UK Law Economics – 20 multiple choice questions

Topics include tort law, contract law, property law, and criminal law. Example question: Every year a certain number of consumers are hurt using lawn mowers. Installation of a safety lever reduces the risk of an accident from 0.002 to 0.001 but costs $50 per lawn mower. Suppose that average damages per accident are $45,000. All parties are risk neutral and have full information.a. Under a strict liability standard, the manufacturer is likely to install the safety lever on its lawn mowers.b. Under a strict liability standard, the manufacturer is not likely to install the safety levers.c. Under a negligence standard, the manufacturer would install the safety levers, but not under a strict liability standard.d. Under a strict liability standard, since the consumers will bear all residual risks themselves, they will be more likely to take care if and only if the manufacturer installs the safety levers.