APPENDIX
LEARNING OUTCOMES
1. How does the legal system govern business transactions and settle business
disputes?
Laws are the rules governing a society’s conduct that are created and enforced by a
controlling authority. The U.S. court system governs the legal system and includes
both federal and state courts, each organized into three levels. The courts settle
disputes by applying and interpreting laws. Most cases start in trial courts.
Decisions can be appealed to appellate courts. The U.S. Supreme Court is the
nation’s highest court and the court of final appeal. To avoid the high costs of going
to court, many firms now use private arbitration or mediation as alternatives to
litigation.
2. What are the required elements of a valid contract; and what are the key types of
business law?
A contract is an agreement between two or more parties that meets five
requirements: mutual assent, capacity, consideration, legal purpose, and legal form.
If one party breaches the contract terms, the remedies are damages, specific
performance, or restitution. Tort law settles disputes involving civil acts that harm
, people or their property. Torts include physical injury, mental anguish, and
defamation. Product-liability law governs the responsibility of manufacturers and
sellers for product defects. Bankruptcy law gives businesses or individuals who
cannot meet their financial obligations a way to be relieved of their debts. Some
laws are designed to keep the marketplace free from influences that would restrict
competition such as price fixing and deceptive advertising. Laws protecting
consumer rights are another important area of government control.
3. What are the most common taxes paid by businesses?
Income taxes are based on the income received by businesses and individuals.
Congress determines the income taxes that are to be paid to the federal government.
In addition to income taxes, individuals and businesses also pay property taxes
(assessed on real and personal property), payroll taxes (the employer’s share of
Social Security taxes and federal and state unemployment taxes), sales taxes (levied
on goods), and excise taxes (levied against specific products such as gasoline,
alcoholic beverages, and tobacco).
APPENDIX
I. Understanding the Legal Environment > Learning Outcome 1
,The smooth function of society depends on the law, which
protects the rights of people and businesses. Laws are rules
governing a society’s conduct that are created and enforced by a
controlling authority.
The Main Sources of Law
The legal system in the United States are the result of a long and
continuing process and consists of many types of law.
Common law is the body of unwritten law that has evolved out of
judicial decisions rather than being enacted by legislatures.
Statutory law is written law enacted by a legislature (local, state,
or federal). Administrative law refers to rules, regulations, and
orders passed by boards, commissions, and agencies of
government (local, state, and federal). Business law is the body of
law that governs commercial dealings. These laws provide a
protective environment within which businesses can operate.
, Lecture Tidbit: Common law derives from the doctrine of state decisis (Latin for
to stand by decisions). State decisis means judges’ decisions establish a
precedent for deciding future cases of a similar nature. In other words, that
decision becomes the example for future cases.
Source: Oyen, Timothy. “Stare Decisis.” LII / Legal Information Institute, Legal
Information Institute, 5 June 2017, www.law.cornell.edu/wex/stare_decisis.
The Court System
The judiciary branch of government is responsible for settling
disputes by applying and interpreting points of law. The U.S. court
system includes both state and federal courts, each organized into
three levels.
A. Trial Courts
Trial courts are the lowest level of courts, where most cases
begin. Trail courts are also called courts of general
LEARNING OUTCOMES
1. How does the legal system govern business transactions and settle business
disputes?
Laws are the rules governing a society’s conduct that are created and enforced by a
controlling authority. The U.S. court system governs the legal system and includes
both federal and state courts, each organized into three levels. The courts settle
disputes by applying and interpreting laws. Most cases start in trial courts.
Decisions can be appealed to appellate courts. The U.S. Supreme Court is the
nation’s highest court and the court of final appeal. To avoid the high costs of going
to court, many firms now use private arbitration or mediation as alternatives to
litigation.
2. What are the required elements of a valid contract; and what are the key types of
business law?
A contract is an agreement between two or more parties that meets five
requirements: mutual assent, capacity, consideration, legal purpose, and legal form.
If one party breaches the contract terms, the remedies are damages, specific
performance, or restitution. Tort law settles disputes involving civil acts that harm
, people or their property. Torts include physical injury, mental anguish, and
defamation. Product-liability law governs the responsibility of manufacturers and
sellers for product defects. Bankruptcy law gives businesses or individuals who
cannot meet their financial obligations a way to be relieved of their debts. Some
laws are designed to keep the marketplace free from influences that would restrict
competition such as price fixing and deceptive advertising. Laws protecting
consumer rights are another important area of government control.
3. What are the most common taxes paid by businesses?
Income taxes are based on the income received by businesses and individuals.
Congress determines the income taxes that are to be paid to the federal government.
In addition to income taxes, individuals and businesses also pay property taxes
(assessed on real and personal property), payroll taxes (the employer’s share of
Social Security taxes and federal and state unemployment taxes), sales taxes (levied
on goods), and excise taxes (levied against specific products such as gasoline,
alcoholic beverages, and tobacco).
APPENDIX
I. Understanding the Legal Environment > Learning Outcome 1
,The smooth function of society depends on the law, which
protects the rights of people and businesses. Laws are rules
governing a society’s conduct that are created and enforced by a
controlling authority.
The Main Sources of Law
The legal system in the United States are the result of a long and
continuing process and consists of many types of law.
Common law is the body of unwritten law that has evolved out of
judicial decisions rather than being enacted by legislatures.
Statutory law is written law enacted by a legislature (local, state,
or federal). Administrative law refers to rules, regulations, and
orders passed by boards, commissions, and agencies of
government (local, state, and federal). Business law is the body of
law that governs commercial dealings. These laws provide a
protective environment within which businesses can operate.
, Lecture Tidbit: Common law derives from the doctrine of state decisis (Latin for
to stand by decisions). State decisis means judges’ decisions establish a
precedent for deciding future cases of a similar nature. In other words, that
decision becomes the example for future cases.
Source: Oyen, Timothy. “Stare Decisis.” LII / Legal Information Institute, Legal
Information Institute, 5 June 2017, www.law.cornell.edu/wex/stare_decisis.
The Court System
The judiciary branch of government is responsible for settling
disputes by applying and interpreting points of law. The U.S. court
system includes both state and federal courts, each organized into
three levels.
A. Trial Courts
Trial courts are the lowest level of courts, where most cases
begin. Trail courts are also called courts of general
