Chapter 01
Law as the Foundation of Business
True / False Questions
1. Law and "rule of law" are synonymous terms.
True False
2. The first known written set of laws was the Code of Hammurabi.
True False
3. Rule-of-law nations adopt laws supporting the private market because it is in
everyone's interest, including the lawmakers'.
True False
4. Common property, applies to public resources owned by the government (or
"state") like roads, public buildings, public lands, and monuments.
True False
5. Contract law compensates owners whose resources are wrongfully harmed
by the actions of others.
True False
6. The secret to economic prosperity and the wealth of nations lies in the
foundation of property law and the legal system to implement it under the rule
of law.
True False
,7. Jurisprudence is the rule of law.
True False
8. Natural law theory asserts that law contains universal moral principles.
True False
9. Sociological jurisprudence emphasizes that contemporary law should focus
on legal principles that have withstood the test of time in a nation.
True False
10. Jurisprudence refers to the general body of law interpretations by judges as
different from legislation passed by legislators.
True False
11. Legal realism is the idea that courts should understand the meaning of the
Constitution relative to the times in which they interpret it.
True False
12. The United Kingdom, the United States, Canada, Jamaica, India, Nigeria,
New Zealand, and a few other countries—all colonized by England—follow
the common law.
True False
13. Civil law arose in the eleventh and twelfth centuries as the English monarch
appointed royal judges to ride circuits around the English countryside and to
resolve disputes in the name of the king (or queen).
True False
14. Louisiana is the only state in the U.S. that follows a partial civil law system
due to Louisiana's historical ties with France, a civil law nation.
True False
,15. Common law relies more on legislation than judicial decisions to determine
what the law is.
True False
16. In administrative law, a government official represents society, or "the
people," and the official is responsible for seeking justice to achieve the ends
of society.
True False
17. Although property law is categorized as one kind of private law; in our legal
system, it is at the heart of both public and private law.
True False
18. Contract law often but not always requires actual injury to the owner's
resources.
True False
19. Legislation passed by the Congress is called a statute or an act.
True False
20. The Second Amendment to the Constitution holds that "No State shall . . .
deprive any person of life, liberty or property without due process of law."
True False
21. Disadvantages of case law do not destroy the benefits of certainty,
predictability, and stability provided by case law and stare decisis.
True False
22. Judges in future cases are not so likely to follow the dicta in prior cases as
they are the holdings.
True False
, 23. Conflicting precedents when applying the principle of stare decisis do not
create confidence in the certainty of law.
True False
24. With reference to the hierarchy of sources of law, Case law prevails over local
ordinances.
True False
25. The Fourteenth Amendment to the Constitution recognizes that the law is
enforced by taking a person's life, freedom, or the resources that he or she
owns.
True False
26. Whether it's stated in the contract or not, when a breach of contract occurs,
the injured party will usually recover her attorney fees as part of her
compensatory damages.
True False
27. The single largest number of lawsuits today, especially in the federal courts,
involves one business suing another business for tortious conduct.
True False
28. Tort law helps protect property boundaries by providing compensation when
someone wrongfully crosses such boundaries.
True False
29. In addition to compensatory damages, breach-of-contract cases may award
punitive damages, when the breaching party knew or had reason to know that
special circumstances existed that would cause the other party to suffer
additional losses if the contract were breached.
True False
Law as the Foundation of Business
True / False Questions
1. Law and "rule of law" are synonymous terms.
True False
2. The first known written set of laws was the Code of Hammurabi.
True False
3. Rule-of-law nations adopt laws supporting the private market because it is in
everyone's interest, including the lawmakers'.
True False
4. Common property, applies to public resources owned by the government (or
"state") like roads, public buildings, public lands, and monuments.
True False
5. Contract law compensates owners whose resources are wrongfully harmed
by the actions of others.
True False
6. The secret to economic prosperity and the wealth of nations lies in the
foundation of property law and the legal system to implement it under the rule
of law.
True False
,7. Jurisprudence is the rule of law.
True False
8. Natural law theory asserts that law contains universal moral principles.
True False
9. Sociological jurisprudence emphasizes that contemporary law should focus
on legal principles that have withstood the test of time in a nation.
True False
10. Jurisprudence refers to the general body of law interpretations by judges as
different from legislation passed by legislators.
True False
11. Legal realism is the idea that courts should understand the meaning of the
Constitution relative to the times in which they interpret it.
True False
12. The United Kingdom, the United States, Canada, Jamaica, India, Nigeria,
New Zealand, and a few other countries—all colonized by England—follow
the common law.
True False
13. Civil law arose in the eleventh and twelfth centuries as the English monarch
appointed royal judges to ride circuits around the English countryside and to
resolve disputes in the name of the king (or queen).
True False
14. Louisiana is the only state in the U.S. that follows a partial civil law system
due to Louisiana's historical ties with France, a civil law nation.
True False
,15. Common law relies more on legislation than judicial decisions to determine
what the law is.
True False
16. In administrative law, a government official represents society, or "the
people," and the official is responsible for seeking justice to achieve the ends
of society.
True False
17. Although property law is categorized as one kind of private law; in our legal
system, it is at the heart of both public and private law.
True False
18. Contract law often but not always requires actual injury to the owner's
resources.
True False
19. Legislation passed by the Congress is called a statute or an act.
True False
20. The Second Amendment to the Constitution holds that "No State shall . . .
deprive any person of life, liberty or property without due process of law."
True False
21. Disadvantages of case law do not destroy the benefits of certainty,
predictability, and stability provided by case law and stare decisis.
True False
22. Judges in future cases are not so likely to follow the dicta in prior cases as
they are the holdings.
True False
, 23. Conflicting precedents when applying the principle of stare decisis do not
create confidence in the certainty of law.
True False
24. With reference to the hierarchy of sources of law, Case law prevails over local
ordinances.
True False
25. The Fourteenth Amendment to the Constitution recognizes that the law is
enforced by taking a person's life, freedom, or the resources that he or she
owns.
True False
26. Whether it's stated in the contract or not, when a breach of contract occurs,
the injured party will usually recover her attorney fees as part of her
compensatory damages.
True False
27. The single largest number of lawsuits today, especially in the federal courts,
involves one business suing another business for tortious conduct.
True False
28. Tort law helps protect property boundaries by providing compensation when
someone wrongfully crosses such boundaries.
True False
29. In addition to compensatory damages, breach-of-contract cases may award
punitive damages, when the breaching party knew or had reason to know that
special circumstances existed that would cause the other party to suffer
additional losses if the contract were breached.
True False
