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Exam: 501160RR – White-Collar Crime in the Economy
1. What variety of environmental crime was the Love Canal tragedy a result of?
A. Illegal disposal of hazardous waste
B. Harmful destruction of property and wildlife
C. Misuse of federal facilities and public land
D. Illegal emissions

2. Which of the following is not considered an environmental crime?
A. Disposing of radioactive wastewater at a municipal sewerage treatment plant
B. Failing to build appropriate fences around zoo animals
C. Removing asbestos ceiling tiles in a 75-year-old building
D. Disposing of old appliances on the side of a rural road

3. When a lending institution allows a home to be sold for an amount lower than what the homeowner
owed on the property, it’s fostering
A. equity skimming.
B. bank fraud.
C. a short sale.
D. a deflated appraisal.

4. Forging a homeowner’s signature on an equity line of credit application is a type of
A. equity fraud.
B. foreclosure rescue scam.
C. equity skimming.
D. reverse mortgage fraud.

5. All of the following are consequences of environmental crime except _______ costs.
A. political
B. economic
C. physical
D. community

6. Richard, a realtor, continues to sell the same property in order to generate fees and commissions. This is
an example of
A. churning.
B. a fraudulent loan.
C. a liar loan.
D. a home improvement scam.

7. Outrageous or unbelievable claims about hair and weight loss products are frequently not supported by
customer experiences of consumer reviews. These are examples of which of the following?
A. Price gouging
B. Bait and switch
C. Price discrimination
D. False advertising

8. Crimes in the economic system are usually classified as
A. market manipulation.
B. economic crimes.
C. computer crimes.
D. investment fraud.

9. If a tenant who lives in a slumlord-run property organizes tenants and mobilizes them to post negative
reviews of the slumlord run property, they have participated in which of the following?
A. Health consequences
B. Grassroots response
C. Legislative consequences
D. Financial consequences

10. The CEO for Tyco stole $120 million in bonuses and lied about the value of his company so the price
of its stock would increase. He was charged with
A. Ponzi scheme, false regulatory filings, and conspiracy to commit securities fraud.
B. fraud, conspiracy, and lying to banks.
C. grand larceny, conspiracy, and falsifying records.
D. securities fraud, insider trading, and wire fraud.

11. If two consumers, John , a 34-year-old white male, and Jessica , a 44-year-old African-American
female, both go to a car dealership and purchase the same car, but John pays a significantly higher price,
this could be an example of which of the following?
A. Bid rotation
B. Complementary bidding
C. Price gouging
D. Price discrimination

12. Omitting key information about an investment and creating negative consequences is a component of
A. insider trading.
B. broker embezzlement.
C. hedge fund fraud.
D. broker fraud.

13. What does the “Cradle to the Grave” provision of the Resource Conservation and Recovery Act refer
A. The idea that companies can’t create waste if they don’t have a plan for its disposal ahead of time
B. The means through which companies can dispose of waste
C. Legal places in which companies can dispose of waste
D. The responsibility of the creator of the waste to track it from creation to disposal

14. Which of the following was not a criticism of British Petroleum’s response to the Deepwater Horizon
rig explosion?
A. BP’s CEO went vacationing on his yacht shortly after the explosion.
B. Its plan referenced a wildlife expert who had died five years before the explosion.
C. BP’s response plan listed animals that don’t live in the vicinity of the rig.
D. BP initially overestimated the extent of the problem.
15. If all cable television providers in a state agreed not to provide services to lower income communities,
this would be an example of which of the following?
A. Complementary bidding
B. Group boycotts
C. Price discrimination
D. Price gouging

16. Mika and Sean are discussing flipping. Mika says that legitimate flipping occurs when a home is bought
and sold numerous times at inflated prices. Sean says legitimate flipping occurs when an investor purchases
a home, fixes it up, and then sells the home for a profit. Who is correct?
A. Only Sean is correct.
B. Neither is correct.
C. Both are correct.
D. Only Mika is correct.

17. Which of the following is not an example of a crime in the economic system?
A. Corporate espionage
B. Ponzi schemes
C. Advance fee fraud
D. Broker embezzlement

18. If Jason, whose home has recently gone into foreclosure, burned down his home in order to have his
insurance company pay off the mortgage debt, he engaged in
A. equity fraud.
B. foreclosure rescue scam.
C. straw buyer fraud.
D. dual settlement statements fraud.

19. While there are a variety of different types of student loan/aid fraud, which of the following is
considered by many as one that could undermine the stability of colleges and of the federal government to
continue to offer student loans?
A. Lying about intent to take classes
B. Lying about grades
C. Lying about parents’ income
D. Taking out loans with no intention of paying them back

20. What type of offense was seen in the aftermath of Hurricane Katrina when gas prices were raised
A. Price discrimination
B. Market allocation
C. Price fixing
D. Price gouging