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Q:
Ace Property Company is a subsidiary of Beta Investments, Inc. Ace operates a hazardous waste disposal site. ChemiCo is one of many parties who generate waste disposed of at the site. Ace borrows money from Delta Bank, which takes over the site when Ace goes bankrupt. The bank sells the site to Eagle Company. The Environmental Protection Agency discovers a leak at the site. Can any of these private parties be forced to pay for the clean up? If so, who?
Q:
Bay City lies on the shore of a bay that empties into the Atlantic Ocean. Collected Waste Company picks up garbage and trash from local businesses. Further inland, Delta Corporation collects radioactive waste from the local utility's nuclear power plant. On the other side of the bay, Eagle Military Base stores chemical warfare supplies for disposal. Can Collected, Delta, or Eagle dump their waste in the ocean?
Q:
United Disposal, Inc., operates a hazardous waste disposal site that accepts waste transported by Ace Trucking Company from General Manufacturing Corporation. United sells the site to Investment Properties, Inc. A release of the waste is discovered at the site, and the Environmental Protection Agency (EPA) cleans it up. The EPA can recover the cost of the cleanup from
a. United only.
b. United or General only.
c. United, General, or Ace only.
d. United, General, Ace, or Investment Properties.
Q:
Photo, Inc., leases property on which it uses chemicals. Later, Quality Company (QC) buys the property and, still later, sells it to Residential Corporation (RC). Under the ground, RC discovers hazardous by-products of photo-chemical processes and files a suit against Quality to recover the cost of their removal. Under Case 3, Carson Harbor Village, Ltd. v. Unocal Corp., the court will most likely hold that Quality is liable for
a. all of the cost.
b. none of the cost.
c. one-half of the cost.
d. one-third of the cost.
Q:
Before being transported, hazardous waste generated by Acme Industries, Inc., must be properly labeled and packaged under the Resource Conservation and Recovery Act by
a. Acme Industries, Inc.
b. the federal Environmental Protection Agency.
c. the local Resource Conservation and Recovery Committee.
d. the state Environmental Regulatory Commission.
Q:
Arkansas enacts pesticide-labeling requirements that are different from, and add to, federal pesticide law. BugOut Corporation, a pesticide maker, files a suit against the state to block the new rules. Under the holding in Case 45.2, Bates v. Dow Agrosciences, LLC, a court is most likely to rule that
a. the federal law and state regulations are mutually compatible.
b. the federal law and state regulations are mutually exclusive.
c. the federal law preempts the state regulations.
d. the state regulations preempt the federal law.
Q:
PetroCorp, Inc., makes and sells industrial chemicals. If a substance is identified as harmful and the harm is imminent, the Environmental Protection Agency can
a. conduct an inspection of PetroCorp's plant.
b. declare the substance to be unregulated and allow its production.
c. ignore the risk if the benefit outweighs the harm.
d. order the substance to be sold in an adulterated form.
Q:
Farm & Garden Company makes and sells pesticides. For the pesticides to remain on the market, the acceptable level of harm to people from exposure to the products is
a. "a definite certainty of no harm."
b. "a possibility of no harm."
c. "a reasonable certainty of no harm."
d. "no harm."
Q:
Universal Chemical Company makes pesticides and herbicides. These substances are regulated by
a. the Comprehensive Environmental Response, Compensation and Liability Act.
b. the Federal Insecticide, Fungicide, and Rodenticide Act.
c. the Safe Drinking Water Act.
d. the Toxic Substances Control Act.
Q:
Under the Marine Protection, Research, and Sanctuaries Act (the Ocean Dumping Act), Bayside Chemical Company may dump its chemical waste into the ocean
a. after obtaining a permit.
b. before obtaining a permit.
c. without a permit.
d. not at all.
Q:
Inland City operates its own municipal public drinking water system. With regard to pollutants in this system, the federal statute that applies is
a. the Marine Protection, Research, and Sanctuaries Act.
b. the Oil Pollution Act.
c. the Rivers and Harbors Appropriations Act.
d. the Safe Drinking Water Act.
Q:
Quality Products Company operates a DVD manufacturing plant on Clean River. Discharging pollutants from the plant into the river can result in
a. civil penalties and criminal penalties.
b. civil penalties only.
c. criminal penalties only.
d. neither civil nor criminal penalties.
Q:
Fried Food, Inc., operates a commercial frying plant, discharging pollutants into the air. Greg reports the violations to the Environmental Protection Agency. Greg
a. is entitled to no payment.
b. may be paid up to any amount.
c. may be paid up to $1,000.
d. may be paid up to $10,000.
Q:
Quality Motor Company makes the Rock, a new model of sport utility vehicle, and sells it at the market's lowest price. The Rock does not, however, satisfy federal emission standards. The Environmental Protection Agency may assess
d. civil penalties, additional fines, and criminal penalties.
b. civil penalties and additional fines only.
c. civil penalties only.
d. criminal penalties, including fines and imprisonment, only.
Q:
A-One Solvents Company averages $15,000 profit per day before deciding to ignore air pollution standards, after which the average is $30,000. A-One is subject to a fine of
a. $0.
b. $15,000 per day.
c. $30,000 per day.
d. $30,000 total.
Q:
Construction Products Corporation (CPC) operates a cement plant. As regards hazardous air pollutants, CPC must use
a. the absolutely cleanest air technology.
b. the best available filter technology.
c. the maximum achievable control technology.
d. the most affordable scrubbing technology.
Q:
A-Plus Paint Company operates plants throughout the United States. Air pollution regulations that apply to A-Plus
a. may be issued at any time and need not apply equally at all locations.
b. may be issued only after A-Plus has begun to pollute.
c. may be issued only before A-Plus has begun to pollute.
d. must apply equally in all locations in which A-Plus operates.
Q:
Resource Mining Corporation operates a smelter subject to air pollution regulations. The maximum levels of certain pollutants in the air are set by
a. state governments only.
b. the Environmental Protection Agency and state governments.
c. the Environmental Protection Agency only.
d. the president of the United States only.
Q:
Great States Storage, Inc., a private company, wants to build a warehouse on private land. For this action, an environmental impact statement is
a. prohibited.
b. required.
c. unnecessary.
d. voluntary.
Q:
The approval of the U.S. Army Corps of Engineers for a dam construction project requires an environmental impact statement
c. because it affects the environment and is a major federal project.
a. only because it affects the environment.
b. only because it is a "major federal" project.
d. under no circumstances.
Q:
Ski Resorts, Inc., wants to add a new run to its facility in a national park on federal land. For this action, an environmental impact statement is
a. prohibited.
b. required.
c. unnecessary.
d. voluntary.
Q:
Garbage Products, Inc., operates a recycling plant. Hal and other Garbage neighbors file a suit, alleging injuries from Garbage's plant. The plaintiffs must show that Garbage failed to use reasonable care if the suit is based on
a. a negligence theory only.
b. a nuisance theory only.
c. a strict liability theory only.
d. a negligence theory, a nuisance theory, or a strict liability theory.
Q:
If the government undertakes clean-up operations at a waste disposal site, all parties associated with the site are free of any clean-up costs.
Q:
If the government undertakes clean-up operations at a waste disposal site, only the site's current owner or operator must contribute to the cost.
Q:
The Environmental Protection Agency does not regulate toxic substances.
Q:
Once certified, a pesticide may be used in unlimited quantities on food crops.
Q:
State or local governments set pollutant standards for most sources of drinking water.
Q:
Under no circumstances can any waste be discharged into navigable waters.
Q:
A new source of water pollutants must install pollution-control equipment before beginning operations.
Q:
Violators of emission standards under the Clean Air Act may be subject to criminal penalties.
Q:
Violators of emission standards under the Clean Air Act may be subject to civil penalties.
Q:
The same standards for air quality apply to sources of pollution in clean areas and sources in polluted areas.
Q:
Pollution-control standards generally do not change.
Q:
State agencies have the primary responsibility for preventing air pollution.
Q:
An environmental impact statement is required for federal government projects only.
Q:
The Environmental Protection Agency is the only federal agency with the authority to regulate specific environmental matters.
Q:
Local governments control some aspects of the environment.
Q:
Only the government can enforce most federal environmental laws.
Q:
Businesses that engage in ultrahazardous activities are strictly liable for any injuries.
Q:
An individual cannot file a "private" nuisance suit against a firm that pollutes the environment.
Q:
Common law doctrines no longer apply against polluters.
Q:
Environmental law is new.
Q:
Eats Company wants to sell its candy in a normal-sized package labeled "Gigantic Size." Fine Fabrics, Inc., wants to advertise its sweaters as having "That Wool Feel," but does not want to specify on labels that the sweaters are 100 percent polyester. What stops these firms from marketing their products as they would like?
Q:
Alpha Corporation makes batteries for motor vehicles. The Federal Trade Commission (FTC) learns that Beta Automotive Stores, a retail company that sells Alpha's batteries, engages in deceptive advertising practices. What actions can the FTC take against Beta?
Q:
American Sales Corporation does business in all fifty states and is subject to state consumer protection laws in those states in which they exist. Those laws are
a. enacted by state legislatures.
b. enforced by the Consumer Product Safety Commission.
c. required by the National Conference of Commissioners on Uniform State Laws.
d. reviewed by the Federal Trade Commission.
Q:
Steel Tool Company makes and sells tools. One of the tools is believed to be hazardous. The appropriate government agency may require Steel to
a. export the tool and sell it only abroad.
b. increase the price to cover the cost of any injuries or damage.
c. reduce the price to indicate the hazard to consumers.
d. remove the tool from the market.
Q:
Corner Market sells groceries. Delta Food & Drug Store sells groceries and fills prescriptions. The party with the chief responsibility to prevent unsafe food and drugs from being sold is
a. Corner Market and Delta Food & Drug Store.
b. Delta Food & Drug Store only.
c. the Federal Trade Commission.
d. the Food and Drug Administration.
Q:
The credit department of Mega-Mart often calls Nora at work about an overdue bill. Nora's employer objects. This is a violation of
a. no federal law.
b. the Fair and Accurate Credit Transactions Act.
c. the Fair Debt Collection Practices Act.
d. the Truth-in-Lending Act.
Q:
Furniture Depot sells Gail a bedroom suite on credit. Gail fails to make the scheduled payments for six months. Furniture Depot sends her a letter, asking for immediate payment. This is a violation of
a. no federal law.
b. the Fair and Accurate Credit Transactions Act.
c. the Fair Debt Collection Practices Act.
d. the Truth-in-Lending Act.
Q:
Quik Collection Agency calls Pat several times a day, and sometimes in the middle of the night, about an overdue bill that Regal Sporting Goods turned over to Quik for collection. This is a violation of
a. no federal law.
b. the Fair and Accurate Credit Transactions Act.
c. the Fair Debt Collection Practices Act.
d. the Truth-in-Lending Act.
Q:
Kent receives an unsolicited credit card in the mail and tosses it on his desk. Without Kent's permission, his roommate uses the card to buy a new personal computer for $1,000. Kent is
a. liable for $1,000.
b. liable for $500.
c. liable for $50.
d. not liable for any amount.
Q:
Consumer Finance Corporation (CFC) extends credit to consumers. CFC is subject to the Equal Credit Opportunity Act, which prohibits credit discrimination based on
a. educational achievement.
b. income.
c. marital status.
d. unfavorable credit reports.
Q:
Eve borrows $40,000 from First National Bank to add a room to her home. This transaction is subject to
a. the Consumer Leasing Act.
b. the Magnuson-Moss Warranty Act.
c. the Truth-in-Lending Act.
d. the Uniform Commercial Code.
Q:
Owen signs an installment contract with Pixel Video Store to finance the purchase of a new TV for $4,999. This transaction is subject to
a. no federal law.
b. the Fair Credit Reporting Act.
c. the Telecommunications Act.
d. the Truth-in-Lending Act.
Q:
Brad borrows $20,000 from City Bank to repair his home and to buy a car. Brad buys a stereo from Delta Store in a transaction financed by Delta. If these parties are subject to the Truth-in-Lending Act, Regulation Z applies to
a. the car loan only.
b. the home repair loan only.
c. the retail installment sale only.
d. the car loan, the home repair loan, and the retail installment sale.
Q:
Friendly Loan Company extends credit in the ordinary course of its business. Under the Truth-in-Lending Act, Friendly must inform potential borrowers of
a. credit terms offered by other lenders and its own credit terms.
b. only credit terms offered by other lenders.
c. only its own credit terms.
d. only the credit terms that will convince borrowers to "close the deal."
Q:
Ron signs a contract with Sam, a door-to-door salesperson for Tutors, Inc., to buy a foreign-language course. To cancel the contract, Ron has up to
a. three days.
b. thirty days.
c. sixty days.
d. ninety days.
Q:
Crunchy Corporation makes and sells cereal. Crunchy's packaging must include
a. neither the identity of the product nor the number of servings.
b. the identity of the product and the number of servings.
c. the identity of the product only.
d. the number of servings only.
Q:
Best Goods Corporation makes and sells consumer goods. Best Goods' product labels must identify
a. the address to which complaints can be directed.
b. the federal agency that inspected the product.
c. the manufacturer.
d. the percentage of the product that consists of artificial substances.
Q:
Fact Pattern 44-1
Phone Sales, Inc., solicits business from consumers over the phone. Quinn, a consumer, objects to being solicited in this way.
Refer to Fact Pattern 44-1. Suppose that Phone Sales uses a prerecorded voice to solicit business over the phone. Rita objects. In a suit against Phone Sales, she may recover
a. nothing.
b. only an injunction against any future calls.
c. up to $500 in damages for each objectionable call.
d. up to treble the amount of any monetary loss.
Q:
Fact Pattern 44-1
Phone Sales, Inc., solicits business from consumers over the phone. Quinn, a consumer, objects to being solicited in this way.
Refer to Fact Pattern 44-1. Quinn may succeed in a suit against Phone Sales if the firm
a. discloses to consumers that its calls are sales calls.
b. informs consumers of restrictions on using its products.
c. tells consumers that all sales are final.
d. uses an automatic dialing system to make its calls.
Q:
A+ Goods, Inc., engages in deceptive advertising when it markets its product Best Cleaner as able to kill germs over long periods of time. In an action against A+ regarding Best, A+ is ordered to stop its false advertising of Best and other products. This is
a. a counteradvertising order.
b. a multiple product order.
c. bait-and-switch advertising.
d. excessive abuse of authority.
Q:
A-One GPS Company's ad states that its product is "the finest that money can buy." Because of this ad, the Federal Trade Commission may
a. issue a cease-and-desist order only.
b. issue a cease-and-desist order or require counteradvertising.
c. neither issue a cease-and-desist order nor require counteradvertising.
d. require counteradvertising only.
Q:
Tech Company's ad states that "if you aren"t using a Tech computer, you aren"t using the best." The Federal Trade Commission would consider this ad
a. false and misleading.
b. false only.
c. misleading only.
d. neither false nor misleading.
Q:
All consumer protection laws are federal.
Q:
The Consumer Product Safety Commission can ban a product that poses an "unreasonable risk" to consumers.
Q:
A creditor may contact at any time a debtor who has refused to pay a debt.
Q:
Creditors can contact a debtor only at the debtor's place of employment.
Q:
A credit agency that negligently fails to delete inaccurate information from a person's credit report is liable.
Q:
An individual is not liable for unauthorized charges on a credit card that he or she did not solicit.
Q:
The Equal Credit Opportunity Act prohibits the denial of credit on the basis of an individual's financial status.
Q:
A loan between two consumers is subject to the Truth-in-Lending Act.
Q:
A sale between two consumers is not subject to the Truth-in-Lending Act.
Q:
Regulation Z spells out what information must be disclosed in transactions subject to the Truth-in-Lending Act.
Q:
Online sales are not yet subject to state or federal consumer laws.
Q:
When a consumer cancels an order, a mail-order merchant must issue a refund within a specific period of time.
Q:
Counteradvertising is advertising that counters a competitor's claims.
Q:
Counteradvertising is prohibited.
Q:
Labels on packages must use words that can be explained by the ordinary marketing executive.
Q:
Product labels do not need to be accurate if they use easily understood words.