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A company uses a competitor's trade secrets to develop a new product
without their knowledge. Which of the following legal issues does this
scenario represent?
 a) Trademark infringement
 b) Patent infringement
 c) Trade secret misappropriation
 d) Copyright infringement
 Answer: c) Trade secret misappropriation
 Rationale: Trade secrets are protected under the law, and using a
competitor's trade secrets without permission constitutes misappropriation,
which is a violation of legal ethics.
A business advertises a product by making false claims about its benefits,
leading to customer harm. This scenario is a violation of:
 a) Truth in advertising laws
 b) Consumer protection laws
 c) Product liability laws
 d) Antitrust laws
 Answer: a) Truth in advertising laws
 Rationale: Truth in advertising laws require businesses to make accurate
and non-deceptive claims about their products to protect consumers from
harm.
An employee of a company discovers evidence of financial fraud by the
management. What ethical obligation does the employee have in this
situation?
 a) Report the fraud to the media
 b) Report the fraud to the company's board of directors
 c) Ignore the evidence to avoid conflict
 d) Confront the management directly
 Answer: b) Report the fraud to the company's board of directors
 Rationale: It is the ethical responsibility of an employee to report any
evidence of fraud or misconduct to the appropriate authorities within the
company to maintain integrity and transparency.
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