Chapter 21 Self-test questions

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. Lawyers need to provide a good service to their clients. Which one of the following will a business client not expect from his lawyer?

An understanding the relevant area of law. correct incorrect

Advice on solutions to the problem and an understanding the commercial impact of each of those solutions. correct incorrect

An understanding of how the business operates commercially. correct incorrect

Advice on how to run the business more effectively in the future. correct incorrect

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. Law firms draw up accounts in the same way as any other business does. Which one of the following is an expense for a law firm which is run as a partnership?

The wages of the staff. correct incorrect

The capital or equity contributed by the partners of the firm. correct incorrect

The share of the profits taken by the partners. correct incorrect

The firm's borrowings. correct incorrect

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. What is PEP?

The share of profit which each equity partner in a law firm receives annually. correct incorrect

The profit made each year by a law firm. correct incorrect

The annual profit margin of a law firm. correct incorrect

The revenue of a law firm. correct incorrect

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. Law firms may aim to do specialist work. Which one of the following best describes low volume, high value work done by highly paid specialist lawyers?

Efficiency work correct incorrect

Expert work correct incorrect

Experience work correct incorrect

Skilled work correct incorrect

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. Which of the following describes the time it takes a law firm to produce a bill from the time when the work is done until the time when the firm is paid?

Lock in correct incorrect

Lock out correct incorrect

Lock up correct incorrect

Lock down correct incorrect

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. Law firms use a variety of pricing structures. In relation to these, which one of the following statements is correct?

If a client is charged hourly rates, the risk is on the client. correct incorrect

If a client is charged a fixed fee, the risk is on the client. correct incorrect

If the client is charged a contingency fee, the risk is on the client. correct incorrect

If a client is charged a conditional fee, the risk is on the client. correct incorrect

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. Which one of the following is most likely to ensure that fee earners in a law firm are fully utilised?

Increasing the rates charged to clients correct incorrect

Introducing targets for fee earners correct incorrect

Outsourcing administrative support for fee earners correct incorrect

Increasing turnover correct incorrect

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. Which one of the following statutes allowed for deregulation of the legal profession?

Legal Aid, Sentencing and Punishment of Offenders Act 2012 correct incorrect

Financial Services Act 2012 correct incorrect

Solicitors Act 1974 correct incorrect

Legal Services Act 2007 correct incorrect

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. What percentage of law firms operate as sole practitioners?

4% correct incorrect

19% correct incorrect

30.4% correct incorrect

47.3% correct incorrect

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. Which one of the following is the term for the top 5 elite City firms?

Golden Circle correct incorrect

Silver Circle correct incorrect

Magic Circle correct incorrect

Global Elite correct incorrect