BLAW 400 FINAL EXAM PREP UPDATED
ACTUAL QUESTIONS AND CORRECT ANSWERS
Question:
1. A U.S. judge decides a dispute by relying heavily on a prior court decision with similar facts,
treating that earlier decision as binding unless distinguishable. This is most associated with:
Answer:
Common law, because precedent (stare decisis) guides future cases
Question:
2. Which set lists only primary sources of law in the U.S.?
Answer:
Constitution, statutes, administrative regulations, case law
Question:
3. Which citation is most clearly a federal statute?
Answer:
15 U.S.C. § 45
Question:
4. Which citation is most clearly a court case?
Answer:
Johnson v. Metro Co., 55 Cal. 4th 123 (2012)
Question:
5. If a federal statute conflicts with a federal regulation, which generally controls?
Answer:
The statute, because regulations must be authorized by statute
Question:
6. Which pairing is most accurate for internal corporate documents?
Answer:
Articles of Incorporation + Bylaws
Question:
7. Which group is typically responsible for major oversight and high-level governance in a
corporation?
Answer:
Board of Directors
Question:
8. A director makes a decision after reasonable investigation and in good faith, but the decision turns
out badly. The director is most likely protected by the:
Answer:
Business Judgment Rule
, Question:
9. A CEO steers a company contract to a business they secretly own. This most directly violates the
fiduciary duty of:
Answer:
Loyalty
Question:
10. Which best captures the main goal of Sarbanes-Oxley (SOX) in corporate governance?
Answer:
Eliminate all conflicts of interest in all companies
Question:
11. A company argues: "Managers are agents of shareholders, and their main responsibility is
maximizing shareholder wealth (while obeying the law)." This is closest to:
Answer:
Shareholder primacy theory
Question:
12. A firm says it will consider stakeholders only when doing so improves long-term shareholder
returns. This best matches which version of stakeholder capitalism?
Answer:
Instrumental
Question:
13. A company considers hiding a legal-but-known safety risk to protect profit. Which ethical
approach most strongly says "disclose because you have a duty/obligation," even if profit drops?
Answer:
Deontology (rights & duties)
Question:
14. A manager lies to customers "just this once" to hit quarterly numbers, arguing "everyone would do
it." Under Kantism, the biggest problem is:
Answer:
The lie treats people as mere tools and fails universalizability
Question:
15. A supervisor asks: "What would an honest, fair professional with integrity do here, consistently?"
This is most aligned with:
Answer:
Virtue ethics
Question:
16. A company follows the law but uses fine-print tactics that predictably confuse customers and
damage trust. Under PBT (Mencius + contract principles), the strongest critique is:
Answer:
"Good faith and fair dealing matter; trust and commitments are central."
ACTUAL QUESTIONS AND CORRECT ANSWERS
Question:
1. A U.S. judge decides a dispute by relying heavily on a prior court decision with similar facts,
treating that earlier decision as binding unless distinguishable. This is most associated with:
Answer:
Common law, because precedent (stare decisis) guides future cases
Question:
2. Which set lists only primary sources of law in the U.S.?
Answer:
Constitution, statutes, administrative regulations, case law
Question:
3. Which citation is most clearly a federal statute?
Answer:
15 U.S.C. § 45
Question:
4. Which citation is most clearly a court case?
Answer:
Johnson v. Metro Co., 55 Cal. 4th 123 (2012)
Question:
5. If a federal statute conflicts with a federal regulation, which generally controls?
Answer:
The statute, because regulations must be authorized by statute
Question:
6. Which pairing is most accurate for internal corporate documents?
Answer:
Articles of Incorporation + Bylaws
Question:
7. Which group is typically responsible for major oversight and high-level governance in a
corporation?
Answer:
Board of Directors
Question:
8. A director makes a decision after reasonable investigation and in good faith, but the decision turns
out badly. The director is most likely protected by the:
Answer:
Business Judgment Rule
, Question:
9. A CEO steers a company contract to a business they secretly own. This most directly violates the
fiduciary duty of:
Answer:
Loyalty
Question:
10. Which best captures the main goal of Sarbanes-Oxley (SOX) in corporate governance?
Answer:
Eliminate all conflicts of interest in all companies
Question:
11. A company argues: "Managers are agents of shareholders, and their main responsibility is
maximizing shareholder wealth (while obeying the law)." This is closest to:
Answer:
Shareholder primacy theory
Question:
12. A firm says it will consider stakeholders only when doing so improves long-term shareholder
returns. This best matches which version of stakeholder capitalism?
Answer:
Instrumental
Question:
13. A company considers hiding a legal-but-known safety risk to protect profit. Which ethical
approach most strongly says "disclose because you have a duty/obligation," even if profit drops?
Answer:
Deontology (rights & duties)
Question:
14. A manager lies to customers "just this once" to hit quarterly numbers, arguing "everyone would do
it." Under Kantism, the biggest problem is:
Answer:
The lie treats people as mere tools and fails universalizability
Question:
15. A supervisor asks: "What would an honest, fair professional with integrity do here, consistently?"
This is most aligned with:
Answer:
Virtue ethics
Question:
16. A company follows the law but uses fine-print tactics that predictably confuse customers and
damage trust. Under PBT (Mencius + contract principles), the strongest critique is:
Answer:
"Good faith and fair dealing matter; trust and commitments are central."
