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MGMT |! 271 |! Final |! exam |! Randy |!
Doucet |! All |! questions |! with |! precise |!
detailed |! answers
to |! start |! a |! business |! you |! need |! - |! Correct |! answer |! ✔
- |! Business |! plan |! / |! marketing |! plan. |!
- |! Business |! location, |! address, |! contact |! information |! 3. |! Determine |! the |! best |! business |! organization |! type. |! Consider |! consulting |! an |! attorney |! and |! accountant. |!
- |! Research |! city/county |! requirements: |! licenses, |! inspections |!
- |! If |! there |! are |! employees |! obtain |! an |! Employer |! Identification |! Number |! (EIN) |! from |! the |! IRS |!
- |! Obtain |! a |! Master |! Business |! License |! from |! the |! WA |! State |! Dept. |! of |! Licensing |!
- |! Business |! banking |!
- |! Insurance |!
- |! Taxes |! - |! sales |! tax, |! excise |! tax |! - |! WA |! Dept. |! of |! Revenue Main |! factors |! for |! choosing |! a |! business |! organization |! - |! Correct |! answer |! ✔
- A. |! Legal |! status |! of |! the |! business |! with |! respect |! to |! ownership |! •B. |! Creation |! •C. |! Control |! and |! compensation |! •D. |! Liability |!
•E. |! Taxation |! •F. |! Duration Sole |! Proprietorship |! - |! Correct |! answer |! ✔•1. |! No |! legal |! distinction |! between |! business |! and |! owner. |! •2. |! Easy |! to |! create |! with |! few |! formalities. |! Can |! be |! formed |! by |! an |! individual |! or |! married |! couple. |! •3. |! Can |! use |! own |! name, |! or |! a |! trade |! name. |! Ex. |! Jan |! Baker, |! dba, |! The |! Little |! Donut |! Shop. |! •4. |! Control |! and |! compensation. |! Owner |! has |! complete |! control |! of |! business. |! Compensation |! comes |! from |! profits. |! •5. |! Liability |! is |! directly |! with |! owner |! and |! unlimited. |! •6. |! Taxation. |! Owner |! is |! taxed |! on |! income |! generated. |! •7. |! Duration |! is |! until |! owner |! dies, |! retires |! or |! transfers |! ownership. |! Debts |! remain |! with |! owner, |! unless |! creditors |! agree |! to |! a |! release |! from |! liability. Partnership |! - |! Correct |! answer |! ✔1.Composed |! of |! two |! or |! more |! persons |! who |! contribute |! money, |! labor, |! and |! skill |! to |! a |! business. |! 2.Partners |! share |! profits, |! losses, |! and |! management |! of |! the |! business. |! Each |! partner |! is |! personally |! and |! equally |! liable |! for |! debts |! of |! the |! partnership. |! 3.Revised |! Uniform |! Partnership |! Act |! applies |! in |! WA |! 4.Partnership |! is |! a |! contractual |! relationship, |! and |! the |! three |! methods |! of |! creating |! a |! contract |! apply |! (expressly, |! impliedly, |! apparently). express |! partnership |! - |! Correct |! answer |! ✔Partners |! expressly |! agree |! to |! form |! a |! partnership. |! Partnership |! agreement |! should |! be |! in |! writing, |! but |! not |! required.
•General |! partners |! manage |! the |! business |! and |! share |! profits |! and |! losses. |! Limited |! partners |! share |! profits |! of |! the |! business, |! but |! their |! losses |! are |! limited |! to |! the |! extent |! of |! their |! investment. |! •Limited |! partners |! usually |! not |! involved |! in |! day-to-day |! operations |! of |! the |! business. |! •Must |! file |! a |! certificate |! of |! limited |! partnership |! with |! state. |! •Must |! contain |! words |! "limited |! partnership" |! in |! business |! name |! •No |! liability |! for |! limited |! partners, |! if |! they |! are |! not |! actively |! involved |! in |! running |! the |! business Limited |! partnership |! liability |! - |! Correct |! answer |! ✔General |! partners |! are |! personally |! liable |! (who |! may |! be |! corporations) Limited |! partnership |! taxation |! - |! Correct |! answer |! ✔is |! like |! a |! partnership, |! partners |! are |! taxed |! on |! income |! from |! the |! partnership. Limited |! partnership |! durration |! - |! Correct |! answer |! ✔Limited |! partners |! are |! passive |! investors |! and |! may |! sell |! their |! interests. |! General |! partners |! can |! withdraw |! like |! in |! a |! partnership. LLC |! (limited |! liability |! company) |! - |! Correct |! answer |! ✔•Authorized |! in |! Washington |! •Advantages |! of |! insulation |! from |! liability |! like |! a |! corporation |! and |! the |! tax |! treatment |! of |! a |! partnership. |! •Formed |! by |! one |! or |! more |! individuals |! or |! entities |! through |! a |! written |! agreement. |! •The |! LLC |! agreement |! provides |! for |! organization |! of |! the |! LLC, |! management, |! assigns |! interests, |! and |! distribution |! of |! profits |! or |! losses. |!
•Must |! include |! "LLC" |! in |! title |! of |! business. |! •Can |! be |! used |! for |! any |! lawful |! for-profit |! business, |! except |! insurance |! and |! banking coorporation |! - |! Correct |! answer |! ✔•A |! corporation |! has |! certain |! rights, |! privileges, |! and |! liabilities |! beyond |! those |! of |! an |! individual. |! It |! is |! a |! separate |! legal |! entity |! from |! the |! owners. |! •Doing |! business |! as |! a |! corporation |! may |! yield |! tax |! or |! financial |! benefits, |! but |! these |! can |! be |! offset |! by |! other |! considerations, |! such |! as |! decreased |! personal |! control. |! •Corporations |! may |! be |! for |! profit |! or |! nonprofit |! purposes. coorporation |! creation |! - |! Correct |! answer |! ✔File |! articles |! of |! incorporation. corporation |! capitalization |! - |! Correct |! answer |! ✔equity |! financing |! and |! debt |! financing. Corporation |! control |! - |! Correct |! answer |! ✔Three |! groups |! involved |! in |! control: |! •(1) |! shareholders, |! (2) |! directors, |! and |! (3) |! officers. Rights |! of |! Shareholders |! - |! Correct |! answer |! ✔•vote |! for |! directors, |! •vote |! on |! extraordinary |! corporate |! transactions, |! •inspect |! corporate |! records, |! See |! Pillsbury |! v |! Honeywell |! •bring |! a |! derivative |! suit, |! See |! Shlensky |! v |! Wrigley |! •preemptive |! rights |! to |! issuance |! of |! new |! shares, |! •right |! to |! dividends, |! and |! •right |! to |! fair |! share |! of |! assets |! on |! liquidation.
Duration |! of |! Corporation |! - |! Correct |! answer |! ✔Perpetual Piercing |! the |! corporate |! veil |! - |! Correct |! answer |! ✔Piercing |! the |! corporate |! veil |! allows |! creditors |! to |! seek |! remedies |! (money) |! from |! the |! shareholders |! personally. |! More |! likely |! in |! closely-held |! corporations |! than |! publicly |! held |! corporations. Fraudulent |! Corporations |! - |! Correct |! answer |! ✔corporate |! form |! being |! used |! for |! a |! dishonest |! purpose, |! ex. |! Dummy |! corporations |! - |! intentionally |! undercapitalized |! to |! avoid |! liability. Co-Mingling |! - |! Correct |! answer |! ✔combine |! corporate |! money |! with |! shareholders |! (closely-held |! corporations) Mere-instrumentality |! rule |! - |! Correct |! answer |! ✔Shell |! or |! dummy |! corporations |! which |! may |! be |! set |! up |! by |! a |! larger |! corporation |! that |! do |! not |! fulfill |! usual |! corporate |! formalities, |! such |! as |! meetings, |! minutes, |! etc. |! will |! not |! be |! recognized |! as |! separately |! existing. •Failure |! to |! Follow |! Corporate |! Formalities |! - |! Correct |! answer |! ✔no |! meetings, |! no |! minutes, |! use |! of |! corporate |! assets |! for |! personal |! use, |! etc. Professionalism |! - |! Correct |! answer |! ✔is |! how |! we |! should |! conduct |! ourselves |! in |! the |! workplace.
environmental |! law |! - |! Correct |! answer |! ✔Laws |! that |! protect |! the |! environment |! and |! human |! health |! by |! regulating |! pollution |! and |! development. |! Two |! Purposes: |!
- |! Pollution |! control |! and |! remediation. |!
- |! Preservation |! and |! conservation. enviromental |! law |! concerns |! real |! property |! - |! Correct |! answer |! ✔public |! and |! private Three |! areas |! of |! common |! law |! pollution |! control |! - |! Correct |! answer |! ✔•1. |! Negligence |! • 2. |! Trespass |! • 3. |! Nuisance come |! to |! the |! nuisance |! - |! Correct |! answer |! ✔defense |! to |! nuisance |! claim |! when |! one |! knows |! of |! a |! foreseeable |! nuisance |! in |! an |! area, |! but |! still |! chooses |! to |! build |! or |! reside |! in |! that |! area. Limitations |! on |! Effectiveness |! of |! Common-Law |! pollution |! remedies |! - |! Correct |! answer |! ✔•1. |! Balancing |! of |! interests. |! This |! was |! the |! problem |! in |! the |! Boomercase. |! •2. |! Standing |! to |! sue. |! The |! plaintiff |! must |! be |! specifically |! (directly) |! harmed |! to |! have |! standing |! to |! sue. |! May |! not |! have |! standing |! to |! sue |! for |! public |! nuisance |! of |! general |! environmental |! degradation. |! • |! 3. |! Finding |! a |! Defendant. |! May |! be |! impossible |! to |! find |! the |! specific |! defendant |! when |! many |! companies |! are |! polluting |! air |! or |! water. |! •4. |! Remedial |! Effect |! Only. |! Common |! law |! remedies |! are |! after |! the |! injury, |! when |! it |! would |! be |! more |! preferable |! to |! prevent |! the |! injury |! from |! occurring.
National |! Environmental |! Policy |! Act |! - |! 1969 |! - |! Correct |! answer |! ✔•Established |! the |! national |! charter |! for |! the |! protection |! of |! the |! environment. |! Sets |! environmental |! policy |! goals |! and |! provides |! the |! means |! to |! carry |! out |! national |! environmental |! policies. |! •Federal |! actions |! are |! to |! take |! the |! environment |! into |! account. Environmental |! Impact |! Statements |! - |! Correct |! answer |! ✔provide |! public |! disclosure |! of |! the |! environmental |! impact |! of |! any |! federal |! action |! significantly |! affecting |! the |! quality |! of |! the |! human |! environment. Environmental |! Protection |! Agency |! (EPA) |! - |! 1970 |! - |! Correct |! answer |! ✔•EPA |! created |! in |! 1970 |! to |! research, |! set |! standards, |! monitor |! and |! enforce |! environmental |! regulations. |! • EPA |! (1) |! helps |! establish |! national |! environmental |! policy, |! (2) |! regulates |! clean |! water |! standards, |! (3) |! regulates |! clean |! air |! standards, |! and |! (4) |! regulates |! solid-waste |! disposal |! standards. Endangered |! Species |! Act |! - |! 1973 |! - |! Correct |! answer |! ✔•Protects |! endangered |! plant |! life, |! animals |! and |! habitats |! •The |! law |! prohibits |! "taking" |! of |! any |! species |! listed |! as |! an |! endangered |! species |! by |! the |! United |! States |! Fish |! and |! Wildlife |! Services. |! •The |! federal |! power |! to |! protect |! endangered |! species |! applies |! to |! private |! property. Protecting |! Water |! - |! Correct |! answer |! ✔•1. |! Safe |! Drinking |! Water |! Act |! - |! 1974 |! •2. |! Clean |! Water |! Act |! - |! 1977 |! •3. |! Wetlands |! Protection
Safe |! Drinking |! Water |! Act |! - |! 1974 |! - |! Correct |! answer |! ✔Establishes |! drinking |! water |! standards |! for |! tap |! water |! safety, |! and |! requires |! rules |! for |! groundwater |! protection |! from |! underground |! injection; |! amended |! in |! 1986 |! and |! 1996. |! The |! 1996 |! amendments |! added |! a |! fund |! to |! pay |! for |! water |! system |! upgrades, |! revised |! standard: |! setting |! requirements, |! required |! new |! standards |! for |! common |! contaminants, |! and |! included |! public |! "right |! to |! know" |! requirements |! to |! inform |! consumers |! about |! their |! tap |! water. Clean |! Water |! Act |! - |! 1977 |! - |! Correct |! answer |! ✔•Expanded |! EPAs |! authority |! to |! regulate |! discharge |! of |! pollutants |! in |! water. |! •EPA |! sets |! waste |! water |! standards |! for |! industry. |! •Made |! it |! unlawful |! to |! discharge |! any |! pollutant |! into |! navigable |! waters, |! unless |! by |! permit. Wetland |! Protection |! - |! Correct |! answer |! ✔Swampbuster, |! protects |! wetlands |! from |! development. Protecting |! Air |! - |! Correct |! answer |! ✔Clean |! Air |! Act |! - |! 1970 Clean |! Air |! Act |! - |! 1970 |! - |! Correct |! answer |! ✔•Regulates |! air |! emissions |! from |! stationary |! and |! mobile |! sources. |! •Authorized |! EPA |! to |! establish |! air |! quality |! standards |! to |! protect |! the |! public |! health |! and |! environment. Clean |! Solid-Waste |! Disposal |! - |! Correct |! answer |! ✔Resource |! Conservation |! and |! Recovery |! Act |! of |! 1976
•2. |! prove |! that |! it |! was |! unreasonable "Per |! Se" |! Illegal |! - |! Correct |! answer |! ✔•1. |! Horizontal |! Price |! Fixing •2. |! Horizontal |! Division |! of |! Territory •3. |! Horizontal |! Group |! Boycotts •4. |! Bid |! Rigging Horizontal |! Price |! Fixing |! - |! Correct |! answer |! ✔Agreement |! between |! competitors |! to |! set |! the |! price |! of |! a |! product |! or |! service. |! Distorts |! competition |! and |! competitive |! pricing. Horizontal |! Division |! of |! Territory |! - |! Correct |! answer |! ✔Competitors |! agree |! to |! divide |! territories. |! Distorts |! competition, |! customers |! only |! have |! one |! supplier |! of |! a |! good |! or |! service. Horizontal |! Group |! Boycotts |! - |! Correct |! answer |! ✔Competing |! sellers |! prohibited |! from |! agreeing |! among |! themselves |! to |! boycott |! certain |! customers |! or |! resellers. |! Distorts |! competition |! by |! restricting |! goods |! or |! services |! available |! to |! consumers. Bid |! Rigging |! - |! Correct |! answer |! ✔Two |! or |! more |! companies |! agree |! to |! set |! bid |! prices |! to |! avoid |! competitive |! bidding. |! Distorts |! competition |! and |! competitive |! pricing. Vertical |! Marketing |! Relations |! violations |! occur |! when: |! - |! Correct |! answer |! ✔(1) |! manufacturers |! restrain |! the |! freedom |! of |! resellers |! to |! distribute |! its |! products |!
•(2) |! restriction |! on |! the |! freedom |! of |! buyers |! to |! purchase |! the |! product Prohibited |! Practices |! - |! Correct |! answer |! ✔•Vertical |! Price |! Fixing |! (Resale |! Price |! Maintenance) •Supplier |! and |! buyer |! agree |! to |! prices |! at |! which |! goods |! will |! be |! resold. |! •Manufacturer |! may |! want |! to |! maintain |! a |! certain |! price |! to |! keep |! up |! the |! exclusiveness |! of |! a |! product. |! •The |! rule |! of |! reason |! is |! applied |! to |! determine |! if |! a |! violation |! has |! occurred. Tying |! Contracts |! - |! Correct |! answer |! ✔restrain |! consumer |! purchasing |! by |! requiring |! consumers |! to |! buy |! additional |! products |! as |! part |! of |! a |! package |! when |! the |! consumer |! only |! wants |! to |! buy |! one |! product. Rule |! of |! reason |! applies |! to |! tying |! contracts. |! Supreme |! Court |! recognized |! that |! tying |! contracts |! are |! not |! per-se |! illegal. |! See |! Jefferson |! Parish |! Hospital |! District |! #2 |! v. |! Hyde. Tying |! contracts |! in |! franchises |! - |! Correct |! answer |! ✔•Tying |! contracts |! in |! franchises |! occur |! when |! a |! franchisor |! requires |! the |! franchisee |! to |! purchase |! products |! exclusively |! from |! the |! franchisor. |! •Apply |! the |! rule |! of |! reason. |! •Consider |! the |! following |! cases: |! •Susser |! v. |! Carvel |! Corp. |! •Siegal |! v. |! Chicken |! Delight |! •Principe |! v. |! McDonald's |! Corp.
Courts |! apply |! the |! rule |! of |! reason |! to |! the |! following |! mergers: |! •A) |! horizontal |! merger |! •B) |! vertical |! merger |! •C) |! conglomerate |! merger Interlocking |! directorates |! are |! prohibited |! (Section |! 8) |! - |! Correct |! answer |! ✔when |! a |! member |! of |! a |! board |! of |! directors |! is |! also |! on |! the |! board |! of |! a |! competing |! company Enforcement |! of |! Antitrust |! Laws |! - |! Correct |! answer |! ✔•Penalties |! can |! be |! civil |! and |! criminal. |!
- |! Federal |! Government |! - |! Federal |! Trade |! Commission |! and |! the |! U.S |! Department |! of |! Justice |! Antitrust |! Division. |! •2) |! States |! may |! bring |! antitrust |! actions |! on |! behalf |! of |! individuals |! or |! the |! state |! to |! enforce |! federal |! antitrust |! laws |! or |! the |! state's |! antitrust |! laws. |! •3) |! Individuals |! and |! businesses |! may |! bring |! antitrust |! lawsuits. Federal |! Trade |! Commission |! - |! Correct |! answer |! ✔a |! federal |! agency |! established |! in |! 1914 |! to |! investigate |! and |! stop |! unfair |! business |! practices Fair |! Labor |! Standards |! Act |! - |! 1938 |! - |! Correct |! answer |! ✔Regulates |! - |! minimum |! wage, |! maximum |! hours, |! child |! labor AT |! WILL" |! Doctrine |! - |! Correct |! answer |! ✔Employee |! free |! to |! quit |! anytime |! and |! employer |! free |! to |! terminate |! employee |! at |! anytime.
"AT |! WILL" |! Doctrine |! exceptions |! - |! Correct |! answer |! ✔•1) |! Employees |! cannot |! be |! fired |! if |! the |! dismissal |! contravenes |! public |! policy.Case |! Study: |! Wagenseller |! v. |! Scottsdale |! Memorial |! Hospital(Ariz, |! 1985). |! •2) |! Violates |! an |! implied |! contract |! term |! of |! good |! faith |! and |! fair |! dealing.Ex. |! Firing |! employee |! to |! avoid |! paying |! sales |! commission. |! •3) |! Contradicts |! an |! employer's |! statements |! regarding |! termination.Ex. |! Personnel |! Policy |! Manual |! provides |! for |! progressive |! discipline |! prior |! to |! termination. •Unemployment |! insurance |! - |! (Social |! Security |! Act |! of |! 1935) |! - |! Correct |! answer |! ✔•Imposes |! payroll |! tax |! on |! covered |! employers |! to |! fund |! the |! program |! •Most |! states |! provide |! up |! to |! 26 |! weeks |! of |! benefits |! to |! unemployed |! workers |! •States |! provide |! most |! of |! the |! funding |! and |! pay |! for |! the |! actual |! benefits |! provided |! to |! workers |! •Washington |! Employment |! Security |! Department |! administers |! unemployment |! benefits. |! • |! Requirements: |! •Must |! have |! 680 |! hours |! of |! covered |! employment |! in |! the |! base |! year |! •Must |! state |! the |! reason |! unemployed. |! •Must |! be |! physically |! able |! to |! work, |! available |! for |! work, |! and |! actively |! seeking |! suitable |! work. Employee |! Retirement |! Income |! Security |! Act |! (ERISA) |! - |! Correct |! answer |! ✔•Federal |! law |! that |! sets |! minimum |! standards |! for |! pension |! plans |! in |! private |! industry. |! •Also |! covers |! medical |! plans. |! •Pension |! funds |! vest |! in |! 7 |! years |! •Pension |! funds |! are |! portable
Civil |! Rights |! Act |! of |! 1964, |! Title |! VII |! - |! Correct |! answer |! ✔Prohibits |! discrimination |! in |! hiring, |! termination, |! compensation, |! terms, |! conditions |! and |! privileges |! of |! employment, |! and |! in |! limiting, |! segregating, |! or |! classifying |! employees |! or |! applicants |! based |! on |! five |! categories: |! •Race |! •Color |! •Religion |! •Sex |! •National |! origin Bona |! Fide |! Occupational |! Qualification |! (BFOQ) |! - |! Correct |! answer |! ✔•Defense |! to |! claim |! of |! disparate |! treatment |! in |! certain |! instances |! for |! religion, |! sex |! or |! national |! origin, |! if |! employer |! meets |! 4 |! part |! test, |! when |! a |! bona |! fide |! occupational |! qualification |! is |! reasonably |! necessary |! to |! the |! normal |! operation |! of |! a |! particular |! business: |! •1. |! a |! real |! connection |! between |! the |! classification |! and |! ability |! to |! perform |! •2. |! proof |! that |! the |! classification |! is |! necessary |! for |! the |! job |! •3. |! demonstrate |! that |! the |! classification |! affects |! the |! "essence" |! of |! the |! employer's |! business, |! and |! •4. |! no |! less-discriminatory |! alternatives |! Ex. |! Hiring |! wait |! staff |! of |! a |! specific |! national |! origin |! to |! go |! along |! with |! a |! national |! origin |! themed |! restaurant. Pregnancy |! Discrimination |! Act |! (1978) |! - |! Correct |! answer |! ✔•Illegal |! to |! discriminate |! because |! of |! pregnancy, |! childbirth, |! or |! medical |! condition |! related |! to |! pregnancy |! or |! childbirth. |!
•Illegal |! to |! retaliate |! for |! making |! a |! complaint |! about |! discrimination |! or |! participating |! in |! an |! investigation |! or |! lawsuit. Sexual |! Harassment |! - |! Correct |! answer |! ✔includes |! any |! unwelcome |! sexual |! advances, |! requests |! for |! sexual |! favors, |! and |! other |! verbal |! or |! physical |! conduct |! of |! a |! sexual |! nature, |! when |! the |! conduct |! explicitly |! or |! implicitly |! affects |! an |! individual's |! employment, |! unreasonably |! interferes |! with |! an |! individual's |! work |! performance, |! or |! creates |! an |! intimidating, |! hostile, |! or |! offensive |! work |! environment. Title |! VII |! - |! Religion |! based |! discrimination |! - |! Correct |! answer |! ✔•Religious |! discrimination |! occurs |! by |! treating |! an |! applicant |! or |! employee |! unfavorably |! because |! of |! religious |! beliefs, |! or |! married |! to, |! or |! associated |! with, |! an |! individual |! of |! a |! particular |! religion, |! or |! connected |! to |! a |! religious |! organization |! or |! group. |! •The |! law |! forbids |! discrimination |! for |! any |! aspect |! of |! employment |! (hiring, |! work |! assignments, |! layoffs, |! etc.). |! •Prohibits |! workplace |! segregation |! based |! on |! religion. |! An |! employer |! may |! not |! assign |! an |! employee |! to |! a |! non-customer |! contact |! position |! because |! of |! concern |! for |! customer |! preference. Reasonable |! accommodation |! - |! Correct |! answer |! ✔Requires |! employers |! to |! reasonably |! accommodate |! employee |! religious |! beliefs |! or |! practices, |! unless |! doing |! so |! would |! cause |! an |! undue |! hardship |! on |! the |! operations |! of |! the |! employer's |! business. Overt |! Discrimination |! - |! Correct |! answer |! ✔obvious |! discriminatory |! statement |! or |! action |! against |! a |! person |! in |! a |! protected |! class
