BMAL 590 LEGAL ENVIRONMENT OF
BUSINESS EXAM SCRIPT 2026 UPDATED
QUESTIONS WITH DETAILED SOLUTIONS
GRADED A+
⩥ Why do we need laws? Answer: Primarily to regulate the behavior of
the individual or the business, to be aligned with what is acceptable to
society as a whole.
⩥ Public Law Answer: relates to the ability of society to take action
against those whose actions are considered to be against the law.
⩥ Private Law Answer: relates to the ability of individuals to initiate
action against others (to sue one another).
⩥ Law is made at the Answer: federal, state, and local levels
⩥ Law is made by Answer: legislatures (statutes), by court decisions
(common law), and by administrative agencies (regulations).
⩥ Old Laws can be Answer: modified or repealed
⩥ New laws can be Answer: made to address changed in society
,⩥ Laws are not Answer: static
⩥ In the U.S., the highest law is the Answer: Constitution (No local,
state, or federal law can contradict the provisions of the U.S.
Constitution.)
⩥ The Constitution may be _________ by the procedure prescribed by
the Constitution itself. Answer: amended
⩥ An amendment comes into force when Answer: approved by two-
thirds of both houses of Congress, then ratified by three-fourths of the
state legislatures. When so ratified, the amendments become part of the
Constitution.
⩥ The first 10 amendments are known as the Answer: Bill of Rights
⩥ Laws created by legislative bodies at all levels are known as Answer:
statutes.
⩥ Generally, _______ laws are applicable throughout the country.
Answer: federal
⩥ _____ laws are confined to a particular state. Answer: State
,⩥ laws are confined to the geographical jurisdiction of the authority.
Answer: Local
⩥ When a state law or a local law conflicts with a federal law, under
__________, the federal law prevails. Answer: supremacy
⩥ Federal laws are passed by Congress and signed into law by the
Answer: President
⩥ State laws are passed by the state legislatures and signed into law by
the Answer: Governor
⩥ If the President or Governor rejects (vetoes) a proposed law, the
legislature may Answer: override the veto if at least two-thirds of the
members of each house of the legislature vote in favor of the law.
⩥ The President has the power to enter into ________ with ________
nations on a wide variety of issues from trade to defense. Answer:
treaties; Sovereign
⩥ A treaty becomes a law when approved by two-thirds of the Answer:
Senate.
, ⩥ A treaty becomes a law when approved by ______ of the Senate.
Answer: two-thirds
⩥ __________ are a source of precedent both for the parties concerned
and prospectively for others in the same jurisdiction in a similar
situation.
Judicial decisions create Answer: Judicial decisions; Case Law
⩥ The opinions of courts, taken together, creates Answer: Common Law.
⩥ Courts make decisions based on Answer: precedent
⩥ Over time, Common Law creates a degree of Answer: consistency and
predictability
⩥ The decision of a ______________ within the jurisdiction of the
higher court. Answer: higher court supersedes the decision of a lower
court
⩥ Courts interpret Answer: existing laws.
⩥ If there is no precedent to guide the resolution of a case, it is said to be
a Answer: Case of First Impression.
BUSINESS EXAM SCRIPT 2026 UPDATED
QUESTIONS WITH DETAILED SOLUTIONS
GRADED A+
⩥ Why do we need laws? Answer: Primarily to regulate the behavior of
the individual or the business, to be aligned with what is acceptable to
society as a whole.
⩥ Public Law Answer: relates to the ability of society to take action
against those whose actions are considered to be against the law.
⩥ Private Law Answer: relates to the ability of individuals to initiate
action against others (to sue one another).
⩥ Law is made at the Answer: federal, state, and local levels
⩥ Law is made by Answer: legislatures (statutes), by court decisions
(common law), and by administrative agencies (regulations).
⩥ Old Laws can be Answer: modified or repealed
⩥ New laws can be Answer: made to address changed in society
,⩥ Laws are not Answer: static
⩥ In the U.S., the highest law is the Answer: Constitution (No local,
state, or federal law can contradict the provisions of the U.S.
Constitution.)
⩥ The Constitution may be _________ by the procedure prescribed by
the Constitution itself. Answer: amended
⩥ An amendment comes into force when Answer: approved by two-
thirds of both houses of Congress, then ratified by three-fourths of the
state legislatures. When so ratified, the amendments become part of the
Constitution.
⩥ The first 10 amendments are known as the Answer: Bill of Rights
⩥ Laws created by legislative bodies at all levels are known as Answer:
statutes.
⩥ Generally, _______ laws are applicable throughout the country.
Answer: federal
⩥ _____ laws are confined to a particular state. Answer: State
,⩥ laws are confined to the geographical jurisdiction of the authority.
Answer: Local
⩥ When a state law or a local law conflicts with a federal law, under
__________, the federal law prevails. Answer: supremacy
⩥ Federal laws are passed by Congress and signed into law by the
Answer: President
⩥ State laws are passed by the state legislatures and signed into law by
the Answer: Governor
⩥ If the President or Governor rejects (vetoes) a proposed law, the
legislature may Answer: override the veto if at least two-thirds of the
members of each house of the legislature vote in favor of the law.
⩥ The President has the power to enter into ________ with ________
nations on a wide variety of issues from trade to defense. Answer:
treaties; Sovereign
⩥ A treaty becomes a law when approved by two-thirds of the Answer:
Senate.
, ⩥ A treaty becomes a law when approved by ______ of the Senate.
Answer: two-thirds
⩥ __________ are a source of precedent both for the parties concerned
and prospectively for others in the same jurisdiction in a similar
situation.
Judicial decisions create Answer: Judicial decisions; Case Law
⩥ The opinions of courts, taken together, creates Answer: Common Law.
⩥ Courts make decisions based on Answer: precedent
⩥ Over time, Common Law creates a degree of Answer: consistency and
predictability
⩥ The decision of a ______________ within the jurisdiction of the
higher court. Answer: higher court supersedes the decision of a lower
court
⩥ Courts interpret Answer: existing laws.
⩥ If there is no precedent to guide the resolution of a case, it is said to be
a Answer: Case of First Impression.
