TEST BANK for Business and Society 17th Edition Stakeholders, Ethics, Public Policy Anne Lawrence;

Test Bank for Business and Society Stakeholders Ethics Public Policy 17th Edition By Anne Lawrence Chapter 1-19 Answers are at the end of Each chapter Chapter 1 Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

1) A business is any organization that is engaged in making a product or providing a service for a profit. ⊚ true ⊚ false 2) The term stakeholder refers exclusively to the founders of a business organization. ⊚ true ⊚ false 3) Businesses and society are independent of each other. ⊚ true ⊚ false 4) The stakeholder theory of the firm argues that a firm’s sole purpose is to create long-term

value for its shareholders. ⊚ true ⊚ false 5) The instrumental argument for the stakeholder theory of the firm says that companies

perform better if they consider the rights and concerns of multiple groups in society. ⊚ true ⊚ false 6) The normative argument for the stakeholder theory of the firm says that the stakeholder view

is simply a more realistic description of how companies really work. ⊚ true ⊚ false

7) Nonmarket stakeholders are those that engage in economic transactions with the company as

it carries out its primary purpose of providing society with goods and services. ⊚ true ⊚ false 8) Market stakeholders include nongovernmental organizations and business support groups. ⊚ true ⊚ false 9) Government can be considered both a market and a nonmarket stakeholder. ⊚ true ⊚ false 10) The interests of different stakeholders often coincide. ⊚ true ⊚ false 11) The first step of stakeholder analysis is to identify relevant stakeholders. ⊚ true ⊚ false 12) Some scholars have suggested that managers pay the most attention to stakeholders

possessing the least salience. ⊚ true ⊚ false 13) The organization of a corporation’s boundary-spanning functions is complex. ⊚ true ⊚ false 14) Businesses are increasingly trying to meet their commitments to multiple stakeholders. ⊚ true ⊚ false 15) The external environment of business is static. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

16) The relationship between business and society is most accurately described by which statement?

A) Business is an unbounded entity within the larger bounded entity of society.

B) Society is a distinct bounded entity within the larger bounded entity of business.

C) Business is a distinct bounded entity separate from the bounded entity of society.

D) Business is a distinct bounded entity within the larger bounded entity of society.

17) According to general systems theory, boundary exchanges are exemplified by which of the

following?

A) An industrial company installs new equipment in its plant to comply with environmental regulations.

B) A software company develops an application for a client.

C) A purchasing department employee negotiates a price on parts with a supplier.

D) All of these choices are correct.

18) The inseparable relationship between business and society results in which of the following?

A) All business decisions have a social impact.

B) The vitality of business depends on society's actions and attitudes.

C) The survival of business is independent of society.

D) Both “All business decisions have a social impact” and “The vitality of business

depends on society’s actions and attitudes” are correct.

19) Which of the following statements is not true about the interactive social system?

A) Business and society need, as well as influence, each other.

B) The boundary between business and society is clear and distinct.

C) Business is a part of society, and society penetrates far and often into business.

D) Business and society are both separate and connected.

20) A firm subscribing to the shareholder theory of the firm would mainly be concerned with

providing long-term value for its A) investors.

B) customers.

C) board of Directors.

D) community.

21) Corporations that follow the stakeholder theory of the firm create value by A) constantly innovating new products.

B) increasing their stock price.

C) developing their employees’ skills.

D) All of these choices are correct.

22) Which argument says that stakeholder management realistically depicts how companies

really work?

A) descriptive argument B) instrumental argument C) normative argument D) fiduciary argument 23) The instrumental argument states that stakeholder management is A) a more realistic description of how companies really work.

B) more effective as a corporate strategy.

C) simply the right thing to do.

D) determined by the amount of stock issued.

24) The fiduciary duty of managers benefits a firm's A) shareholders.

B) customers.

C) employees.

D) All of these choices are correct.

25) The main reason a number of European countries require public companies to include

employee members on their boards of directors is that A) the employees will be available to answer other board members' questions.

B) management will not have to attend the meetings.

C) employees' interests will be explicitly represented.

D) employees will have more power than any other stakeholder.

26) Stakeholder groups can include A) shareholders.

B) business support groups.

C) environmental activists.

D) All of these choices are correct.

27) A nonmarket stakeholder of business is exemplified by which of the following?

A) customers B) nongovernmental organizations C) creditors D) shareholders 28) A market stakeholder of business is exemplified by which of the following?

A) business support groups B) creditors C) activist groups D) nongovernmental organizations 29) All of the following are external stakeholders of the firm except A) managers.

B) customers.

C) shareholders.

D) suppliers.

30) When a person or group holds multiple stakeholder roles, it is referred to as A) role sets.

B) primary stakeholder(s).

C) role theory.

D) role play.

31) A stakeholder analysis A) creates equality among all stakeholder interests.

B) allows managers to examine two primary questions.

C) involves understanding the nature of stakeholder interests.

D) All of these choices are correct.

32) The five types of stakeholders' power recognized by most experts are A) voting, economic, political, legal, and informational power.

B) social, legal, environmental, economic, and political power.

C) social, regulatory, voting, governance, and information power.

D) economic, informational, legal, shareholder, and political power.

33) The power of stakeholders is accurately described by which statement(s)?

A) Different stakeholders have different types and degrees of power.

B) An individual stakeholder may utilize multiple powers.

C) Stakeholder power leverages resources to achieve a desired outcome.

D) All of these choices are correct.

34) Customers can exercise economic stakeholder power by A) voting on a proposed merger for the company and a competitor.

B) boycotting products they believe are too expensive.

C) suing the company for damages caused by products.

D) writing negative online product reviews.

35) Which statement is an example of stakeholders' political power?

A) A social group protests a government’s decision to raise property taxes.

B) A supplier halts shipments to a business customer that is behind on payments.

C) A state government implements a new business-related regulation.

D) A local community boycotts a grocery store suspected of discriminatory hiring.

36) When a community group sues a company for health effects caused by the unsafe disposal of

toxic chemicals, this is an exercise of a stakeholder's A) legal power.

B) voting power.

C) economic power.

D) political power.

37) Which stakeholder group(s) can exercise legal power?

A) employees B) customers C) shareholders D) All of these choices are correct.

38) What actions might a local community use to influence a company’s decisions?

A) publicizing an issue on social media B) lobbying government policy makers for regulations C) protesting corporate behavior at shareholder meetings D) All of these choices are correct.

39) With the explosive growth of technologies that facilitate the sharing of information, which

kind of stakeholder power has become increasingly important?

A) economic power B) political power C) informational power D) legal power 40) What is the primary reason that stakeholder coalitions form?

A) The stakeholder power(s) of different groups coincides.

B) The communication skills of different groups coincide.

C) The stakeholder interest(s) of different groups coincides.

D) The urgency of different stakeholder groups coincides.

41) When something stands out from a background, is seen as important, or draws attention it is A) urgent.

B) salient.

C) powerful.

D) legitimate.

42) Particular stakeholders stand out to managers when they exhibit A) integrity, power, and legitimacy.

B) power, legitimacy, and urgency.

C) integrity, loyalty, and power.

D) legitimacy, loyalty, and urgency.

43) A stakeholder map is a useful tool because A) it enables managers to quickly see how stakeholders feel about an issue.

B) it allows managers to evaluate what outcomes are likely regarding an issue.

C) it helps managers identify stakeholder coalitions likely to form.

D) All of these choices are correct.

44) Departments, or offices, within an organization that reach across the dividing line that

separates the company from groups and people in society are A) inter-departmental divisions.

B) geographical location areas.

C) boundary-spanning departments.

D) organizational maps.

45) External forces that influence the relationship between business and society include A) increased globalization and new government regulations of business.

B) dynamic natural environment and new technology advances.

C) changing societal expectations and a growing demand for ethical values.

D) All of these choices are correct.

46) In the case “Tipping Point at Union Square Hospitality Group (USHG),” who were the

internal market stakeholders?

A) customers B) investors C) employees D) governments 47) In the case “Tipping Point at Union Square Hospitality Group (USHG),” what was the

primary reason the company reversed its no-tipping policy?

A) to reward back-of-house workers who earned lower base pay B) to better satisfy the needs of all USHG stakeholders C) to avoid penalties from state tip regulation offenses D) because the majority of customers "hated" the policy SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

48) Describe how general systems theory can be applied to a business.

49) Supporters of the stakeholder theory of the firm make three core arguments for their position.

Define and provide examples of each.

50) Compare and contrast the relationships a firm may have with market and nonmarket

stakeholders.

51) Discuss why a manager should, or should not, be considered a stakeholder.

52) Explain the process called stakeholder analysis. Include a description of its four key

questions.

53) What is a stakeholder map? Why is it a useful tool?

54) Which of the boundary-spanning departments shown in Figure 1.5 is most likely to interact

with internal as well as external stakeholders, and why do you think so?

55) Describe and give examples of the external forces that shape the relationship between

business and society.

Answer Key Test name: chapter 1 1) TRUE 2) FALSE 3) FALSE 4) FALSE 5) TRUE 6) FALSE 7) FALSE 8) FALSE 9) TRUE 10) TRUE 11) TRUE 12) FALSE 13) TRUE 14) TRUE 15) FALSE 16) D 17) D 18) D 19) B 20) A 21) D 22) A 23) B 24) D 25) C 26) D 27) B 28) B 29) A 30) A 31) C 32) A 33) D 34) B 35) C 36) A 37) D

38) D 39) C 40) C 41) B 42) B 43) D 44) C 45) D 46) C 47) B 48) Short Answer

Answers may vary.

49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

53) Short Answer

Answers may vary.

54) Short Answer

Answers may vary.

55) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

56) A public issue exists when there is agreement between the stakeholders' expectations of what a business firm should do and the actual performance of that business firm. ⊚ true ⊚ false 57) Emerging public issues are both a risk and an opportunity. ⊚ true ⊚ false 58) Understanding and responding to changing societal expectations is a business necessity. ⊚ true ⊚ false 59) Because the public issues that garner the most public attention change over time, companies

do not waste time tracking them. ⊚ true ⊚ false 60) Environmental analysis is a method managers use to gather information about external issues

and trends. ⊚ true ⊚ false 61) Environmental intelligence is the acquisition of information gained from analyzing the

multiple environments affecting organizations. ⊚ true ⊚ false 62) Competitive intelligence enables managers in companies of all sizes to make informed

decisions in all areas of the business. ⊚ true ⊚ false 63) Stakeholder materiality is a method companies use to prioritize the relevance of the

stakeholders and their issues. ⊚ true ⊚ false

64) In the issue management process, identifying the issue involves anticipating emerging issues. ⊚ true ⊚ false 65) Contemporary issue management is a finite process that occurs on average once a year. ⊚ true ⊚ false 66) The boundary-spanning department assigned to manage a public issue often depends on the

nature of the issue. ⊚ true ⊚ false 67) Business organizations are transitioning from transparently sharing their opinion on an issue

to managing issues after the fact. ⊚ true ⊚ false 68) For stakeholder engagement to occur, both the business and the stakeholder must be

motivated to work with one another to solve the problem. ⊚ true ⊚ false 69) Stakeholder dialogue refers to all of the support calls a firm gets from its stakeholders. ⊚ true ⊚ false 70) Companies are learning that it is important to take a strategic approach to the management of

public issues, both domestically and globally. ⊚ true ⊚ false MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

71) Public issues are also referred to as A) B) C) D)

social issues. sociopolitical issues. political issues. both social issues and sociopolitical issues.

72) The emergence of a public issue indicates that A) a gap may be forming between what stakeholders expect and what a firm is doing.

B) technology is forcing ethical decisions and business strategy closer together.

C) consumers are often unaware of how an organization’s actions affect them.

D) All of these choices are correct.

73) Failure to understand the beliefs and expectations of stakeholders may A) cause a company’s profits to increase in the short run.

B) cause a company’s profits to decrease in the short run.

C) cause the performance-expectations gap to grow larger.

D) decrease the chance of a corporate buyout.

74) Because of the risks and opportunities public issues present, organizations need A) a strong relationship with a lobbying firm or an in-house lobbying department.

B) executives to be rewarded with substantial bonuses as part of total compensation.

C) a systematic way of identifying, monitoring, and selecting public issues.

D) tougher government regulations and oversight by political action committees.

75) Customer environmental intelligence includes A) demographic factors.

B) an analysis of the firm's competitors.

C) new technological applications.

D) the cost of producing consumer goods.

76) Scanning the competitor environment includes A) identifying the number of competing organizations.

B) determining how many rivals may become allies.

C) analyzing the growth rates of competing firms.

D) All of these choices are correct.

77) An analysis of the stability or instability of a government is an example of scanning which

type of environmental intelligence?

A) social B) legal C) geophysical D) political

78) Legal environmental intelligence includes A) patterns of aggressive corporate growth versus static maintenance.

B) analysis of local, state, national, and international politics.

C) considerations of patents, copyrights, or trademarks.

D) information regarding costs, prices, and international trade.

79) The role of special interest groups is an important element in acquiring intelligence from

which environment?

A) customer B) competitor C) economic D) social 80) The relevance and importance of stakeholders and their issues is known as A) stakeholder salience.

B) competitive intelligence.

C) stakeholder materiality.

D) organizational capacity.

81) The issue management process is important to organizations because it A) is now required by certain government regulations.

B) assists firms in reactively managing a public-facing issue.

C) helps firms to proactively manage a public-facing issue.

D) guides firms in consistently making ethical decisions.

82) The issue management process consists of these steps in this order: A) identify issue, take action, analyze results, defend results.

B) analyze issue, take action, generate options, evaluate results.

C) evaluate results, take action, identify issue, analyze issue.

D) identify issue, analyze issue, generate options, take action, evaluate results.

83) An issue's public profile indicates to managers A) how significant an issue is for the organization, but it does not tell them what to do.

B) both how significant an issue is for the organization and exactly what to do.

C) exactly what to do without indicators of how significant an issue is for the

organization.

D) Each of the other choices are correct, depending on the organization type.

84) When working well, the issue management process A) is static and never pulls in additional information that would disturb the balance.

B) automatically operates with little to no company involvement.

C) minimizes dialogue with the stakeholders and focuses on short-term survival.

D) continuously cycles back to the beginning and repeats.

85) Contemporary issue management A) is a linear process.

B) was useful in the 1970s, but not today.

C) is used by all government agencies.

D) is an interactive, forward-thinking process.

86) How does a firm decide which internal department takes the lead on a public issue?

A) The CEO and other officers always lead the resolution of public issues.

B) Human resources is the default department for resolving public issues.

C) Marketing is the first line of defense for managing public issues.

D) The nature of the issue typically determines which team manages the issue.

87) The most effective global leaders possess the ability to grasp changing business context,

which means what?

A) having the appropriate skills to communicate with external stakeholders B) possessing the ability to deal with the frequent ambiguity of public issues C) understanding emerging environmental and social trends affecting the firm D) being able to grasp the long-term strategic plan of the organization 88) Effective global leaders deal with the complexity of public issues in what ways?

A) being flexible B) using creativity C) learning from mistakes D) All of these choices are correct.

89) The capability of effective global leaders to engage stakeholders in dialogue and partnership

over public issues is referred to as A) connectedness.

B) conceptualism.

C) contextualization.

D) continuity.

90) Over time, the nature of business's relationship with its stakeholders often A) remains generally static.

B) evolves through a series of stages.

C) becomes increasingly hostile.

D) becomes more competitive.

91) Companies that believe they can make decisions unilaterally, without taking into

consideration their impact on others, are A) interactive.

B) proactive.

C) reactive.

D) inactive.

92) Firms that generally act only when forced to do so, and then in a defensive manner, are A) interactive.

B) proactive.

C) reactive.

D) inactive.

93) Proactive companies are A) much less likely to be blindsided by crises and negative surprises.

B) much more likely to be blindsided by crises and negative surprises.

C) more likely to be blindsided by crises and negative surprises.

D) more likely to be forced to defend themselves in a stakeholder lawsuit.

94) An interactive business–stakeholder relationship is one where A) companies actively engage with stakeholders through mutual respect and trust.

B) companies engage with all of their stakeholders using only electronic

communications.

C) competitive advantage is realized through a constant change of internal representatives.

D) organizations use role-playing to effectively engage with external stakeholders.

95) Stakeholder engagement is best described as a A) program.

B) relationship.

C) process.

D) systems model.

96) The drivers of stakeholder engagement are A) scanning, assessment, and growth.

B) data, strategy, and organizational development.

C) goals, motivation, and operational capacity.

D) financial, operational, and legal.

97) What role does social media play in stakeholder engagement?

A) provides a forum for the firm to share information with the public via blogs and press

releases B) offers a mechanism for the public to voice their opinions of the firm and its products via reviews C) makes stakeholder communications faster and more effective D) All of these choices are correct.

98) The process of a business and its stakeholders coming together for face-to-face conversations

about issues of common concern is called stakeholder A) networks.

B) motivation.

C) systems.

D) dialogue.

99) The act of corporations working collaboratively with other businesses, concerned persons,

and organizations is an example of stakeholder A) networks.

B) motivation.

C) systems.

D) salience.

What was the primary performance–expectations gap in the case “Robinhood: The Challenges of Keeping Pace with Innovation”?

A) The firm advertised free trades for all but actually charged its customers hefty hidden fees.

B) The public expected effective customer support, but it was slow and inadequate.

C) The public expected a state-of-the-art app, but it was essentially outdated software.

D) The firm claimed to have made donations to charity, but instead the money went to investors.

100)

101)

Which of the eight strategic radar screens would be the most significant in the case “Robinhood: The Challenges of Keeping Pace with Innovation”?

A) legal B) competitor C) customer D) technological

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

102) What are public issue and how do they impact modern firms?

103)

What is competitive intelligence? Why is it important to the public affairs function?

104)

Identify the eight strategic radar screens that enable public affairs managers to scan their business environment. Briefly discuss the issues involved with each environment.

105)

Give an example and explain why stakeholder materiality is important to both the company and its stakeholders.

106)

Identify and discuss the five steps of the issues management process.

107)

What are the various stages of the business–stakeholder relationship?

108)

Engaging interactively with stakeholders carries a number of potential benefits. Discuss.

Answer Key Test name: chapter 2 1) FALSE 2) TRUE 3) TRUE 4) FALSE 5) TRUE 6) TRUE 7) TRUE 8) TRUE 9) TRUE 10) FALSE 11) TRUE 12) FALSE 13) TRUE 14) FALSE 15) TRUE 16) D 17) A 18) C 19) C 20) A 21) D 22) D 23) C 24) D 25) C 26) C 27) D 28) A 29) D 30) D 31) D 32) C 33) D 34) A 35) B 36) D 37) C

38) A 39) A 40) B 41) C 42) D 43) D 44) A 45) B 46) C 47) Short Answer

Answers may vary.

48) Short Answer

Answers may vary.

49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

53) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

109) Corporate social responsibility is the idea that businesses interact with the organization's stakeholders for social good while they pursue economic goals. ⊚ true ⊚ false

110)

Huge businesses can disproportionately influence politics, shape tastes, and dominate public discourse. ⊚ true ⊚ false

111)

The term corporate power means that in the long run, those who do not use power in ways that society considers responsible will tend to lose it. ⊚ true ⊚ false

112)

The concept of corporate social responsibility is rooted in the meaning "to pledge back," creating a commitment to give back to society and the organization's stakeholders. ⊚ true ⊚ false

113)

Being socially responsible means that a company must abandon its other missions. ⊚ true ⊚ false

114)

Corporate citizenship refers to a set of beliefs stating that socially responsible behavior is a good idea. ⊚ true ⊚ false

115)

Enlightened self-interest is the idea that the wealthiest members of society should be charitable toward those less fortunate. ⊚ true ⊚ false

116)

One of the most appealing arguments in favor of corporate social responsibility for business supporters is that voluntary social acts may head off increased government regulation. ⊚ true ⊚ false

117)

An argument against corporate social responsibility is that it imposes unequal costs among competitors. ⊚ true ⊚ false

118)

The core mission of a social entrepreneur is to create and sustain social rather than economic value. ⊚ true ⊚ false

119)

To qualify as a B corporation, a business must be certified by a state government agency. ⊚ true ⊚ false

120)

Global corporate citizenship refers to putting an organization's commitment to social and environmental responsibility into practice locally. ⊚ true ⊚ false

121)

In the first stage of corporate citizenship, the elementary stage, managers are uninterested and uninvolved with social issues. ⊚ true ⊚ false

122)

A social audit is a systematic evaluation of an organization's social, ethical, and environmental performance. ⊚ true ⊚ false

123)

When a company publishes the results of a social audit, they are meeting the demands of local governments' taxation policies. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

124) The capability of corporations to influence government, the economy, and society based on their organizational resources is called A) corporate power.

B) CEO power.

C) corporate citizenship.

D) corporate media.

125)

The iron law of responsibility says that A) in the long run, those who do not use power responsibly will lose it.

B) in the short run, one must sacrifice social goals for economic goals.

C) law is the most important, more than social or economic responsibility.

D) in the long run, economic responsibility leads to social responsibility.

126)

Corporate social responsibility is accurately described by which statement(s)?

A) Businesses should monitor and prevent social problems before they become major issues.

B) A company should seek maximum profits from its operations to provide the best for society.

C) Corporations should be accountable for any actions that affect people, their communities, and the environment.

D) Both “Businesses should monitor and prevent social problems before they become major issues” and “Corporations should be accountable for any actions that affect people, their communities, and the environment” are correct.

127)

The underlying concept behind corporate citizenship is that businesses are A) like individual citizens with real responsibilities to society.

B) exempt from social responsibility, unlike individuals.

C) transforming society through a vision of integrated financials.

D) making foreign investments to help people in other countries.

128)

When a company puts its commitment to social and environmental responsibility into practice worldwide, not just locally or regionally, it is called A) corporate social responsibility.

B) global sustainability.

C) global corporate citizenship.

D) community investing.

129)

Early business leaders, such as automaker Henry Ford, developed these programs to support the recreational and health needs of their employees.

A) corporate social responsibility programs.

B) corporate citizenship programs.

C) social networking programs.

D) paternalistic programs.

130)

Social unrest, ethnic beliefs, geopolitical shifts, and generational changes are examples of A) CSR policy instruments.

B) phases of CSR. C) drivers of CSR. D) CSR results.

131)

The most recent phase of CSR integrates culture and nature and also seeks A) common ethical principles.

B) stakeholder mapping.

C) planetary sustainability.

D) a balance of social pressures.

132)

An example of a company guided by enlightened self-interest is one that A) spends money on short-term projects to benefit market stakeholders.

B) puts most of their effort into marketing schemes to attract more business.

C) invests in long-term programs that provide assistance to their stakeholders.

D) follows all government rules and regulations to avoid penalties and fines.

133)

When undertaking social initiatives, a company A) must take out social responsibility insurance.

B) will always receive long-term profits.

C) may sacrifice short-term profits.

D) risks going bankrupt in nearly all cases.

134)

Those in support of corporate social responsibility believe the practice A) lowers economic efficiency and profit.

B) discourages increased government regulation.

C) places responsibility on business rather than on individuals.

D) imposes unequal costs among competitors.

135)

According to Barlow v. A.P. Smith Manufacturing A) the laws prohibited charitable contributions, at that time.

B) charitable contributions were bad corporate investments for the short term.

C) socially responsible actions must be approved by a majority of the firm's stakeholders.

D) socially responsible actions are an investment in the future, and thus an allowable expense.

136)

The social reputation of a firm is important when establishing what between a company and its stakeholders?

A) trust B) liability C) costs D) assets

137)

The costs of corporate social responsibility may ultimately be passed on to the A) supplier through discounts.

B) consumer through higher prices.

C) shareholders through higher dividends.

D) taxpayers by the government.

138)

When a business diverts resources for social purposes, it risks A) a loss of foreign sales.

B) increased regulations.

C) lowering its efficiency.

D) a positive social reputation.

139)

Proponents against corporate social responsibility feel that public officials, not businesspeople, should solve societal problems because: A) businesspeople may not have the skills to solve societal problems.

B) the private sector is not mandated to solve public issues.

C) public officials were elected to manage social topics.

D) All of these choices are correct.

140)

Organizations founded with a core mission to create and sustain social value are called social: A) entrepreneurships.

B) nonprofits.

C) ventures.

D) capitalists.

141)

How does a business get qualified as a B Corporation?

A) It must meet all of the Global Reporting Initiative standards.

B) Its results must meet the independent standards developed by B Lab. C) The firm must be chartered by its state government as a benefit corporation.

D) It must have already received at least three environmental excellence awards.

142)

What is one advantage of operating as a B Corporation?

A) They are tax-free organizations.

B) Financial reporting is not required.

C) Social audits are not required.

D) Government certifications are frequently conferred.

143)

Recent reports stress the role of business in shaping the social contract for A) defining social mobility.

B) short-term value for stakeholders.

C) opportunities for non-marginalized groups.

D) addressing global inequity.

144)

How do professional management consultants assist businesses with becoming better corporate citizens?

A) Lobby Congress for socially responsible legislation.

B) Discover tax shelters for social program expenditures.

C) Conduct company-wide social audits.

D) Develop sustainable business strategies.

145)

How do managers organize to effectively engage in global corporate citizenship?

A) by focusing solely and specifically on the local community B) through limited corporate philanthropy and volunteerism C) by using an integrated approach that leverages company resources D) by removing senior leadership from driving stakeholder expectations

146)

Increased acceptance of global corporate citizenship has spurred the growth of which industry?

A) specialized management consultancies B) microfinance banking firms C) cryptocurrency financial markets D) manufacturing efficiency associations

147)

Visionary CEOs see global citizenship as an opportunity to A) create value for their organization.

B) gain a competitive advantage.

C) help address global challenges.

D) All of these choices are correct.

148)

The issue of reactive management policies occurs in which stage of global corporate citizenship?

A) transforming B) engaged C) integrated D) innovative

149)

Managers responding to the needs of the local education system as a normal or routine aspect of its operations is an example of an organization in which stage?

A) innovative B) integrated C) transforming D) engaged

150)

What is the leadership characteristic of the transforming stage of global corporate citizenship?

A) champion, in front of it B) steward, on top of it C) supporter, in the loop D) visionary, ahead of the pack

151)

A social audit systematically evaluates which of a firm’s performance metrics?

A) social, financial, technical B) social, ethical, environmental C) ethical, financial, legal D) ethical, sustainability, sales

152)

Social audit standards may be developed by which group(s)?

A) Companies can set standards for themselves, for suppliers, and for partners.

B) A group of firms in the same business can set industry-wide standards.

C) Global nongovernmental organizations or standard-setting groups can set social audit standards.

D) All of these choices are correct.

153)

The most significant motivator of corporate social reporting is A) government reporting requirements.

B) ethical concerns.

C) financial concerns.

D) employee demand.

154)

How did Dan Price blend social responsibility with Gravity Payment’s mission to provide high-service, low-cost credit card processing, according to the case “Corporate Social Responsibility at Gravity Payments”?

A) The CEO donated 15 percent of profits to charity.

B) He provided free in-kind services to small businesses.

C) Price implemented a pay equity plan for all employees.

D) Price donated his 13-year-old Audi to a local shelter.

In the case “Corporate Social Responsibility at Gravity Payments,” which view in support of corporate social responsibility is relevant according to Figure 3.3?

A) balances corporate power with responsibility B) discourages government regulation C) improves supplier relations D) promotes short-term profits for the business

155)

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

156) Describe the iron law of responsibility.

157)

Explain why a business should seek to balance its economic, legal, and social obligations.

158)

Define and provide an example of a business practicing enlightened self-interest.

159)

Provide three arguments in support of corporate social responsibility.

160)

Provide three concerns about corporate social responsibility.

161)

Describe a social venture with which you are familiar. What is the organization’s core mission? How have they helped society?

162)

Global corporate citizenship is more than espoused values; it requires action. Discuss some of the ways forward-thinking companies are changing to improve their ability to act as responsible citizens.

163)

Explain how a company can operate at multiple stages of global corporate citizenship at any one point in time.

164)

What is a social audit? Describe one of the three ways audit standards can be created.

Answer Key Test name: chapter 3 1) TRUE 2) TRUE 3) FALSE 4) TRUE 5) FALSE 6) FALSE 7) FALSE 8) TRUE 9) TRUE 10) TRUE 11) FALSE 12) FALSE 13) TRUE 14) TRUE 15) FALSE 16) A 17) A 18) D 19) A 20) C 21) D 22) C 23) C 24) C 25) C 26) B 27) D 28) A 29) B 30) C 31) D 32) C 33) B 34) D 35) D 36) D 37) C

38) A 39) D 40) B 41) C 42) D 43) B 44) D 45) B 46) C 47) A 48) Short Answer

Answers may vary.

49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

53) Short Answer

Answers may vary.

54) Short Answer

Answers may vary.

55) Short Answer

Answers may vary.

56) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

165) Globalization directly and indirectly influences the politics, environment, geopolitics, and economics of virtually every country in the world. ⊚ true ⊚ false 166)

Although many firms conduct business across national boundaries, most global commerce is carried out by a small number of powerful firms. ⊚ true ⊚ false

167)

Even small local businesses often compete with global companies from around the world. ⊚ true ⊚ false

168)

The importing of foreign goods by U.S. firms is called foreign direct investment. ⊚ true ⊚ false

169)

The World Bank makes currency exchange easier for member countries so they can participate in global trade. ⊚ true ⊚ false

170)

The International Monetary Fund sometimes imposes strict conditions for loans that often lead to hardship. ⊚ true ⊚ false

171)

The World Trade Organization conducts negotiations, called "cycles," on various topics, rotating its meetings among different cities. ⊚ true ⊚ false

172)

Globalization is accepted worldwide and creates little controversy. ⊚ true ⊚ false

173)

Productivity rises more quickly when countries produce goods and services for which they have a natural talent. ⊚ true ⊚ false

174)

Only manufacturing jobs are being lost through globalization. ⊚ true ⊚ false

175)

Critics of globalization support the spread of American ideals and culture throughout the rest of the world. ⊚ true ⊚ false

176)

Most nations in the world share similar political, social, and economic beliefs. ⊚ true ⊚ false

177)

According to researchers, there has been a continuing global decline in political rights and civil liberties. ⊚ true ⊚ false

178)

Global inequality may be measured in two ways: wealth and income. ⊚ true ⊚ false

179)

In the context of globalization, the term sector refers to parts or spheres of society. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

180) Global market channels involve a firm producing goods in A) their home country to sell to other countries.

B) their home country to sell at home.

C) a foreign country to sell at home.

D) a foreign country to sell abroad.

181)

A firm that has global operations has A) all of their manufacturing and service operations abroad.

B) some or all of their manufacturing or service operations abroad.

C) manufacturing but not service operations abroad.

D) service but not manufacturing operations abroad.

182)

A firm that would like to develop a global supply chain would A) manufacture components or supplies in other countries.

B) sell abroad raw materials, components, or supplies produced at home.

C) purchase raw materials, components, or supplies from sellers in other countries.

D) check products that were manufactured abroad for defects in their home country.

183)

The three strategies of globalization can be summarized using what three words?

A) channels, operations, and chains B) export, locate, and purchase C) sell, make, and buy D) ethics, import, and sell

184)

Why are the World Bank, the International Monetary Fund, and the World Trade Organization so important to the current global economy?

A) They helped rebuild the many war-torn economies of Europe.

B) They frequently revalue and devalue foreign currencies.

C) They set the rules by which international commerce is transacted.

D) They support private equity vulture funds helping indebted countries.

185)

Representation on the World Bank's board of directors is based on A) the size of the member nation's population.

B) the size of the member nation's economy.

C) the size of the member nation's land mass.

D) equal representation of all member nations.

186)

The primary purpose of the International Monetary Fund is to A) lend foreign currency to member countries.

B) exchange one currency for another.

C) consolidate the debt facing developing nations.

D) collect the interest on loans made by the World Bank.

187)

The primary goal of a "vulture fund" is to A) provide countries with debt relief.

B) pay back loans in default.

C) increase global financial stability.

D) make a profit.

188)

The purpose of the World Trade Organization is to A) impose tariffs to protect international business.

B) eliminate barriers to free trade among nations.

C) develop trading partnerships between rich and poor nations.

D) lend money or foreign currency for international trade.

189)

Under the World Trade Organization's most-favored nation rule A) all import restrictions require a cultural waiver.

B) all import restrictions are illegal unless proven scientifically.

C) most favored nations can impose heavy tariffs on other nations.

D) any nation can oppose the dumping of goods in their home market.

190)

When one country tries to damage another by imposing tariffs or other restrictions on that country’s goods, this is called a A) trade war.

B) vulture fund.

C) price war.

D) protective tariff.

191)

The theory of comparative advantage states that A) productivity rises more quickly when countries produce goods and services for which they have a natural talent.

B) specialization tends to raise the prices of all goods produced for foreign trade.

C) all countries produce goods that start out on an equal playing field.

D) countries that operate under a policy of isolationism have a comparative advantage.

192)

An individual who supports globalization would argue that it helps the developing world

by A) giving entrepreneurs access to foreign investment funds to support economic

development.

B) allowing new ideas and technological innovations to spread more quickly.

C) supporting the spread of democracy and freedom.

D) All of these choices are correct.

193)

Why do critics of globalization claim that it creates job insecurity?

A) Wages in developing countries may stagnate due to competition with other nations.

B) The massive global supply chain forces workers to compete with each other for jobs.

C) Exports replace homemade goods and services previously used in the home country.

D) Businesses move to other countries to find cheap labor and lay off workers at home.

194)

The term race to the bottom refers to A) seeking to mine valuable minerals from the bottom of the ocean.

B) moving production jobs to the country with the lowest labor cost.

C) moving jobs to countries with strong health and safety rules.

D) an old concept that is no longer relevant to globalization.

195)

The deep anti-Americanism that exists in some parts of the world is thought to be caused

by A) B) C) D) 196)

increased cultural, linguistic, and religious diversity among nations. resentment of cultural penetration from U.S.-based multinational corporations. an upswing in the number of communist countries in the world. an increase in international human rights and environmental standards.

Democracy refers broadly to the presence of A) open markets.

B) global trade.

C) social planning.

D) political freedom.

197)

The political system that offers fair elections, a free press, separation of powers, and an open society is called A) central state control.

B) free enterprise.

C) democracy.

D) communism.

198)

A society where economic power is concentrated in the hands of government officials and political authorities is called A) a central state control system.

B) a social democracy.

C) a communist system.

D) a military dictatorship.

199)

A free enterprise system refers to A) economic assets that are privately owned and exchanged in an open market.

B) property ownership by a centralized state government.

C) a mix of privately owned and government-controlled economic assets.

D) an index of free goods and services available for purchase.

200)

Which of these countries has the least economic freedom?

A) Australia B) Cuba C) France D) Singapore

201)

Assets that a person accumulates and owns at a certain point in time are called A) income.

B) equity.

C) wealth.

D) microfinance.

202)

Which level of the Global Wealth Pyramid represents the largest number of people?

A) bottom B) middle C) top level D) high wealth

203)

How much a person earns in a day or a year is called A) wealth.

B) income.

C) net worth.

D) tax base.

204)

Income at the bottom of the pyramid may be adjusted per country according to its overall A) population.

B) land mass.

C) prosperity.

D) density.

205)

Historically, global corporations have focused their attention on which income level(s)?

A) The focus has been entirely on the top and ultra-top of the pyramid.

B) All at the top of the pyramid and some of the middle class.

C) The focus has always been solely on the middle of the pyramid.

D) The entire bottom of the pyramid and a small amount in the middle.

206)

Microfinance refers to banks A) lending money to a very small number of businesses.

B) making affordable loans to low-income businesses.

C) lending very small amounts of money to wealthy businesses.

D) charging low fees for all business loans.

207)

Multisector partnerships that address specific social issues in the global economy are called A) global action networks.

B) civil societies.

C) globalization.

D) nonprofit networks.

208)

Nonprofit, educational, and religious groups are examples of which sector of society?

A) private B) public C) civil D) business

209)

Experts attribute the growth of nongovernmental organizations to A) the creation of global stock exchanges.

B) the globalization of manufacturing.

C) greater openness in many societies.

D) the rise of authoritarianism.

210)

Government has distinctive resources and competencies including A) knowledge of public policy.

B) the ability to enforce the rules.

C) revenue from taxation.

D) All of these choices are correct.

211)

Within society, what is the primary goal of the civil sector, according to Figure 4.4?

A) wealth creation B) societal order C) expression of values D) job creation

212)

As part of a global action network, business may exhibit which weakness?

A) limited access to capital funding B) not enough focus on long-term impacts C) too much focus on prior results D) outdated management skills

213)

A global action network exhibits which characteristic?

A) Some members can help overcome other members’ weaknesses.

B) The differences across sectors are too difficult to overcome.

C) An individual member’s strengths can dominate the entire group.

D) The unique capabilities of some members can conflict with the group.

What was Intel’s primary interest in mineral mining, according to the case “Intel and the Responsible Minerals Initiative”?

A) to prevent the horrific violence associated with sourcing conflict minerals B) to identify cheaper labor and increased efficiencies in their sourcing chain C) to introduce and enforce democracy throughout their large supply chain D) to distance themselves from human rights abuses associated with conflict minerals

214)

215)

How did the public sector help reduce trade in conflict minerals, according to the case “Intel and the Responsible Minerals Initiative”?

A) They visited mines and refining facilities in remote areas of Rwanda.

B) They sent in troops to fend off the persistent militias looting coltan.

C) They required all member nations to comply with responsible sourcing guidelines.

D) They educated their trading partners about the problem of conflict minerals.

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

216) What is a multinational enterprise (MNE)? How do these corporations operate in the global marketplace?

217)

Describe the roles of the World Bank, International Monetary Fund, and World Trade Organization as international financial and trade institutions.

218)

Discuss the benefits and costs of globalization. Provide examples of how globalization has helped or harmed individual nations and the world economy.

219)

220)

Explain the theory of competitive advantage.

Compare and contrast the world's political and economic systems and their effects on globalization.

221)

Explain global wealth and power inequalities. What are the special challenges of serving the "bottom of the pyramid" sector?

222)

How can global action networks help solve global problems?

Answer Key Test name: chapter 4 1) TRUE 2) TRUE 3) TRUE 4) FALSE 5) FALSE 6) TRUE 7) FALSE 8) FALSE 9) TRUE 10) FALSE 11) FALSE 12) FALSE 13) TRUE 14) TRUE 15) TRUE 16) A 17) B 18) C 19) C 20) C 21) B 22) A 23) D 24) B 25) B 26) A 27) A 28) D 29) D 30) B 31) B 32) D 33) C 34) A 35) A 36) B 37) C

38) A 39) B 40) C 41) B 42) B 43) A 44) C 45) C 46) D 47) C 48) B 49) A 50) D 51) C 52) Short Answer

Answers may vary.

53) Short Answer

Answers may vary.

54) Short Answer

Answers may vary.

55) Short Answer

Answers may vary.

56) Short Answer

Answers may vary.

57) Short Answer

Answers may vary.

58) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

223) Ethics are primarily based on religious beliefs. ⊚ true ⊚ false

224)

Ethical ideas are present in all societies, all organizations, and all individual persons. ⊚ true ⊚ false

225)

If all people relied on ethical relativism, there would be no universal ethical standards on which people around the globe could agree. ⊚ true ⊚ false

226)

Business must develop its own definition of what is right and wrong, apart from ethics. ⊚ true ⊚ false

227)

Business cannot expect to be profitable while adhering to ethical principles of conduct. ⊚ true ⊚ false

228)

The U.S. Corporate Sentencing Guidelines provide a strong incentive for businesses to promote their ethics at work. ⊚ true ⊚ false

229)

The Sarbanes–Oxley Act requires that firms maintain good financial practices, apart from high ethical standards, in how they conduct and monitor business operations. ⊚ true ⊚ false

230)

An ethical egoist acts for the benefit of others and sacrifices self-interest. ⊚ true ⊚ false

231)

Because managers make major decisions, they have limited opportunity to influence the ethical tone of the firm. ⊚ true ⊚ false

232)

Only in the last few years have scholars found a positive relationship between an organization's economic performance and attention to spiritual values. ⊚ true ⊚ false

233)

Managers in the same company are likely to be at the same stages of moral reasoning at any given time. ⊚ true ⊚ false

234)

For managers who reason at stages 2 and 3, their personal rewards, recognition from others, or compliance with the company's rules become their main ethical compass. ⊚ true ⊚ false

235)

According to utilitarian reasoning, an action is ethically preferred when its benefits outweigh its costs. ⊚ true ⊚ false

236)

Business managers should use all four methods of ethical reasoning—virtues, utility, rights, and justice—to better understand ethical issues at work. ⊚ true ⊚ false

237)

Moral intensity refers to the perception of how illegal an ethical issue is. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

238) A conception of right and wrong is A) impossible to know.

B) the definition of ethics.

C) determined by power.

D) based on stakeholder dialogue.

239)

People's ethical principles come from A) legislative action and judicial decisions.

B) reading the company's profit and loss statements.

C) their religious background, family, and education.

D) the organization's code of ethics.

240)

Ethical relativism is most accurately defined by which statement?

A) Ethical principles transcend all periods of time in history.

B) What’s ethical in one society may be forbidden in another.

C) Ethical beliefs are identical across international boundaries.

D) All religions agree on a common set of universal ethical standards.

241)

Businesses are expected to be ethical in their relationships with A) stockholders.

B) customers.

C) competitors.

D) All of these choices are correct.

242)

What normative reason is there for business to be ethical, according to Figure 5.1?

A) to enhance business performance B) to promote personal morality C) to meet the demands of stakeholders D) to comply with legal requirements

243)

How do ethical business practices impact the sentencing of an employee convicted of criminal activity, according to the U.S. Corporate Sentencing Guidelines?

A) There is no impact because a firm is never responsible for the actions taken by an employee.

B) The degree of blame is calculated based on how strong the firm’s ethical policies are.

C) The U.S. Sentencing Commission does not take ethics into account when sentencing.

D) The U.S. Corporate Sentencing Guidelines are temporarily suspended while under review.

244)

245)

Under the Sarbanes–Oxley Act, corporations are required to A) have executives vouch for the accuracy of a firm’s financial reports.

B) have their audit committee comprised of only executives employed by the firm.

C) collect reimbursements from the U.S. government if financial restatements occur.

D) transparently report the number of employees who consistently do the right thing.

A purchasing agent giving an exclusive contract to a supplier, from which she received a valuable gift, is an example of A) conflict of interest.

B) ethical relativism.

C) moral development.

D) altruistic behavior.

246)

Cross-cultural contradictions arise due to A) the emergence of a developing country’s economic power.

B) religious differences practiced by business executives.

C) differences between home and host countries’ ethical standards.

D) All of these choices are correct.

247)

An ethics issue based on cross-cultural contradictions is best illustrated by which example?

A) legally marketing a pesticide abroad that has been banned in the United States B) circumventing government regulations to ensure company profits C) hiring child workers in violation of civil law D) false and misleading advertising claims

248)

A recent study found that, compared to the 1980s, managers today place what level of importance on moral values, such as honesty and forgiveness?

A) less important B) about the same importance C) slightly more important D) triple the importance

249)

According to an annual Gallup poll, which occupation was consistently ranked the highest for honesty and ethics?

A) lawyers B) bankers C) nurses D) clergy

250)

Why do some disagree with the trend toward a stronger presence of religion in the workplace?

A) Bringing religion into the workplace causes stress for the majority of workers.

B) Spirituality increases personal growth but has no impact on the business world.

C) They cite the separation of church and state in the United States and other countries.

D) People with a strong religious identity tend to take less responsibility for their decisions.

251)

As spirituality in the workplace has increased, how have some organizations responded?

A) partnered with local churches and temples to allow spiritual visits for workers B) created ways to allow for religious diversity and expression at work C) disallowed employees from engaging in religious activities on the job D) built separate physical areas for those who are religious and those who are not

252)

Which age groups within the stages of moral development apply egocentric reasoning?

A) adulthood only B) mature adulthood C) childhood, youth D) youth, early adulthood

253)

In early adulthood, young people can improve their level of moral reasoning by A) learning the give-and-take of group life.

B) spending quality time with mature adults.

C) being caregivers to infants and children.

D) watching family-oriented television daily.

254)

How would a manager at moral reasoning level 4, full adulthood, likely respond to a new government regulation?

A) comply with the law B) ignore the new ruling C) consult with a group D) complain to management

255)

Mature adults typically base their ethical reasoning on broad principles and relationships such as A) human rights and constitutional guarantees of human dignity.

B) universal principles of justice, such as equal treatment.

C) customs and traditions displayed by their peers.

D) Both “human rights and constitutional guarantees of human dignity” and “universal principles of justice, such as equal treatment” are correct.

256)

Business managers need a set of ethical guidelines to help them A) understand the changing customs throughout the world.

B) justify their own self-serving solutions.

C) identify and analyze the nature of an ethical problem.

D) decide which action is likely to bring the best financial result.

257)

Aristotle argued A) self-control is the most virtuous of values.

B) faith is a road to charity and modesty.

C) moral virtue is a mean between two vices.

D) high-mindedness delivers human integrity.

258)

When the benefits of an action outweigh its costs, the action is considered ethically preferred according to A) utilitarian reasoning.

B) virtue ethics.

C) theological reasoning.

D) Plato and Aristotle.

259)

The main drawback to utilitarian reasoning is that A) the majority may override the rights of those in the minority.

B) managers using this reasoning process often fail to consider the means taken to reach the end.

C) it is difficult to accurately measure both costs and benefits.

D) cost-benefit calculations can only be provided by accountants.

260)

At the core of rights reasoning is the belief that A) the company's right to a profit must be protected.

B) respecting others is the essence of human rights.

C) the right to join a union is no longer universally accepted.

D) economic and political powers determine who is right.

261)

A just or fair ethical decision occurs when A) the rights of all affected are considered.

B) the greatest good for those with power is achieved.

C) benefits and burdens are distributed in fair proportions.

D) benefits exceed costs.

262)

The reason(s) behind the uncertainty of an ethical decision is(are) that different people and groups A) may use different sources of information.

B) may rank various rights in different ways.

C) may not share the same meaning of justice.

D) All of these choices are correct.

263)

One factor in determining the moral intensity of an ethical issue is how quickly the consequences take effect, a factor that is known as A) temporal immediacy.

B) social consensus.

C) proximity.

D) probability.

264)

As a factor of moral intensity, how does the proximity of an issue affect the decision maker?

A) The shorter the physical distance, the lower the intensity.

B) The greater the psychological distance, the higher the intensity.

C) The greater the empathy, the higher the intensity.

D) The shorter the social distance, the lower the intensity.

265)

Why is it important for an ethical decision maker to consider the probability that the action will lead to the consequences predicted?

A) to solve the problem before time runs out B) to mitigate the likelihood of harm C) to stay in line with social consensus D) to save face if things don’t work out

266)

A high magnitude of consequences that increases the moral intensity of an ethical issue is best exemplified by which of the following?

A) A manager used company funds to pay for personal expenses.

B) A contract employee recorded more hours than he or she actually worked.

C) An employee stole several packs of paper clips from the supply closet.

D) A food product contaminated with salmonella was distributed to stores.

267)

Which type of ethical issue did 3M face with regard to price gouging accusations, according to the case “3M and N95 Respirators for Americans”?

A) cross-cultural contradictions B) competitive pressures on profits C) conflicts of interest D) personal gain and selfishness

268)

Which factor of moral intensity likely played the biggest role in 3M’s response to FEMA’s request, according to the case “3M and N95 Respirators for Americans”?

A) probability B) social consensus C) magnitude D) proximity

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

269) Briefly discuss the meaning of ethics.

270)

Discuss why businesses should be ethical.

271)

Explain the purpose of the Sarbanes–Oxley Act. What issues does the act address? Is this act still a potent government tool?

272)

Four reasons given in the textbook state why ethical problems occur in business. Identify the nature of each ethical problem and the typical approach taken in response to the problem.

273)

How does a person’s spirituality influence his or her ethical behavior? How have organizations responded to the increased attention to spirituality and religion at work in their attempt to accommodate their employees?

274)

Define and discuss the six stages of moral development. What is the ethics referent at each stage? What is the basis of ethics reasoning at each stage?

275)

What are the four methods of ethical reasoning? Discuss the limitations of each of the four methods.

Answer Key Test name: chapter 5 1) FALSE 2) TRUE 3) TRUE 4) FALSE 5) FALSE 6) TRUE 7) FALSE 8) FALSE 9) FALSE 10) FALSE 11) FALSE 12) TRUE 13) TRUE 14) TRUE 15) FALSE 16) B 17) C 18) B 19) D 20) B 21) B 22) A 23) A 24) C 25) A 26) C 27) C 28) C 29) B 30) C 31) A 32) A 33) D 34) C 35) C 36) A 37) C

38) B 39) C 40) D 41) A 42) C 43) B 44) D 45) B 46) C 47) Short Answer

Answers may vary.

48) Short Answer

Answers may vary.

49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

53) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

276) Personal values and moral character play key roles in improving a company's ethical performance. ⊚ true ⊚ false 277)

In most companies, a moral atmosphere cannot be detected. ⊚ true ⊚ false

278)

In a benevolence ethical climate, the interests of the company's employees and external stakeholders most likely would be given high priority. ⊚ true ⊚ false

279)

It is impossible for multiple ethical climates to exist within one organization. ⊚ true ⊚ false

280)

Managers, as major decision makers, are one of the keys to whether a company will act ethically or unethically. ⊚ true ⊚ false

281)

Honesty, integrity, and accuracy are absolute requirements of the accounting function. ⊚ true ⊚ false

282)

Marketing ethics include having concern for consumer health and safety issues. ⊚ true ⊚ false

283)

The Principles and Standards of Ethical Supply Chain Management Conduct focuses on integrity, value, and loyalty. ⊚ true ⊚ false

284)

The majority of large U.S. corporations do not have codes of ethics. ⊚ true ⊚ false

285)

In the United States, most ethics policies are based primarily on the company’s mission and vision. ⊚ true ⊚ false

286)

Ethics training is typically the most costly element of an ethics program. ⊚ true ⊚ false

287)

Today, more companies than ever are turning to formal ethics audits to measure the quality of their ethics programs. ⊚ true ⊚ false

288)

Ethical compliance programs are less effective when multiple safeguards are implemented. ⊚ true ⊚ false

289)

The Securities and Exchange Commission enforces the Foreign Corrupt Practices Act (FCPA). ⊚ true ⊚ false

290)

Bribery is found in nearly every sector of the global marketplace but can be worse in some parts of the world. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

291) The blend of ideas, customs, company values, and shared meanings within a firm are referred to as its A) company climate.

B) mission statement.

C) corporate culture.

D) vision statement.

292)

The unspoken understanding among employees of what is and is not acceptable behavior is called A) ethical climate.

B) corporate image.

C) ethical relativism.

D) rites and rituals.

293)

If a manager approaches ethics with benevolence in mind, he or she would stress what?

A) friendly relations with coworkers B) company rules and procedures C) laws and professional codes D) economic efficiency

294)

A company that strives for efficiency is demonstrating which ethical criterion?

A) egoism B) benevolence C) principle D) virtue ethics

295)

By law, the financial records of publicly held companies are required to be A) managed by an accounting department of at least five CPAs. B) summarized in the employee manual for new hires.

C) reviewed quarterly by the Internal Revenue Service.

D) audited by a certified professional accounting firm.

296)

An accounting auditor who softens a report in return for receiving nonaudit business is committing what?

A) limited liability B) professional incompetence C) conflict of interest D) false advertising

297)

A member of the Chartered Financial Analyst Institute (CFA) must A) put the interests of clients above their own personal interests.

B) act with integrity, competence, diligence, respect and in an ethical manner.

C) maintain and improve their professional competence.

D) All of these choices are correct.

298)

The ethical issue(s) of top concern within the marketing function of a firm include A) customer privacy, especially for children.

B) honesty and transparency in advertising.

C) consumer health and safety.

D) All of these choices are correct.

299)

Ethical challenges for information technology employees include A) invasions of privacy.

B) laptop performance.

C) copyright protections.

D) Both “invasions of privacy” and “copyright protections” are correct.

300)

The Principles and Standards of Ethical Supply Chain Management Conduct includes the principle A) protect confidentiality.

B) create opportunities.

C) do no harm to others.

D) maintain social competence.

301)

Building ethical safeguards into a company's everyday routines is called A) change management.

B) justifying ethics.

C) institutionalizing ethics.

D) ethical awareness.

302)

A company that channels employee behavior in a lawful direction by emphasizing the threat of detection and punishment is A) operating under the compliance-based approach.

B) practicing the ethical “tone at the top.”

C) operating under the integrity-based approach.

D) operating under the instrumental policy approach.

303)

Integrity-based ethics programs A) seek to avoid legal sanctions and other regulatory penalties.

B) combine concern for the law with an emphasis on employee responsibility.

C) threaten employees with punishment for noncompliance with the ethics program.

D) are predominately implemented within the European Union.

One of the most ethical safeguards a firm can leverage, sometimes called the “tone at the top,” is A) ethics policies or codes.

B) ethical leadership.

C) ethics training programs.

D) ethical reporting.

304)

305)

A giant step is taken toward improving ethical performance throughout the company when: A) the firm hires a university ethics professor to lecture employees on moral philosophy.

B) the Justice Department launches an investigation of the firm’s pricing practices.

C) senior-level managers signal to employees that they believe ethics is a high priority.

D) a consumer hotline is created and staffed 24 hours a day, 365 days a year.

306)

Why are ethics policies or codes important to business managers?

A) to understand the changing customs throughout the world B) to justify the resolution that best helps them individually C) to identify and analyze the nature of an ethical problem D) to help maintain the security of proprietary information

307)

Research has shown that the primary type of ethics policy in the United States is A) instrumental.

B) legal compliance.

C) normative.

D) mission and values.

308)

When are written ethics policies most effective?

A) only when they are placed in the employee handbook B) when they are frequently and widely distributed to all stakeholders C) specifically when they are distributed to nonmarket stakeholders D) after government regulators perform an audit on the policies

309)

Most ethics or compliance officers are entrusted to A) act as a liaison between the company and their competitors.

B) reduce the risks to the company of employee misconduct.

C) audit the company’s sustainability reports.

D) arrange marketing training courses at a nearby university.

310)

The most effective ethics programs use which methods of communication?

A) written policy B) company posters C) quick reference guides D) All of these choices are correct.

311)

What is the purpose of an ethics reporting “helpline”?

A) to interpret what is proper ethical behavior B) to report allegations of unethical conduct C) to provide general company information D) All of these choices are correct.

312)

Which type of employee is most likely to report ethical issues in the workplace?

A) rank and file B) middle managers C) executives D) part-time workers

313)

Which type of organization typically conducts regular, ongoing ethics training?

A) small start-up businesses B) technology-based organizations C) midsized newer companies D) larger and more mature firms

314)

The critical component in installing an effective ethics program is A) to allow all employees the freedom to act as they wish.

B) in hiring an expensive professional ethics consultant.

C) the integration of various ethics safeguards into a comprehensive program.

D) maintaining the firm’s position as the industry sales leader.

315)

What is the current trend in measuring the effectiveness of corporate ethics and compliance programs?

A) The number of formal ethics audits has recently increased.

B) Only the smallest firms are using more formal audits.

C) Most firms have turned to company-wide risk assessments.

D) Many organizations have completely abandoned ethical audits.

316)

Which of these components are not considered during a risk-assessment audit to gauge the effectiveness of a firm's ethics programs?

A) the financial bottom line B) ethical leadership C) ethics training programs D) ethical codes and policies

317)

A questionable or unjust payment to facilitate a business transaction is called A) treachery.

B) prepayment.

C) bribery.

D) ransomware.

318)

Which U.S. act prohibits executives of U.S.-based companies from paying bribes to foreign government officials, political parties, or political candidates?

A) the United States Patriot Act B) the U.S. Anti-bribery Act C) the Corruption of Foreign Officials Act D) the U.S. Foreign Corrupt Practices Act

319)

Which foreign mandate was considered to be one of the most powerful anti-corruption laws in the world?

A) Brazil’s Operation Car Wash B) Kazakhstan’s Anti-Corruption Law C) The U.K. Bribery Act D) China’s State Control System

320)

Using Figure 6.1, how would you classify the ethical climate of Vale Mining Company, as described in the case “The Vale Mining Company Dam Collapse”?

A) hostile B) egoism C) benevolence D) principle

321)

What was the primary ethical challenge between Vale Mining and their auditor, TUV SUD, according to the case “The Vale Mining Company Dam Collapse”?

A) conflict of interest B) false advertising C) cross-cultural contradictions D) accounting fraud

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

322) Define ethical climate. Discuss the differences and similarities among the ethical climates outlined in the textbook.

323)

Provide examples of role model companies and what efforts they took to develop effective ethics programs.

324)

Not all ethics issues in business are the same. Discuss the distinct ethical issues across three different organizational functions. Highlight details of the professional codes of conduct for each.

325)

Construct a comprehensive ethics program using four of the five ethical safeguards identified in the textbook.

326)

Discuss the importance of ethics training at different levels of an organization. Is it more important for managers to receive ethical training? Why or why not?

327)

Explain the criteria used to assess the results of a corporate ethics program.

328)

Define bribery. Explain why certain countries are less likely to participate in such acts.

Answer Key Test name: chapter 6 1) TRUE 2) FALSE 3) TRUE 4) FALSE 5) TRUE 6) TRUE 7) TRUE 8) TRUE 9) FALSE 10) FALSE 11) TRUE 12) FALSE 13) FALSE 14) TRUE 15) TRUE 16) C 17) A 18) A 19) A 20) D 21) C 22) D 23) D 24) D 25) A 26) C 27) A 28) B 29) B 30) C 31) C 32) A 33) B 34) B 35) D 36) D 37) C

38) D 39) C 40) C 41) A 42) C 43) D 44) C 45) B 46) A 47) Short Answer

Answers may vary.

48) Short Answer

Answers may vary.

49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

53) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

329) A cooperative government–business relationship on one issue does not guarantee cooperation on another issue. ⊚ true ⊚ false

330)

How a business reacts to specific government policy often depends on if they would be helped or hurt by the rules. ⊚ true ⊚ false

331)

In all cases, businesses are unable to exert enough influence over government leaders to keep them in power. ⊚ true ⊚ false

332)

Public policy is a plan of action undertaken by business to influence the government. ⊚ true ⊚ false

333)

In nondemocratic countries, the power of government may derive from a monarchy, military dictatorship, or religious authority. ⊚ true ⊚ false

334)

Monetary policies refer to policies that affect the supply, demand, and value of the nation's currency. ⊚ true ⊚ false

335)

A national health care policy is an example of an economic policy. ⊚ true ⊚ false

336)

Regulation is a primary way of accomplishing public policy. ⊚ true ⊚ false

337)

New improved mining equipment that was found to increase cases of black lung disease because it generated higher levels of dust in the mines is an example of negative externalities. ⊚ true ⊚ false

338)

Economic regulations aim to modify the normal operations of the free market and the forces of supply and demand. ⊚ true ⊚ false

339)

Social regulations are limited to a particular type of business or industry. ⊚ true ⊚ false

340)

If a company uses its market dominance to restrain commerce, compete unfairly, or hurt consumers, then it may be violating antitrust laws. ⊚ true ⊚ false

341)

The cost of economic regulation in the United States has grown more slowly than that of social regulation. ⊚ true ⊚ false

342)

The amount of regulatory activity is often cyclical. ⊚ true ⊚ false

343)

Regulation cannot be applied to international business behavior. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

344) Which entity enforces rules to balance the relationship between business and society?

A) government B) business C) society D) consumers 345)

Businesses’ understanding of government regulations is A) both a domestic and an international issue.

B) primarily a local domestic issue.

C) primarily an international issue.

D) only an issue for multinational firms.

346)

Cooperation between business and government often occurs when A) regulations set standards that apply to all firms.

B) rules build consumer confidence in product safety.

C) barriers to entry help maintain a competitive advantage.

D) All of these choices are correct.

347)

If a regulation is costly or stifles innovation, how would the impacted business likely respond?

A) with complete cooperation B) with strong opposition C) by sanctioning government officials D) by carefully monitoring the situation

348)

Why should companies be concerned when doing business with questionable governments?

A) Questionable governments have no interest in doing business with foreigners.

B) There is no need for concern because international laws prevent bad dealings.

C) They might indirectly support the illegitimate controlling power.

D) There should be no worries since governments have virtually no economic power over business.

349)

When a government orders companies not to conduct business in another country because of a war, human rights violations, or the lack of a legitimate government; these orders are called A) government bailouts.

B) political sanctions.

C) economic sanctions.

D) government stop orders.

350)

A plan of action taken by government to achieve some broad purpose affecting a substantial segment of a nation’s citizens is called A) public policy.

B) common laws.

C) public goods.

D) fiscal policy.

351)

Past decisions of the courts, the original basis for the U.S. legal system, are called A) civil society.

B) amendments.

C) civil rights.

D) common law.

352)

A government is being asked to regulate driving distractions is an example of a public policy A) input.

B) goal.

C) effect.

D) tool.

353)

Public policy tools involve a combination of A) incentives and political favors.

B) penalties and prison terms.

C) incentives and penalties.

D) political favors and prison terms.

354)

Patterns of government collecting and spending funds to stimulate or support the economy fall under which type of policy?

A) trade B) welfare C) fiscal D) monetary

355)

Rules that affect the supply, demand, and value of a nation’s currency refer to which type of public policy?

A) regulatory B) industrial C) fiscal D) monetary

356)

By raising and lowering the interest rates at which private banks borrow money from the government, the Federal Reserve Bank influences A) the size of the nation’s money supply.

B) the value of the dollar.

C) investor confidence.

D) All of these choices are correct.

357)

When the marketplace does not adjust for the full costs of a firm’s behavior, this is called A) negative externalities.

B) deregulation.

C) market failure.

D) reregulation.

358)

Government regulations help balance negative externalities such as A) mining regulations to fight black lung disease.

B) gender controls over alcohol purchases and consumption.

C) drug testing for workers at private businesses.

D) age restrictions for Social Security recipients.

359)

If a company builds a complex infrastructure, which would be inefficient for a second firm to duplicate, the industry may develop into a A) collaborative network.

B) natural monopoly.

C) market failure.

D) technology cooperative.

360)

Regulation can be argued as justified based on A) collective market theory.

B) utilitarian and justice grounds.

C) the life cycle of regulation.

D) virtue ethics and tradition.

361)

Economic regulations are illustrated by which action?

A) allowing market forces to set prices B) preventing anticompetitive business practices C) providing protection of pension benefits.

D) ensuring safe working conditions.

362)

An example of an economic regulatory agency is the A) Consumer Product Safety Commission.

B) Equal Employment Opportunity Commission.

C) Consumer Financial Protection Bureau.

D) National Labor Relations Board.

363)

An example of a regulatory agency charged with enforcing social regulation is the A) Federal Aviation Administration.

B) Federal Trade Commission.

C) Federal Communications Commission.

D) Internal Revenue Service.

364)

Laws aimed at protecting consumers, the environment, and workers are collectively known as A) the social contract.

B) economic regulations.

C) the social network.

D) social regulations.

365)

The removal or scaling back of regulatory authority and activities of government is called A) clawback.

B) reregulation.

C) deregulation.

D) regulation.

366)

Reregulation is A) the adoption of regulation in another country to promote trade.

B) necessary since all regulation has a time limit.

C) the increase or expansion of government regulation.

D) the shifting of regulation to the state level from the national level.

367)

Antitrust laws protect consumers from A) anticompetitive practices by business, such as price fixing.

B) selling products above cost to drive away rivals.

C) conspiring with business partners to increase competition.

D) firms using market dominance to expand commerce.

368)

When a firm sells products below cost to drive rivals out of business, this is called A) price gauging.

B) price fixing.

C) predatory pricing.

D) market dominance.

369)

The antitrust enforcement agencies in the United States have the legal authority to A) legalize and enforce fixed prices only in the United States.

B) fine European firms who are unfairly operating in their home country.

C) block anticompetitive mergers in the United States.

D) issue tariffs against foreign nations involved in illegal business practices.

370)

A structural remedy for an antitrust violation includes A) paying a large fine and compensating damages.

B) breaking up a monopolistic organization.

C) disclosure of company information to rivals.

D) agreeing to change a firm’s conduct.

371)

A test to determine if the benefits of regulation are worth its costs is called a A) cost–benefit analysis.

B) root cause analysis.

C) say-on-pay assessment.

D) monetary policy tool.

372)

One concern of critics of regulation is A) the exorbitant fees paid by natural monopolies.

B) the high cost to small and manufacturing businesses.

C) the number of people it takes to enforce the rules.

D) their cyclical nature deems them virtually worthless.

373)

Since 1960, what was the growth trend in the U.S. regulatory apparatus?

A) significantly declined.

B) increased moderately.

C) significantly increased.

D) remained about the same.

374)

What is one critical reason justifying international regulatory agreements and cooperation?

A) It’s a good way to build collaborative partnerships with foreign firms.

B) Fees paid by regulatory violators provide additional income for global firms.

C) They are needed to protect national economies from unfair foreign competition.

D) International regulations are not possible due to jurisdiction limitations.

375)

An example of a global regulation that mitigates the impact of jet fuel on the environment

is A) B) C) D)

the Aviation Plan. the Clean Air Act. the Space Force Initiative. the International Space Station.

376)

Why did vaccine companies collaborate with governments in the United States and the United Kingdom during the global COVID-19 pandemic, as noted in the case “Government’s Response to the Coronavirus Pandemic in the United States and the European Union”?

A) They did this to ensure the rapid development and delivery of their products.

B) Neighboring countries of the United States and the United Kingdom pressured the vaccine makers.

C) They were required to cooperate under international human rights regulations.

D) The vaccine manufacturers did not cooperate with the government.

377)

When the U.S. government passed the CARES Act targeting health care during the COVID-19 pandemic, this was an example of which type of public policy, according to the case “Government’s Response to the Coronavirus Pandemic in the United States and the European Union”?

A) economic policy B) social assistance C) monetary policy D) taxation assistance

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

378) How do governments seek to cooperate with or oppose business? Does it matter whether the government is legitimately elected or has illegitimately acquired power?

379)

Define each key element of the public policy process and provide an illustration or example for each element.

380)

Compare and contrast economic policies with social assistance policies.

381)

Identify and compare the four reasons why governments turn to regulation as a way to solve their problems.

382)

Government regulations come in different forms. Discuss the major types of government regulations of business.

383)

What could the U.S. government do about the out-of-control costs of regulation and the staffing of regulatory agencies in the United States?

384)

Why does international regulation occur? Discuss the conditions that affect the regulation of business in a global context.

Answer Key Test name: chapter 7 1) TRUE 2) TRUE 3) FALSE 4) FALSE 5) TRUE 6) TRUE 7) FALSE 8) TRUE 9) TRUE 10) TRUE 11) FALSE 12) TRUE 13) TRUE 14) TRUE 15) FALSE 16) A 17) A 18) D 19) B 20) C 21) C 22) A 23) D 24) A 25) C 26) C 27) D 28) D 29) C 30) A 31) B 32) B 33) B 34) D 35) B 36) D 37) C

38) C 39) A 40) C 41) C 42) B 43) A 44) B 45) C 46) C 47) A 48) A 49) B 50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

53) Short Answer

Answers may vary.

54) Short Answer

Answers may vary.

55) Short Answer

Answers may vary.

56) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

385) Businesses believe they should avoid politics because the economic stakes are too high. ⊚ true ⊚ false

386)

The emergence of public issues often encourages companies to monitor public concerns, respond to government proposals, and participate in the political process. ⊚ true ⊚ false

387)

Those who oppose business involvement with politics argue that managers do not have enough expertise to participate. ⊚ true ⊚ false

388)

Political spending by corporations is big business and common practice. ⊚ true ⊚ false

389)

Businesses that are frequent targets of public debate are more likely to develop a longterm political strategy. ⊚ true ⊚ false

390)

A firm that provides technical details to policymakers to influence a political outcome is using the financial-incentives strategy. ⊚ true ⊚ false

391)

A Super PAC is a financial-incentive political strategy tool. ⊚ true ⊚ false

392)

The tactics or tools used by business to influence the public policy process are often very different from those available to other political participants. ⊚ true ⊚ false

393)

Under U.S. law, lobbying activities must be disclosed publicly. ⊚ true ⊚ false

394)

Sometimes businesses hire former government officials as political advisors. ⊚ true ⊚ false

395)

Expert witnesses provide testimony to legislators for businesses or business groups. ⊚ true ⊚ false

396)

Businesses may use a variety of tactics to appeal to a wide range of stakeholder groups. ⊚ true ⊚ false

397)

The creation of public affairs units is a global trend, with many companies in Canada, Australia, and Europe developing sophisticated public affairs operations. ⊚ true ⊚ false

398)

According to the textbook, most public affairs departments are managed by a senior manager or executive. ⊚ true ⊚ false

399)

U.S. firms that operate outside the country have no need to understand businesses’ role in foreign politics. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

400) Public policies and government regulations are shaped by A) business.

B) special interest groups.

C) government.

D) All of these choices are correct.

401)

Proponents of business as a political participant argue that A) a pluralistic system invites many participants.

B) it is business’s constitutional right to be involved.

C) business is a vital stakeholder of government.

D) Both “a pluralistic system invites many participants” and “business is a vital stakeholder of government” are correct.

402)

According to Figure 8.1, critics of businesses’ involvement with politics argue that A) business stakes are too minor for most organizations to get involved.

B) managers are not qualified to engage in political debate.

C) it is illegal and unethical for corporations to donate to politicians.

D) the business–government relationship is a natural conflict of interest.

403)

The reason(s) behind a corporate political strategy might be to A) focus on limiting a competitor’s progress.

B) further a firm’s economic survival or growth.

C) exercise their voice in government affairs.

D) All of these choices are correct.

404)

Firms in the chemical industry, which must contend with environmental regulations and the risk of dangerous accidents, usually have A) no officially defined political strategy.

B) a sophisticated political strategy.

C) a wait-and-see political strategy.

D) a political strategy focused on licensing rights.

405)

To influence government policymakers' actions, an information strategy involves A) business leaders speaking before government policymakers.

B) government policymakers hiring special interest groups for fact-finding projects.

C) businesses listening to policymakers to develop a corporate strategy.

D) gaining support from other affected organizations.

406)

Which political action strategy seeks to gain support from other affected organizations to better influence policymakers?

A) information strategy B) constituency-building strategy C) financial-incentive strategy D) lobbying strategy

407)

The information strategy tool most used by business is A) political contributions.

B) political lobbying.

C) legal challenges.

D) direct communication.

408)

The job of a business lobbyist is to represent A) the company while influencing business policy.

B) the public by influencing business policy.

C) the company by influencing government policy.

D) the government while influencing business policy.

409)

What is the risk of a revolving-door hiring policy?

A) There is often a skill set mismatch.

B) There may be favoritism in decision making.

C) These employees come and go quickly.

D) The costs can be exorbitant.

410)

Why do businesses use direct communications, like plant visits, with political leaders?

A) to intimidate workers into following all rules and regulations B) to dehumanize the relationship and create objectivity C) to improve the officials’ understanding of the business D) to curry favor so the organization can sidestep regulations

411)

Expert witness testimony is often collected through A) governmental websites.

B) professional business forums.

C) public congressional hearings.

D) traditional and social media sites.

412)

A common tactic in a financial-incentive political strategy is A) political lobbying.

B) legal challenges.

C) expert witness testimony.

D) political contributions.

413)

What is one disadvantage to business for making political action committee contributions?

A) Direct donations to politicians could harm a firm’s reputation.

B) The contribution amount is capped at fairly low levels.

C) Most of the money goes specifically to partisan candidates.

D) In spite of the financial gain, most politicians never return the favor.

414)

What contribution limits are in place for a Super PAC? A) limited contributions from groups B) limited contributions from individuals C) unlimited amounts from groups or individuals D) matching funds from business and individuals

415)

Undisclosed contributions to tax-exempt organizations are called A) dark money.

B) soft money.

C) Super PACs. D) business PACs.

416)

What was the effect of the Citizens United decision to allow direct unlimited contributions from businesses to politicians?

A) Political spending by corporations increased dramatically.

B) Contributions to the Federal Election Commission decreased.

C) Aggregate limits on political spending decreased significantly.

D) Dark money contributions flattened to the 2010 level.

417)

Economic leverage occurs when a business uses its economic power to A) hire lobbyists to gain a desired political outcome.

B) pay for the costs of regulation to acquire a desired political action.

C) persuade a government body to act in a certain way that favors the business.

D) buy out another firm to acquire a desired business outcome.

418)

Which of the following is not a constituency-building strategy tool?

A) direct communication B) advocacy advertising C) public relations D) legal challenges

419)

A company that builds stakeholder coalitions to influence government is using which strategy?

A) informational B) financial incentives C) constituency building D) friendly forces

420)

A major concern around advocacy advertising during the U.S. 2020 presidential election was that A) the significant increase in media revenue was unethical.

B) company views were seen as negative or controversial.

C) public opinion on a topic was unjustifiably biased.

D) they were vulnerable to online attacks, especially by foreign actors.

421)

Supporters of advocacy advertisements believe that they A) identify a company as an interested and active stakeholder.

B) can help mold public opinion on a particular policy issue.

C) increase union activity and long-term expenses for an organization.

D) Both the answers “identify a company as an interested and active stakeholder” and “can help mold public opinion on a particular policy issue” are correct.

422)

When a business seeks to overturn a law or threatens to challenge the legal legitimacy of a new regulation through the courts, this is called a A) Super PAC. B) lobbying effort.

C) legal challenge.

D) business roundtable.

423)

When a firm solicits its stockholders for political contributions for a particular candidate and then sends those contributions to the candidate on behalf of its stockholders, this is called A) lobbying.

B) bundling.

C) soft money.

D) dividends.

424)

When managers become personally involved in developing public policy, the firm is at what level of business political involvement?

A) limited B) moderate C) aggressive D) holistic

425)

An organizational department that manages the firm’s interaction with governments at all levels and promotes the firm’s interests is called A) strategic planning.

B) public relations.

C) public affairs.

D) business operations.

426)

According to a 2020 survey, the most frequent public affairs activity was related to A) trade association oversight.

B) public policy matters.

C) issues management.

D) federal government relations.

427)

To develop public affairs policies that closely reflect the primary business activities of a firm, a company could involve A) a neutral third-party consulting organization.

B) customers and suppliers who work with the firm.

C) employees from various parts of the business.

D) limited participation from senior-level executives.

428)

The typical public affairs executive spends most of the day A) coalition building.

B) direct lobbying.

C) fund raising.

D) All of these choices are correct.

429)

What is the current trend in the amount of funding for public affairs activities?

A) decreasing significantly B) staying about the same C) budgets are increasing D) diverting funds to sales

430)

To help control political favoritism, there have been global efforts to A) promote fairness in the electoral process.

B) control the rapid decrease in campaign costs.

C) diminish the role of political parties.

D) discourage grassroots participation.

431)

The most common methods of political action in the European Union are A) legal challenges and advocacy advertising.

B) lobbying and direct contributions.

C) stakeholder coalitions and economic leverage.

D) expert witness testimony and Super PACs.

432)

In Japan’s pluralistic public policy process, who are the major participants?

A) members of religious institutions and nonprofits B) representatives of big business, agriculture, and labor C) military personnel and top law-enforcement agents D) professors and other members of academia

433)

Which type of political strategy did the U.S. steel industry use when it sent expert witnesses to Congress, as described in the discussion case “Political Action by the U.S. Steel Industry, 2015–2020”?

A) financial incentive B) constituency building C) information D) revolving door According to the discussion case “Political Action by the U.S. Steel Industry, 2015– 2020,” evidence of level 3 political involvement within the steel industry included A) increased contributions to key political campaigns.

B) a coalition with the Manufacturers for Trade Enforcement.

C) that employees were encouraged to sign petitions.

D) increased spending on federal lobbying efforts.

434)

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

435) Prepare a strong argument in favor of and in opposition to businesses being involved in the political process.

436)

Who are the major participants in the U.S. political process and are they cooperative or adversarial in their relations with each other?

437)

How do the three types of corporate political strategies differ from each other?

438)

Describe two tactics used to promote each of the three types of corporate political strategies.

439)

Compare and contrast the three levels of business political involvement.

440)

Describe the role of an organization's public affairs department and describe who would be in charge of that department.

441)

Briefly describe the public policy process of a foreign country and its implication on the business political activity in that country.

Answer Key Test name: chapter 8 1) FALSE 2) TRUE 3) TRUE 4) TRUE 5) TRUE 6) FALSE 7) TRUE 8) FALSE 9) TRUE 10) TRUE 11) TRUE 12) TRUE 13) TRUE 14) TRUE 15) FALSE 16) D 17) D 18) B 19) D 20) B 21) A 22) B 23) B 24) C 25) B 26) C 27) C 28) D 29) B 30) C 31) A 32) A 33) C 34) A 35) C 36) D 37) D

38) C 39) B 40) C 41) C 42) A 43) C 44) D 45) C 46) A 47) B 48) B 49) C 50) B 51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

53) Short Answer

Answers may vary.

54) Short Answer

Answers may vary.

55) Short Answer

Answers may vary.

56) Short Answer

Answers may vary.

57) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

442) Business and society operate within, and depend on, the natural environment. ⊚ true ⊚ false

443)

All natural capital assets are nonrenewable. ⊚ true ⊚ false

444)

For human society to survive over time, it must operate sustainably. ⊚ true ⊚ false

445)

A global set of Sustainable Development Goals (SDGs) have been developed by the United States. ⊚ true ⊚ false

446)

If humanity continues to breach planetary boundaries, environmental devastation will result. ⊚ true ⊚ false

447)

The world’s natural resource base—the air, water, soil, minerals, and so forth—is infinite, or unbounded. ⊚ true ⊚ false

448)

According to the textbook, global population is tripling every 50 years. ⊚ true ⊚ false

449)

Densely populated regions are some of the most polluted areas on Earth. ⊚ true ⊚ false

450)

All forms of economic growth are detrimental to the environment. ⊚ true ⊚ false

451)

The leading contributor to global warming is the burning of fossil fuels, which releases carbon dioxide into the atmosphere. ⊚ true ⊚ false

452)

Black carbon is the second largest contributor to climate change, responsible for as much as 18 percent of global warming. ⊚ true ⊚ false

453)

Biodiversity refers to the number and variety of species that have become extinct. ⊚ true ⊚ false

454)

Life-cycle analysis involves collecting information on the lifelong environmental impact of a product, all the way from extraction of raw material, to manufacturing, to its distribution, use, and ultimate disposal. ⊚ true ⊚ false

455)

The circular economy refers to a production system that is regenerative by design. ⊚ true ⊚ false

456)

Sustainable development will require technology cooperation through long-term partnerships between companies in developed and developing countries to transfer environmental technologies. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

457) Both large and small businesses have adopted sustainable practices to what advantage?

A) cost savings from operational efficiency B) opportunity to serve emerging economies C) reduction of regulatory risk D) All of these choices are correct.

458)

The world’s supply of geology, soil, air, water, and all living things is called A) natural capital.

B) carrying capacity.

C) ecological biodiversity.

D) industrial ecology.

459)

Natural assets such as oil and coal are considered to be what type of resource?

A) sustainable B) renewable C) nonrenewable D) stable and lasting

460)

How can business and government ensure fairness in sustainable development?

A) emphasize societal consumption over the basic quality of life B) promote development that does not further degrade the environment C) use innovation to meet human needs in developing nations only D) give precedence to present human needs over future human needs

461)

The geological era in which human activity has dominated the impact on climate and the environment is called the A) Industrial Revolution.

B) Precambrian era.

C) Anthropocene era.

D) Great Acceleration.

462)

What is one reason humanity continues to breach planetary boundaries?

A) The majority of society is not even aware of natural boundary limitations.

B) Nature’s feedback on human actions tends to be delayed until it’s too late.

C) Business, governments, and society really don’t care about sustainability.

D) There is an unspoken belief that technology will save us from ourselves.

463)

The amount of land and water a human population needs to produce the resources it consumes and to absorb its wastes given prevailing technology is called A) ecological footprint.

B) technological innovation.

C) sustainable development.

D) consumption footprint.

464)

The global population is currently A) staying about the same.

B) growing exponentially.

C) growing gradually.

D) declining gradually.

465)

The percentage of people in a country who live in a city or town as compared to rural areas is called A) industrialization.

B) ruralization.

C) urbanization.

D) acceleration.

466)

Which pattern of consumption is recommended to reduce humanity’s energy usage?

A) Buy goods from firms that focus strictly on profits.

B) Consume less and purchase less harmful products.

C) Build more transit stops on the outskirts of town.

D) Eat more beef, veal, mutton, and pork.

467)

Exponential GDP growth can have what impact on the environment?

A) further degradation of natural habitats B) increased usage of nonrenewable resources C) greater air and water pollution D) All of these choices are correct.

468)

About how much has the Earth warmed since 1880, according to the Intergovernmental Panel on Climate Change?

A) 1.8 degrees Fahrenheit B) 1 degree Celsius C) 1 degree Fahrenheit D) 2 degrees Celsius

469)

By promoting the use of clean cookstoves in developing nations, a global alliance hopes to reduce A) deforestation.

B) meat consumption.

C) black carbon.

D) methane emissions.

470)

Deforestation impacts the environment in what way(s)?

A) There are fewer trees to absorb CO2.

B) It significantly increases methane emissions.

C) Less shade leads to even more warming.

D) The answers “There are fewer trees to absorb CO2” and “ Less shade leads to even more warming” are correct.

471)

The largest single source of global methane emissions derives from A) beef production.

B) oil and gas wells.

C) deforestation.

D) manufacturing.

472)

Which recent addition to the Convention on Climate Change set limits on average global temperature rise?

A) Kyoto Protocol B) Montreal Protocol C) Paris Agreement D) Global Air Report

473)

A thin layer of gas that protects the earth from excessive ultraviolet radiation from the sun is A) ozone.

B) carbon.

C) methane.

D) oxygen.

474)

Participants in the Montreal Protocol agreed that by 2030 they would phase out A) black carbon.

B) CFCs. C) HCFCs. D) carbon dioxide.

475)

Arable land is accurately described by which statement?

A) If cared for properly, it is a renewable resource.

B) Over half of irrigated lands in developing countries have been desalinized.

C) Poor farming practices have caused arable lands to turn into swamps.

D) Soil erosion helps to distribute dirt across arable lands.

476)

Why is water considered a renewable resource?

A) Moisture evaporates from oceans and returns to Earth as freshwater precipitation.

B) Water is not considered to be a renewable resource.

C) When surface water is depleted, underground water bubbles up naturally.

D) Polar ice cap melt regularly replenishes the global water supply.

477)

The commitments of the Convention on Biological Diversity include A) developing national conservation strategies.

B) completely eliminating CFC production.

C) providing population control education.

D) massive irrigation projects in developing countries.

478)

The Great Pacific garbage patch formed due to which marine ecosystem threat?

A) overfishing B) microplastics C) coastal development D) ocean acidity

479)

The term for the number and variety of species and the range of their genetic makeup is A) biodiversity.

B) biosphere.

C) ecosystem.

D) natural capital.

480)

Life-cycle analysis involves A) accurately recording the production costs at each stage of a product’s life cycle.

B) collecting information on the lifelong environmental impact of a product, from cradle to grave.

C) reducing recycling costs for disposable products.

D) increasing productivity while improving the environment.

481)

An example of industrial ecology in practice is A) developing a paper recycling program in a business office.

B) using waste from one process as raw material for another process.

C) manufacturing recyclable containers for food products.

D) All of these choices are correct.

482)

Product stewardship refers to the idea that companies have responsibility for the environmental impact of their goods A) only during manufacturing.

B) up until they are sold.

C) even after they are sold.

D) every time a product is returned.

483)

The term circular economy refers to a production system that is A) linear and finite.

B) proven and repeatable.

C) regenerative by design.

D) distributed around the world.

484)

An organization that produces net zero emissions of greenhouse gases is achieving A) carbon offsets.

B) carbon credits.

C) carbon neutrality.

D) carbon dating.

485)

Sustainable development through technology cooperation is best illustrated by A) the Paris Agreement, which aims to limit the rise of the average global temperature.

B) Microsoft providing the Jane Goodall Institute with animal migration tracking tools.

C) a Swiss company selling chemicals agreeing to global sustainable development goals.

D) Salesforce installing its own water recycling system, including “graywater” processing.

How do primitive cooking methods impact the environment, according to the case “Clean Cooking”?

A) Gathering firewood increases biodiversity.

B) Combustion creates black carbon pollution.

C) Cutting trees for fuel replenishes the watershed.

D) Burning animal dung adds moisture to the air.

486)

According to the case “Clean Cooking,” the widespread adoption of clean cookstoves would provide which benefit?

A) reduced health risks B) an increase in arable land C) more take-out food options D) less entrepreneurial activity

487)

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

488) Explain how business and society interact within the natural environment.

489)

Identify a business with which you are familiar. What management steps could this business take to operate more sustainably?

490)

What is meant by the Earth’s planetary boundaries? How can they be addressed? Discuss the changes that need to be made to bring the Earth’s carrying capacity back into balance with the demands placed on it by human society.

491)

Four critical forces of the Great Acceleration have combined to intensify the ecological crisis facing the world community and to make sustainable development more difficult.

Explain and discuss these forces.

492)

What defines an environmental problem that is inherently global in scope? Discuss in detail two of the global problems outlined in the textbook that will have major consequences for business and society.

493)

Discuss some of the voluntary initiatives undertaken by businesses around the world to incorporate sustainable development into their everyday business practices.

Answer Key Test name: chapter 9 1) TRUE 2) FALSE 3) TRUE 4) FALSE 5) TRUE 6) FALSE 7) FALSE 8) TRUE 9) FALSE 10) TRUE 11) TRUE 12) FALSE 13) TRUE 14) TRUE 15) TRUE 16) D 17) A 18) C 19) B 20) C 21) B 22) A 23) B 24) C 25) B 26) D 27) B 28) C 29) D 30) B 31) C 32) A 33) C 34) A 35) A 36) A 37) B

38) A 39) B 40) B 41) C 42) C 43) C 44) B 45) B 46) A 47) Short Answer

Answers may vary.

48) Short Answer

Answers may vary.

49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

494) By setting a common standard for all firms, government can take the cost of pollution control out of competition. ⊚ true ⊚ false 495)

The first U.S. federal laws to protect the environment involved protecting navigable waterways. ⊚ true ⊚ false

496)

The EPA has identified carbon monoxide as the sole indicator of the overall level of air pollution. ⊚ true ⊚ false

497)

Efforts to prevent inequitable exposure to risk, such as from hazardous waste, are sometimes referred to as the movement for environmental justice. ⊚ true ⊚ false

498)

Superfund sites were primarily funded by a tax on petroleum and chemical companies because they created significant amounts of toxic waste. ⊚ true ⊚ false

499)

Command-and-control regulation can retard innovation. ⊚ true ⊚ false

500)

Market-based pollution control mechanisms are the easiest to enforce. ⊚ true ⊚ false

501)

One potential cost of environmental regulation is reduced capital investment. ⊚ true ⊚ false

502)

Environmental regulations, such as energy conservation, depress the economy. ⊚ true ⊚ false

503)

Corporate sustainability leaders operate so they can continue their activities indefinitely, without altering the carrying capacity of the biosphere. ⊚ true ⊚ false

504)

In the past decade, nearly all organizations have become truly sustainable businesses. ⊚ true ⊚ false

505)

Sustainability leaders have found they are most effective in reaching their goals when they do not involve line managers or employees. ⊚ true ⊚ false

506)

Rewards and incentives are effective ways to make businesspeople consider the environmental impacts of their actions. ⊚ true ⊚ false

507)

Research shows that firms with good performance on material sustainability issues significantly outperform firms with poor performance on these issues. ⊚ true ⊚ false

508)

Products, but not services, can be marketed as being environmentally friendly. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

509) In the United States, the federal government regulates which of the following major areas of environmental protection?

A) Air pollution B) Water pollution C) Solid and hazardous waste D) All of these answers are correct.

510)

The category of cross-media environmental law refers to A) controls over contaminants from both hardware and software manufacturers.

B) rules that monitor emissions from TV, radio, and cell towers.

C) oversight of pollution with multiple impacts on air, water, and land.

D) regulations around waste from social media and email providers.

511)

Air pollution is accurately described by which statement?

A) Air pollution occurs when more pollutants are emitted into the atmosphere than can be safely absorbed and diluted by natural processes.

B) A majority of the people in the United States breathe unsafe air for at least part of the year.

C) Air pollution is caused by mixing natural water vapor with diesel fuel, creating acid rain.

D) The EPA has identified hundreds of "criteria" pollutants, which are relatively common harmful substances that serve as indicators of overall levels of air pollution.

512)

The main U.S. law governing water pollution is the A) Safe Drinking Water Act. B) Clean Water Act. C) Pesticide Control Act. D) Oil Pollution Act.

513)

In the United States, most solid waste ends up A) recycled.

B) composted.

C) incinerated.

D) in landfills.

514)

The Toxic Substances Control Act is accurately described by which of the following?

A) It required reductions in urban smog, acid rain, and greenhouse gas emissions.

B) It established a national policy to regulate, restrict, and, if necessary, ban toxic chemicals.

C) It promoted nontoxic chemicals and fuels for business use.

D) It authorized funds for treatment plans and toxic waste cleanup.

515)

The annual EPA report Toxics Release Inventory (TRI) is an example of which environmental policy type?

A) cap-and-trade system B) government incentives C) criminal enforcement D) information disclosure

516)

The process of firms buying and selling the right to pollute is an example of which type of environmental regulation?

A) command B) control C) market-based D) emissions charges

517)

The government imposing high taxes on new cars, with exceptions for electric vehicles, is an example of which type of pollution control method?

A) local business incentives B) emissions charges or fees C) criminal tax penalties D) regulation by publicity

518)

Under U.S. sentencing guidelines, how would firms facing environmental violations typically be treated if they had an active compliance program and fully cooperated with investigators?

A) They would be treated the same as any other violator.

B) Their sentence would likely be lighter.

C) They would be given less prison time but levied higher fines.

D) They would be granted automatic probation.

519)

520)

Possible costs of environmental regulation include all of the following except A) increased unemployment.

B) reduced capital investment.

C) corporate restructuring.

D) lowered productivity.

Every environmental regulation must be initially evaluated for its costs and benefits in a process called A) strategic planning.

B) government savings study.

C) regulatory impact analysis.

D) command and control legislation.

521)

Environmental regulations stimulate some sectors of the economy by A) creating jobs in industries such as environmental consulting, recycling, and solar panel installation.

B) saving jobs in industries like fishing and tourism when natural areas are protected or restored.

C) compelling businesses to become more efficient by conserving energy.

D) All of these answers are correct.

522)

These organizations recognize stewardship of the natural environment as one of their core responsibilities.

A) corporate sustainability leaders B) purpose-driven marketers C) waste management firms D) science-based recyclers

523)

The concept of businesses not emitting more pollutants than they remove or offset is called A) not zero.

B) net zero.

C) net clean.

D) full offset.

524)

An important principle of sustainability leadership is aligning corporate practices with A) marketing-based targets.

B) customer satisfaction.

C) science-based targets.

D) employee interests.

525)

The role of chief sustainability officer has recently evolved to include A) oversight of regulatory compliance.

B) supervising financial activities.

C) working across functional areas.

D) strategic thinking and leadership.

526)

The most environmentally proactive companies tend to have strong support from A) government regulators.

B) union leadership.

C) boards of directors.

D) state legislators.

527)

Sustainability leaders have found that the most effective environmental management approach involves A) a team of line managers from across the business organization.

B) top-level executives who make all corporate decisions.

C) the largest and most influential shareholders.

D) a consortium of staff employees with no manager involvement.

528)

The practice of aligning executive pay to their success at meeting sustainability goals is an example of which management technique?

A) top management commitment B) employee engagement C) alignment of rewards and incentives D) building environmental partnerships

529)

What is the purpose of an environmental partnership?

A) to enforce international sustainability standards and guidelines B) to leverage the strengths of each partner to improve the environment C) to find ways for all nonpartners to conserve resources D) to raise funds from shareholders to create environmental programs

530)

How do companies that reduce waste, recycle, and operate efficiently impact their costs?

A) Costs stay about the same.

B) Costs are generally reduced.

C) Costs are slightly increased.

D) Costs are greatly increased.

531)

When companies develop a reputation for environmental excellence to attract environmentally aware customers, this is called A) technological innovation.

B) strategic planning.

C) brand differentiation.

D) cost savings.

532)

A company that installs sensors to drive efficient water usage is adopting which sustainability strategy?

A) technological innovation B) product differentiation C) brand differentiation D) cost savings

533)

Proactive environmental management can help reduce which risk(s)?

A) regulatory B) liability C) climate change D) All of these answers are correct.

534)

Sustainable organizations use complex auditing and forecasting techniques to A) satisfy government rules and regulations.

B) guarantee long-term financial success.

C) analyze ecological trends from prior years.

D) anticipate external influences on the firm.

535)

The instrumental argument for promoting sustainability management is that it A) is simply the right thing to do.

B) must be done because it is the law.

C) makes sense from a business perspective.

D) is a losing proposition and should be avoided.

536)

What was the primary indicator that General Motors is trying to become a corporate sustainability leader, according to the case “General Motors’ Drive for Carbon Neutrality”?

A) They ran a funny ad challenging Norway’s EV leadership during the Super Bowl.

B) Many gas-powered GM vehicles will remain on the roads for at least another decade.

C) GM withdrew from the lawsuit challenging California’s miles-per-gallon rules.

D) They announced a plan to become carbon neutral, meaning zero carbon emissions, by 2040.

537)

General Motors’ attempt to create a distinguished reputation for environmental excellence by announcing a full suite of 30 new EVs is an example of what, according to the case “General Motors’ Drive for Carbon Neutrality”?

A) environmental auditing B) brand differentiation C) reduction of regulatory risk D) environmental justice

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

538) What are the appropriate civil and criminal penalties for companies that violate environmental laws? What types of guidelines exist for sentencing environmental wrongdoers?

539)

Briefly describe climate change. Do you think a command-and-control or market-based regulatory approach would work better to reduce emissions of carbon dioxide and other greenhouse gases, and why?

540)

Commercial buildings and industrial facilities account for a major share of a company's environmental impact. Identify one business that has implemented green building standards and describe the advantages they have gained from their efforts.

541)

Cost–benefit analysis seeks to weigh the relative costs and benefits of various alternatives, to see which one gives the "best value." Of the various areas of environmental protection discussed in this chapter (air, water, and waste), which one do you think has been the best value? Which has been the worst value? On what basis do you think so?

542)

Do you think businesses should voluntarily undertake environmental efforts, beyond those required by law? Why or why not?

543)

Describe the sustainability management practices of a business firm with which you are familiar. What steps might its managers take to improve its environmental performance? In answering this question, consider the various elements of effective environmental management.

544)

Discuss the following statement: "Effective sustainability management makes firms more competitive."

Answer Key Test name: chapter 10 1) TRUE 2) TRUE 3) FALSE 4) TRUE 5) TRUE 6) TRUE 7) FALSE 8) TRUE 9) FALSE 10) TRUE 11) FALSE 12) FALSE 13) TRUE 14) TRUE 15) FALSE 16) D 17) C 18) A 19) B 20) D 21) B 22) D 23) C 24) B 25) B 26) C 27) C 28) D 29) A 30) B 31) C 32) D 33) C 34) A 35) C 36) B 37) B

38) C 39) A 40) D 41) D 42) C 43) D 44) B 45) Short Answer

Answers may vary.

46) Short Answer

Answers may vary.

47) Short Answer

Answers may vary.

48) Short Answer

Answers may vary.

49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

545) In the modern world, technology is a major ethical force with no economic or social impacts. ⊚ true ⊚ false 546)

The dominant feature of technology is change and then more change. ⊚ true ⊚ false

547)

Technology tends to ripple through society until it affects every community. ⊚ true ⊚ false

548)

Nations have tended to move sequentially through each phase of technology, beginning with the lowest technology and moving higher with each step. ⊚ true ⊚ false

549)

The current phase of technology is the service society. ⊚ true ⊚ false

550)

The United States has the most Internet users, more than any other country. ⊚ true ⊚ false

551)

Internet usage in developing nations has not even begun to catch up with developed countries. ⊚ true ⊚ false

552)

With the ability to collect big data comes an increasing ethical responsibility over its usage. ⊚ true ⊚ false

553)

In the United States, individuals have the absolute right to unfiltered free speech. ⊚ true ⊚ false

554)

The gap between those who have access to technology and those who do not is called the digital divide. ⊚ true ⊚ false

555)

In the United States, the government has tried to help narrow the digital divide through multiple initiatives. ⊚ true ⊚ false

556)

Individual privacy increased dramatically following the Information Age. ⊚ true ⊚ false

557)

Businesses and governments often clash over who should have access to personal data found on devices such as smartphones and automobile black boxes. ⊚ true ⊚ false

558)

Nondemocratic governments tend to fiercely protect the public’s intellectual property rights. ⊚ true ⊚ false

559)

Since the first genetically modified foods reached the market, dozens of adverse health effects among consumers have been found. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

560) This term refers to the practical applications of science and knowledge to commercial and organizational activities.

A) technology B) e-commerce C) software D) semantic 561)

Many rapid changes in technology over the past few decades were facilitated by A) artificial intelligence.

B) wireless networks.

C) processing of big data.

D) All of these choices are correct.

562)

The self-reinforcing feature of technology means that A) civilization tends to develop at an uncontrollable pace.

B) developing economies demand newer and larger innovations.

C) technology acts as a multiplier to encourage its own faster development.

D) an invention developed in one place remains localized.

563)

The phase of technology that focuses on building material goods and manual labor is A) agrarian.

B) service.

C) industrial.

D) information.

564)

The place where information is stored, ideas are described, and communication takes place in and through an electronic network of linked systems is called A) the personal computer.

B) cyberspace.

C) cloud computing.

D) communication.

565)

We are currently in which phase in the development of technology?

A) industrial B) biotechnology C) information D) service

566)

The primary skills required in the information stage were A) sales and services.

B) intellectual and electronic skills.

C) manual and machine skills.

D) the same skills as needed in previous phases.

567)

The use of biological processes in the development or manufacture of a product or in the technological solution to a problem is called A) physical science.

B) metatechnology.

C) modern biology.

D) biotechnology.

568)

Which nation currently has the greatest number of Internet users?

A) United States B) India C) China D) Japan

569)

Which region of the world has the highest Internet usage?

A) North America B) Asia C) Europe D) Africa

570)

A compulsion to engage in rewarding behaviors, despite negative consequences, is called A) tissue engineering.

B) physical dependency.

C) behavioral addiction.

D) Facebook fatigue.

571)

Another name for unsolicited commercial emails is A) spam.

B) junk email.

C) UCE. D) All of these choices are correct.

572)

Besides spam filters, why has the global spam email rate declined in recent years?

A) This is due to a campaign by the Anti-Phishing Working Group.

B) Governments created strong penalties against spamming.

C) Consumers used the Do Not Call Registry option.

D) The rate of unsolicited spam emails has actually increased.

573)

The practice of using fake business emails to trick users into divulging personal data, such as usernames and passwords, is called A) phishing.

B) pharming.

C) spamming.

D) hacking.

574)

The digital divide describes the gap between those A) individuals who have access to technology and those who do not.

B) businesses who use e-business and those who do not.

C) hospitals who use online information and those who do not.

D) individuals who have broadband technology and those who do not.

575)

Currently, about what percentage of global households have no access to the Internet?

A) 98 percent B) 45 percent C) 25 percent D) 5 percent

576)

The use of mobile (or cell) phones to conduct commercial transactions is called A) e-commerce.

B) mobility.

C) m-commerce.

D) i-purchasing.

577)

The term cryptocurrency is accurately defined by which statement?

A) A digital currency that operates inside the banking system using encrypted technology.

B) A digital currency that operates outside the banking system using encrypted technology.

C) A physical currency that operates using a secure set of microchipped coins.

D) A global online banking system that allows international currency exchange.

578)

About what percentage of the world’s population uses social media?

A) less than half B) slightly more than half C) only a quarter D) over three-quarters

579)

A person’s entitlement to protection from invasion of one’s personal life is called the A) right of free speech.

B) declaration of independence.

C) right to privacy.

D) principle of freedom.

580)

Invasion of privacy through technology is best exemplified by A) the neighbor video recording his dog in his own yard.

B) your car’s GPS tracking you at every location.

C) a friend taking photos of the ocean with her smartphone.

D) your mom’s home assistant reminding her to pay the power bill.

581)

In the United States, the right to free speech A) is an absolute privilege to all American citizens.

B) is a constant threat to every brick-and-mortar business.

C) must be weighed against the consequences for the community.

D) depends on individual state and local laws.

582)

Which of the following is not a potential source of personal private data?

A) smartphones B) internet connections C) automobiles D) broadcast radio

583)

Why did some authoritarian governments limit access to the Internet?

A) to suppress political dissent B) to impose ideological views C) to impose religious views D) All of these choices are correct.

584)

What recent U.S. government regulations were implemented to control genetically modified foods?

A) uniform labeling of all foods containing genetically engineered ingredients B) a national ban on the use of various kinds of genetically modified seeds C) a regional ban on genetically modifying soybeans to resist weed killer D) hefty fines per square acre of genetically modified crops

585)

586)

What are the benefits of sequencing the human genome?

A) provides early diagnosis of diseases B) allows development of generic drug therapies C) spurs new ways to prevent illnesses.

D) The answers “provides early diagnosis of diseases” and “spurs new ways to prevent illnesses” are correct.

Which medical breakthrough offered the promise to rejuvenate or regenerate human cells?

A) DNA sequencing B) artificial intelligence C) stem cell research D) the HapMap catalogue

587)

Which new technology forms the backbone of China’s Social Credit System, according to the Discussion Case?

A) big data mining B) facial recognition C) cryptocurrency D) email phishing

588)

Which ethical concerns surround China’s Social Credit System, according to the case?

A) a loss of personal privacy B) censorship of free speech C) publication of citizens’ DNA D) The answers “a loss of personal privacy” and “censorship of free speech” are correct.

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

589) Define technology and describe its three primary features.

590)

Describe the activities and primary skills used in each of the six periods of technology development.

591)

Discuss what factors have fueled technological growth and development.

592)

Discuss the current impacts of technology in our daily lives.

593)

Describe an Internet threat that you or a friend have experienced. How do threats to individuals differ from threats to businesses?

594)

Discuss the issue of digital divide. Is it lessening or widening with more technological innovation? How have businesses, government bodies, and nonprofit organizations met the digital divide challenge?

595)

How does the increase in technological innovation affect individual privacy and free speech? Discuss the related ethical issues around this topic.

596)

Describe the ethical challenges regarding one of the following scientific breakthroughs: genetically modified foods, human genome or stem cell research. Do the potential benefits of this breakthrough outweigh the potential costs?

Answer Key Test name: chapter 11 1) FALSE 2) TRUE 3) TRUE 4) TRUE 5) FALSE 6) FALSE 7) FALSE 8) TRUE 9) FALSE 10) TRUE 11) TRUE 12) FALSE 13) TRUE 14) FALSE 15) FALSE 16) A 17) D 18) C 19) C 20) B 21) B 22) B 23) D 24) C 25) B 26) C 27) D 28) B 29) A 30) A 31) B 32) C 33) B 34) B 35) C 36) B 37) C

38) D 39) D 40) A 41) D 42) C 43) B 44) D 45) Short Answer

Answers may vary.

46) Short Answer

Answers may vary.

47) Short Answer

Answers may vary.

48) Short Answer

Answers may vary.

49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

597) In 2018, the European Union passed legislation to protect personal user data during collection, processing, and storage. ⊚ true ⊚ false

598)

All countries have nearly identical intellectual property laws. ⊚ true ⊚ false

599)

Net neutrality refers to the principle that wealthier users should pay higher rates for faster Internet speeds. ⊚ true ⊚ false

600)

The collection of large amounts of consumer data by businesses creates ethical issues of privacy and security. ⊚ true ⊚ false

601)

The stakeholders rarely targeted by companies for personal data collection are employees and consumers. ⊚ true ⊚ false

602)

E-business refers to electronic exchanges from business to business and consumer to business. ⊚ true ⊚ false

603)

Due to the coronavirus pandemic, e-commerce experienced a surge of activity and new consumers. ⊚ true ⊚ false

604)

Experts predicted that the use of artificial intelligence would decline rapidly over the next decade. ⊚ true ⊚ false

605)

Robotic technology has advanced enough to generate many new business opportunities. ⊚ true ⊚ false

606)

The responsibility of managing technology with its many privacy and security issues for business organizations is entrusted to the CFO. ⊚ true ⊚ false

607)

In recent years, the role of the chief information officer has become more strategic. ⊚ true ⊚ false

608)

The primary reason that hackers hack is to make money. ⊚ true ⊚ false

609)

Cybersecurity experts recommend that firms implement an incident-response plan for cyberattacks, which are strictly preventative in nature. ⊚ true ⊚ false

610)

Some experts believe that cybercrime can be controlled only through international government coordination. ⊚ true ⊚ false

611)

In 2014, NATO ratified a change to its mission of collective defense by stating that a cyberattack on one member nation would be declared an attack on all members. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

612) The purpose of the right to be forgotten is to A) protect an individual’s right to online privacy.

B) protect property rights.

C) protect intellectual property.

D) prevent software privacy.

613)

Intellectual property refers to A) protecting one’s ideas, concepts, and symbolic creations.

B) special laws protecting copyrights, patents, and trademarks.

C) prohibiting the downloading of commercial software or video games.

D) All of these choices are correct.

614)

Software piracy is a major problem in which part of the world?

A) globally B) North America only C) Asia only D) Europe only

615)

This Act makes it a crime to circumvent antipiracy measures built into most commercial software agreements between the manufacturers and their users.

A) Software Business Piracy Act B) Digital Millennium Copyright Act C) Intellectual Property Millennium Act D) Copyright Act of 1998

616)

617)

One argument in favor of net neutrality is A) businesses that are willing to pay more should have faster Internet.

B) broadband providers should have free reign to block any site they object to.

C) to fairly compete, small, medium, and large firms should have the same Internet bandwidth.

D) individuals don’t need fast Internet, only businesses do.

MIT researchers determined that 90 percent of shopper’s credit card transactions could be used to A) uniquely identify an individual’s shopping habits and preferences.

B) collect individual names and Social Security numbers of the shoppers.

C) identify an individual shopper using only four bits of secondary information.

D) Both answers “uniquely identify an individual’s shopping habits and preferences” and “identify an individual shopper using only four bits of secondary information” are correct.

618)

One ethical concern about businesses collecting vast amounts of stakeholder data is A) if the effort actually benefits the stakeholders.

B) the terms and conditions are confusing to consumers.

C) the information is too secure to be useful.

D) there is often not enough detail to build a marketing campaign.

619)

Buying and selling goods and services electronically is called A) m-commerce.

B) e-business.

C) telecommunications.

D) intellectual property.

620)

One major advantage of conducting business online is A) enhanced local and regional presence.

B) cost-effective marketing and promotions.

C) no need for professional customer service.

D) web security is less costly than physical security.

621)

The idea that every distribution channel must work together to deliver a unified and consistent customer experience is called A) multichannel.

B) natural monopoly.

C) fulfillment center.

D) omnichannel.

622)

The ability of a digital computer or computer-controlled robot to perform tasks commonly associated with intelligent beings is called A) business robotics.

B) artificial intelligence.

C) cyborg knowledge.

D) autonomous brainpower.

623)

The use of robotics in the workplace has increased recently because A) the cost of robots has decreased.

B) robots are more reliable than people.

C) new collaborative machines have been invented.

D) All of these choices are correct.

624)

A recent Oxford study noted that the move to robots tends to generate what kind of new jobs?

A) lower paying B) higher paying C) governmental D) automated

625)

According to McKinsey and Company, which position(s) cannot be easily replaced with robots?

A) repetitive factory jobs B) clerks and bookkeepers C) team managers D) legal researchers

626)

What is a major ethical concern over businesses using drones?

A) excessive noise B) property theft C) personal privacy D) property damage

627)

A CIO is the company’s A) chief investigative officer.

B) chief information officer.

C) coordinator of international operations.

D) controller of internal overhead.

628)

Over time the role of the CIO A) has remained focused on simply managing IT. B) has decreased in level of responsibility as technology has taken over.

C) has changed dramatically, superseding the role of the chief executive officer.

D) has become more integrated into the overall strategic direction of the firm.

629)

The role of the CIO includes all of these tasks except A) acting as lead security officer to protect information.

B) educating the organization about technology initiatives.

C) marketing technology projects to stakeholders.

D) monitoring the appropriate level of employee productivity.

630)

Downloading illegal files, spreading computer viruses, and stealing from online bank accounts is collectively referred to as A) hacking.

B) software piracy.

C) cybercrime.

D) Internet censorship.

631)

An example of a hacking job motivated by retaliation is A) a woman hired a hacker to break into Facebook to find out if her boyfriend was cheating on her.

B) a foreign government stole data from U.S. institutions and asked for ransom to return it.

C) a white hatter broke into a major software firm’s computer network exposing security flaws.

D) a gray hatter revealed previously unreported bugs on a popular online shopping site.

632)

Hackers employed by businesses or governments to intentionally discover weaknesses in information systems are called A) gray hatters.

B) black hatters.

C) white hatters.

D) mad hatters.

633)

The type of cybercrime where malware locks the data on a computer and payment is demanded to unlock it, is called A) a phishing attack.

B) a ransomware attack.

C) software piracy.

D) victim bashing.

634)

Cybersecurity experts recommend including which essential elements for an incidentresponse plan for cyberattacks?

A) support from executive leadership B) involvement by all functional departments C) focus on how to respond to a breach D) All of these choices are correct.

635)

What is the Sheltered Harbor?

A) a new U.S. cybersecurity law that sought to control cybercrime B) a nongovernmental organization that promoted international cybersecurity solutions C) a collective of U.S. banks that adopted a robust set of cybersecurity safeguards D) a group of businesses located around New York Harbor that invested in cybersecurity

636)

What is the mission of Data Privacy Day, held annually on January 28th?

A) empower people to protect their privacy B) escalate the protection of personal privacy C) help people control their digital footprint D) All of these choices are correct.

637)

Increased cyber activity by which countries prompted NATO officials to brand them as “patriotic hackers”?

A) Russia and Estonia B) Iran and China C) Iraq and Pakistan D) Mexico and Canada

638)

The EU law passed in 2018 that required companies to promptly report personal data breaches was called the A) Digital Millennial Copyright Act. B) Right to be Forgotten.

C) General Data Protection Regulation.

D) Global Policy Forum.

What are some business concerns around self-driving vehicles, as found in the case “The Arrival of Autonomous Cars—Bright Future or Looming Threat”?

A) the elimination of many jobs that currently employ human drivers B) the possibility of the vehicles’ computer systems being hacked C) people in the vehicle as backup drivers may tend to downplay the technology D) Both “the elimination of many jobs that currently employ human drivers” and “the possibility of the vehicles’ computer systems being hacked” are correct.

639)

640)

What has the U.S. government done to make automated driving systems (ADS) safe, according to the case “The Arrival of Autonomous Cars—Bright Future or Looming Threat”?

A) NHTSA released new federal safety guidelines for ADS. B) Every state in the union enacted ADS safety laws.

C) Safe development laws were passed in states that make ADS. D) They have partnered with insurance companies to ensure fair coverage.

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

641) Explain the concept of the “right to be forgotten.” What are its implications to governments, businesses, and individuals?

642)

Discuss some of the interventions that different governments have taken to control information technology in their nations. How have these steps affected individual privacy rights as well as public security?

643)

What have businesses done to manage personal information about their employees and customers? Identify a specific company that has taken action and discuss the results.

644)

Discuss the advantages of e-business for businesses around the world and of different sizes.

How is the corporate Chief Information Officer (CIO) a “security guard” for the organization? What are some of the important responsibilities of the CIO?

645)

646)

Discuss the motivations of cybercriminals. Explain the costs that cybercrimes have on businesses, governments, and individuals.

647)

Discuss the global impact of cybercrime and explain how some international and national groups are fighting it.

Answer Key Test name: chapter 12 1) TRUE 2) FALSE 3) FALSE 4) TRUE 5) FALSE 6) TRUE 7) TRUE 8) FALSE 9) TRUE 10) FALSE 11) TRUE 12) TRUE 13) FALSE 14) TRUE 15) TRUE 16) A 17) D 18) A 19) B 20) C 21) D 22) A 23) B 24) B 25) D 26) B 27) D 28) A 29) C 30) C 31) B 32) D 33) D 34) C 35) A 36) C 37) B

38) D 39) C 40) D 41) B 42) C 43) D 44) A 45) Short Answer

Answers may vary.

46) Short Answer

Answers may vary.

47) Short Answer

Answers may vary.

48) Short Answer

Answers may vary.

49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

648) The two main types of investors that own shares of stock in U.S. corporations are individuals and institutions. ⊚ true ⊚ false 649)

Since the 1960s, growth in the number of institutional investors in the United States has been phenomenal. ⊚ true ⊚ false

650)

Investors always choose to invest in the stock of companies that pay high dividends. ⊚ true ⊚ false

651)

A corporation's shareholders have a right to inspect the company's books for any reason. ⊚ true ⊚ false

652)

It is the responsibility of the board of directors and its audit committee to engage an independent accounting firm to audit the financial statements prepared by management. ⊚ true ⊚ false

653)

When boards of directors meet without management present, they are more likely to have completely candid discussions about a company's affairs. ⊚ true ⊚ false

654)

The Organization for Economic Cooperation and Development (OECD), representing 37 nations, issued a revised set of principles of corporate governance to serve as a benchmark for companies and policymakers worldwide. ⊚ true ⊚ false

655)

Stock options represent the right to buy a company's stock at a set price for a certain period. ⊚ true ⊚ false

656)

The ratio of average executive to average worker pay tends to increase during recessions and fall during periods of economic expansion. ⊚ true ⊚ false

657)

Executive compensation in the United States, by international standards, is about the same as in Europe. ⊚ true ⊚ false

658)

Shareholders must rely exclusively on the board of directors to protect their interests. ⊚ true ⊚ false

659)

Institutional investors have little incentive to hold their shares and organize to change management policy. ⊚ true ⊚ false

660)

The activism of institutional shareholders has been completely limited to the United States. ⊚ true ⊚ false

661)

It is illegal in the United States to offer stock trade tips to clients based on public information. ⊚ true ⊚ false

662)

Shareholders have become an increasingly powerful and vocal stakeholder group in corporations. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

663) What is another term for the shareholders of a firm?

A) investors B) stockholders C) owners D) All of these choices are correct.

664)

Which statement below is true about shareholders?

A) They are the legal owners of business corporations.

B) They own equal shares of company assets.

C) They are nonmarket stakeholders in the company.

D) They have no stake in how well the company performs.

665)

Institutional investors are accurately described by which statement?

A) Institutions invest their funds by purchasing shares of stock in corporations.

B) The number of institutional investors in the United States has declined since the 1960s.

C) Banks and student loans are examples of institutional investors.

D) Institutions account for over 90 percent of total U.S. equity value.

666)

Institutional investors are sometimes referred to as A) Main Street investors.

B) Wall Street investors.

C) inside investors.

D) outside investors.

667)

Investors may receive an economic benefit from the ownership of stock by receiving A) interest.

B) dividends.

C) capital gains.

D) Both “dividends” and “capital gains” are correct.

668)

In 2020, share values declined sharply during the coronavirus pandemic. This type of stock market is referred to as a A) bull market.

B) volatile market.

C) bear market.

D) global tailspin.

669)

A legal right of shareholders is A) to vote for members of the board of directors.

B) to receive interest, if declared.

C) to publish annual financial reports.

D) to vote on the next chief executive officer (CEO).

670)

Corporate governance involves the exercise of control over a company's A) finance and accounting departments.

B) overall strategic direction.

C) global manufacturing facilities.

D) marketing and sales departments.

671)

Corporate boards are accurately characterized by which statement?

A) Corporate boards average between 9 and 11 members.

B) Less than half of the members are “outside” directors.

C) Board members are also called directors.

D) High-tech boards tend to be larger than average.

672)

Which protected group has the largest representation on boards of directors?

A) women B) African Americans C) Latino(a)s D) Asian Pacific Islanders

673)

How are corporate directors typically compensated?

A) cash only B) stock only C) grants and fees D) cash and stock

674)

The board committee that administers and approves salaries and benefits of high-level managers in a company is called the A) executive.

B) audit.

C) nominating.

D) compensation.

675)

The audit committee is required by U.S. law to be A) composed entirely of outside directors.

B) financially literate.

C) headed by the company’s CEO. D) Both “composed entirely of outside directors” and “financially literate” are correct.

676)

How are board members (directors) selected?

A) Shareholders elect the directors from a list of candidates.

B) The company’s CEO appoints the directors.

C) The nominating committee elects the directors.

D) Investors with the greatest ownership in the company become directors.

677)

Best practices of good corporate governance include A) hold regular meetings without the CEO present.

B) fill most board positions with managers of the firm.

C) combine the duties of the board chairperson and the chief executive.

D) hold frequent, but closed, board elections.

678)

The "agency problem" arises when A) business owners manage the company on their own behalf.

B) there is no separation of ownership and control in a company.

C) managers act in their own interest, rather than in the interest of shareholders.

D) shareholders act in their own interest, rather than in the interest of the board.

679)

Why are pay-for-performance stock option grants an incentive to improve company results?

A) High executive compensation attracts talent from competitors and suppliers.

B) It allows executive compensation to be better aligned with other developed nations.

C) If the company stock price increases, the executive compensation also rises.

D) It actually becomes a disincentive because the stakes are too high to manage.

680)

One of the main reasons that American executives are paid so much is because A) their pay is set by the compensation committees of the board, largely comprised of other CEOs who have an interest in pushing compensation up.

B) qualified individuals are scarce, as most current CEOs were born during the “baby bust” years of the Great Depression.

C) high executive compensation in other nations puts upward pressure on the salaries of U.S. executives.

D) most executives are paid based on their performance, and rising compensation reflects the excellent performance of their firms.

681)

An argument that opposes the idea of high executive pay is A) high salaries provide an incentive for innovation and risk taking.

B) not many individuals are capable of running today's large, complex organizations.

C) top athletes and entertainers make a lot of money, so top executives should, too.

D) high salaries divert resources that could be used to invest in the business.

682)

An argument in support of high executive compensation is A) inflated executive pay helps U.S. firms compete with foreign rivals.

B) the high pay causes resentment by talented middle managers.

C) high salaries provide an incentive for innovation and risk-taking.

D) there is currently a surplus of qualified executive candidates.

683)

This provision of the Dodd–Frank Act required firms to hold shareholder votes on executive pay at least once every three years.

A) clawback B) pay-for-performance C) proxy access.

D) say-on-pay

684)

When firms take back incentive-based pay after a financial restatement, this is called A) say-on-pay.

B) a recall.

C) clawback.

D) a pay cut.

685)

A reason for institutions becoming more assertive in promoting the interests of their member investors is A) protesting management performance by selling a large block of stock would reduce the value of the institution’s holdings.

B) institutional investors are rarely able to influence management policy.

C) institutions have greater flexibility in selling stocks than do individual investors.

D) institutions have placed members on the finance committee of the board of directors.

686)

The activism of institutional investors in other countries has been spearheaded by A) U.S.-based pension and mutual funds that acquired large stakes in foreign companies.

B) foreign institutions that were granted new rights by their governments.

C) managers who became less active in proxy battles on a global level.

D) the rising number of individual investors in public service companies.

687)

Which of these uses aggressive strategies to earn high returns for their investors?

A) social investors B) hedge funds C) private equity firms D) pension funds

688)

When activist shareholders seek to promote social, environmental, and good corporate governance, it is called A) social investment.

B) socially responsible investment.

C) sustainable, responsible, and impact investment.

D) All of these choices are correct.

689)

What does the term stock screening refer to?

A) investing in companies that support ESG goals B) divesting from businesses that support ESG goals C) avoiding investments in firms that are not socially responsible D) Both “investing in companies that support ESG goals” and “avoiding investments in firms that are not socially responsible” are correct.

690)

The SEC allows social responsibility shareholder resolutions on the ballot under what condition?

A) whenever there is a good chance the proposal will be resolved before the election B) when the shareholder owns a certain number of shares for a certain time period C) when the issue deals with ordinary company business, like employee wages D) only when shareholders have concerns over explicit advertising content

691)

When investors took McKesson Corporation to court over their role in the opioid crisis, this was an example of which type of shareholder activism?

A) social responsibility shareholder resolution B) socially responsible stock screening C) sustainable, responsible, and impact investing D) a socially responsible shareholder lawsuit

692)

The mission of the Securities and Exchange Commission (SEC) is to A) protect shareholders’ rights by making sure that stock markets are run fairly.

B) protect companies from vulture capitalists and hostile takeovers.

C) ensure that institutional investors do not take control of company management.

D) ensure that the federal Treasury receives its share of the revenues from stock trading.

693)

Reports filed with the SEC provide information on a company’s A) corporate sales and earnings.

B) depreciation by line of business.

C) details of foreign operations.

D) All of these choices are correct.

694)

An example of “insider trading” is A) an auditor using public information about the company to invest in its stock.

B) a marketing executive briefing stock analysts on the company’s sales performance.

C) the CEO’s cousin offering to acquire the heavily indebted company.

D) a manager sharing nonpublic news about an upcoming acquisition with a friend, who traded for a profit.

695)

In what way did the Wynn Resorts’ board of directors contribute to the ongoing problem of sexual misconduct in the workplace, as described in the case “Corporate Governance and Executive Misconduct at Wynn Resorts”?

A) The entire board continually defended Wynn’s high CEO compensation package.

B) Nine of the 10 members were outside directors, and Wynn was chairman of the board.

C) Many of the board members were friendly with Wynn and almost always voted in his favor.

D) The company was given an “F” grade in corporate governance by a proxy advisory firm.

696)

The company justified Wynn’s high compensation package, in the discussion case “Corporate Governance and Executive Misconduct at Wynn Resorts,” by saying that A) he was the inspiration for the casino owner character in the Ocean’s films.

B) his personal signature was literally the company logo.

C) he had led the company to total returns of 19 percent per year between 2002 and 2017.

D) his ex-wife was the only one who ever voted against him.

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

697) Identify and provide an example for each of the five major legal rights afforded to shareholders.

698)

What are the key features of effective boards of directors?

699)

Describe a current trend in corporate governance, providing a real example.

700)

Do you think U.S. executives are compensated too highly? Why or why not?

701)

Why have U.S. institutions become more active as investors? How has this trend spread to other countries?

702)

703)

What is insider trading? Explain how the courts have defined this practice.

In your opinion, how is the relationship between modern corporations and their shareholders changing? Explain and justify your argument.

Answer Key Test name: chapter 13 1) TRUE 2) TRUE 3) FALSE 4) FALSE 5) TRUE 6) TRUE 7) TRUE 8) TRUE 9) FALSE 10) FALSE 11) FALSE 12) FALSE 13) FALSE 14) FALSE 15) TRUE 16) D 17) A 18) A 19) B 20) D 21) C 22) A 23) B 24) C 25) A 26) D 27) D 28) D 29) A 30) A 31) C 32) C 33) A 34) D 35) C 36) D 37) C

38) A 39) A 40) B 41) D 42) D 43) B 44) D 45) A 46) D 47) D 48) C 49) C 50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

53) Short Answer

Answers may vary.

54) Short Answer

Answers may vary.

55) Short Answer

Answers may vary.

56) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

704) The “right to choose” guarantees competitive prices for consumers within all industries. ⊚ true ⊚ false

Under the “right to be heard” protection, the consumer is guaranteed satisfactory quality and service at fair prices. ⊚ true ⊚ false

705)

706)

The only recourse consumers have to protect themselves from unsafe products is through the courts. ⊚ true ⊚ false The Latin phrase caveat emptor, meaning “let the seller beware,” has put sellers on alert to look after their own interests. ⊚ true ⊚ false

707)

708)

Consumer advocacy groups in the United States actively promote and speak for the interests of millions of consumers. ⊚ true ⊚ false

709)

The collective goals of government to safeguard the rights of consumers are called consumer protection laws. ⊚ true ⊚ false

710)

The Department of Agriculture has authority over vitamins and some minerals that may affect consumers. ⊚ true ⊚ false

711)

The mission of the Consumer Financial Protection Bureau is to ensure that financial products and services are fair, transparent, and competitive. ⊚ true ⊚ false

712)

One danger of businesses collecting vast amounts of private data is that it might lead to unanticipated harm. ⊚ true ⊚ false

713)

A variety of technologies may be implemented to collect private data without the consumer’s knowledge. ⊚ true ⊚ false

714)

Advertisements tailored to a user’s interests and preferences have advantages only for the business. ⊚ true ⊚ false

715)

The doctrine of strict liability extends only to the retailer who is involved in selling the product, not the manufacturer. ⊚ true ⊚ false

716)

One reason for business efforts to reform product liability laws is the increasing cost of insuring against liability suits. ⊚ true ⊚ false

717)

Product quality refers to everything an organization does to assure the sales of its products. ⊚ true ⊚ false

718)

One problem with product recalls is that the public is often unaware of them. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

719) The core rights of consumers include the right to A) be represented.

B) purchase goods.

C) safety.

D) due process.

720)

Nutrition labels on food products are an example of which consumer right?

A) right to be heard B) right to be safe C) right to be informed D) right to choose

721)

The “right to be heard” promises that consumers’ interests will A) be protected against fraudulent or misleading information.

B) receive full and sympathetic consideration.

C) be assured satisfactory quality and service at a fair price.

D) be given all the facts to make an informed choice.

722)

Consumers have become more dependent on businesses for product quality because A) the complexity of economic life makes choices complicated for consumers.

B) instructions for use or care of products are provided in clear and simple language.

C) their technical competence allows them to inspect the products thoroughly.

D) competition has forced manufacturers to market lower-quality goods.

723)

The Consumer Federation of America is an example of a(n) A) government consumer agency.

B) consumer advocacy organization.

C) online group of individual consumers.

D) organized group of legal professionals.

724)

One example of a self-organized consumer protection method is A) joining the American Association for Retired People.

B) posting and reading product reviews online.

C) subscribing to Consumer Reports magazine.

D) supporting government-run consumer regulations.

725)

Consumer protection laws include regulating which type(s) of protections?

A) pricing B) liability C) privacy D) All of these choices are correct.

726)

When DeVry University exaggerated its graduates’ job prospects and earnings, this was an example of what?

A) predatory pricing B) deceptive advertising C) hazardous materials D) invasion of privacy

727)

The act that requires lenders to inform borrowers of the annual rate of interest to be charged, plus related fees and services charges, is called the A) Consumer Protection Act. B) Product Safety Act. C) Predatory Mortgage Act. D) Truth in Lending Act.

728)

The law requiring that toys and infant products be tested before sale is called the A) Child Safety Protection Act. B) Strong Product Safety Bill.

C) Consumer Product Safety Improvement Act. D) Uniform Safety Testing Bill.

729)

Warning consumers about the possible side effects of pharmaceutical drugs is an example of protecting consumers from A) predatory pricing.

B) incomplete information disclosure.

C) hazardous products.

D) violations of individual privacy.

730)

The main responsibility of the National Highway Traffic Safety Administration is to A) set a uniform national speed limit.

B) set airline safety standards.

C) set motor vehicle safety standards.

D) safeguard consumers from altered odometers.

731)

The role of the Food and Drug Administration includes A) approving a wide range of consumer products.

B) pulling existing products off the market when necessary.

C) issuing emergency authorizations for use of drugs not yet fully approved.

D) All of these choices are correct.

732)

After home mortgages, what makes up the largest portion of household debt?

A) credit card debt B) medical debt C) car loans D) student loans

733)

The major federal consumer protection agencies are authorized by law to A) intervene directly into the very center of free market activities to protect consumers.

B) substitute government-mandated standards for decisions made by private buyers and sellers.

C) substitute private manufacturing standards for government-mandated standards.

D) Both “intervene directly into the very center of free market activities to protect consumers” and “substitute government-mandated standards for decisions made by private buyers and sellers” are correct.

734)

An identifying marker placed on a user’s computer hard drive used to build profiles of their behavior over time is called a A) Web beacon.

B) deep packet.

C) flash cookie.

D) firewall.

735)

Groups that collect and combine data from various sources into individual profiles that are sold to retailers and advertisers are called A) the Internet of things.

B) data aggregators.

C) Internet marketers.

D) 360-degree viewers.

736)

The risk online shoppers take when their Web profile negatively impacts their credit is known as A) digital discredit.

B) weblining.

C) dark money.

D) crisis management.

737)

One particularly negative aspect of behavioral advertising is A) consumers receive too many coupons for products they purchase regularly.

B) sellers collect so much data about purchasers they can’t use most of it.

C) shoppers cannot keep up with all the new online sales.

D) online users may be vulnerable to the spread of misinformation tailored to their beliefs.

738)

The EU’s 2018 General Data Protection Regulation applies to A) individual consumers anywhere in the world.

B) only companies headquartered in the European Union.

C) companies anywhere who provide services to European customers.

D) only corporations that provide financial services.

739)

When businesses adopt voluntary policies for protecting the privacy of individuals' information disclosed during electronic transactions, this is an example of A) industry self-regulation.

B) privacy legislation.

C) consumer self-help.

D) business privacy regulation.

740)

Under what legal doctrine does a firm bear legal responsibility for injuries caused by something it made or sold, whether or not it was negligent?

A) strict liability B) product liability C) consumer liability D) supplier liability

741)

Many companies have argued that the evolution of strict liability has A) unfairly burdened them with excess costs.

B) decreased liability insurance rates.

C) increased corporate revenues and dividends.

D) changed top management's attitude about the consumer.

742)

The Class Action Fairness Act of 2005 included which provision(s)?

A) Lawyers were restricted from using local venues to try interstate cases.

B) Excessive attorney compensation was limited.

C) The burden of proof was shifted to government.

D) Both “Lawyers were restricted from using local venues to try interstate cases" and “Excessive attorney compensation was limited” are correct.

743)

Consumer groups have opposed the idea of product liability reform using which argument?

A) Punitive damages should be further limited.

B) Strict liability pressures firms into making safe products.

C) The burden of proof should be shifted to consumers.

D) All consumer protection cases should be tried in federal courts.

744)

One alternative to product liability lawsuits is called A) limited resolution.

B) punitive damages reform.

C) alternative dispute resolution.

D) consumerism.

745)

Why do many companies favor the use of mandatory arbitration clauses?

A) to avoid expensive liability lawsuits against them B) to limit the consumer’s right to product safety C) to keep minor lawsuits out of the judicial system D) to charge customers more for the same products

746)

A company that assures product quality often sees which impact?

A) lower labor fees B) higher service costs C) build brand loyalty D) increase lawsuits.

747)

When businesses band together to agree on how they will treat their customers, this is called A) consumer action network.

B) consumer affairs doctrine.

C) voluntary industry codes of conduct.

D) national industry standards.

748)

What is the primary role of a consumer affairs officer?

A) to build and maintain a user-facing company website B) to manage a complex network of contacts with customers C) to market and sell products and services to consumers D) to create and manage both internal and external product training

749)

Anheuser-Busch voluntarily taking back packages of their beer because they might contain small pieces of glass is an example of a A) process improvement.

B) supply chain issue.

C) product recall.

D) voluntary code of conduct.

750)

What specific claim did Volkswagen make about their diesel vehicles that constituted deceptive advertising, as noted in the case “Volkswagen’s ‘Clean Diesel’ Campaign”?

A) The cars were so much fun to drive.

B) TDI “Clean Diesel” had very low chemical emissions.

C) Diesel was more economical than gasoline.

D) The vehicle characteristics were clean and beautiful.

751)

Which major consumer right was violated according to the discussion case “Volkswagen’s ‘Clean Diesel’ Campaign”?

A) right to choose B) right to privacy C) right to be heard D) right to be informed

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

752) Consumer advocates argue that consumers are entitled to five core rights. What are they?

Explain each.

753)

The consumer movement exists because consumers want to be treated fairly and honestly in the marketplace. Outline and explain the additional reasons for the existence of the consumer movement.

754)

Outline some of the major government agencies responsible for consumer-related issues.

What is the major mission of each?

755)

How do new technologies increasingly enable businesses to collect and use vast amounts of personal data about their customers and potential customers? Explain. Do you think these trends benefit consumers or not, and why?

756)

In your opinion, do U.S. product liability laws need to be changed? If so, how? If not, why not?

757)

Because of the movement toward product quality, companies are now focusing on the customer. How does this occur? How could a specific industry be even more socially responsible to its customers? Explain.

Answer Key Test name: chapter 14 1) FALSE 2) FALSE 3) FALSE 4) FALSE 5) TRUE 6) TRUE 7) FALSE 8) TRUE 9) TRUE 10) TRUE 11) FALSE 12) FALSE 13) TRUE 14) FALSE 15) TRUE 16) C 17) C 18) B 19) A 20) B 21) B 22) D 23) B 24) D 25) C 26) C 27) C 28) D 29) D 30) D 31) C 32) B 33) B 34) D 35) C 36) A 37) A

38) A 39) D 40) B 41) C 42) A 43) C 44) C 45) B 46) C 47) B 48) D 49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

53) Short Answer

Answers may vary.

54) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

758) Rights of employees are ethical and social, not legal or contractual, in nature. ⊚ true ⊚ false 759)

Employees in the United States have the right to organize and bargain collectively. ⊚ true ⊚ false

760)

Employers are not required by law to agree to the union's demands, but they are required to bargain in good faith. ⊚ true ⊚ false

761)

The amount of violence in the workplace has recently diminished. ⊚ true ⊚ false

762)

The Occupational Safety and Health Act gives workers the right to a job "free from recognized hazards that are causing or likely to cause death or serious physical harm." ⊚ true ⊚ false

763)

Employment-at-will is a legal doctrine that means employees are hired and retain their jobs at the sole discretion of the employer. ⊚ true ⊚ false

764)

The rise of the “gig economy” has allowed companies to become more cost-efficient. ⊚ true ⊚ false

765)

The level of income inequality in the United States has fallen since the 1980s. ⊚ true ⊚ false

766)

Firms paying high executive compensation and very low worker pay are contributing to inequality in the broader society. ⊚ true ⊚ false

767)

In a business context, privacy rights refer to protecting an individual’s personal life from unwarranted intrusion by his or her employer. ⊚ true ⊚ false

768)

Electronic monitoring of employees is illegal in the United States. ⊚ true ⊚ false

769)

Drug testing for cause is commonly used after an accident or some observable change in behavior. ⊚ true ⊚ false

770)

The problem of alcohol-related accidents in the workplace is caused almost entirely by hard-core alcoholics. ⊚ true ⊚ false

771)

The U.S. Constitution explicitly protects freedom of expression in the workplace. ⊚ true ⊚ false

772)

Speaking out against an employer can be risky to the employee. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

773) If someone is entitled to be treated in a certain way, this refers to a(n) A) relationship.

B) obligation.

C) duty.

D) right.

774)

Employees in the United States have a legal right to A) organize and bargain collectively.

B) a safe and healthy workplace.

C) a job with fair compensation.

D) Both “organize and bargain collectively” and “a safe and healthy workplace” are correct.

775)

What is the purpose of a labor union?

A) to negotiate employee wages B) to promote safe working conditions C) to represent workers on the job D) All of these choices are correct.

776)

Under U.S. laws, who has the right to hold an election to choose what union they want to represent them, if any?

A) only private workers B) only public workers C) most private and public workers D) only the employer

777)

Why has union membership declined in the United States since the 1950s?

A) a decrease in the manufacturing sector B) the ongoing economic recession C) a heavy reduction in globalization D) increased levels of inequality

778)

The right to a safe and healthy workplace is accurately described by which statement?

A) Over recent years no new categories of accidents or illnesses have emerged.

B) Extensive training and strict enforcement are necessary to avoid accidents, injuries, and illness.

C) A very limited number of jobs are potentially hazardous to workers’ safety and health.

D) Regulations and enforcement have failed to curb worker accidents.

779)

The leading cause of death on the job is due to A) falls at work.

B) vehicle accidents.

C) being struck by an object.

D) human violence.

780)

The practice of adapting the job to the worker is called A) social contracts.

B) work–life balance.

C) electronic monitoring.

D) ergonomics.

781)

According to the U.S. Department of Labor, some of the most dangerous jobs include A) biologists and lab technicians.

B) teachers and school administrators.

C) pilots and flight attendants.

D) police, firefighters, and prison guards.

782)

The Occupational Safety and Health Act gives workers the right to a job A) that offers all employees equal wages for similar kinds of work.

B) with wages that enable an employee to enjoy a decent standard of living.

C) that is free from recognized hazards that are likely to cause death or serious injury.

D) that does not require them to lift, bend, or move items at any time on the job.

783)

What impact has OSHA had on businesses?

A) a notable increase in lost workdays B) stagnant compensation payment costs C) a significant reduction in workplace deaths D) a minor reduction in workplace deaths

784)

Some states recognize which exemption(s) to worker termination under the at-willemployment doctrine?

A) public policy B) implied contract C) just cause D) All of these choices are correct.

785)

According to the new social contract A) the employer is obligated to provide long-term job security.

B) companies try to attract workers by giving them interesting and challenging work.

C) unions have less representation on company boards to codetermine policy.

D) the employer has no legal or ethical responsibilities toward employees.

786)

The “gig” economy is accurately described by which statement(s)?

A) Many companies have become more cost-efficient.

B) Risk has shifted from the worker to the company.

C) The generally low wages decreased in many cases.

D) Both the answers “Many companies have become more cost-efficient” and “The generally low wages decreased in many cases” are correct.

787)

Businesses can reduce income inequality by taking which action?

A) Adjust minimum wage laws to increase worker pay.

B) Pass a new tax law that benefits workers.

C) Provide very high executive compensation.

D) Commit to paying a living wage to all employees.

788)

A living wage has been defined as a wage that A) equals or exceeds the minimum wage established by law.

B) equals or exceeds one-and-a-half times the minimum wage established by law.

C) supports the basic needs of an average-sized family, based on local prices.

D) supports half the basic needs of an average-size family, based on local prices.

789)

A recent study found that companies that paid workers above-average wages saw which impact?

A) lower shareholder returns B) excellent shareholder returns C) reduced worker productivity D) much lower overall growth

790)

Which example illustrates a legal reason for employee monitoring?

A) a worker telling a colleague that they are being monitored B) an employee documenting trade secrets for another department C) a staff member discussing personal activities with her manager D) multiple part-time workers collaborating to steal company goods

791)

What is one major concern about allowing romance in the workplace?

A) The couple, whether management or staff, would be too distracted to work effectively.

B) An unwelcome relationship could be demanded by an employee in a position of authority.

C) Whenever a relationship is disclosed, the subordinate would likely quit their job.

D) Workplace romance is completely prohibited by government regulations.

792)

Random drug testing of employees is accurately described by which statement?

A) It screens randomly selected employees at various times through the year.

B) It randomly tests selected applicants before hiring, as part of a physical examination.

C) It tests an employee believed to be impaired by drugs and unfit for work.

D) It regularly tests employees from randomly selected job categories or job levels.

793)

Employee Assistance Programs (EAPs) are correctly described by which statement(s)?

A) They offer counseling and follow-up to alcohol and drug abusers.

B) Almost all employers with 1,000 or more workers offer EAPs. C) Nearly three-quarters of small companies with 50 to 99 employees offer EAPs. D) All of these choices are correct.

794)

Employee theft is correctly described by which statement?

A) Almost half of all inventory losses are due to employee theft in the United States.

B) Employee theft is a significant economic, social, and ethical problem in the workplace.

C) Almost half of all employees admit to stealing a former employer’s sensitive data.

D) In 2020, employee thefts in the United States cost businesses almost $30 million a day.

795)

What is one criticism of honesty testing in the workplace?

A) The American Psychological Association reported that testing always fails.

B) The tests tend to identify dishonesty regarding fraud, but not theft.

C) The tests may create an opportunity to discriminate against legally protected groups.

D) Because theft in the workplace is minimal, testing is not needed.

796)

When an employee believes that their employer has done something wrong or harmful to the public, and he or she reports the alleged organizational misconduct to the media, government, or a high-level company officials, what has occurred?

A) insider trading B) hotlining C) whistleblowing D) snitching

797)

The Sarbanes–Oxley Act makes it illegal for employers to retaliate against whistleblowers under what conditions?

A) specifically when the firm is successfully prosecuted for violations of fraud B) when the information reported might impact the company’s share value C) only when the whistleblower has full support of law enforcement D) whenever the employee is a ranking member of any official labor union

798)

Which law allows individuals who sue federal contractors for fraud to receive up to 30 percent of any amount recovered by the government?

A) Dodd–Frank Act of 2010 B) Economic Priorities Act (as amended in 1999) C) U.S. False Claims Act (as amended in 1986) D) Fair Labor Standards Act

799)

What is one criticism against whistleblowing?

A) The stress of blowing the whistle always outweighs any reward.

B) Even when whistleblowers win, the actual problem is rarely solved.

C) Hundreds of unsubstantiated, or false, are cases reported.

D) In all cases, both the employee and the company lose.

800)

What criteria must be met before a whistleblower goes public?

A) The unreported act would do some amount of harm to others.

B) The employee has not yet tried to resolve the issue internally.

C) Reporting the problem publicly may or may not resolve the issue.

D) There is enough potential harm to justify the possible costs of disclosure.

How did Amazon respond to the unionization campaign, according to the case “Do It Without Dues”?

A) The company supported the effort during several mandatory meetings.

B) Employees received text messages with negative messaging about unions.

C) Amazon set up a website for workers to join the union at their convenience.

D) The firm placed posters in bathroom stalls listing worker rights and privileges.

801)

What was the primary concern of Amazon workers, as described in the case “Do It Without Dues”?

A) extremely low wages B) inadequate company benefits C) unsafe working conditions D) no opportunity to unionize

802)

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

803) Workers in the United States enjoy several important legal guarantees. Discuss three major worker rights. What are the U.S. laws and regulations that govern each? How do such policies compare with those of other countries?

804)

Discuss working conditions around the world. What challenges face multinational corporations? What approaches are companies using to establish fair labor standards? Are there circumstances under which some approaches might work better than others?

805)

Discuss the pros and cons of the new social contract from the viewpoint of an employer and employee. What duty does an employer have to provide job security to its workers?

806)

Income inequality has grown in the United States since the 1980s. In what ways do businesses contribute to this trend? What, if anything, can businesses do to reduce income inequality?

807)

Some people believe that the right to privacy should be extended to the workplace.

Others think, on the contrary, that such an extension would constitute an unwarranted incursion into management’s right to manage. Comment on this debate using examples from the text discussion of electronic monitoring, romance in the workplace, employee drug testing, and employee honesty testing. Are there particular circumstances under which it is, or is not, appropriate for employers to monitor employee behavior?

808)

As the use of electronic communication at work has risen, new ethical issues involving worker privacy have emerged. Should employers be allowed to read employee email, inspect their Facebook pages or blogs, or access files located on a personal computer at work? Why or why not?

809)

Provide an example where employee whistleblowing is justified and an example where it is not. Support each example.

Answer Key Test name: chapter 15 1) FALSE 2) TRUE 3) TRUE 4) FALSE 5) TRUE 6) TRUE 7) TRUE 8) FALSE 9) TRUE 10) TRUE 11) FALSE 12) TRUE 13) FALSE 14) FALSE 15) TRUE 16) D 17) D 18) D 19) C 20) A 21) B 22) B 23) D 24) D 25) C 26) C 27) D 28) B 29) D 30) D 31) D 32) B 33) D 34) B 35) A 36) D 37) B

38) C 39) C 40) B 41) C 42) C 43) D 44) B 45) C 46) Short Answer

Answers may vary.

47) Short Answer

Answers may vary.

48) Short Answer

Answers may vary.

49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

810) The term diversity refers to variation in the important human characteristics that distinguish people from one another. ⊚ true ⊚ false 811)

Workforce diversity represents both a challenge and an opportunity for businesses. ⊚ true ⊚ false

812)

The term pay gap refers to the inequitable concentration of a group, such as minorities or women, in a particular job category. ⊚ true ⊚ false

813)

Minority groups experience disproportionately higher levels of unemployment, especially during times of economic hardship. ⊚ true ⊚ false

814)

In the United States, immigrants were twice as likely as nonimmigrants to start their own business. ⊚ true ⊚ false

815)

The major agency charged with enforcing equal opportunity laws and executive orders in the United States is the Americans with Disabilities Council (ADC). ⊚ true ⊚ false

816)

Some women and persons of color have spoken out against affirmative action, preferring to achieve personal success without receiving preferential treatment. ⊚ true ⊚ false

817)

Sexual harassment is limited to overt acts of individual coworkers or supervisors. ⊚ true ⊚ false

818)

The proportion of working women that have told researchers they have been sexually harassed on the job is between 40 and 70 percent. ⊚ true ⊚ false

819)

Sexual and racial harassment will happen, and there is little a business can do to eliminate the problem. ⊚ true ⊚ false

820)

Companies that implement effective diversity programs often see an improvement in their reputation. ⊚ true ⊚ false

821)

A diversity council is a group of managers and employees responsible for developing and implementing specific action plans to meet an organization's diversity goals. ⊚ true ⊚ false

822)

Policies and practices that leverage a variety of perspectives, life experiences, and approaches that every individual brings to the workplace, are referred to as diversity. ⊚ true ⊚ false

823)

According to the latest government data, in about 60 percent of all married couples with children, both parents worked at least part-time. ⊚ true ⊚ false

824)

Under the Family Medical Leave Act, companies that employ 50 or more people must grant unpaid, job-protected leaves for up to 12 weeks to employees with serious family needs, including the birth or adoption of a baby. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

825) Variation in the important human characteristics that distinguish people from one another is called A) workforce variability.

B) diversity.

C) difference.

D) affirmative action.

826)

Age, ethnicity, gender, mental or physical abilities, race, and sexual orientation fall under which dimension of diversity?

A) primary B) secondary C) tertiary D) legal

827)

The growing diversity in the U.S. workforce is due to A) millennials and members of Gen Z entering the workforce.

B) significant immigration from other countries.

C) shifting patterns of work and retirement.

D) All of these choices are correct.

828)

In 2015, the largest generation in the workforce was A) baby boomers.

B) Generation X. C) millennials.

D) Generation Y.

829)

Women in the U.S. workforce are accurately characterized by which statement(s)?

A) The participation rate has been between 46 and 47 percent since the late 2000s.

B) A lack of family-friendly business policies has made it difficult for working mothers.

C) The participation rates of women and men in the workforce have diverged.

D) Both the answers “The participation rate has been between 46 and 47 percent since the late 2000s” and “A lack of family-friendly businesses policies has made it difficult for working mothers” are correct.

830)

According to the textbook, Asian American men now have higher median weekly earnings than white American men primarily because A) the Asian group collectively increased connections with upper management.

B) most Asians had earned a bachelor’s degree or higher.

C) white men had generally dropped out of management.

D) white women had taken over most of the jobs of white men.

831)

Which of the following is not true about occupational segregation?

A) It concentrates women in traditionally female-dominated jobs.

B) The pay gap in American businesses persists, in part, because of it.

C) It means that women cannot get the jobs that could break the cycle of low pay.

D) The technology sector is rapidly becoming dominated by women.

832)

When women and minorities are highly competent but are unable to attain executive positions, this is typically called A) transparency.

B) broken windows theory.

C) glass ceiling.

D) glass wall.

833)

Why does the inclusion of women on corporate boards improve company performance?

A) Alternative courses of action are more realistically considered.

B) Women bring different life experiences to discussions.

C) Women are more likely to raise multiple stakeholder concerns.

D) All of these choices are correct.

834)

What is one reason why women and minorities fail to move into executive or board positions?

A) Women prefer jobs that are occupationally segregated.

B) There are already too many women in executive roles.

C) Minorities prefer staff-level positions throughout their careers.

D) Recruiters rely heavily on the old boys’ network.

835)

In 2019, more than 50 percent of minority-owned businesses were owned by A) Asian Americans.

B) African Americans.

C) Hispanics.

D) Native Americans.

836)

Government rules on equal employment opportunity include A) discrimination on the basis of sexual orientation is prohibited in all employment practices.

B) government contractors must have written affirmative action plans to overcome the past and present effects of discrimination.

C) women and men must receive equal pay for performing equal work, but only if the woman is not pregnant.

D) affirmative action plans must be permanent and designed to correct future discrimination.

837)

Which law eliminated certain time restrictions for filing pay discrimination lawsuits?

A) Lilly Ledbetter Fair Pay Act of 2009 B) Family and Medical Leave Act of 1993 C) Equal Opportunity Employment Act of 1972 D) Equal Pay Act of 1963

838)

An argument against affirmative action is A) it costs American businesses too much money.

B) there are no mechanisms in place to verify that it is actually working.

C) it is inconsistent with the principles of fairness and equality.

D) it violates individuals' basic human rights.

839)

One argument in favor of affirmative action is A) people hired through this program tend to be more dedicated workers.

B) only the most qualified people are hired through this process.

C) it’s easy to monitor the success of affirmative action programs.

D) it levels the playing field to correct past discriminatory hiring practices.

840)

What is one of the most common reasons that sexual harassment occurs on the job?

A) people wearing sexy clothing B) boys will be boys C) an imbalance of power D) workplace comradery

841)

Gender identity refers to A) one’s emotional, romantic, or sexual attraction to other people.

B) the rule under Title VII that allows discrimination based on sex.

C) an individual’s self-perception as male, female, both, or neither.

D) the concentration of women within certain job categories.

842)

Racial harassment is illegal under A) Title VII of the Civil Rights Act. B) the Third Amendment to the Constitution.

C) the Equal Pay Act. D) the Family Medical Leave Act.

843)

Companies can combat sexual and racial harassment—and protect themselves from expensive lawsuits—by A) communicating a zero-tolerance policy on harassment to all employees.

B) establishing a complaint procedure in a way that avoids retaliation.

C) acting quickly to resolve any problems.

D) All of these choices are correct.

844)

Benefits of managing diversity and inclusion effectively include all except A) the federal government provides diversity-related tax breaks.

B) they can more effectively serve diverse customers.

C) they are better able to attract and retain workers from a variety of backgrounds.

D) businesses with a diverse workforce boost innovation for the firm.

845)

Many executives believe that a diverse workforce boosts innovation because A) many unique perspectives provide valuable insights into tastes and preferences.

B) those who think exactly the same develop the most robust ideas.

C) people from poorer countries have to be more creative to survive.

D) people from different backgrounds have to work much harder to communicate.

846)

A diverse and inclusive workforce provides companies with all of the following except A) reflection of a global customer base.

B) cultural insensitivity.

C) improvement in innovation.

D) avoidance of public embarrassment.

847)

In the business context, inclusion means having policies that A) tap into the diverse perspectives, life experiences, and approaches of each worker.

B) require that all employees, including temp workers, attend the annual meeting.

C) apply the same measure of discipline to all company employees.

D) follow all legal mandates and actually go beyond full compliance.

848)

One action a company can take to effectively manage diversity and inclusion is to A) hire a majority of foreign and immigrant workers.

B) set up a diversity council to monitor the company’s goals.

C) use a broad list of demographic factors to select applicants.

D) hire only those with existing employee referrals.

849)

Bias within the hiring process refers to A) always hiring the best fit candidate no matter what their physical characteristics are.

B) selecting only candidates that match a preconceived ideal of the role.

C) choosing new employees without consideration for their demographic data.

D) hiring based only on the applicant’s knowledge, skills, and abilities.

850)

Child-care assistance in the workplace is accurately described by the following: A) It helps reduce employee absenteeism and tardiness.

B) It aids in recruitment by making the company more attractive to parents.

C) It helps retain talented employees.

D) All of these choices are correct.

851)

Caregivers who care for both children and elderly adults are often referred to as the A) baby boom generation.

B) millennial generation.

C) silent generation.

D) sandwich generation.

852)

The time a mother or father is granted off when children are born or adopted and during the early months of a child’s development is called A) child care.

B) flextime.

C) parental leave.

D) family leave.

853)

Which type of U.S. company is required to follow the Family and Medical Leave Act (FMLA) and offer up to 12 weeks of unpaid employee leave to address family needs?

A) corporations that employ 100 or more people B) firms with at least 50 employees C) only companies within the gig economy D) small businesses with fewer than 50 workers

854)

Firms that fully support both men and women in their efforts to balance work and family responsibilities are known as A) family-friendly workplaces.

B) remote work environments.

C) all-inclusive organizations.

D) onsite child-care providers.

Which law protects Xiuying, as introduced in the case “Hello, My Name Is,” from job discrimination based on race, color, gender, religion, or national origin?

A) the Equal Employment Opportunity Act B) the Civil Rights Act (and its amendments) C) the Equal Rights Amendment D) the Age Discrimination in Employment Act

855)

The firm who rejects a job seeker by saying they had “hired so many foreign nationals that it seems time for us to hire an American or be unfair” is demonstrating which type of bias, according to the case “Hello, My Name Is”?

A) racial B) national origin C) religious D) ethnic

856)

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

857) Based on what we know about demographic trends, identify and describe three to five expected changes in workforce composition over the next 20 years.

858)

Identify and explain three or more factors that result in the low number of female CEOs heading Fortune 500 companies.

859)

Do you believe companies are ever justified in treating women or minority employees differently, with respect to wages, benefits, job assignments, or promotions? If not, why not?

If so, under what conditions, and why?

860)

What is the role of government in the area of equal employment opportunity? Discuss from a historical perspective.

861)

Government regulations ban both sexual and racial harassment. Discuss both kinds of harassment and why they are a concern to employers. What can companies do to combat sexual and racial harassment?

862)

In what ways will continued diversity create competitive advantages for companies?

Discuss based on the material in the textbook.

863)

Identify and explain best practices for improving workplace diversity, equity, and inclusion.

864)

Do you believe that support programs for work and family primarily benefit women employees, men employees, or both equally? Explain.

Answer Key Test name: chapter 16 1) TRUE 2) TRUE 3) FALSE 4) TRUE 5) TRUE 6) FALSE 7) TRUE 8) FALSE 9) TRUE 10) FALSE 11) TRUE 12) TRUE 13) FALSE 14) FALSE 15) TRUE 16) B 17) A 18) D 19) C 20) D 21) B 22) D 23) C 24) D 25) D 26) A 27) B 28) A 29) C 30) D 31) C 32) C 33) A 34) D 35) A 36) A 37) B

38) A 39) B 40) B 41) D 42) D 43) C 44) B 45) A 46) B 47) B 48) Short Answer

Answers may vary.

49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

53) Short Answer

Answers may vary.

54) Short Answer

Answers may vary.

55) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

865) An organization that purchases goods or services from another company is known as a supplier. ⊚ true ⊚ false

866)

The term "supply webs" refers to the multiple steps taken to move a product or service from the most distant supplier to the customer. ⊚ true ⊚ false

867)

Although several steps removed, distant suppliers can still have a big impact on a company’s reputation and bottom line. ⊚ true ⊚ false

868)

All overseas supplier factories that pay low wages are engaging in a highly unethical social practice. ⊚ true ⊚ false

869)

Global lead firms that depend on farmed, extracted, or mined resources run a relatively high risk for human rights abuses by their suppliers. ⊚ true ⊚ false

870)

Suppliers that dump toxic chemicals, emit air pollution, or reduce biodiversity have little impact on the lead firm that buys their products. ⊚ true ⊚ false

871)

Because supply chains have become heavily globalized, government regulation efforts are now more concentrated and increasingly effective. ⊚ true ⊚ false

872)

873)

A company can develop its own code of conduct or adopt an NGO or industrywide code. ⊚ true ⊚ false

Assurance that a supplier is in compliance with the relevant code of conduct is determined by a supply chain audit. ⊚ true ⊚ false

874)

When a supply chain audit is conducted, workers are usually willing to share their experiences with the auditors. ⊚ true ⊚ false

875)

An emerging method of auditing suppliers involves gathering factory conditions directly from employees using their mobile phones. ⊚ true ⊚ false

876)

A growing trend is for lead firms to work collaboratively with their suppliers to build capabilities and create shared value. ⊚ true ⊚ false

877)

Lead firms often choose to develop their supplier's capabilities when the supplier has a strong management team, many resources, and high technical knowledge. ⊚ true ⊚ false

878)

One reason lead firms do not change suppliers is due to moral obligation to the workers and the community to retain jobs. ⊚ true ⊚ false

879)

Lead firms sometimes create contradictory demands on suppliers, for example, by insisting on low costs as well as compliance with expensive environmental standards. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

880) Which type of supplier is hired to provide products or services directly to a lead firm?

A) Tier 1 B) Tier 2 C) subcontractors D) networks

881)

As a stakeholder, suppliers' interests include A) selling to customers and earning income B) using productive capacity efficiently C) building short-term, but profitable, business relationships D) Both “selling to customers and earning income” and “using productive capacity efficiently” are correct.

882)

A supplier that controls critical worker skills and technical know-how holds which type of power over their lead firm?

A) economic B) informational C) legal D) voting

883)

A visual representation of the many links between a lead firm and its suppliers, superimposed on a geographical map, is called a A) linked list.

B) supply chain map.

C) supply web.

D) network map.

884)

Social effects of global supply chains include impacts on A) worker wages.

B) working conditions.

C) employee health.

D) All of these choices are correct.

885)

Companies where employees work long hours, at low wages, under unsafe conditions, are collectively referred to as A) nonunion shops.

B) sweatshops.

C) garment factories.

D) workshops.

886)

The illegal recruitment and movement of people against their will is called A) temporary labor.

B) day workers.

C) forced labor.

D) farmworkers.

887)

The International Labor Organization (ILO) identifies child labor by which factors?

A) a child’s age B) the work hours C) the child’s work experience D) Both “a child’s age” and “the work hours” are correct.

888)

Environmental concerns for supply chain managers may be mitigated by A) adopting a policy of local sourcing.

B) sourcing raw materials from online firms.

C) switching from seaborne to overland transport.

D) dumping all toxic chemicals locally.

889)

Which of these statements is not true about supply chain transparency?

A) A firm's social, ethical, and environmental responsibilities are revealed.

B) The use of technology is enhancing supplier transparency.

C) Brand loyalty among consumers is diminished by a firm’s revelations.

D) Recent audits and certifications are publicized.

890)

Nongovernmental institutions that govern economic activities are referred to as A) voluntary auditors.

B) public governance.

C) private regulation.

D) civic control.

891)

The lack of jurisdiction of home country governments over supplier behavior is exemplified by A) the United States Department of Labor having no control over safety in Indonesia.

B) OSHA being unable to enforce laws in Alabama and Oklahoma.

C) Business elites in developing countries effectively blocking regulation.

D) the Global Compact having moral authority but no enforcement power.

892)

Why has private regulation become more important in recent years?

A) weak governmental regulations in developing nations B) lack of government interest in supply chain management C) limited enforcement power of human rights organizations D) Both the answers “weak governmental regulations in developing nations” and “limited enforcement power of human rights organizations” are correct.

893)

What is one condition that can cause private governance of a business to emerge?

A) when small lead firms have too much leverage over larger suppliers B) when large lead firms have limited leverage over larger suppliers C) when the public is satisfied with a firm’s social and environmental performance D) when firms have highly visible brands and are more vulnerable to reputational damage

894)

Codes of conduct are accurately described by which statement?

A) Most early codes of conduct were developed by individual companies.

B) The adoption rate of industry-specific codes of conduct is currently decreasing.

C) Standard-setting organizations have failed to influence industries and individual firms.

D) The costs of building common industry standards have become prohibitive.

895)

Which groups often collaborate when developing industry-wide codes of conduct?

A) government officials B) nongovernmental organizations C) business organizations D) All of these choices are correct.

896)

Richard M. Locke argues that global supply chains are best managed through a combination of public and private governance because A) government-enforced laws give legitimacy to demands for workplace changes.

B) regulators benefit from record keeping required by private companies’ codes of conduct.

C) public and private organizations are able to share the enforcement workload.

D) All of these choices are correct.

897)

Which type of supplier audit is being used when a company hires and trains its own staff of auditors?

A) external B) third-party C) factory D) internal

898)

Which of the following type of audit is perceived by stakeholders as more objective and reliable?

A) internal B) third-party C) government D) crowd-pleasing

899)

What is one drawback of conducting supplier audits?

A) Workers trust the auditors to the point of giving away company secrets.

B) Audits scale so well across the supply chain that only general averages can be collected.

C) On-site inspections are both expensive and time-consuming, and do not scale.

D) On-site inspections are so fast that teams must conduct hundreds of them in a single day.

900)

A type of supply chain inspection that bypasses the factory and relies instead on worker feedback, is called a A) virtual inspection.

B) crowdsourced audit.

C) cloud-based audit.

D) consumer review.

901)

What is one trend in supply chain auditing?

A) Companies are working together to audit major suppliers.

B) Suppliers are increasingly enduring audit fatigue.

C) Physical inspections across all industries are on the rise.

D) More and more workers are trusting in-factory audits.

902)

When a lead firm invests in supplier resources or offers training, this is an example of A) root cause analysis.

B) supplier development.

C) supply chain auditing.

D) shared value.

903)

What is a cost-effective way for a lead firm to improve a supplier’s performance when the cost to replace the supplier is high?

A) engage the supplier in capability building B) acquire the supplier and force them into compliance C) report the supplier to the Better Business Bureau D) build the supplier's products internally

904)

Studying the underlying cause of repeated supplier violations is called A) capability-building.

B) supplier scoring.

C) root cause analysis.

D) supply chain auditing.

905)

An integrated supplier scorecard uses which measurement(s)?

A) environmental performance B) product quality C) number of employees.

D) Both “environmental performance” and “product quality” are correct.

906)

When firms invest in suppliers to exchange knowledge and collaborate on improvements, they create shared value for A) the supplier only.

B) the lead firm only.

C) both the supplier and the lead firm.

D) neither the lead firm nor the supplier.

907)

908)

What is the first step that lead firms take to develop their suppliers?

A) creating shared value B) capability building C) supplier monitoring D) publicizing the results

Which critical environmental challenge did IKEA face within its cotton supply chain, as mentioned in the case “IKEA’s Sustainable Cotton Supply Chain”?

A) A large amount of soot was produced throughout the chain.

B) Child labor was used extensively across the entire supply chain, and the industry.

C) A single pair of jeans used 3,000 gallons of water, depleting surface and groundwater supplies.

D) Women earned about 25 percent less than men, many with poverty-level incomes.

In the discussion case, “IKEA’s Sustainable Cotton Supply Chain,” which statement accurately describes IKEA’s supply chain?

A) Nearly 100 percent of IKEA’s cotton was sourced from just two countries, India and China.

B) The long and complex chain involved farming, ginning, spinning, weaving, and stitching.

C) The supply chain was long but all steps flowed easily across only a few locations.

D) The company’s supply chain was self-contained with IKEA owning all steps in the process.

909)

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

910) Define suppliers and explain their interests and power, especially as related to lead firms.

How has globalization affected the supply chain?

911)

Select a common product and create a supply chain map showing the product movement from source to consumer.

912)

Discuss the social, ethical, and environmental issues that affect suppliers. Provide three examples of suppliers that are currently raising concerns for their lead firms.

913)

Explain why some companies are establishing their own forms of private regulation.

914)

Describe the three types of supplier audits: internal, third-party, and crowd-sourced.

915)

Walmart, Monster Beverage, and Patagonia are presented as three examples of firms capturing the extraordinary complexity of the business-supplier relationship. Identify the major components of these examples as a model for other firms to follow in managing their supplier stakeholder relationship.

916)

Under what conditions might a lead firm choose to develop a supplier rather than replace them?

Answer Key Test name: chapter 17 1) FALSE 2) TRUE 3) TRUE 4) FALSE 5) TRUE 6) FALSE 7) FALSE 8) TRUE 9) TRUE 10) FALSE 11) TRUE 12) TRUE 13) FALSE 14) TRUE 15) TRUE 16) A 17) D 18) B 19) B 20) D 21) B 22) C 23) D 24) A 25) C 26) C 27) A 28) D 29) D 30) A 31) D 32) D 33) D 34) B 35) C 36) B 37) A

38) B 39) A 40) C 41) D 42) C 43) C 44) C 45) B 46) Short Answer

Answers may vary.

47) Short Answer

Answers may vary.

48) Short Answer

Answers may vary.

49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

917) The term community refers to a company’s area of business influence. ⊚ true ⊚ false 918)

The term community is sometimes improperly used to refer to a range of groups that are affected by an organization's actions, whether or not they are in the immediate vicinity. ⊚ true ⊚ false

919)

The community relies heavily on business, but business is not mutually dependent on the community. ⊚ true ⊚ false

920)

Civic engagement is a major way in which companies carry out their corporate citizenship mission. ⊚ true ⊚ false

921)

Social capital refers to the norms and networks that enable collective action. ⊚ true ⊚ false

922)

Community relations departments work primarily on the national level to link the corporation to community stakeholders. ⊚ true ⊚ false

923)

The top goal of a community relations manager is to promote business investments that generate more social capital. ⊚ true ⊚ false

924)

Corporations are prohibited from giving more than 10 percent of their income for philanthropic purposes. ⊚ true ⊚ false

925)

Foreign-owned corporations typically establish and use corporate foundations less frequently than U.S. firms. ⊚ true ⊚ false

926)

Corporate charitable donations are defined as gifts of products or services. ⊚ true ⊚ false

927)

Many companies have turned to technology to improve the amount and effectiveness of employee volunteerism. ⊚ true ⊚ false

928)

Strategic philanthropy emphasizes the links between corporate contributions and business goals, such as creating demand for a product or service. ⊚ true ⊚ false

929)

All corporate contributions benefit the donors directly. ⊚ true ⊚ false

930)

A firm that is civically engaged is usually able to respond quickly to changing stakeholder demands. ⊚ true ⊚ false

931)

A license to operate refers to a formal license every firm must obtain from local municipalities to conduct business there. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

932) Communities depend on business for A) schools.

B) health care.

C) the arts.

D) All of these choices are correct.

933)

How do businesses support their community’s civic needs?

A) through partnerships with noncommunity businesses B) through donations of money, goods, and time C) by frequent use of the local transportation system D) by calling for local police and fire protection when needed

934)

People who buy from or follow a company online represent which type of community?

A) site community B) virtual community C) community of interest D) employee community

935)

The relationship between business and the community is accurately described by the following: A) The relationship is one of mutual interdependence.

B) Business and communities are independent of one another.

C) Communities possess more social power than businesses do.

D) Business dominates community using economic power.

936)

The term civic engagement describes A) the active involvement of businesses and individuals in improving communities.

B) the collective set of cultural and artistic activities in a community.

C) strong governmental regulation to control businesses at the municipal level.

D) a close and collaborative business–government relationship.

937)

A good way for a business to express its commitment to corporate citizenship is A) by establishing community relations programs.

B) by behaving responsibly toward all its stakeholders.

C) by correcting problems associated with its operations.

D) All of these choices are correct.

938)

How are firms typically affected when they get involved with the community?

A) They often win the loyalty of customers, employees, and neighbors.

B) Unfortunately, their reputations frequently suffer and decline.

C) They usually find it more difficult to respond to changing stakeholder demands.

D) Generally speaking, the government steps in and institutes new regulations.

939)

Social capital is a phrase that refers to all of the following, except A) the goodwill that is engendered by the fabric of social relations.

B) a close relationship between companies and groups in the community.

C) the norms and networks that enable collective action.

D) company funds set aside for employee events.

940)

What is the primary goal of a community relations department?

A) to improve the company’s financial bottom line B) to build relationships with important community groups C) to collaborate with other company teams to create policy D) "Both "to build relationships with important community groups" and "to collaborate with the other company teams to create policy" are correct."

941)

This business role interacts with locals, manages donations, and encourages employee volunteerism.

A) chief financial officer B) director of human resources C) community involvement manager D) vice president of marketing

942)

What is one reason that firms partner with communities to increase economic development?

A) to expand environmental sustainability B) to develop workplace skills C) to control the rate of entrepreneurship D) to avoid paying higher taxes

943)

Why might a company help a community with its housing needs?

A) so they could use the space for offices B) to receive a discounted tax rate C) to improve the quality of the community D) to fix up and resell the properties

944)

Minority enterprises often do business in locations with A) low crime rates.

B) excellent transportation.

C) low-quality public services.

D) high-income clientele.

945)

Minority, women, and disabled veteran–owned firms are accurately described by which of these?

A) They often operate at an economic advantage.

B) They have a medium rate of business failure.

C) They face limited competition from more established firms.

D) They often partner with larger firms in a diversity supplier role.

946)

Besides being helpful, firms often contribute to disaster relief funds to A) offset damages to the environment they themselves caused.

B) build loyalty from those grateful for the assistance.

C) prevent death among the cheapest labor forces in the world.

D) enhance the company’s overall financial position.

947)

Another term for corporate giving is corporate A) welfare.

B) goodwill.

C) philanthropy.

D) citizenship.

948)

In 2020, the smallest source of philanthropic contributions in the United States came from which organization?

A) individuals B) foundations C) corporations D) bequests

949)

What was the primary motivator for corporate giving, according to the National Bureau of Economic Research?

A) financial B) philanthropical C) political influence D) popularity

950)

The share of all giving made up by in-kind contributions of products and services has been A) rising steadily over the past decade.

B) declining steadily over the past decade.

C) remaining relatively constant over the past decade.

D) declining sharply over the past decade.

951)

How do companies encourage their employees to volunteer their time?

A) by sponsoring specific projects B) by offering recognition for service C) by publicizing opportunities to serve D) All of these choices are correct.

952)

Which industry has consistently given the most in-kind contributions?

A) pharmaceutical companies B) high-technology companies C) grocery retailers D) publishing houses

953)

When Fidelity partnered with the Capital Good Fund to service loans to disadvantaged communities, this was an example of A) an in-kind contribution.

B) skills-based volunteerism.

C) community-based philanthropy.

D) organizational support.

954)

A corporate philanthropic strategy that provides free goods or services to the community is trying to A) enhance the supply of untrained workers.

B) align corporate and community goals.

C) increase demand for the product or service.

D) align employee and corporate goals.

955)

Which of the following is not a strategy to help companies get the most benefit from their contributions?

A) Use targeted business methods to assess the impact of gifts.

B) Align company priorities with employee interests.

C) Establish priorities even if they conflict with the firm’s core values.

D) Draw on the unique competencies of the business.

956)

Measurements used to calculate the return on social investment should include A) the changes in both share price and dividends.

B) the amount of corporate donations and volunteer hours.

C) the increases or decrease in overall labor productivity.

D) the before and after inventory capacity.

957)

The most difficult element of the social investment cycle to measure is A) inputs.

B) outputs.

C) impacts.

D) value creation.

958)

Voluntary agreements among business, government, and society to achieve goals are called A) collaborative partnerships.

B) community relations.

C) social capital.

D) social investment.

959)

Why might a firm invest in improving educational opportunities in a community?

A) to satisfy local government regulations B) to build a skills-based talent pool C) as one way to lower their corporate tax rate D) Businesses rarely invest in community education.

960)

Which of these is an example of business supporting their community, as described in the case “Salesforce's 1+1+1 Integrated Philanthropy Model”?

A) Salesforce employees received seven days a year of paid time off to volunteer.

B) The Philanthropy Cloud project allowed employees to track their volunteer hours.

C) The company donated millions to public education in its home community.

D) In 2021, Salesforce had a market capitalization of almost $200 billion.

961)

Which form of corporate giving did Tableau’s COVID-19 dashboard take, according to the case “Salesforce's 1+1+1 Integrated Philanthropy Model”?

A) gift of money B) in-kind contribution C) skills-based volunteerism D) unskilled volunteerism

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

962) Discuss both the community services desired by businesses and the requests made to communities by businesses.

963)

Analyze why a business may wish to get involved in community relations. What benefits accrue to businesses that actively participate in their communities?

964)

In your opinion, what are the most pressing and significant concerns facing communities today? Why do you think so? How would a business’s community relations department address those concerns?

965)

Discuss the three forms of gifts typically made by corporations and their foundations.

Which form of gift do you think is most valuable, and why?

966)

Explain two strategies that businesses can use to help them get the most benefit from their contributions. Cite examples of companies that adopt these strategies.

967)

Describe the four elements of a complete assessment of the return on social investment.

How might each of these elements be measured? Which would be the hardest to measure, and why do you think so?

968)

Describe a collaborative partnership between a business and community that attempts to address a social problem. What strengths does each party bring to the collaboration?

Answer Key Test name: chapter 18 1) TRUE 2) FALSE 3) FALSE 4) TRUE 5) TRUE 6) FALSE 7) TRUE 8) FALSE 9) TRUE 10) FALSE 11) TRUE 12) TRUE 13) FALSE 14) TRUE 15) FALSE 16) D 17) B 18) B 19) A 20) A 21) D 22) A 23) D 24) B 25) C 26) B 27) C 28) C 29) D 30) B 31) C 32) C 33) C 34) A 35) D 36) A 37) B

38) C 39) C 40) B 41) D 42) A 43) B 44) C 45) B 46) Short Answer

Answers may vary.

47) Short Answer

Answers may vary.

48) Short Answer

Answers may vary.

49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

Student name:__________ TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.

969) How the general public perceives a business firm can have a major effect on its performance. ⊚ true ⊚ false 970)

The public may pressure a firm to take a stand when the issue is important enough to the community. ⊚ true ⊚ false

971)

The way an organization presents itself to its stakeholders is known as the corporate reputation. ⊚ true ⊚ false

972)

Companies that have name recognition also have a good reputation. ⊚ true ⊚ false

973)

The public relations department manages the firm’s public image and its relationship with the public. ⊚ true ⊚ false

974)

An example of direct communications is through a company website. ⊚ true ⊚ false

975)

The variety of communications channels for public relations departments has decreased due to combined technology options. ⊚ true ⊚ false

976)

A firm must constantly reestablish its brands in order to maintain their reputation. ⊚ true ⊚ false

977)

A company’s name and logo have little impact on its reputation. ⊚ true ⊚ false

978)

The public scrutiny following a corporate crisis can have a political, legal, financial, and governmental impact on its business. ⊚ true ⊚ false

979)

Key employees must be identified in advance of a crisis so they are ready to address the issue. ⊚ true ⊚ false

980)

Experts say that the first 72 hours of a crisis are the most crucial. ⊚ true ⊚ false

981)

It is recommended that businesses use the same tactics to communicate with all stakeholders. ⊚ true ⊚ false

982)

The most important part of building a firm's reputation is winning trust from its key stakeholders. ⊚ true ⊚ false

983)

Board-level attention to a firm’s reputation has decreased in recent years. ⊚ true ⊚ false

MULTIPLE CHOICE - Choose the one alternative that best completes the statement or answers the question.

984) The general public is accurately described by which statement?

A) They frequently deal with businesses through an economic exchange.

B) Organizational stakeholders consist of individuals and groups found in society.

C) They are unable to influence a firm’s positive or negative reputation.

D) They are internal market stakeholders of the organization.

985)

Through which stakeholder networks can the public demand a certain level of performance from a firm?

A) consumer groups B) community groups C) labor unions D) All of these choices are correct.

986)

Which term refers to the collective means of communicating to an audience?

A) media B) megaphone C) blogging D) pontificating

987)

Which of these situations is not a reason for a firm to communicate through the media?

A) repairing a damaged image B) ignoring or downplaying an organizational crisis C) managing its public relations D) engaging with multiple stakeholders

988)

The corporate reputation is accurately described by which statement?

A) refers to the way that a firm presents itself to an audience B) refers to the way members believe others see the company C) refers to stakeholders’ perceptions of the organization D) refers to the desirable and undesirable qualities of the firm

989)

The way organizational members believe others see the organization is called the corporate A) identity.

B) reputation.

C) image.

D) perception.

990)

The corporate reputation of distinction must be built A) in an ongoing fashion over time.

B) during the firm’s startup period.

C) only after a major product release.

D) only after a corporate crisis.

991)

Building a positive and ethical reputation requires a firm to A) offer products that are somewhat better than their competitors.

B) convey a compelling story about the firm and what it stands for.

C) avoid attention from news channels and social media.

D) pay opinion leaders to write positive reviews about them.

992)

Organizations with strong positive reputations are generally more successful because they A) receive fewer opportunities to advance their interests.

B) are generally less immune to long-term criticism.

C) often get the benefit of the doubt in uncertain circumstances.

D) Both the answers “receive fewer opportunities to advance their interests” and “often get the benefit of the doubt in uncertain circumstances” are correct.

993)

A firm with a reputation of distinction often obtains what over other companies in the same industry?

A) regulatory exemptions B) a competitive advantage C) a lower local tax rate D) lower international trade fees

994)

Which company department manages a firm’s public image and its relationship with the public?

A) human resources B) product marketing C) information technology D) media relations

995)

What is a social media influencer?

A) the group of CEOs that runs the major social media companies B) government regulators from the Federal Communications Commission C) a social media user with credibility in a specific industry or topic D) the collective set of investors who focus on social media transactions

996)

Global businesses that have extended their public relations strategies worldwide should A) ensure that communications with local media take place in the area's native language.

B) never decentralize their global public relations programs to ensure the company has "one voice."

C) assume there is no anti-American sentiment in the countries where they have operations.

D) ignore local customs and emerging issues in the locations where they operate.

997)

Using techniques to increase the perceived value of a product or brand over time is called A) public relations.

B) brand management.

C) public service.

D) crisis management.

998)

Can social trends impact a company’s brands?

A) Yes, they can influence the public’s perception of a brand.

B) No, social trends rarely influence the public’s perception.

C) Unfortunately, there’s no way to measure the social impact.

D) The impact is felt only in companies with large government subsidies.

999)

How can a firm leverage its name and logo to improve its reputation?

A) They can make the company's signature widely recognizable.

B) They can create a public association with exceptional products.

C) They can develop a message that they are a trusted organization.

D) All of these choices are correct.

1000)

Brand management often involves conveying what about a product or service?

A) the solutions it provides B) its flaws and disadvantages C) the experience it offers D) Both “the solutions it provides” and “the experience it offers” are correct.

1001) Why might the public justifiably assign an unflattering nickname to a firm or product?

A) The firm or product failed to meet public expectations.

B) The public just likes to have some fun with good products.

C) The public never ascribes negative names to organizations.

D) An unhappy employee’s false claim went viral on social media.

1002) A significant business disruption that stimulates extensive news media and social

networking coverage is called a A) corporate identity.

B) crisis plan.

C) corporate crisis.

D) public relations.

1003) This type of corporate crisis often involves a cover-up or lack of urgency.

A) violent terrorism B) “acts of God” C) mechanical problems D) management indecision 1004) How might a corporate crisis affect an organization?

A) positively impact financials B) negatively disrupt operations C) create a governmental partnership D) set a positive legal precedent

1005) Scenario-based press releases, key discussion points, and procedures to activate the

organization's website are all part of which step in an effective crisis management plan?

A) Get ready before the crisis hits.

B) Communicate quickly, but accurately.

C) Use the Internet to reassure the public.

D) Do the right thing during the crisis.

1006) During crisis management, doing the right thing should include A) accepting full responsibility.

B) expressing sincere regret.

C) making excuses for the problem.

D) Both “accepting full responsibility” and “expressing sincere regret” are correct.

1007) The last step of the crisis management process instructs organizations to A) show sympathy for creating the problem.

B) prepare an emergency dark site.

C) seek to restore the firm’s reputation.

D) communicate promptly with the public.

1008) Why is media training especially important for executive-level employees?

A) Executives must learn to tell the company story in multiple languages.

B) Media training is not actually that important for executives.

C) Media training is only important when a company does international business.

D) Executives must be well-versed in communicating the corporate story.

1009) A firm who hires a public media spokesperson is following expert communications

advice to be A) current.

B) accessible.

C) helpful.

D) courteous.

1010) Emphasizing key points and guiding the media reporter to them is called A) hooking.

B) bridging.

C) flagging.

D) gapping.

1011) The media control technique called bridging is exemplified by which phrase?

A) “We are undertaking a program to correct the situation.”

B) “Your listeners may not know that …”

C) “What I can tell you is …”

D) “This is important news because …”

1012) A customer tweeting about a recent bad shopping experience is using which type of

media communication?

A) paid content B) public service announcement C) user-generated content D) event sponsorship 1013) What media technique is used to promote the general perception of a product or service,

rather than promoting its functional attributes?

A) user-generated content B) issue advertisements C) public service announcements D) image advertisements 1014) What happened to United Airlines’ reputation after several in-flight incidents were

reported, according to the discussion case “United Airlines—Navigating a Social Media Storm”?

A) United’s reputation suffered, but not enough to fall behind Delta.

B) The company’s public rating dropped significantly.

C) The airline’s reputation improved ever so slightly.

D) After defending their actions, there was no effect on their reputation.

1015) According to the discussion case “United Airlines—Navigating a Social Media Storm,” in

the Dr. Dao incident, did United do the right thing? Why or why not?

A) No. They blamed the entire violent incident on the doctor.

B) Yes. They apologized immediately and compensated Dr. Dao. C) Partly. United changed their response three times before they got it right.

D) No. They were eventually charged with discrimination against Dr. Dao.

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

1016) Define the general public. How do firms and the public affect one another?

1017) How do firms develop a distinctive and positive reputation? How can the general public

affect a company’s reputation? Identify an organization that has recovered from having a bad reputation and explain how the firm restored public confidence.

1018) Why do firms create public relations departments? Outline the structure and activities of

a typical department.

1019) What new challenges emerge when public relations strategies take on a global

perspective?

1020) Discuss the value of a recognizable brand. What can a company do to foster brand

appeal? What can customers do to voice dissatisfaction with a company’s products?

1021) Define a corporate crisis. Outline an effective crisis management plan for a public

relations manager.

1022) Evaluate public opinion–influencing strategies used by business organizations, such as

image advertisements, paid content, and event sponsorship.

Answer Key Test name: chapter 19 1) TRUE 2) TRUE 3) FALSE 4) FALSE 5) TRUE 6) TRUE 7) FALSE 8) TRUE 9) FALSE 10) TRUE 11) TRUE 12) FALSE 13) FALSE 14) TRUE 15) FALSE 16) B 17) D 18) A 19) B 20) D 21) C 22) A 23) B 24) C 25) B 26) D 27) C 28) A 29) B 30) A 31) D 32) D 33) A 34) C 35) D 36) B 37) A

38) D 39) C 40) D 41) B 42) C 43) C 44) C 45) D 46) B 47) C 48) Short Answer

Answers may vary.

49) Short Answer

Answers may vary.

50) Short Answer

Answers may vary.

51) Short Answer

Answers may vary.

52) Short Answer

Answers may vary.

53) Short Answer

Answers may vary.

54) Short Answer

Answers may vary.