CBA Business Law & Compliance 3

Question 1

What is a 'fiduciary duty' in a business context?

Accepted Answer

A legal and ethical obligation to act in the best interest of another party

Answer

A fiduciary duty is the highest standard of legal care, requiring a person (such as a board member or trustee) to act in the best interest of the party they represent.

Question 2

Which of the following is an example of 'vicarious liability' for a business?

Accepted Answer

An employer being held liable for an employee's negligent acts performed during the scope of employment

Answer

Vicarious liability holds an employer responsible for wrongful acts committed by employees within the scope of their employment duties.

Question 3

Under the Family and Medical Leave Act (FMLA), eligible employees are entitled to how many weeks of unpaid, job-protected leave per year?

Accepted Answer

12 weeks

Answer

FMLA entitles eligible employees of covered employers to take up to 12 weeks of unpaid, job-protected leave per year for qualifying family or medical reasons.

Question 4

What is the purpose of an 'indemnification clause' in a business contract?

Accepted Answer

To require one party to compensate the other for specified losses or damages

Answer

An indemnification clause requires one party to cover the losses, damages, or legal costs incurred by the other party under specified circumstances.

Question 5

Which regulatory body enforces securities laws and regulates the US securities industry?

Accepted Answer

Securities and Exchange Commission (SEC)

Answer

The SEC is the primary federal regulator of the US securities industry, enforcing laws against market manipulation, insider trading, and requiring accurate public company disclosures.

(CBA) Certified Business Administrator Practice Test

(CBA) Certified Business Administrator Practice Test

CBA Business Law & Compliance 3