CBAD 344 Legal Environment of
Business - Exam 4 well answered to
pass
Evan Smith suffered a heart attack in the emergency room of Baptist Memorial Hospital after being given
a dose of penicillin for a sore throat. Smith filed a lawsuit against the attending physician, as well as the
hospital. The hospital did not consider the physician to be its agent or its employee; all physicians who
treated patients at the hospital were considered by the hospital to be independent contractors.
Physicians did not receive any employee benefits from the hospital, and they were responsible for the
payment of their own taxes on the income that they earned from the hospital. The court most likely
found that the hospital was: - correct answer ✔✔liable for Smith's claim, because an agency between
the physician and the hospital had been created by estoppel.
Cody contracts with Drew to act as her agent in a fraudulent marketing scheme. Cody does not
successfully complete the scheme. Drew can recover from Cody for:
A. breach of contract.
B. breach of implied warranty.
C. breach of the duty of performance.
D. none of these. - correct answer ✔✔D. none of these.
(T/F) Apparent authority exists if a principal causes a third party to believe reasonably that an agent has
authority to act. - correct answer ✔✔True
Quick Supplies Company (QSC) requires its customers to pay by check. Ron, a QSC driver, tells customers
on his route that they can pay him with cash. When QSC learns of Ron's collections, it takes no action to
stop it. Ron steals some of the cash. QSC may suffer the loss under the doctrine of: - correct answer
✔✔apparent authority.
Lyn may hire employees to work in the Main St. Computer Store that she manages despite the fact that
her employment agreement with Main St. says nothing about her being able to hire employees. This is: -
correct answer ✔✔implied authority.
, Prospective Enterprises (PE) employs Quinn to buy property for a possible commercial development.
Quinn secretly buys some of the property and sells it to PE at a profit. Quinn has breached: - correct
answer ✔✔the duty of loyalty.
(T/F) An employer who hires and fires workers according to a fair seniority system may have a good
defense to an employment discrimination suit. - correct answer ✔✔True
L visas: - correct answer ✔✔allow a company's foreign managers or executives to work inside the United
States.
Harrison runs a construction company working on a federal government construction project. Under the
Davis-Bacon Act, Harrison must pay his employees: - correct answer ✔✔"prevailing wages."
The Age Discrimination in Employment Act:
A. is not widely enforced by American courts.
B. covers business activities that affect intrastate commerce.
C. prohibits employment discrimination on the basis of age against individuals aged 35 or older.
D. applies to all U.S. businesses. - correct answer ✔✔B. covers business activities that affect intrastate
commerce.
Phil, using the credit card of Vivian, his wife, buys a box of motor oil worth $48.99. Vivian is liable to pay
for his purchase based on agency by: - correct answer ✔✔operation of law.
All of the following can be a bona fide occupational qualification except:
A. national origin.
B. religion.
C. gender.
D. race. - correct answer ✔✔race.
Cora, a female, and Dom, a male, are employees of Equipment Leasing Corporation. Cora regularly e-
mails sexually explicit images to Dom via Equipment Leasing's computer network. Dom finds this
offensive. This is: - correct answer ✔✔hostile-environment harassment.
Business - Exam 4 well answered to
pass
Evan Smith suffered a heart attack in the emergency room of Baptist Memorial Hospital after being given
a dose of penicillin for a sore throat. Smith filed a lawsuit against the attending physician, as well as the
hospital. The hospital did not consider the physician to be its agent or its employee; all physicians who
treated patients at the hospital were considered by the hospital to be independent contractors.
Physicians did not receive any employee benefits from the hospital, and they were responsible for the
payment of their own taxes on the income that they earned from the hospital. The court most likely
found that the hospital was: - correct answer ✔✔liable for Smith's claim, because an agency between
the physician and the hospital had been created by estoppel.
Cody contracts with Drew to act as her agent in a fraudulent marketing scheme. Cody does not
successfully complete the scheme. Drew can recover from Cody for:
A. breach of contract.
B. breach of implied warranty.
C. breach of the duty of performance.
D. none of these. - correct answer ✔✔D. none of these.
(T/F) Apparent authority exists if a principal causes a third party to believe reasonably that an agent has
authority to act. - correct answer ✔✔True
Quick Supplies Company (QSC) requires its customers to pay by check. Ron, a QSC driver, tells customers
on his route that they can pay him with cash. When QSC learns of Ron's collections, it takes no action to
stop it. Ron steals some of the cash. QSC may suffer the loss under the doctrine of: - correct answer
✔✔apparent authority.
Lyn may hire employees to work in the Main St. Computer Store that she manages despite the fact that
her employment agreement with Main St. says nothing about her being able to hire employees. This is: -
correct answer ✔✔implied authority.
, Prospective Enterprises (PE) employs Quinn to buy property for a possible commercial development.
Quinn secretly buys some of the property and sells it to PE at a profit. Quinn has breached: - correct
answer ✔✔the duty of loyalty.
(T/F) An employer who hires and fires workers according to a fair seniority system may have a good
defense to an employment discrimination suit. - correct answer ✔✔True
L visas: - correct answer ✔✔allow a company's foreign managers or executives to work inside the United
States.
Harrison runs a construction company working on a federal government construction project. Under the
Davis-Bacon Act, Harrison must pay his employees: - correct answer ✔✔"prevailing wages."
The Age Discrimination in Employment Act:
A. is not widely enforced by American courts.
B. covers business activities that affect intrastate commerce.
C. prohibits employment discrimination on the basis of age against individuals aged 35 or older.
D. applies to all U.S. businesses. - correct answer ✔✔B. covers business activities that affect intrastate
commerce.
Phil, using the credit card of Vivian, his wife, buys a box of motor oil worth $48.99. Vivian is liable to pay
for his purchase based on agency by: - correct answer ✔✔operation of law.
All of the following can be a bona fide occupational qualification except:
A. national origin.
B. religion.
C. gender.
D. race. - correct answer ✔✔race.
Cora, a female, and Dom, a male, are employees of Equipment Leasing Corporation. Cora regularly e-
mails sexually explicit images to Dom via Equipment Leasing's computer network. Dom finds this
offensive. This is: - correct answer ✔✔hostile-environment harassment.
