Ethics vs. Law in Business
Which principle guides behavior based on right and wrong in business, often influencing but not necessarily governed by law?
Ethics
What is the first step in resolving a legal dispute?
negotiation
A company chooses to disclose a potential environmental hazard even though it’s not legally required. What ethical principle does this show?
transparency
If a company falsifies financial records, it can face charges of fraud. What is the legal term for this kind of crime?
corporate fraud
A 16-year-old named Alex buys a used car for $5,000 with his own money. After a month, he decides he no longer wants the car and wants to return it. Can he legally cancel the contract?
yes, Alex can legally cancel the contract because he is a minor and has the right to disaffirm contracts before reaching the age of majority
Which of these describes rules established by a governing body that are enforced by the legal system?
Law
Which process involves a third-party mediator helping both parties find a solution without going to court?
mediation
What is the ethical responsibility of a business when it comes to handling confidential customer information?
privacy and confidentiality
What legal term describes the act of misleading consumers by providing false or deceptive information about a product?
false advertising
Mia, who is 17, enters into a contract to purchase a new laptop for $1,200. After she turns 18, she decides she wants to cancel the contract. Can she legally do so now that she is an adult?
no, once Mia reaches the age of majority, the contract is no longer voidable and becomes legally binding
A business may legally exploit a loophole in a contract, but it may violate ethical standards. What is this an example of?
ethics and law
In which stage of a lawsuit does a judge decide whether to dismiss the case or allow it to proceed?
pretrial motion
A business is aware that its product is slightly defective but continues to sell it without informing customers. Which ethical principle is the company violating?
honesty or transparency
If a business violates antitrust laws by unfairly limiting competition, which legal consequence might they face?
fine or lawsuit
Noah, a 15-year-old, signs a contract to join a gym. After attending for two months, he decides he no longer wants to go to the gym and asks to cancel the contract. Can the gym enforce the contract?
no, Noah can disaffirm the contract because he is a minor, and the gym cannot enforce the contract unless Noah chooses to ratify it after reaching the age of majority
If a company chooses to pay workers above the minimum wage, even though not required by law, which concept is it following?
ethical behavior
Which process is used when a judge or jury makes a final decision after hearing both sides of a case in court?
litigation
A company decides to pay its workers above the minimum wage, even though it is not legally required. What ethical principle is the company following by doing this?
fairness or social responsibility
What is the term for a business being legally required to compensate for harm caused by its unethical actions?
damages or restitution
Sarah, a 14-year-old, buys a video game console with her own money but later regrets the purchase. Can she return the console and get her money back from the store?
yes, Sarah can return the console and get her money back because, as a minor, she can void the contract and reclaim her money, provided she does so before reaching the age of majority