Deck 15: Legal and Ethics

Question 1

The authority that is necessary,usual,and proper to carry through to completion the express authority conferred,is called:

A)apparent authority.
B)implicit authority.
C)implied authority.
D)direct authority.
E)performance authority.

Answer 1

C

Question 2

In a contract for services,a key personnel clause:

A)legally cannot be included because work assignment is the responsibility of the service provider.
B)is undesirable from the buyer's perspective because on-going negotiations are a better way to ensure the best personnel are assigned throughout the contract.
C)should always be included no matter the nature of the service.
D)may be included if success depends on specific individuals.
E)is desirable from the supplier's perspective to ensure that the buyer cannot demand personnel changes mid-contract.

Answer 2

D

Question 3

In a contractual dispute between buyer and seller,the process of elevating the discussion from buyer and sales representative to their supervisors and up through the organization before other forms of dispute resolution are pursued.

A)arbitration.
B)mediation.
C)negotiation.
D)adjudication.
E)internal escalation.

Answer 3

E

Question 4

The legal authority of a salesperson normally is:

A)the same as that of a buyer.
B)to solicit orders and get ratification and acceptance from his or her employer.
C)to make legally-binding contracts for $500 or less.
D)to make legally binding contracts for sales over $500.
E)based on the length of time the salesperson has been employed.

Question 5

When it comes to product liability,supply management:

A)lowers risk by ensuring that suppliers deliver defect-free goods.
B)has little or no role since this is essentially a legal action.
C)has responsibility only to the internal customer,not the final customer.
D)is liable depending on the type of warranty agreed to in the contract.
E)is responsible for establishing the cost of the actual damage.

Question 6

Which of the following is a factor in determining the validity of a contract?

A)competent parties.
B)opposing parties.
C)employment in the legal department.
D)amount over $500.
E)offer and counteroffer.

Question 7

If a termination for convenience clause is included in a services contract:

A)its validity depends on whether the contract is in the private or public sector.
B)it is easy to determine if it is exercised in bad faith or an abuse of discretion.
C)it specifically identifies events that will trigger termination.
D)it defines what constitutes sufficient cause to terminate.
E)is exercised in bad faith,it may mean the termination is a breach of contract.

Question 8

The Sarbanes-Oxley Act:

A)has no impact on the supply management process.
B)requires the Chief Purchasing Officer to sign off on every contract.
C)requires listing off-balance sheet items such as long-term purchase agreements.
D)requires supply management to report directly to the Chief Financial Officer.
E)affects internal accounting procedures of privately-held companies.

Question 9

Commercial bribery:

A)is outlawed in very few countries.
B)often flourishes although it is outlawed in almost every country in the world.
C)is outlawed throughout the West,but not in Asia.
D)legal rulings rest on the doctrine of promissory estoppel.
E)usually involves only one company offering bribes.

Question 10

When the goods fit the ordinary purpose for which goods of that description are used in the trade,there is a(n):

A)express warranty.
B)implicit warranty.
C)warranty of title and against infringement.
D)implied warranty of merchantability.
E)implied warranty of fitness for a particular purpose.