Chapter 1

1. Why Nations are economically weak or strong?

- Dependency Theory: It argues that economically strong nations exploit the resources and labor
of weaker nations through trade.
- Natural resources: whether or not a nation with strong abundant natural resources has been
offered to explain economic prosperity.
- Education and technology: Economically strong nations usually have more schools and
implement technology more quickly than economically weak nations.
-Climate: Some geographers have thought that climate helps explain whether nations are
economically strong or weak.
- Private Market: According to many economics the presence or absence of a modern private
market is the single most reason why some economics are strong and/or weak.
-Law and the legal system: An adequately enforced system of equally applied law is increasingly
recognized as a necessary foundation for strong productive economies.
b) What does this section say is the foundation of the private market and prosperity?
Prosperity is the state of flourishing, thriving success a good fortune.
2. Define law, compare and contrast lay and custom.
Law is the most significant of the social force and customs are norms of the society. Customs are
practices that people in a given society follow for public good, they were not necessarily be in
the form of law.
B) what roles do the courts and police play in the legal system?

They have the role to maintain order in society

3. Define the rule of law. How does the rule of law differ from law as the command of the
state?
The rule of law is an ideal rather than a complete fact in even the most democratic nation.
Special interest groups attempt to persuade lawmakers to benefit these groups of the expenses of
others.
In a democracy well-educated voters who understand the importance of the rule of law can hold
the account lawmakers who excessively favor special interests. Judges also play a vital role in
maintaining the rule of law.
b) why is property important to society? To private enterprise?
Property is the legal right to exclude or keep other from interfering with what you own and your
resources.
Private enterprise: Basis of a free market capitalist system. It is a business unit established,
owned and operated by private individuals for profit instead of by or for any government or its
agencies.
4. What is property? How does it differ from resources?
Property is the legal right to exclude or keep others fro interfering with what you own, with your
resources. It makes what is yours “yours”.
Public property which applies to public resources own by the government like roads, public
buildings, public lands, and monuments. Private property applies to resources that you own as an
individual. Common property is resources, like land, that more than one individual own jointly.
b) Explain why the rule of law is an ideal rather than a complete fact?
The rules of law are laws that are generally and equally applicable. They apply to all or most
member of society. They also apply to various groups in the same way.
5. why property can be thought of as the central concept underlying western digital legal
system?
Property includes an ownership of individual constitutional and human rights in ourselves that
excludes the state from interfering with these rights.
b) what does James Madison mean when he says we have property in our opinions and free
communication of them?
It means that property protects not only physical resources like land but also human rights like
freedom of speech, freedom of religion, and freedom from unreasonable intrusion by the
government.
6. What is jurisprudence?
It is the philosophy of law (the origin, justification, meaning, and essence of law). School of
jurisprudence: natural law, positive law, historical school, sociological jurisprudence, and legal
realism.
b) Difference between the jurisprudences of natural law and sociological jurisprudence.
Natural law theory asserts that law contains universal moral principles, these principles are
observable in nature and we can determine them trough human reason. Sociological
jurisprudence supports the idea that law can and should change to meet new developments in
society.
7. what is common law?
It emphasizes the role of judges in determining the meaning of laws and how they apply.
United States is a common law country because the English colonist brought it here.
b) what is the primary distinction between common law and civil law legal system?
Common law emphasizes the role of judges in determining the meanings of law. Civil law relies
more on legislation than judicial decisions for law.
8. What is public law?
It includes those matters that involve the regulation of society as opposed to individuals
interacting. Three examples: Constitutional, administrative, and criminal law.
B) Private law: it covers those legal problems and issues that concern your private resource
relationships with other people. Three examples: Property, contract, and tort law.
9. What is the difference between criminal law and civil law?
Civil law cases include suits for breach of contract or tort cases, such as suits for personal
injuries. Criminal law cases, however, involve a representative of government attempting to
prove the wrong committed against society and seeking to have the wrongdoer punished by the
court system. Civil cases involve a request for damages or other appropriate relief that does not
involve punishment of the wrongdoer.
b) explain the two ways that the words civil law are used in this chapter.
The chapter uses civil law to refer to a civil law legal system, where civil law relies ore on
legislation than judicial decisions for law. The other use of civil law is when discussing civil
(noncriminal) lawsuits.
10. Define substantive law and procedural law
Substantive law defines the legal relationship of people with other people or between them and
the state.
Procedural law deals with the method and means by which substantive law is made and
administered.
b) Is contract law substantive law or procedural law? How about a rule specifying that a
defendant has 30 days to respond to a complaint?
Contract law is substantive law. A rule specifying that a defendant has 30 days to respond to a
complaint is procedural law.
11. Explain what it means to say that constitutions are the “highest laws of the nation”
The U.S. constitution is the supreme law of the nation. It overrides all other resources of law.
The constitution establishes the federal government, and its amendments guarantee basic rights
and liberties to the people of the nation.
b) Explain the important distinction between state and federal constitution.
The state constitutions authority as a source of law applies only to the particular states that have
adopted them. Is state constitutional provisions conflict with the U.S. constitution or with federal
constitutions at all, the provisions are void as a source of law, meaning that they do not apply to
your question about pollutants.
12. Give two additional terms of legislation.
Legislation adopted by congress or a state legislature is usually referred to as a statue or act.
b) Why is uniformity of law important to business? How can legislators achieve uniformity of
the laws affecting business? What is the most significant uniform law affecting business?
Uniformity of law is important to business because if the law lacks uniformity, it decreases the
certainty necessary for the conduct of interstate business and the general ordering of society.
Legislators can achieve uniformity of the law by Congress enacting a single law that preempts
varying state laws or by the national conference of commissioners on Uniform State Laws trying
to promote uniformity by drafting model acts. The most significant uniform law affecting
business is the Uniform Commercial Code.
13. Where do administrative agencies come from?
Legislative bodies, recognizing the need for greater specificity, often authorize the creation of
administrative agencies to provide clarity and enforcement of a legal area.
B) For what purposes the administrative agencies exist?
They regulate business activities through the adoption of rules and regulations. They also
investigate businesses to determine if they have violated rules and regulations.
14. Define Stare Decisis. What are its advantages and disadvantages?
It means that the court should follow prior decision in all casers based on substantially similar
facts. The advantages of stare decisis are that people became secure in their right of property.
Then they became willing to invest resources in fixed locations for factories and other
immovable valuables because they were certain the state would not seize these resources for its
own use. It helps specify in great detail the boundaries of our property-based legal system, and it
protects what is “prosper” to people from the interference of others. The disadvantages involve
the volume of cases, searching through hundreds of thousands of cases and then identifying and
reading the significant ones is a very lark task. Which is booth time consuming and expensive.
b) What is the distinction between a precedent and dicta in judicial decisions, and how does this
distinction relates to stare decisis?
A precedent is a prior judicial decision relied upon as an example of a rule law. Dicta are
statements made in a judicial opinion that are not essential to the decision of the case. The
distinction is that dicta is a statement made but is not essential to the decision of the case. It
relates to stare decisis because the holdings in prior cases are precisely what were necessary to
the decision reached. The dicta are whatever else the cart said.
c) The Indiana court will apply the “conflicts of law” to determine if Sam is at fault. These rules
vary from state to state.
15. Explain the relationship of case of law to the other sources of law.
Case law court cases, as they interpret all of the other sources, may or may not void sources
lower than the source being interpreted.
16. What is sanction and remedy?
A sanction is penalties imposed for violation of a law. Remedy is the action or procedure that is
followed in order to enforce a right or to obtain damages for injury to a right.
17. What is the purpose of compensatory damages?
Compensatory damages are accorded to make the victim of the breach “whole” in the economic
sense. Such damages compensate the party for all looses that are the direct and foreseeable result
of the breach of contract. The objective is that the party be in as good apposition as he or she
have been in had the contract been performed.
b) What is specific performance of a contract?

Specific performance of a contract is an order by the court commanding the other party actually
to perform a bargain as agreed.
18. for tortuous conduct
A tort is a civil wrong other than a breach of contract. Torts involve improper crossing of
property boundaries usually causing injury to our person or other things your own. The
boundaries may be physical as when someone trespasses across the boundaries of another’s land.
Boundaries may also be behavioral as when someone acts unreasonably and injures another.
B) what are two premises of tort liability?
Intentional torts require the plaintiff to prove the defendant intended to cross the boundaries.
C) Negligence torts: This tort requires the plaintiff to show that the defendant injured what was
proper to the plaintiff through unreasonable behavior.
19. What types of sanctions are used for the violation of statues and regulations?
These sanctions are often similar to those imposed for criminal conduct, breach of contract, or
tortuous conduct. Many statues for example impose a fine for a violation and authorize damages
to injured parties as well.
B) What is an injunction?
It is a court order directing a party to do or to refrain from doing some act.
20. what is the specific sense of corporate governance?
Corporate governance refers to the legal rules that structure, empower and regulate the agents
(primarily the board of directors and managers) of corporations and define their relationship to
the owners.
b) For example if the managers have salaries, bonuses or stock option that are tied to the
corporation profit by putting up assets or concealing debts, they may be able to raise their
incomes by millions of dollars.
21, what is the general sense of corporate governance?
In a general sense, corporate governance also applies to the legal relationship that business have
with each other, with their customers, and with society.
B) Discuss how effective corporate governance contributes to the creation of economic wealth.
The collapse of many financial institutions led to a major economic recession. In part, the
recession may have been caused by the government encouragements of mortgage loans to
expand housing. However a major factor in the collapse was the risky lending practices of banks
and other financial institution that repackaged, sold, and resold hundreds of billions of dollars of
housing loans that were inadequately secured.

Chapter 2
1) ethics and society
· Describe the reasons for the rising concern over business ethics
The rising concern over business ethics responds to a decline in public education and the family
structure as a source for ethical teaching. Increasingly sensitive to challenge of bias, school
system have reduced their involvement in promoting shared ethical values and increased their
emphasis on the teaching of value free facts.
2) ethics and government
· How has government action in recent years encouraged increased business attention to
ethical matters?
Business leaders have become increasingly concerned with business ethics precisely because
they want to limit further governmental regulation.
The Nature of Ethics
3) ethics and morality
· Compare and contrast ethics and morality. What do philosophers call the end result of
ethical examination?
Ethics involve a Rational method for examination our moral lives, not only for recognizing what
is right and wrong but also for understanding why we think something is right or wrong. The end
result of ethical examination is what philosophers call the good.
4) ethics and law
· A marketing consultant to your firm comments that being ethical in business means
nothing more than obeying the law. Discuss.
Both consist of rules to guide conduct and foster social cooperation. Both deals with what is right
and wrong. Society ethical values may became law through legislation or court decision, and
obedience to law is often viewed as being ethically correct.
Two Systems of Ethics
5) Formalism
· As amended in 1988, the foreign corrupt practices act prohibits bribery as a practice for
U.S. companies to uses in obtaining business in other countries. In passing the act, congress
expressed the concern that bribery was inherently wrong. Which major system of ethical thought
does this concern suggest? Explain
Kant and Formalism. To be ethical requires that you act with a good intent. To have a good
intent, you have to act in ways that are ethically consistent. This emphasis on consistency Kant
called the categorical imperative. You should never act in the way you believe everyone should
act. You should never act in a certain way unless you are willing to have everyone else act in the
say way. You cannot make an exception for your own action.

6) Consequentialist
· A headline from the Wall Street Journal read us companies pay increasing attention to
destroying files. The articles discussed how man companies are routinely shredding files in the
ordinary course of business to prevent future plaintiffs from obtaining the files and finding
incriminating evidence. Is this practice unethical? Evaluate.
It is because the moral consequences of actions rather than with the morality of the actions
themselves.

7) comparing the two ethical system

a) It is ethical to advertise tobacco products in association a desirable exciting or
sophisticated lifestyle.
Formalism may say that tobacco products can cause cancer. And the companies may know. But
for consequentialist the act of advertises tobacco is ethically right or wrong.
b) It is ethical to advertise these products in association with a cartoon character that is
appealing to young people?
Formalist may say that cartoon can influent in young people mind but consequentialist may say
that lying is not unethical.

Sources of value for business ethics:

8) legal regulation
· Explain how in our society, ethical values frequently become law, and how legal
regulation can promote change in ethical values. Describe several common ethical values that are
found in law.
Society ethical commitment to equal opportunity became law in civil right act of 1964 which
prohibits employment discrimination based on race sex color religion and national origin. At the
same time the very existence of legal regulation can influence society’s view of what is ethical.

9) professional code of ethics

· Discuss why lawyer are sometime viewed as being unethical. Is the average lawyering
more or less ethical that the average business manager?
Lawyer sometimes viewed as being unethical because they tried to defend for example to the bad
guy but is their job they pay them for defended the person.

10) organizational codes of ethics

· A study of major companies code of ethics by business roundtable found that the lower
level of employees on the corporate ladder, the greater their hostility and cynicism toward codes
of business ethics.
a) Why might this be true?
Because the roundtable a national group of senior business leaders has identified a general list of
topics that organization codes of business ethics should cover.

b) What can top business management do to change this view?

Companies take different approaches to ethical codes, they will conduct business ethically and
honestly in dealing with our customer supplies and employees

11) individual values

· In addition to the five questions listed in the text can you think of question to ask yourself
to help explore your ethical values before making a business (or personal) decision?
Will my decision cause harm to others or to the environment?

12) the obstacles

· A Newsweek articles on business ethics concludes, even in today’s complex world
knowing what’s right is comparatively easy. It’s doing what’s right that’s hard. Explain why this
statement may be true I modern corporate decision making.
This is not true but there are certain obstacles to ethical corporate behavior that deserve serious
consideration.

13) the step

· Another article from the wall street journal carries the headline. Tipsters telephoning
ethics hot lines can end up sabotaging their own job. Discuss why whistle blowing is unpopular
within the corporation.
Despite the obstacles that sometime stand in the way of the ethical corporate behavior, certain
steps can be taken to promote business ethics in corporate life.

14) the reward

· why are formal legal rules alone not an adequate ethical system for business
For business merely to observe the law is not sufficiently responsible. Legal regulation lacks
flexibility and is inadequately informed to be the only social guide for business decision making.

15) the morality of property

· The law of property describes what is proper and right between people regarding the
things people need and want. Explain how property is related to ethics.
Adequate property in resources maximizes total wealth in society. It provide incentives for
individuals and groups to development both physical and human resource to produce the goods
that society values