FBLA Business Law Study Guide | 2026/2027 | A+ Grade | Questions and
Answers |Exam preparation
cooperative - (ANSWER)A business organization owned and operated by a group of individuals for their
mutual benefit
nominal consideration - (ANSWER)small amount of money identified in a written contract when parties
cannot or do not wish to state the amount precisely
restraint - (ANSWER)A human, mechanical, and or physical device that is used with or without the
client's permission to restrict his or her freedom of movement or normal access to a person's body and
is not a usual part of treatment plans indicated by the person's condition or symptoms.
disaffirmance - (ANSWER)The legal avoidance, or setting aside, of a contractual obligation.
commercial paper - (ANSWER)A short-term unsecured debt instrument used by corporations to borrow
money at rates lower than bank rates. CP has maturities from 2 - 270 days; unregulated by the SEC.
Migrant & Seasonal Agricultural Workers - (ANSWER)The Migrant and Seasonal Agricultural Worker
Protection Act (MSPA) regulates the hiring and employment activities of agricultural employers, farm
labor contractors, and associations using migrant and seasonal agricultural workers. The Act prescribes
wage protections, housing and transportation safety standards, farm labor contractor registration
requirements, and disclosure requirements. The Wage and Hour Division administers this law.
The Fair Labor Standards Act (FLSA) exempts agricultural workers from overtime premium pay, but
requires the payment of the minimum wage to workers employed on larger farms (farms employing
more than approximately seven full-time workers. The Act has special child-labor regulations that apply
to agricultural employment; children under 16 are forbidden to work during school hours and in certain
jobs deemed too dangerous. Children employed on their families' farms are exempt from these
regulations. The Wage and Hour Division administers this law. OSHA also has special safety and health
standards that may apply to agricultural operations.
The Immigration and Nationality Act (INA) requires employers who want to use foreign temporary
workers on H-2A visas to get a labor certificate from the Employment and Training Administration
certifying that there are not sufficient, able, willing and qualified U.S. workers available to do the work.
The labor standards protections of the H-2A program are enforced by The Wage and Hour Division.
,FBLA Business Law Study Guide | 2026/2027 | A+ Grade | Questions and
Answers |Exam preparation
Reasons for Termination - (ANSWER)1)
Consistent incompetence. If an employee just isn't able to do a competent job, and you have given the
employee a reasonable opportunity to succeed, then termination will often be seen as appropriate.
2)
Violation of company policy. If you have established clear, legal, and consistent policies, and the
employee obviously has violated them in a meaningful way, then termination is appropriate. Violation of
antiharassment, discrimination, or confidentiality policies are particularly actionable.
3)
Repeated unexcused absenteeism or tardiness. Your company depends on its employees to show up for
work and perform their jobs. Continual absence or tardiness jeopardizes the ability of an employee to
complete important tasks. If absenteeism or tardiness is continual and unexcused, then termination may
be justified. Be careful to investigate the reason for the absences. If they're the result of a medical
condition, you may need to accommodate that condition, or at least attempt to do so.
4)
Physical violence. If an employee commits or threatens physical violence, you will want to fire him or her
immediately. All employees are entitled to a safe work environment, and employers have a duty to take
reasonable steps to provide for that.
5)
Drugs and alcohol. Depending on the circumstances, being under the influence at the office may be
grounds for immediate suspension or termination. Some companies now offer treatment and
rehabilitation counseling as an alternative to immediate firing. Conditions caused by the use of
prescribed drugs may also require a more tempered response.
6)
Illegal acts. If you find the employee committing illegal acts, such as theft or embezzlement, immediate
termination is justified. Before you fire the accused employee, however, make sure you know all the
facts and have heard the employee's side of the stor
Product Organizational Structure - (ANSWER)Product Organizational Structure
A product organizational structure has managers reporting to the president or head of the company by
product type. Product organizational structures are primarily used by retail companies that have stores
in various cities. However, stores in each city may still need a local human resources or marketing
department to carry out functions locally. For example, a small department store company may have a
, FBLA Business Law Study Guide | 2026/2027 | A+ Grade | Questions and
Answers |Exam preparation
vice president of sporting goods, housewares and general merchandise at the corporate office. One
manager may report to each vice president. However, each manager may oversee the work of one or
more field marketing employees who travel and handle local marketing stores in several states. These
field marketing employees may work for the sporting goods manager one week in League City, Texas,
then do merchandising for the housewares manager another week in the Sugarland, Texas, market.
Contract Steps - (ANSWER)1 Intent
2 Offer
3 Timeframe
4 Obligations
5 Representations
6 Consideration
7 Arbitration
8 Acceptance
Assignment - (ANSWER)An assignment (Latin cessio) is a term used with similar meanings in the law of
contracts and in the law of real estate. In both instances, it encompasses the transfer of rights held by
one party—the assignor—to another party—the assignee.[1] The details of the assignment determines
some additional rights and liabilities (or duties).
Mistake - (ANSWER)A mistake is an incorrect understanding by one or more parties to a contract and
may be used as grounds to invalidate the agreement. Common law has identified three different types of
mistake in contract: common mistake, mutual mistake, and unilateral mistake.
A common mistake occurs when both parties hold the same mistaken belief of the facts. This is
demonstrated in the case of Bell v. Lever Brothers Ltd.,[48] which established that common mistake can
only void a contract if the mistake of the subject-matter was sufficiently fundamental to render its
identity different from what was contracted, making the performance of the contract impossible.
A mutual mistake occurs when both parties of a contract are mistaken as to the terms. Each believes
they are contracting to something different. The court usually tries to uphold such a mistake if a
Answers |Exam preparation
cooperative - (ANSWER)A business organization owned and operated by a group of individuals for their
mutual benefit
nominal consideration - (ANSWER)small amount of money identified in a written contract when parties
cannot or do not wish to state the amount precisely
restraint - (ANSWER)A human, mechanical, and or physical device that is used with or without the
client's permission to restrict his or her freedom of movement or normal access to a person's body and
is not a usual part of treatment plans indicated by the person's condition or symptoms.
disaffirmance - (ANSWER)The legal avoidance, or setting aside, of a contractual obligation.
commercial paper - (ANSWER)A short-term unsecured debt instrument used by corporations to borrow
money at rates lower than bank rates. CP has maturities from 2 - 270 days; unregulated by the SEC.
Migrant & Seasonal Agricultural Workers - (ANSWER)The Migrant and Seasonal Agricultural Worker
Protection Act (MSPA) regulates the hiring and employment activities of agricultural employers, farm
labor contractors, and associations using migrant and seasonal agricultural workers. The Act prescribes
wage protections, housing and transportation safety standards, farm labor contractor registration
requirements, and disclosure requirements. The Wage and Hour Division administers this law.
The Fair Labor Standards Act (FLSA) exempts agricultural workers from overtime premium pay, but
requires the payment of the minimum wage to workers employed on larger farms (farms employing
more than approximately seven full-time workers. The Act has special child-labor regulations that apply
to agricultural employment; children under 16 are forbidden to work during school hours and in certain
jobs deemed too dangerous. Children employed on their families' farms are exempt from these
regulations. The Wage and Hour Division administers this law. OSHA also has special safety and health
standards that may apply to agricultural operations.
The Immigration and Nationality Act (INA) requires employers who want to use foreign temporary
workers on H-2A visas to get a labor certificate from the Employment and Training Administration
certifying that there are not sufficient, able, willing and qualified U.S. workers available to do the work.
The labor standards protections of the H-2A program are enforced by The Wage and Hour Division.
,FBLA Business Law Study Guide | 2026/2027 | A+ Grade | Questions and
Answers |Exam preparation
Reasons for Termination - (ANSWER)1)
Consistent incompetence. If an employee just isn't able to do a competent job, and you have given the
employee a reasonable opportunity to succeed, then termination will often be seen as appropriate.
2)
Violation of company policy. If you have established clear, legal, and consistent policies, and the
employee obviously has violated them in a meaningful way, then termination is appropriate. Violation of
antiharassment, discrimination, or confidentiality policies are particularly actionable.
3)
Repeated unexcused absenteeism or tardiness. Your company depends on its employees to show up for
work and perform their jobs. Continual absence or tardiness jeopardizes the ability of an employee to
complete important tasks. If absenteeism or tardiness is continual and unexcused, then termination may
be justified. Be careful to investigate the reason for the absences. If they're the result of a medical
condition, you may need to accommodate that condition, or at least attempt to do so.
4)
Physical violence. If an employee commits or threatens physical violence, you will want to fire him or her
immediately. All employees are entitled to a safe work environment, and employers have a duty to take
reasonable steps to provide for that.
5)
Drugs and alcohol. Depending on the circumstances, being under the influence at the office may be
grounds for immediate suspension or termination. Some companies now offer treatment and
rehabilitation counseling as an alternative to immediate firing. Conditions caused by the use of
prescribed drugs may also require a more tempered response.
6)
Illegal acts. If you find the employee committing illegal acts, such as theft or embezzlement, immediate
termination is justified. Before you fire the accused employee, however, make sure you know all the
facts and have heard the employee's side of the stor
Product Organizational Structure - (ANSWER)Product Organizational Structure
A product organizational structure has managers reporting to the president or head of the company by
product type. Product organizational structures are primarily used by retail companies that have stores
in various cities. However, stores in each city may still need a local human resources or marketing
department to carry out functions locally. For example, a small department store company may have a
, FBLA Business Law Study Guide | 2026/2027 | A+ Grade | Questions and
Answers |Exam preparation
vice president of sporting goods, housewares and general merchandise at the corporate office. One
manager may report to each vice president. However, each manager may oversee the work of one or
more field marketing employees who travel and handle local marketing stores in several states. These
field marketing employees may work for the sporting goods manager one week in League City, Texas,
then do merchandising for the housewares manager another week in the Sugarland, Texas, market.
Contract Steps - (ANSWER)1 Intent
2 Offer
3 Timeframe
4 Obligations
5 Representations
6 Consideration
7 Arbitration
8 Acceptance
Assignment - (ANSWER)An assignment (Latin cessio) is a term used with similar meanings in the law of
contracts and in the law of real estate. In both instances, it encompasses the transfer of rights held by
one party—the assignor—to another party—the assignee.[1] The details of the assignment determines
some additional rights and liabilities (or duties).
Mistake - (ANSWER)A mistake is an incorrect understanding by one or more parties to a contract and
may be used as grounds to invalidate the agreement. Common law has identified three different types of
mistake in contract: common mistake, mutual mistake, and unilateral mistake.
A common mistake occurs when both parties hold the same mistaken belief of the facts. This is
demonstrated in the case of Bell v. Lever Brothers Ltd.,[48] which established that common mistake can
only void a contract if the mistake of the subject-matter was sufficiently fundamental to render its
identity different from what was contracted, making the performance of the contract impossible.
A mutual mistake occurs when both parties of a contract are mistaken as to the terms. Each believes
they are contracting to something different. The court usually tries to uphold such a mistake if a
