protected by the First Amendment. C. protected by the Fifth Amendment. D. protected by the Tenth Amendment. Answer: B 61. Brad stands in front of Rooster’s Round-Up Café, shouting “fighting words” that are likely to incite Rooster’s patrons to respond violently. The First Amendment protects such speech A. all of the time. B. none of the time. C. only if it is non-commercial. D. only if it is symbolic. Answer: B 62. Adult Shoppe in Bay City sells a variety of publications, including child pornography. Bay City enacts an ordinance prohibiting the sale of such materials. This ordinance is most likely A. an invalid restriction of individuals’ privacy. B. an unconstitutional restriction of speech. C. a violation of adults’ rights to enjoy certain privileges. D. constitutional under the First Amendment. Answer: D 63. Which of the following does not necessarily make material obscene? A. The average person finds that it violates contemporary community standards. B. The work taken as a whole appeals to a prurient interest in sex. C. The work shows patently offensive sexual conduct. D. The work shows animals mating. Answer: D 64. Oklahoma enacts a law requiring all businesses in the state to donate 10 per-cent of their profits to Protestant churches that provide certain services to persons whose income is below the poverty level. Price Less Stores files a suit to block the law’s enforcement. The court would likely hold that this law violates A. no clause in the U.S. Constitution. B. the establishment clause. C. the free exercise clause. D. the supremacy clause. Answer: B 65. Marie claims that a Nebraska state statute infringes on her “procedural due process” rights. This claim focuses on A. procedures used in making decisions to take life, liberty, or property. B. the content of the statute. C. the similarity of the treatment of similarly situated individuals. D. the steps to be taken to protect Marie’s privacy. Answer: A 66. A Massachusetts state statute imposes a prison term, without a trial, on all street performers who operate in certain areas. A court would likely review this statute under the principles of A. the commerce clause. B. the equal protection clause. C. the due process clause. D. the First Amendment. Answer: C 67. Orin claims that a Pennsylvania state statute infringes on his “substantive due process” rights. This claim focuses on A. procedures used to make decisions to take life, liberty, or property. B. the content of the statute. C. the similarity of the treatment of similarly situated individuals. D. the steps to be taken to protect Orin’s privacy. Answer: B 68. Justice For All, a political organization, files a claim to challenge a Colorado statute that limits the liberty of all persons to broadcast “annoying” radio commercials. This claim is most likely based on the right to A. equal protection of the law. B. indictment. C. procedural due process. D. substantive due process. Answer: D 69. To reduce traffic, Harbor Town enacts an ordinance that allows only a few street vendors to op-er-ate in certain areas. A court would likely review this ordinance under the principles of A. the commerce clause. B. the equal protection clause. C. the due process clause. D. the First Amendment. Answer: B 70. Jon, a law enforcement official, monitors Kelsey’s Internet activities—e-mail and Web site visits—to gain access to her personal financial data and student information. This may violate Kelsey’s right to A. equal protection of the law. B. privacy. C. procedural due process. D. substantive due process. Answer: B Essay 71. Jim operates Jim’s Fruits & Vegetables, a small market stocked entirely with produce grown on his adjacent farm. Under what clause of the Constitution can the federal government regulate Jim’s activities? What is Jim’s best argument against federal regulation of his farm and business? Answer: Under the commerce clause, at least in theory, Congress has the power to regulate any activity—interstate or intrastate—that affects interstate commerce. Thus, under that clause, it could be argued that the farmer’s growing and selling of produce is subject to federal regulation because these activities affect inter-state commerce. The farmer-vendor’s best argument against federal regulation of his farm and business in this problem might be that in his case these activities and their effects are purely local. But because of the economic char-acter of these activities, and hence their effect on interstate commerce, however minimal and de-spite their local character, it is unlikely that a court would accept this argument. 72. The Arkansas state legislature enacts a statute that prohibits the advertising of video games “because the games might be harmful to minors.” Despite this new statute, the president of Games Marketing, Inc. (GMI), orders GMI marketers to place ads in various media. When a GMI ad appears on HDTV, a local television station, GMI and HDTV are charged with violating the statute. What is the defendants’ best defense against a conviction? Answer: GMI and HDTV cannot be convicted because a state legislature cannot enact a statute that restricts commercial speech (in this problem, marketing video games) to this extent. The First Amendment protects commercial speech. Commercial speech does not receive as much protection as non-commercial speech, however, so states can place some restraints on the former. For example, to protect consumers, a state may ban certain kinds of marketing practices, such as deceptive or misleading advertising. Generally, a restriction on commercial speech will be considered valid as long as it (1) seeks to implement a substantial government interest, (2) directly advances that interest, and (3) goes no further than necessary to accomplish the objective. Here, the complete ban on ads for video games “because the games might be harmful to minors” is too restrictive: it goes too far in attempting to protect minors for an apparently unsubstantiated purpose. Test Bank for Essentials of the Legal Environment Today Roger LeRoy Miller 9781305262676

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