Test Bank For Business Ethics Decision Making for Personal Integrity & Social Responsibility, 6th Ed

Test Bank For Business Ethics Decision Making for Personal Integrity & Social Responsibility, 6th Edition By Laura Hartman, Joseph DesJardins, Chris MacDonald Chapter 1-10 Answers are at the End of Each Chapter Chapter 1

Student name:__________ 1) In a general sense, a business stakeholder is one who has made substantial financial

investments in the business. ⊚ true ⊚ false

2) In the face of inevitable disagreement, Thrasymachus’s view was that everyone works

together to figure the best way forward. ⊚ true ⊚ false

3) Ethics refers to how human beings should live their lives. ⊚ true ⊚ false

4) Norms appeal to certain values that would be promoted or attained by acting in a certain way. ⊚ true ⊚ false

5) Values are the only guidance individuals need to act in ways that are positive or ethical. ⊚ true ⊚ false

Ethical values are personal codes of ethics that ensure that a person meets his or her individual standards of well-being.

⊚ true ⊚ false

6) The well-being promoted by ethical values is not a personal and selfish well-being. ⊚ true ⊚ false

7) Societies that value individual freedom legally stipulate codes of personal integrity and

common decency to safeguard this freedom. ⊚ true ⊚ false

8) Human beings are capable of a wide diversity of motivations and behaviors, ranging from

narrow self-interest to wide empathy and altruism, and in this, business is no different. ⊚ true ⊚ false

9) Ethical theories are patterns of thinking, or methodologies, to help us decide what to do. ⊚ true ⊚ false

10) Which of the following represents the role of philosophical ethics in the field of business

ethics?

A) B) C) D)

providing the fundamental language and categories of ethics understanding how business organizations fit into political context recognizing the mental processes behind why people behave as they do promoting a culture in which legal compliance flourishes

Identify a true statement about the field of business ethics.

E) It is rooted in the more general principle of social ethics.

F) It is not a multidisciplinary field.

G) It is mainly relevant to decision making within an organization.

H) It involves decisions at the individual, at the organizational, and at a broader social and governmental level.

11) Which of the following is a goal of a business ethics class?

A) understanding how and why people behave unethically B) doing everything required to satisfy business stakeholders C) separating ordinary ethical consideration from business decisions D) recognizing that business has its own standards of good and bad

12) ________ is a theory of human motivation that claims that all human actions are selfish and

motivated by self-interest.

A) Theoretical reasoning B) The stakeholder theory C) Psychological egoism D) The separation thesis

13) The ________ asserts that ordinary ethical standards should be kept separate from, and not

be used to judge, business decisions because business has its own standards of good and bad.

A) scientific method B) separation thesis C) concept of theoretical reasoning D) social ethics model

14) In a general sense, anyone who affects or is affected by decisions made within a firm can be

called a business ________.

A) nominee B) stakeholder C) analyst D) insider

15) Which of the following best describes a business stakeholder?

A) only the minority shareholders in a business entity B) only those who have acquired significant shares in a firm C) anyone who audits a firm D) anyone who affects or is affected by decisions made within a firm

16) Which of the following best describes ethics?

A) an academic discipline that originated in the early 1900s B) a descriptive approach that provides an account of how and why people do act the

way they do C) the study of how human beings should lead their lives D) a descriptive approach such as psychology and sociology

17) Which of the following is an approach advocated while teaching ethics?

A) Teachers should teach ethical dogma to a passive audience.

B) Teachers should consider acceptance of customary norms as an adequate ethical

perspective.

C) Teachers should understand that their role is only to tell the right answers to their students.

D) Teachers should challenge students to think for themselves.

18) Philosophers often state that ethics is ________, which means that it focuses on people’s

reasoning about how they should act.

A) normative B) derivative C) circumstantial D) clinical

19) Which of the following observations is true of ethics?

A) It is descriptive in nature.

B) It deals with our reasoning about how we should act.

C) It provides an account of how and why people act the way they do.

D) It is equivalent to law-abiding behavior.

20) Social sciences such as psychology and sociology are different from ethics owing to the fact

that they are ________.

A) normative in nature B) descriptive in nature C) conjectural in nature D) clinical in nature

21) ________ seeks an account of the how and why people should act a certain way, rather than

how they do act.

A) Sociology B) Psychology C) Ethics D) Anthropology

22) Which of the following is a factor that distinguishes social sciences, such as psychology and

sociology, from ethics?

A) Unlike ethics, these disciplines inquire why people act the way they do.

B) Unlike ethics, these disciplines are normative rather than descriptive.

C) Unlike ethics, these disciplines provide an account of how people should act.

D) Unlike ethics, these disciplines give directives about how people should act.

23) The ________ discipline provides an account of how and why people do act the way they do.

A) descriptive B) supererogatory C) normative D) stipulative

24) Individual codes of conduct based on one’s value structures regarding how one should live,

how one should act, what one should do, and what kind of a person should one be is sometimes referred to as ________.

A) morality B) independence C) leadership D) rationality

25) Morality is the aspect of ethics that we can refer to by the phrase “________.”

A) personal freedom B) individual rationality C) personal integrity D) persuasive rationality

26) Ethics refers to the applications of ________ on which people’s decisions are based.

A) values B) morals C) etiquettes D) norms

27) Identify the area of ethics that raises questions about justice, law, civic virtues, and political

philosophy.

A) stipulative ethics B) existential ethics C) virtue ethics D) social ethics

28) The aspect of business ethics that examines business institutions from a social rather than an

individual perspective is referred to as A) decision making for social responsibility.

B) corporate cultural responsibility.

C) organizational ethical responsibility.

D) institutional morality.

29) ________ establish the guidelines or standards for determining what one should do, how one

should act, and what type of person one should be.

A) Governments B) Set expectations C) Norms D) Laws

30) Which of the following is a true statement about norms?

A) They are a set of broad and flexible expectations of behavior.

B) They are standards of appropriate and proper behavior.

C) They do not adhere to any underlying values or beliefs.

D) They consist of guidelines for bringing about positive behavioral change.

31) The crux of normative ethics is that these disciplines A) presuppose some underlying values.

B) describe what people do.

C) should always involve the study or discipline of ethics.

D) branch away from social ethics to personal ethics.

32) Which of the following refers to an underlying belief that causes people to choose between

plausible courses of action?

A) norms B) paradigms C) protocols D) values

33) Which of the following is true about values?

A) Values are the highest standards of appropriate and proper behavior.

B) Corporate scandals prove the fact that individuals have personal values, but

institutions lack values.

C) Values cannot lead to unethical results.

D) Values are underlying beliefs that cause us to act or to decide in a certain way.

34) ________ are beliefs and principles that provide the ultimate guide to a company’s decision

making.

A) Mission statements B) Core values C) Historical milestones D) Vision statements

35) Business ethics is a multidisciplinary field that takes its roots from the more general

discipline of A) philosophy.

B) anthropology.

C) sociology.

D) political code of conduct.

36) Ethics requires that the promotion of human welfare be done A) based on the personal opinions of the decision maker.

B) based on the level of need of the beneficiaries.

C) understanding the religious beliefs of the beneficiary.

D) in a manner that is acceptable and reasonable from all relevant points of view.

37) Dramatic examples of tyrannical regimes in history demonstrate that A) societies valuing freedom welcome laws that require more than the ethical minimum.

B) just societies can only be achieved through strict enforcement of ethical codes.

C) obedience to the law almost always makes people apathetic toward their ethical

duties.

D) one’s ethical responsibility may run counter to the law.

38) Telling organizations that their ethical responsibilities end with obedience to the law A) is just inviting more legal regulation.

B) is enough to maintain an ethical business environment.

C) reduces the frequency of corporate scandals.

D) eliminates ambiguity while making personal ethics-related decisions.

39) The failure of personal ethics among companies like Enron led to the creation of the A) Brooks Act. B) Gramm-Leach-Bliley Act. C) Clinger-Cohen Act. D) Sarbanes-Oxley Act.

40) Which of the following observations is true?

A) Obedience to the law is sufficient to fulfill one’s ethical duties.

B) The law is very effective at promoting “goods.”

C) The law cannot anticipate every new dilemma that businesses might face.

D) An individual’s ethical responsibility can never run counter to the law.

41) Which of the following is a true statement about the Americans with Disabilities Act (ADA)?

A) What counts as a disability remains ambiguous under the law.

B) The law lays out clear-cut rules for reasonable accommodation.

C) The law has not been put into practice till date.

D) Mental disabilities have been left out of the purview of the law.

42) A process to identify potential events that may affect the entity, and manage risk to be within

its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives is called ________.

A) risk assessment B) practical reasoning C) theoretical reasoning D) risk pooling

43) Practical reasoning is reasoning about A) what we should think.

B) what we should do.

C) what we should believe.

D) what we should share.

44) Reasoning about what should be done is known as ________ reasoning.

A) practical B) objective C) theoretical D) predictive

45) Theoretical reasoning is reasoning about A) what we actually do.

B) what we should do.

C) what we should believe.

D) what we should implement.

46) ________ reasoning is reasoning about what we should believe.

A) Practical B) Abstract C) Theoretical D) Descriptive

47) Which of the following is the pursuit of the highest standard for what we should believe?

A) theoretical reason B) notional reason C) emotional reason D) practical reason

48) Which of the following is the great arbiter of truth according to the tradition of theoretical

reason?

A) religion B) customs C) science D) norms

49) Which of the following can be thought of as the answer to the fundamental questions of

theoretical reason?

A) the scientific method B) the practical approach C) the contingency approach D) the normative model

50) A ________ is anyone affected, for better or for worse, by the decisions made within a

particular firm.

51) ________ is a theory of human motivation that claims that all human actions are selfish and

motivated by self-interest.

52) The ________ asserts that ordinary ethical standards should be kept distinct from, and not be

used to judge, business decisions because business has its own standards of good and bad.

53) A process to identify potential events that may affect the entity, and manage risk to be within

its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives is called ________.

54) As a discipline, ________ deals with norms and standards of appropriate and proper

behavior.

55) ________ is the aspect of ethics that is referred to by the phrase “personal integrity.”

56) Normative disciplines presuppose some underlying ________.

57) Acts and decisions that seek to promote human welfare are based on ________.

58) The aspect of business integrity that focuses on examining business institutions from a

collective rather than from an individual perspective falls under the area of ________.

59) ________ reasoning is reasoning about what we should believe.

60) Explain how the study of ethics was viewed until recently, and what kind of shift in focus has

occurred post the scandals.

61) Describe the advantages associated with ethical decision making.

62) Discuss the hesitation (that may be justified) associated with teaching ethics. Explain briefly

how the authors of this text believe that ethics can be taught constructively in a class.

63) Define ethics. How is it different from social sciences such as psychology and sociology?

64) Differentiate the concepts of morality and social ethics.

65) Why is “ethics” considered a normative discipline?

66) Define values and discuss the element of corporate culture in detail.

67) Describe the two elements of ethical values.

68) Discuss the impact of maintaining that holding to the law is sufficient to fulfill one's ethical

duties, and what it says about the law itself.

69) Explain the difficulties associated with telling a business that its ethical responsibilities end

with obedience to the law.

70) Discuss the importance of precedents for most laws concerning business.

71) Define risk assessment.

72) While using the risk assessment model, what might the decision makers include in their

assessment before taking action?

73) Differentiate between practical reasoning and theoretical reasoning.

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

38) D 39) D 40) A 41) D 42) C 43) A 44) A 45) B 46) A 47) C 48) C 49) A 50) C 51) A 52) stakeholder 53) Psychological egoism 54) separation thesis 55) risk assessment 56) normative ethics 57) Morality 58) values 59) ethical values 60) social ethics 61) Theoretical 62) Essay 63) Essay 64) Essay 65) Essay 66) Essay 67) Essay 68) Essay 69) Essay 70) Essay 71) Essay 72) Essay 73) Essay 74) Essay 75) Essay

Student name:__________ 74) The first step in making decisions that are ethically responsible is to consider all of the

people affected by a decision, the people often called stakeholders. ⊚ true ⊚ false

75) There is a role for science and critical thinking in any study of ethics. ⊚ true ⊚ false

76) A person’s understanding of facts does not affect the degree of reasonability of his ethical

judgments. ⊚ true ⊚ false

77) Issue identification becomes the first step of the ethical decision-making process when no

ethical issue or dilemma is known to the decision maker at the beginning. ⊚ true ⊚ false

78) Business decisions and ethical decisions cannot blend; they remain mutually exclusive. ⊚ true ⊚ false

79) Inattentional blindness results from a very broad perspective of ethical issues. ⊚ true ⊚ false

80) Normative myopia occurs when one becomes very involved with the ethical issues of

business decisions and loses sight of the technical aspects. ⊚ true ⊚ false

81) Stakeholders include only those groups and/or individuals who take calls on internal

decisions, policies, or operations. ⊚ true ⊚ false

82) Trying to understand another person’s perspective of a situation usually leads to poor

comparisons of alternatives for ethical decision making. ⊚ true ⊚ false

83) A critical element of comparing and weighing the alternatives is the consideration of ways to

mitigate, minimize, or compensate for any possible harmful consequences. ⊚ true ⊚ false

84) Consequences or justifications always override every other consideration when comparing

alternatives for ethical decision making. ⊚ true ⊚ false

85) Within business, an organization’s context sometimes makes it difficult for even the well-

intentioned person to act ethically. ⊚ true ⊚ false

86) Responsibility for the circumstances that can encourage ethical behavior and can discourage

unethical behavior falls predominantly to the business management and executive team. ⊚ true ⊚ false

87) Within a business setting, individuals must consider the ethical implications of both personal

and professional decision making. ⊚ true ⊚ false

88) Which of the following is the first step in making an ethically responsible decision?

A) determining the facts of the situation B) considering the available alternatives C) monitoring and learning from the outcomes D) comparing and weighing alternatives

89) Which of the following is the second step of the ethical decision-making process?

A) considering available alternatives B) making the decision C) identifying the ethical issues involved D) considering the impact of the on stakeholders

90) Kathy, your best friend and classmate, asks you to help her with a challenging ethical

dilemma. Which of the following would be your first step in the decision-making process?

A) identifying the ethical issue B) considering the available alternatives C) determining the facts of the situation D) making the decision

91) Which of the following conditions makes issue identification the first step in the ethical

decision-making process?

A) when the ethical predicament of the situation is hard to determine B) when the responsibility for the decision lies with one person C) when the issue is presented from the start D) when the stakeholders in the decision cannot be determined

92) In the ethical decision-making process, identify the steps that might arise in reverse order,

depending on the circumstances.

A) identifying relevant ethical issues; considering the impact of a decision on stakeholders B) determining the facts of the situation; identifying the impact of the decision on stakeholders C) identifying the impact of the decision on stakeholders; considering available alternatives D) determining the facts of the situation; identifying relevant ethical issues

93) ________ refers to shortsightedness about values.

A) Inattentional blindness B) Normative myopia C) Change blindness D) Descriptive myopia

94) Which of the following is the reason why normative myopia is especially liable to occur in a

business context?

A) The fast-paced world of business allows little time for contemplation on ethics.

B) Business attracts people from diverse backgrounds, which makes it difficult to identify ethical standards agreeable to everybody.

C) People are more likely to focus on the technical aspects of the task at hand in a business context, and thus, fail to recognize the ethical aspect.

D) Ethics can justifiably be allowed to take a backseat in a business context.

95) Identify the true statement about normative myopia.

A) It occurs when decision makers fail to notice gradual changes over time.

B) It refers to the shortsightedness about values.

C) It has only been observed to occur in business.

D) It only results from focusing failures.

96) Which of the following statements commits the ethical oversight known as normative

myopia?

A) “I skipped the red light because I was so involved in our debate.”

B) “The only reason they did not notice the pilferage happening is because it involved the theft of such small quantities of goods over a long period of time.”

C) “I hope Brad has learnt his lesson after getting drunk and crashing his car.”

D) “I strongly believe in the saying, ‘finders keepers, losers weepers.’”

97) If we are told specifically to pay attention to a particular element of a decision or event, we

are likely to miss all of the surrounding details, no matter how obvious. According to Bazerman and Chugh, this phenomenon is known as ________.

A) inattentional blindness B) descriptive ignorance C) change blindness D) normative myopia

98) Focusing failures result in moments where we ask ourselves, “How could I have missed

that?” According to Bazerman and Chugh, this phenomenon is known as A) change blindness.

B) descriptive ignorance.

C) inattentional blindness.

D) normative myopia.

99) Which of the following causes inattentional blindness according to Bazerman and Chugh?

A) perceptual differences B) moral exclusions C) perceptual barriers D) focusing failures

100)

Which of the following is true of inattentional blindness?

A) It occurs when someone deliberately avoids taking a decision about an unpleasant ethical issue.

B) It refers to the shortsightedness about values.

C) It distinguishes good people who make ethically responsible decisions from good people who do not.

D) It occurs when people pay specific attention to a particular element of a decision, while losing sight of other aspects of it.

101)

Missing a highway turn-off as a result of speaking on a cell phone while driving is an example of ________.

A) normative myopia B) inattentional blindness C) rational ignorance D) change blindness

102)

Which of the following factors was a common factor behind ethical scandals at corporations such as Wells Fargo, Enron, and Volkswagen?

A) decision-making inability B) descriptive ignorance C) peer pressure D) employee egoism

103)

Rumah, when faced with a dilemma, considered only the two most obvious choices. They failed to see that there are other not-so-obvious choices that could be potential solutions to their problem. What cognitive barrier did Rumah face?

A) considering only limited alternatives B) overlooking a sudden change in circumstances C) maintaining status quo due to a fear of change D) acting on a whim

104)

During difficult decision making, selecting the alternative that meets the minimum decision criteria is also termed as A) intentional blinding.

B) simplifying.

C) satisficing.

D) rationalizing.

105)

In the ethical decision-making process, once one examines the facts and identifies the ethical issues involved, one should next ________.

A) make the decision B) consider the available alternatives C) monitor and learn from the outcomes D) identify the stakeholders

“________” include all of the groups and/or individuals affected by a decision, policy, or operation of a firm or individual.

A) Stakeholders B) Shareholders C) Employees D) Owners

106)

107)

Jim resides close to Bunton Steel Company, a steel factory. The company has recently implemented changes to its pollution control policy that has adversely affected Jim and his family. This makes Jim a(n) ________ in the company’s pollution control policy.

A) associate B) stockholder C) partner D) stakeholder

108)

In an ethical decision-making process, moral imagination helps individuals make ethically responsible decisions. Identify the step in which moral imagination is critical.

A) determining the facts B) considering the available alternatives C) identifying the ethical issues D) identifying and considering impact of decision on stakeholders

109)

In the ethical decision-making process, moral imagination is used by decision makers while A) considering the available alternatives.

B) identifying the stakeholders.

C) identifying the ethical issues involved.

D) determining the facts of the situation.

110)

In the ethical decision-making process, creativity in identifying options is also known as A) moral imagination.

B) descriptive imagination.

C) intentional deliberation.

D) normative imagination.

111)

________ is one element that distinguishes good people who make ethically responsible decisions from good people who do not.

A) Normative myopia B) Inattentional blindness C) Change blindness D) Moral imagination

112)

Which of the following is true of moral imagination?

A) It occurs when decision makers fail to notice gradual variations over time.

B) It denotes reasonable ethical judgments that a person makes without regard for facts.

C) It distinguishes good people who make ethically responsible decisions from good people who do not.

D) It refers to the positive impact a hypothetical decision is projected to have on the stakeholders involved in the decision.

113)

Which of the following qualities would an effective decision maker display when considering the available alternatives for ethical decision making?

A) reciprocal obligation B) servant leadership C) social entrepreneurship D) moral imagination

114)

Which of the following elements is important not only to consider the obvious options with regard to a particular dilemma, but also the much more subtle ones that might not be evident at first glance?

A) intentional deliberation B) descriptive imagination C) moral imagination D) normative imagination

115)

Identify the step of the ethical decision-making process that involves predicting the likely, foreseeable, and the possible consequences to all the relevant stakeholders.

A) comparing and weighing the alternatives B) making the decision C) identifying the ethical issues D) monitoring and learning from the outcomes

116)

A critical element of this step in the ethical decision-making process will be the consideration of ways to mitigate, minimize, or compensate for any possible harmful consequences or to increase and promote beneficial consequences. Which step is this?

A) monitoring the outcomes B) considering available alternatives C) identifying the ethical issues D) comparing and weighing alternatives

117)

Which of the following considerations can sometimes override consequences when comparing and weighing alternatives for ethical decision making?

A) ideas B) apprehensions C) principles D) assumptions

118)

Which step in the ethical decision-making process occurs once you have considered how a decision affects stakeholders by comparing and weighing the alternatives?

A) evaluating the results after executing the decision B) monitoring and learning from outcomes C) finalizing a decision D) identifying key stakeholders

119)

Identify the final step in the ethical decision-making process.

A) listing out the eventualities that may result from the decision B) monitoring and learning from outcomes C) corresponding with the stakeholders D) identifying new ethical dilemmas to tackle

120)

Dayo knew that teasing a classmate for stammering was not good conduct, nevertheless they joined in to fit in with the majority. Which stumbling block to ethical behavior did Dayo face?

A) too many decision factors B) satisficing C) peer pressure D) lack of intelligence

121)

Which of the following is part of the final step in an ethical decision-making process?

A) evaluating the implications of a decision B) ensuring that the decision taken is a simple “yes” or “no” decision C) assessing the transparency of a decision D) engaging in moral imagination

122)

When faced with a situation that suggests two clear alternative ways forward, we often consider only those two clear paths, missing the fact that other alternatives might be possible.

Considering limited alternatives is a stumbling block to responsible action that can be categorized as a(n) A) personality barrier.

B) perceptual barrier.

C) cognitive barrier.

D) individuality barrier.

123)

Which of the following is a cognitive barrier to responsible, ethical decision making?

A) choosing the alternative that meets maximum decision criteria B) considering unlimited alternatives C) following simplified decision rules D) selecting only the best option

124)

Identify the cognitive barrier which might appear to relieve us of accountability for a decision.

A) looking for creative alternatives B) considering unlimited alternatives C) satisfying the maximum decision criteria D) using a simplified decision rule

125)

126)

Which of the following explains the term “satisficing?”

A) striving to select only the best alternative B) following simplified decision rules C) selecting the alternative simply because it is the easy way out D) selecting the alternative that meets minimum decision criteria

When making a decision, selecting the alternative that meets the minimum decision criteria is selected is known as ________.

A) normalcy bias B) satisficing C) optimism bias D) flipism

127)

Identify the attitude which leads to an unexamined life not worth living according to Socrates.

A) narcissism B) passivity C) cynicism D) satisficing

128)

Which of the following is a cognitive barrier to responsible decision making and behavior?

A) complex decision rules B) lack of transparency C) morality D) ignorance

129)

According to the Greek philosopher Aristotle, ________ explains why some people act unethically even when they know what is right.

A) normative myopia B) change blindness C) weakness of will D) moral imagination

130)

Identify the institutional role from the following.

A) spouse B) citizen C) sibling D) teacher

131)

Identify the social role from the following.

A) student-body president B) manager C) citizen D) librarian

132)

Individuals within a business setting are often in situations in which they must reach an agreement using their own point of view and the perspective of the specific role they fill within an institution. This best describes the term ________.

A) practical and theoretical reasoning B) critical thinking C) personal and professional decision making D) risk assessment

133)

In the context of ethical decision making in managerial roles, ________ lies at the heart of an individualized ethical decision-making process.

A) theoretical reasoning B) personal integrity C) lack of transparency D) inattentional blindness

134)

Avoiding ethical responsibility by applying easy guidelines in decision making is termed as using ________.

135)

According to business scholars Chugh and Bazerman, ________ results from focusing on too narrow a range of questions.

136)

________ surrounding how individuals experience and understand situations can explain many ethical disagreements.

137)

Some writers have called the inability to recognize ethical issues while dealing with the financial aspect of business decisions ________.

138)

When an unethical decision is made just because it was easier than the ethical option, the decision maker has succumbed to ________.

139)

A long tradition in philosophical ethics argues that a key test for ________ is whether or not a decision would be acceptable from the point of view of all parties involved.

140)

In an ethical decision-making process, creativity in identifying options is called “________”.

141)

Responsible decision making involves identifying and considering all of the people affected by a decision, the people often called ________.

142)

Selecting the alternative that meets minimum decision criteria is known as ________.

143)

We tend to give in to ________ in our professional environments, both because we want to “fit in” and to achieve success in our organizations, and also because our actual thinking is influenced by our peers.

144)

Explain the importance of determining the facts when making a responsible ethical decision.

145)

Elaborate on the concept of perceptual differences in ethics.

146)

Explain the role of the sciences in the study of ethics.

147)

How does a business decision become an ethical one?

148)

What is normative myopia?

149)

What are the consequences of not looking at various perspectives and the interests of other people involved while making a responsible ethical decision?

150)

What is the test for ethical legitimacy in philosophical ethics?

151)

What is moral imagination? How is it important?

152)

Explain the importance of moral imagination with an example.

Outline the importance of “walking a mile in another’s shoes” and associate it with the fifth step of the ethical decision-making process.

153)

154)

Identify the means for comparing and weighing alternatives.

155)

Outline the thought process of responsible persons comparing and weighing alternatives while considering the effects of a decision on their own integrity and character.

156)

Explain how the ethical decision-making process does not end with making a decision.

157)

Identify and describe the intellectual or cognitive stumbling blocks that can come in the way of responsible ethical decision.

158)

Give three examples each of social and institutional roles.

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

38) D 39) C 40) D 41) C 42) A 43) D 44) C 45) C 46) B 47) C 48) A 49) C 50) C 51) D 52) D 53) B 54) B 55) D 56) C 57) D 58) C 59) C 60) B 61) simplified decision rules 62) inattentional blindness 63) Perceptual differences 64) normative myopia 65) weakness of will 66) ethical legitimacy 67) moral imagination 68) stakeholders 69) satisficing 70) peer pressure 71) Essay 72) Essay 73) Essay 74) Essay 75) Essay 76) Essay 77) Essay

78) Essay 79) Essay 80) Essay 81) Essay 82) Essay 83) Essay 84) Essay 85) Essay

Student name:__________ 159)

Ethics attempts to answer the question of how we should live, but it does not give reasons to support its answers. ⊚ true ⊚ false

160)

Unlike religious ethics that explains human well-being in religious terms, philosophical ethics provides justifications that must be applicable to all people regardless of their religious starting points. ⊚ true ⊚ false

161)

Principle-based ethics directs us to consider the moral character of individuals and how various character traits can contribute to, or obstruct, a happy and meaningful human life. ⊚ true ⊚ false

162)

163)

Utilitarianism has been called a virtue-based approach to ethics and social policy. ⊚ true ⊚ false

Utilitarianism is a social philosophy that promotes the welfare of well-informed political minorities. ⊚ true ⊚ false

The “administrative” version of utilitarianism considers competitive markets to be the most efficient means of maximizing happiness. ⊚ true ⊚ false

164)

The “market” version of utilitarianism argues that questions of safety and risk should be determined by experts who establish standards that the business is required to meet. ⊚ true ⊚ false

165)

166)

Utilitarians would object to child labor as a matter of principle. ⊚ true ⊚ false

167)

A principle-based framework defines a set of rules that enforces us to act or decide in certain ways. ⊚ true ⊚ false

168)

The judiciary’s role in a democracy can be thought of as pursuing the utilitarian goal of creating policies to produce the greatest good for the greatest number, while the legislative role is to enforce basic principles of justice and fairness. ⊚ true ⊚ false

169)

The concept of a human or moral right is central to the utilitarian ethical tradition. ⊚ true ⊚ false

170)

The rights of employees to minimum wage, equal opportunity, and to bargain collectively as part of a union are examples of their rights grounded in moral entitlements. ⊚ true ⊚ false

171)

The three ethical frameworks that have proven influential in the development of business ethics and that have a very practical relevance in evaluating ethical issues in modern business are utilitarianism, principle-based framework, and virtue ethics. ⊚ true ⊚ false

172)

An ethics of virtue focuses on the actions of a person rather than the person’s characteristics. ⊚ true ⊚ false

173)

Virtue ethics directs us to act on the basis of moral principles such as respecting human rights. ⊚ true ⊚ false

174)

The three major categories of an ethical framework are A) utility, virtue, and values.

B) universal rights, values, and moral principles.

C) universal rights, cultural norms, and morals.

D) consequences, principles, and personal character.

175)

________ directs us to decide based on overall consequences of our acts.

A) Deontology B) Role ethics C) Utilitarianism D) Virtue ethics

176)

________ typically assert that individual rights and duties are fundamental and thus can also be referred to as a rights-based, or duty-based approach to ethics.

A) Principle-based ethics B) Role ethics C) Virtue-based ethics D) Pragmatic ethics

177)

The study of various character traits that can contribute to, or obstruct, a happy and meaningful human life is part of ________.

A) Kantian tradition B) virtue ethics C) principle-based ethics D) utilitarianism

178)

Which of the following is true of philosophical ethics?

A) It provides justifications that must be applicable to all people regardless of their religious starting points.

B) It tends to disconnect the “oughts” and “shoulds” of ethics from the underlying account of human well-being.

C) It is concerned with how business institutions ought to be structured.

D) It explains human well-being in religious terms.

179)

________ holds that ethical values are dependent on particular people, cultures, or times.

A) Theoretical reasoning B) Psychological egoism C) Business ethics D) Ethical relativism

180)

Utilitarianism’s fundamental insight is that we should decide what to do by A) considering the moral character of individuals.

B) following the rules, regardless of consequences.

C) acting only out of a self-interest.

D) considering the consequences of our actions.

181)

Utilitarianism has been called a(n) A) commonsensical approach to ethics.

B) behavioral approach to ethics.

C) consequentialist approach to ethics.

D) intuitive approach to ethics.

182)

What is the difference between a principle-based framework of ethics and utilitarianism?

A) Ethics of principles is based on self-interest, whereas utilitarianism is based on human rights.

B) Ethics of principles is based on human rights, whereas utilitarianism is based on selfinterest.

C) Ethics of principles is based on rules, whereas utilitarianism is based on consequences.

D) Ethics of principles is based on consequences, whereas utilitarianism is based on rules.

183)

________ is commonly identified with the policy of “maximizing the overall good.”

A) Stoicism B) Deontology C) Pragmatism D) Utilitarianism

184)

Which of the following principles does utilitarianism emphasize?

A) producing the greatest good for the greatest number B) acting only out of self-interest C) ensuring that a fair decision is an impartial decision D) obeying the law and keeping promises

185)

Amare and Jela argue about the employment of children in tobacco farms in a certain part of the world. Jela is of the view that this practice is ethical. They support this view by stating facts about how the economic and social gains from employing children in these farms outweigh the economic losses due to the health problems and lack of education suffered by these children. Jela is most likely an adherent of ________.

A) virtue ethics B) deontological ethics C) utilitarianism D) classicism

186)

The utilitarian tradition relies on ________ for deciding on the ethical legitimacy of alternative decisions.

A) intuition B) experience C) variable analysis D) social sciences

187)

Free-market economics is grounded in the ________.

A) rights-based framework of ethics B) principle-based framework of ethics C) utilitarian framework of ethics D) legal framework of ethics

188)

Which of the following is true of a market version of utilitarianism?

A) Questions of safety and risk are determined by experts.

B) Social science determines policies to maximize the overall good.

C) Individuals calculate for themselves what risks they wish to take.

D) A government regulator determines the safety standards in the marketplace.

Which of the following would be advocated by the “administrative” version of utilitarianism?

A) deregulation of advertising standards B) reliance on free and competitive markets C) risk-taking by consumers D) government regulation of business

189)

190)

Identify the statement that most accurately describes the difference between the market and the administrative versions of utilitarianism.

A) The administrative version of utilitarianism promotes policies that protect property rights and encourage competition.

B) The administrative version of utilitarianism uses social sciences to predict consequences.

C) The administrative version of utilitarianism turns to policy experts for the design and implementation of policies.

D) The administrative version produces those goods that the consumers want.

191)

Utilitarianism determines ethical and unethical acts by their ________.

A) legality B) consequences C) fairness D) nuances

192)

One of the problems of the utilitarian tradition of ethics is A) its need to count, measure, compare, and quantify consequences.

B) its lack of focus on the possible results of actions.

C) its tendency to excessively focus on individual welfare.

D) its reliance on unmeasurable and abstract actions.

193)

The ________ goes against the ethical principle of obeying certain duties or responsibilities, no matter the end result.

A) rights-based framework of ethics B) duty-based framework of ethics C) deontological framework of ethics D) utilitarian framework of ethics

194)

The emphasis on producing the greatest good for the greatest number makes utilitarianism a ________.

A) social philosophy B) separation thesis C) legal right D) moral imagination

195)

People endorsing child labor by justifying that it brings foreign investment into poor countries are ________.

A) utilitarians B) humanitarians C) relativists D) egoists

196)

________ are ethical rules that put values into action.

A) Morals B) Attitudes C) Virtues D) Principles

197)

Which of the following statements reflects the approach of a principle-based ethical tradition?

A) obey the law B) ends justify the means C) maximize the overall good D) survival of the fittest

198)

Which of the following approaches emphasizes the need to follow legal rules regardless of unfavorable consequences?

A) virtue ethics B) utilitarianism C) principle-based ethics D) egoism

“We ought to stop at a red light, even if no cars are coming and I could get to my destination that much sooner.” Identify the ethical approach that follows this line of thought.

A) virtue ethics B) utilitarianism C) role ethics D) ethics of principles

199)

200)

Lawyers, accountants, auditors, financial analysts, and bankers play the ________ function to ensure the integrity and proper working of the economic, legal, or financial systems.

A) social B) administrative C) marketing D) gatekeeper

201)

No group could function if members were free at all times to decide for themselves what to do and how to act. Which of the following functions to organize and ease relations between individuals?

A) autocracy B) self-rule C) social contract D) personal norms

202)

Which of the following is a fundamental moral duty according to Immanuel Kant?

A) to place principles over morals B) to ponder over the nuances of ethics C) to treat each person as an end in themselves D) to continuously set moral examples for everyone to follow

203)

A rights-based framework of ethics would object to child labor because such practices A) violate laws that are widely accepted in developed countries.

B) are not economically feasible in the modern era.

C) disregard our duty to treat children with respect.

D) do not produce beneficial consequences to children.

204)

The concept of human rights is central to which of the following ethical traditions?

A) virtue-based ethical tradition B) consequence-based ethical tradition C) role-based ethical tradition D) principle-based ethical tradition

205)

The ________ tradition claims that our fundamental human rights, and the duties that follow from them, are derived from our nature as free and rational beings.

A) utilitarian B) virtue-based C) role-based D) Kantian

206)

The Kantian tradition claims that humans do not act only out of instinct and conditioning; they make free choices about how they live their lives, about their own ends. In this sense, humans are said to have a fundamental human right of A) dignity.

B) rationality.

C) autonomy.

D) dependency.

207)

________ understandings of social justice argue that freedom from coercion by others is the most central element of social justice.

A) Anarchist B) Egalitarian C) Libertarian D) Conservative

208)

________ are core elements of social justice upon which democratic societies and capitalist economies have been built.

A) Liberty and equality B) Fraternity and autocracy C) Kinship and cooperation D) Consideration and kindness

209)

The right to ________ is a right granted to an employee on the basis of legislation or judicial rulings.

A) a specific health care package B) bargain as part of a union C) pension funds D) a bonus

210)

Identify the true statement about ethics based on rights.

A) Rights and duties can be easily defined.

B) There is no agreement on the scope and range of rights.

C) Application of theory to real-life situations is easy.

D) There exists a well-defined line between rights and desires.

211)

Which of the following is a true statement in the context of the libertarian understandings of social justice?

A) Individual liberty is the least important element of social justice.

B) Individuals should be restricted from engaging in any voluntary economic exchange.

C) Businesses should be free to pursue profit in any voluntary and nondeceptive manner.

D) All government regulation would be seen as just interference in the market.

212)

213)

What is the difference between virtue ethics and principle-based ethics?

A) Virtue ethics is based on character traits, whereas principle-based ethics is based on a set of rules.

B) Virtue ethics is based on the consequences of actions, whereas principle-based ethics is based on character traits.

C) Virtue ethics is based on set of rules, whereas principle-based ethics is based on consequences of actions.

D) Virtue ethics is based on producing the greater good, whereas principle-based ethics is based on self-interest.

________ recognizes that our motivations are not the sorts of things that each of us chooses anew each morning.

A) Principle-based ethics B) Pragmatic ethics C) Role-based ethics D) Virtue ethics

214)

________ is a tradition within philosophical ethics that seeks a full and detailed description of those character traits that would constitute a good and full human life.

A) Kantian ethics B) Deontological ethics C) Role ethics D) Virtue ethics

215)

Identify the view which holds that people act only out of a self-interest.

A) altruism B) egoism C) utilitarianism D) libertarianism

216)

Which of the following approaches shifts the focus from questions about what a person should do, to a focus on who that person is?

A) altruism B) principle-based ethics C) utilitarianism D) virtue ethics

217)

The sum of relatively set traits, dispositions, and habits of an individual is defined as the individual’s ________.

A) character B) moral imagination C) principle D) psychological egoism

218)

________ is an important perspective within the philosophical study of ethics that holds that ethical values and judgments are ultimately dependent on one’s culture, society, or personal feelings.

219)

________ denies that there can be any rationally justified or objective ethical judgments.

220)

Understanding the ________ of ethics will enable you to become more aware of ethical issues, better able to recognize the significance of your decisions, and more likely to make better-informed and more reasonable decisions.

221)

Ethical theories, such as utilitarianism, that determine right and wrong by calculating the consequences of actions are called ________.

222)

The ________ version of utilitarianism would be sympathetic with government regulation of business on the grounds that such regulation will ensure that business activities do contribute to the overall good.

223)

________ are those obligations that one is bound to perform, regardless of consequences, and might be derived from basic ethical principles, from the law, or from one’s institutional or professional role.

224)

In the language of many philosophers, ethical duties should be ________ rather than hypothetical.

225)

________ protect individuals from being treated in ways that would violate their dignity and that would treat them as mere objects or means.

From the Greek for “self-ruled,” ________ is the capacity to make free and deliberate choices.

226)

227)

Ethical principles create certain duties or obligations that require us to act, or prohibit us from acting, in a certain way regardless of consequences. Philosophers refer to this approach to ethics as ________.

228)

What is an ethical framework? What does it address?

229)

Explain how child labor may be justified in the eyes of a utilitarian.

230)

How does utilitarianism have a strong impact on business and business ethics?

231)

How does a free and competitive market help in attaining utilitarian goals?

232)

How does utilitarianism contradict the fundamental ethical principle: the end does not justify the means?

233)

Briefly highlight the challenges associated with utilitarian thinking.

234)

What do principle-based, ethical frameworks address?

235)

How do legal rules and principles bind us to act and take decisions in certain ways?

236)

What is a social contract?

237)

What is a moral right?

238)

Explain Immanuel Kant’s view on the ethical principles of human rights.

239)

How is the concept of moral right central to the principle-based ethical tradition?

240)

Distinguish between legal and employee rights.

241)

Briefly explain the concept of virtue ethics.

242)

What is the biggest challenge posed by “egoism?”

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

38) D 39) A 40) C 41) D 42) D 43) C 44) C 45) C 46) D 47) D 48) C 49) C 50) A 51) B 52) B 53) C 54) A 55) D 56) D 57) B 58) D 59) A 60) ethical relativism 61) Ethical relativism 62) philosophical basis 63) consequentialist theories 64) administrative 65) Duties 66) categorical imperatives 67) Human rights 68) autonomy 69) deontology 70) Essay 71) Essay 72) Essay 73) Essay 74) Essay 75) Essay 76) Essay 77) Essay

78) Essay 79) Essay 80) Essay 81) Essay 82) Essay 83) Essay 84) Essay

Student name:__________ 243)

Due to diverse employee groups and management styles, the work culture of a large global firm in one country will differ significantly from the work culture of the same firm halfway around the world. ⊚ true ⊚ false

244)

Organizations with clearly codified cultures enjoy labor cost advantages and great employee and customer loyalty. ⊚ true ⊚ false

245)

Differing individual perception of culture makes it easier to define the specific culture within an organization. ⊚ true ⊚ false

246)

An ethical environment, or culture, would be one in which employees are expected to act by the rules in spite of unethical conditions. ⊚ true ⊚ false

247)

The cultivation of habits, including the cultivation of ethical virtue, is greatly shaped by the culture in which one lives. ⊚ true ⊚ false

248)

Organizations that have a traditional approach to culture can be classified as compliancebased cultures. ⊚ true ⊚ false

249)

A values-based culture recognizes that where rules do not apply the firm must rely on the personal integrity of its workforce during decision making. ⊚ true ⊚ false

“Quietly ethical” executives within the confines of the top management team are likely to be perceived as ethical leaders because they have the support of the top management. ⊚ true ⊚ false

250)

251)

Organizational cultures can deteriorate over time. ⊚ true ⊚ false

252)

For a firm, a declared credo or code of conduct serves to preclude all problems. ⊚ true ⊚ false

253)

The first step in the construction of a code or mission is to articulate a clear vision regarding the firm’s direction. ⊚ true ⊚ false

254)

One of the most determinative elements of integration is communication. ⊚ true ⊚ false

255)

Whistle-blowing to external groups is usually preferred over internal mechanisms for reporting wrongdoing. ⊚ true ⊚ false

256)

Lack of any generally accepted fundamental values for the organization is a clear sign of a “toxic” culture. ⊚ true ⊚ false

257)

The word ethics can be traced to a Greek word ethos, which described the values, norms, and beliefs of a particular culture. ⊚ true ⊚ false

258)

Identify a true statement about corporate cultures.

A) Corporate cultures remain unaffected even in the presence of strong business leaders.

B) Corporate cultures are static in nature.

C) Corporate cultures influence, limit, and shape the decision making within a firm.

D) Corporate cultures in a global firm differ significantly across different countries.

259)

A true statement about corporate culture is that ________.

A) it provides stability that can be a benefit at one time and can be a barrier to success at another B) it is unlikely to play any role in determining or influencing the decision making within a firm C) it differs significantly across different countries in a global firm D) is generally easy to modify

260)

Identify a true statement about culture.

A) The specific culture within an organization can be defined easily and objectively.

B) Culture, in business and elsewhere, is considered static in nature.

C) Attitude and behavior comprise the biggest fraction of the elements that determine culture.

D) A firm’s culture can be its sustaining value, offering it direction and stability during challenging times.

261)

Identify a true statement regarding corporate culture.

A) Corporations with several global locations most likely have different cultures at each.

B) It survives distance and differences.

C) It typically does not help or hinder an individual employee in decision making.

D) Decentralized firms do not have one.

262)

Which of the following situations could result in the business culture becoming a determining factor in ethical decision making?

A) lack of competition B) law providing incomplete answers C) lack of strong leadership D) stagnant or decreasing profits

263)

264)

Which of the following statements is true about ethical cultures in organizations?

A) Workplace ethical cultures have no impact on decision making.

B) Subordinates are expected not to act unless directed by superior authorities.

C) Decisions are expected to be taken based on laws and not on ethical values.

D) Employees are expected to act in responsible ways, even when the law does not require it.

According to the ________ ethics tradition, people act out of habit than out of deliberations.

A) Kantian B) virtue C) utilitarian D) principle-based

265)

Which of the following is a traditional approach to corporate culture?

A) values-based B) integrity-based C) customer-based D) compliance-based

266)

Which of the following statements is true about value-based cultures?

A) They emphasize obedience to the rules as the primary responsibility of ethics.

B) They are only as strong and as precise as the rules with which workers are expected to comply.

C) They reflect the traditional approach of classifying corporate culture.

D) These cultures are perceived to be more flexible and far-sighted corporate environments.

267)

Which of the following is emphasized by a compliance-based culture?

A) reliance on personal integrity of employees for decision making B) use of values as the principle for decision making C) obedience to rules as the primary responsibility of ethics D) reinforcement of a set of values rather than a set of rules

268)

Which of the following cultures will empower legal counsel and audit offices to mandate and to monitor conformity with the law and with internal codes?

A) a customer-based culture B) an integrity-based culture C) a values-based culture D) a compliance-based culture

269)

Which of the following is true about an integrity-based culture?

A) It reinforces a particular set of rules.

B) It reinforces a particular set of values.

C) It empowers legal bodies to monitor compliance.

D) It emphasizes rules as the primary responsibility of ethics.

270)

In which of the following situations is the distinction between compliance-based and values-based corporate cultures most evident?

A) advertising B) accounting and auditing C) packaging and labeling D) printing

271)

Identify a true statement about a compliance-based culture.

A) A compliance-based culture recognizes that where a rule does not apply, a firm must rely on the personal integrity of its workforce when decisions need to be made.

B) A compliance-based culture is one that reinforces a particular set of values rather a particular set of rules.

C) A compliance-based culture is only as strong and as precise as the rules which workers are expected to follow.

D) A compliance-based culture is perceived to have a more flexible and far-sighted corporate environment.

272)

Unlike the goals of a more evolved and inclusive ethics program, the goals of a traditional compliance-oriented program include A) maintaining brand and reputation.

B) minimizing the risks of litigation and indictment.

C) recruiting and retaining desirable employees.

D) helping unify a firm’s global operations.

273)

Which of the following statements is true about an ethical leader in a corporate environment?

A) An ethical leader agrees to conduct that would be inconsistent with her or his own personal values.

B) An ethical leader refrains from placing her or his own ethical behavior above any other consideration.

C) An ethical leader shirks her or his duties in the corporate structure.

D) An ethical leader allocates corporate resources to support and promote ethical behavior.

274)

Which of the following is a necessary part of being an ethical business leader?

A) achieving goals through threats, intimidation, harassment, and coercion B) guiding, directing, and escorting followers to their common destination, even if it means employing unfair methods C) refraining from placing her or his own ethical behavior above any other consideration D) creating a corporate culture in which employees are empowered and expected to make ethically responsible decisions

275)

When firms are effective in enacting ethics programs employees are, ________.

A) less likely to have sufficient time for reflection in order to reach responsible decisions B) more likely to believe that the culture of their firm impedes integrity C) more likely to see themselves as participants in an ethical workplace culture D) less likely to perceive the style of decision making as collaborative

276)

How is an ethical, effective leader different from an effective leader?

A) An ethical, effective leader takes decisions based only on a set of rules unlike an effective leader.

B) An ethical, effective leader follows a set of rules regardless of consequences unlike an effective leader.

C) An ethical, effective leader empowers the employees in decision making unlike an effective leader.

D) An ethical, effective leader achieves her or his goals through intimidation unlike an effective leader.

277)

The means used to motivate others and achieve one’s goals plays a key role in distinguishing between A) silent leaders and visible leaders.

B) effective leaders and ethical leaders.

C) informal leaders and formal leaders.

D) silent leaders and ethical leaders.

278)

Which of the following is an essential element in establishing an ethical leadership?

A) the end or objective toward which the leader leads B) the prevailing culture in the external environment C) the ethical nature of the team members D) the personality traits of the team members

279)

According to Robert Greenleaf, the best leaders are people who lead by example by A) establishing categorical imperatives across the firm.

B) enforcing strict rules at all levels.

C) achieving their goals through threats, intimidation, harassment, and coercion.

D) serving others in a nonhierarchical style.

280)

Which of the following is true of effective leaders?

A) They are always ethical in their leadership styles.

B) They might be able to achieve their goals through threats, intimidation, harassment, and coercion.

C) They employ methods that empower subordinates to take the initiative and to solve problems for themselves.

D) They are unlikely to lead using more amenable interpersonal means such as modeling ethical behavior or persuading.

281)

Which of the following is a value that will impact the culture of an organization in the absence of any other established values?

A) profit—at any cost B) ethical behavior C) legal compliance D) customer satisfaction

282)

A(n) ________ provides concrete guidance for internal decision making creating a builtin risk management system.

A) code of conduct B) organization vision C) income statement D) ombudsperson

283)

The ________ serves as an articulation of the fundamental principles at the heart of the organization and should guide all decisions without abridgment.

A) annual report B) vision statement C) mission statement D) income statement

284)

The first step in constructing a personal code or mission for a firm is to A) articulate a clear vision regarding the firm’s direction.

B) ask oneself what one stands for or what the firm stands for.

C) believe that the culture is actually possible and achievable.

D) identify clear steps as to how the cultural shift will occur.

285)

The second step in the development of guiding principles for a firm is to A) ask oneself what one stands for or what the company stands for.

B) articulate a clear vision regarding the firm’s direction.

C) identify clear steps as to how the cultural shift will occur.

D) believe that the culture is actually possible and achievable.

286)

The final step in the development of corporate codes of conduct or mission statements is

to A) B) C) D)

287)

ask oneself what one stands for or what the company stands for. articulate a clear vision regarding the firm’s direction. identify clear steps as to how the cultural shift will occur. believe that the culture is actually possible and achievable.

Which of the following is true about communicating unethical behavior in a corporate structure?

A) Reporting ethically suspect behavior is a simple thing to do.

B) Employees are always comfortable in raising questions against superiors.

C) Reporting individuals can face retaliation from superiors.

D) Whistle-blowing is the most preferred mechanism for communicating ethical behavior.

288)

Which of the following involves the disclosure of unethical or illegal activities to someone who is in a position to take action to prevent or punish the wrongdoing?

A) whistle-blowing B) redlining C) gentrification D) flyposting

289)

A true statement about an effective internal mechanism of whistle-blowing is that A) it occurs when employees report wrongdoing to legal authorities.

B) it must expose unethical behaviors to the press.

C) it should disallow confidentiality and anonymity.

D) it must strive to protect the rights of the accused party.

290)

Which of the following statements is true about whistle-blowing?

A) It involves the disclosure of ethical activities.

B) It occurs internally when stakeholders report wrongdoing to legal authorities.

C) It can expose and end unethical activities.

D) It is safe and seldom causes any harm to the whistle-blower or the business.

291)

Identify a mechanism that allows employees to report wrongdoing and to create further mechanisms for follow-up and enforcement.

A) accountability B) ethics hotlines C) mission statement D) code of conduct

292)

Identify an effective way of creating clear and successful reporting schemes.

A) leaders empowering subordinates to take decisions without providing guidance B) managers ignoring the risk and taking a wait-and-see attitude C) reinforcing the organization’s values through its compensation and reward structure D) discouraging running drills or rehearsals of challenging events

293)

________ and an ongoing ethics audit allow organizations to uncover silent vulnerabilities that could pose challenges later to the firm, thus serving as a vital element in risk assessment and prevention.

A) A mission statement B) Monitoring C) Statements of values D) Ombudsperson

294)

In the context of toxic corporate cultures, the way a firm treat its customers, suppliers, clients, and workers is evidence of its ________.

A) profitability B) environmental sustainability C) finances D) relationships

295)

Identify a true statement about the Federal Sentencing Guidelines for Organizations.

A) They were updated in 2004 to include references to both compliance programs and “ethics and compliance” programs.

B) They are used to give arbitrary punishments.

C) They were updated in 2004 and excluded the requirement that organizations periodically measure the effectiveness of their programs.

D) They assign most federal crimes to one of 57 “offense levels”.

The Supreme Court separated the “mandatory” element of the Federal Sentencing Guidelines for Organizations from their advisory role, holding that their mandatory nature A) was only applicable to individuals and not to organizations.

B) provided arbitrary punishments.

C) violated the Sixth Amendment right to a jury trial.

D) encouraged internal whistle-blowing.

296)

297)

Which of the following statements is true about the revised Federal Sentencing Guidelines for Organizations?

A) It included the criteria for an effective program, which is included in the guidelines’ commentary.

B) It included the requirement that organizations periodically measure the effectiveness of their program.

C) It excluded the requirement that organizations assess areas of risk for ethics and compliance.

D) It excluded references to ethics and compliance programs.

298)

According to the 2010 amendments to the Federal Sentencing Guidelines for Organizations (FSGO), which of the following is a condition that an organization guilty of compliance violations should meet to face lower penalties?

A) The compliance and ethics program detected the offense after discovery outside the organization.

B) The organization promptly reported the offense to appropriate governmental authorities.

C) The individual with operational responsibility neither participated in nor condoned the offense.

D) The individual with operational responsibility for the compliance program has restricted or no reporting obligations to a governing authority.

299)

Which of the following should an organization do in order to have an effective compliance and ethics program?

A) The organization should refrain from promoting and consistently enforcing its compliance and ethics program.

B) It should ensure that people who have previously engaged in unethical activities are placed in charge of programs.

C) The organization should establish standards and procedures to prevent and detect criminal conduct.

D) Low-level personnel must be assigned to have responsibility for the program.

300)

According to the 2004 updated guidelines of the United States Sentencing Commission (USSC), firms that do not have effective ethics and compliance systems will be sentenced to an additional term of probation and ordered to develop a program during that time. This is known as a(n) ________.

A) inattentional blindness B) aggravated penalty C) mitigated penalty D) change blindness

301)

In the United States, the ________ was created in 1984 to regulate sentencing policy in the federal court system.

A) United States Commission on Civil Rights (USCCR) B) Federal Judicial Center (FJC) C) United States Sentencing Commission (USSC) D) Federal Sentencing Guidelines for Organizations (FSGO)

302)

In his book The Culture Cycle: How to Shape the Unseen Force That Transforms Performance, author James Heskett uses a __________that include Referrals, Retention, Returns to labor, and Relationships with customers to measure a culture’s impact on the bottom line.

303)

The Federal Sentencing Guidelines for Organizations and the ________ have resulted in a proliferation of corporate codes of conduct and mission statements by organizations.

304)

A ________ environment is one in which employees act in responsible ways, even when the law does not require it.

A ----________ progressive culture will have a business focus instead of an audit focus, and a customer focus as opposed to a financial account focus.

305)

306)

A ________ culture emphasizes adherence to the rules as the primary responsibility of ethics and will empower legal counsel and audit offices to mandate and monitor obedience of the law and internal codes.

307)

Individuals within an organization charged with managerial oversight of ethical compliance and enforcement within the organization are called ________.

308)

To encourage a more positive image for the concept of ________, some firms call their reporting systems “helplines” instead of “hotlines,” or “speak-up” programs.

309)

A formal summary statement that describes the goals, values, and institutional aim of an organization is called a(n) ________.

310)

One way in which leaders create a strong and shared culture is by being perceived as a people-oriented and seen as leaders engaging in ________.

311)

Based on the severity of a crime, the Federal Sentencing Guidelines for Organizations (FSGO) assigns most federal crimes to one of forty-three ________.

312)

What is corporate culture? How does it shape an employee?

313)

How does perception affect the culture within an organization?

314)

In addition to attitudes and behaviors, list the other determinants of culture within an organization.

315)

How are the corporate culture and ethics related in an organization?

316)

Explain how corporate culture and virtue ethics are related.

317)

How can an ethical culture have a direct effect on the bottom line of an organization?

318)

Describe how a values-based culture works.

319)

How does a compliance-based structure work?

320)

Explain the reasoning behind the popularity of the values-based culture.

321)

How are leaders responsible for supporting ethical decision making?

322)

Which traits should a leader possess so that he or she can be perceived as being ethical?

323)

What are the differences between an effective leader and an ethical leader?

324)

What is a code of conduct? What is its role within an organization?

325)

What is the last step in the development of guiding principles for a firm?

326)

How is communication important for the integration of an ethical culture? What is whistle-blowing?

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

38) B 39) A 40) A 41) C 42) B 43) B 44) D 45) C 46) A 47) D 48) C 49) B 50) C 51) B 52) D 53) A 54) C 55) B 56) B 57) C 58) B 59) C 60) Four R Economic Model 61) Sarbanes-Oxley Act 62) ethical 63) values-based 64) compliance-based 65) ethics officers 66) whistle-blowing 67) mission statement 68) visible ethical action 69) offense levels 70) Essay 71) Essay 72) Essay 73) Essay 74) Essay 75) Essay 76) Essay 77) Essay

78) Essay 79) Essay 80) Essay 81) Essay 82) Essay 83) Essay 84) Essay

Student name:__________ 327)

Legislators created a form of business called corporations to encourage people to engage in business activities. ⊚ true ⊚ false

328)

The economic model of CSR holds that businesses should integrate social goals and economic goals. ⊚ true ⊚ false

329)

Volunteering and charitable work are examples of the most demanding social responsibilities of a business. ⊚ true ⊚ false

330)

The philanthropic perspective of the economic model holds that business has no strict obligation to contribute to social causes. ⊚ true ⊚ false

331)

Within the philanthropic perspective of the economic model, socially responsible activities are never done for building the reputation of a firm. ⊚ true ⊚ false

332)

The stakeholder model of CSR views business as a citizen of the society in which it operates and, like all members of a society, business must conform to the normal range of ethical duties and obligations that all citizens face. ⊚ true ⊚ false

333)

Stakeholder theory recognizes the fact that every business decision affects a wide variety of people, benefiting some and imposing costs on others. ⊚ true ⊚ false

334)

Nobel Prize-winning economist Milton Friedman’s classic 1970 New York Times article “The Social Responsibility of Business Is to Increase Its Profits” is the best-known argument for the economic model of CSR. ⊚ true ⊚ false

335)

Philosopher Norman Bowie rejected the economic view that managers are the agents of stockholder-owners and thus they also have a duty to further the interests of stockholders. ⊚ true ⊚ false

336)

Stakeholder theory states that a firm should be managed for the sole benefit of stockholders. ⊚ true ⊚ false

337)

The sustainability version of CSR suggests that the long-term financial well-being of every firm is directly tied to questions of how the firm both affects and is affected by the natural environment. ⊚ true ⊚ false

338)

A firm that is environmentally unsustainable is also a firm that is, in the long-term, financially unsustainable. ⊚ true ⊚ false

339)

Reputation management refers to the practice of caring for the “image” of a firm. ⊚ true ⊚ false

340)

CSR-related activities can improve profitability by enhancing a company’s standing among its stakeholders, including consumers and employees. ⊚ true ⊚ false

341)

According to David Vogel, investing in CSR when consumers are not willing to pay higher prices to support that investment improves the profit levels of the firm. ⊚ true ⊚ false

342)

Corporate social responsibility (CSR) refers to the A) dedication that businesses show in expanding their market share.

B) accountability that a manager has to his subordinates.

C) ethical expectation that society has for business.

D) actions that maximize the profit of an organization.

343)

Identify a true statement about social responsibility.

A) It refers to what a business should or ought to do for the sake of the society, even if it comes with an economic cost.

B) It refers to the responsibility of an organization to fulfill the terms of contract with its employees and lenders.

C) It refers to the steps taken by an organization to avoid internal malpractices or misconduct.

D) It refers to the responsibility that society has to ensure a business’s success.

344)

Which of the following is the most demanding social responsibility?

A) A business should prevent harm even in those cases where it is not the cause.

B) A business should volunteer for social work.

C) A business should engage in charitable work for the development of the society.

D) A business should not cause harm to others.

345)

Often called a duty or an obligation,________ bind, or compel, or require us to act in certain ways as society uses the full force of social sanctioning, including the law and legal punishment, to enforce them.

A) penalties B) levies C) surcharges D) responsibilities

346)

Which of the following ethical requirements is the type of responsibility established by the precedents of tort law?

A) duty to not cause avoidable harm to the society B) duty to find employment for employees injured at work C) duty to engage in charitable work D) duty to volunteer for causes related to the environment

347)

Every year, Tech Beats Incorporated organizes a competition in various universities wherein its representatives assess student project proposals and offer to sponsor the projects of three students. From the information given in this scenario, we can say that Tech Beats Incorporated engages in ________.

A) corporate philanthropy B) profit maximization C) unethical marketing D) unsustainable business practice

348)

A beverage manufacturing company proceeds to launch its latest energy drink in the market in spite of research findings that suggest that the drink could result in nausea, dizziness, and vomiting after considerable consumption. In this example, the beverage manufacturing company is failing to fulfill its responsibility to ________.

A) support charities B) do volunteer work C) discourage corporate philanthropy D) not cause harm to consumers

349)

The form of business that limits the liability of individuals for the risks involved in business activities is known as ________.

A) corporation B) partnership C) joint proprietorship D) sole proprietorship

350)

Legislators created a form of business called corporations because they thought that businesses could be more efficient in raising the capital necessary for producing goods, services, jobs, and wealth if A) multiple owners were involved in the strategic decision-making process of the firm.

B) there was transparency among all stakeholders.

C) firms had the obligation to justify bad decisions.

D) investors were protected from undue personal risks.

351)

According to the economic model of CSR, the sole social responsibility of a business is

to A) B) C) D)

go beyond legal responsibilities to cater to the needs of the society. fulfill the economic functions that it was designed to serve. think beyond economic ends that have to be met to help society. analyze the defects in society and design products to overcome these defects.

352)

Identify a true statement about the economic model of CSR. A) It shifts focus from pursuit of profit to environment sustainability.

B) It has its roots in the Kantian tradition of ethics.

C) It has direct implications for the proper role of business management.

D) It holds that social goals should be at the heart of a firm’s mission.

353)

Maniyar manages the sales team at an information technology (IT) firm. Their focus is to conduct business in accordance with his firm’s mission and vision, while making as much money as possible for the firm and conforming to the basic rules of the society. They ensure that their actions embody ethical custom. In this scenario, Maniyar’s view of corporate social responsibility is most likely rooted in the ________ tradition.

A) consequential B) Keynesian C) utilitarian D) virtue

354)

Which of the following statements is true of the common view of CSR? A) It has its roots in the deontological tradition and Keynesian economics.

B) It holds that the primary responsibility of managers is to serve shareholders.

C) It holds that profit is independent of optimal allocation of resources.

D) It states that business has a strict obligation to contribute to social causes.

355)

Which of the following is a feature of the economic model of CSR? A) Corporations are understood to be a particular legal form of property that the owners get to use for their own ends.

B) Shareholders are not at the center of a corporation.

C) Managers are not employees who must work to further the owners’ interests, primarily by maximizing profits.

D) Managers have a primary responsibility to pursue profit outside the limitations of the law.

356)

Which of the following statements is true about the economic model of CSR? A) It recognizes that every business decision imposes costs on someone and mandates that those costs be acknowledged.

B) It holds that businesses should fully integrate economic and social goals by bringing social responsibilities into the core of their business model.

C) It places shareholders at the center of the corporation and suggests that the ethical responsibility of management is to serve those shareholders.

D) It holds that businesses have social responsibilities beyond the economic and legal ends for which they were created.

357)

The ________ of CSR holds that just as individuals have no ethical obligation to contribute to charity or to do volunteer work in their community, business has no strict ethical responsibility to serve wider social goods.

A) philanthropic model B) legal model C) ethical model D) integrative model

358)

Identify a true statement about the philanthropic perspective of the economic model of corporate social responsibility.

A) It argues that business has an ethical duty to respect the rights of consumers to such things as safe products and truthful advertising, even when not specified in law.

B) This approach holds that as long as managers comply with the moral minimum and cause no harm, they have a responsibility to maximize profits.

C) This approach is especially common with small, privately owned businesses where the owners also often play a prominent leadership role within their local community.

D) It recognizes that every business decision imposes costs on someone and mandates that those costs be acknowledged.

359)

The ________ holds that just as charity is a good thing and something that should be encouraged, business should be encouraged to contribute to society in ways that go beyond the narrow obligations of law and economics.

A) integrative model B) stakeholder theory C) philanthropic model D) legal model

360)

The ________ directs managers to maximize profit and shareholder wealth and recognizes only legal limitations on the pursuit of profit.

A) economic model of CSR B) stakeholder theory of CSR C) integrative model of CSR D) sustainability theory of CSR

361)

The philanthropic perspective of the economic model in which business support for a social cause is done because it is the right thing to do differs from the reputational version only in terms of the A) level of social good done.

B) underlying motivation.

C) reach of the social good done.

D) medium used.

362)

Which of the following is true of philanthropy in accordance with the economic model of corporate social responsibility?

A) Philanthropy done for reputational reasons is not fully ethical.

B) Philanthropy done for solely financial benefits is not truly an act of social responsibility.

C) Philanthropy done for reputational reasons and financial ends is ethically responsible.

D) Philanthropy is considered a social contribution rather than an investment.

363)

The theory of ________ states that the primary obligation of business leaders is to serve the interests of stockholders by maximizing profits.

A) ethical relativism B) categorical imperative C) managerial capitalism D) risk assessment

364)

Which of the following models of CSR considers business as a citizen of the society that it operates in?

A) philanthropic model B) economic model C) altruistic model D) stakeholder model

According to Norman Bowie, the “moral minimum”that we expect of every person— either acting as individuals or within corporate institutions—is A) basic spirituality.

B) respect for human rights.

C) contribution to charity.

D) accountability.

365)

366)

According to philosopher Norman Bowie, managers have a responsibility to maximize profits as long as they A) respect human rights and cause no harm.

B) contribute to charitable organizations.

C) are confident and do charitable work.

D) adhere to rules and regulations.

367)

According to the philosopher Norman Bowie, the contractual duty that managers have to stockholder-owners A) makes them focus on philanthropy.

B) makes them feel obliged to perform social good and prevent harm to the society.

C) overrides their responsibility to prevent harm or to do good.

D) leads them to take environment-conscious managerial decisions.

368)

Which of the following statements is true about the stakeholder theory?

A) It begins with the recognition that every business decision affects a wide variety of people, benefiting some and imposing costs on others.

B) It argues that the narrow economic model successfully provides an accurate descriptive and a reasonable normative account of business management.

C) It holds that business firms should fully integrate economic and social goals by bringing social responsibilities into the core of their business model.

D) It suggests that the long-term financial well-being of every firm is directly tied to questions of how the firm both affects and is affected by the natural environment.

369)

________ recognizes that every business decision imposes costs on someone and mandates that those costs be acknowledged.

A) Integrative theory B) Stakeholder theory C) Keynesian theory D) Institutional theory

370)

The ________of CSR asserts that neither a business nor the individuals who work for it are exempt from the ordinary ethical responsibilities that everyone has to cause no harm, to prevent harm, and to sometimes do good.

A) philanthropic model B) stakeholder model C) integrative model D) economic model

371)

Identify a true statement about the stakeholder theory.

A) It holds that a firm’s financial goals must be balanced against, and perhaps even overridden by, environmental considerations.

B) It argues that the narrow economic model fails both as an accurate descriptive and as a reasonable normative account of business management.

C) It suggests that the long-term financial well-being of every firm is directly tied to questions of how the firm both affects and is affected by the natural environment.

D) It suggests that firms should fully integrate economic and social goals by bringing social responsibilities into the core of their business model.

372)

Which of the following is a similarity between utilitarianism and stakeholder theory?

A) Both place organizational benefits above other considerations.

B) Both consider the consequences of management decisions for the well-being of all affected groups.

C) Both contribute to society in ways that go beyond the narrow obligations of law and economics.

D) Both strive to focus only on consumers.

373)

Corporate managers who fail to give due consideration to the rights of employees and other concerned groups in the pursuit of profit are treating these groups as means to the ends of stockholders. This is unjust according to the ________.

A) financial framework B) classical tradition C) rights-based ethical framework D) stockholder theory

374)

The ________ recognizes that organizations have distinct missions, priorities, and values affecting its final decisions.

A) stakeholder theory B) separation thesis C) concept of categorical imperative D) concept of ethical payoff

375)

Identify a true statement about the integrative model of CSR. A) It suggests that firms should fully combine economic and social goals by bringing social responsibilities into the core of their business model.

B) It recognizes that every business decision imposes costs on someone and mandates that those costs be acknowledged.

C) It recognizes that some stakeholders have different power and impact on decisions than others.

D) It argues that every business should adopt the principles of benefit corporations and devote all their activities to service of social goals.

376)

The tension that prevails when an organization tries to meet both social and economic responsibilities is generally overcome by A) utilizing a small percentage of profit on social causes.

B) doing charitable work to build a good reputation within the community.

C) pursuing social ends as the very core of an organization’s mission.

D) emphasizing the importance of achieving the desired economic goals.

377)

The defenders of the sustainability approach toward CSR point out that ________.

A) all economic activity exists within a biosphere that supports all life B) the success of a business must be judged only against profitability C) people have a strong ethical duty to cause no harm, and only a prima facie duty to prevent harm D) businesses’ sole social responsibility is to fulfill the economic functions they were designed to serve

378)

Sustainability holds that A) a firm’s financial goals must be balanced against environmental considerations.

B) a firm must place social considerations below tasks beneficial to its growth.

C) a firm must not prioritize social goals at the expense of economic growth.

D) a firm’s sustenance is affected by overemphasis on environmental considerations.

379)

Which of the following is an example of a firm that is failing its fundamental social responsibility?

A) a firm that has its loss margins exceeding its profit margins B) a firm that uses resources at unsustainable rates C) a firm that is financially unstable D) a firm that prioritizes environmental sustainability

380)

Which of the following versions of CSR suggests that the long-term financial well-being of every firm is directly tied to questions of how the firm both affects and is affected by the natural environment?

A) stakeholder B) philanthropic C) social entrepreneurship D) sustainability

381)

When a firm engages in socially accountable activities with a prime focus on reputation A) social responsibility tends to become a form of social marketing.

B) the measure of positive reputation gained is impossible to calculate.

C) profits have to be sacrificed for social causes.

D) it always loses employee loyalty.

382)

The practice of attending to the “image” of a firm is sometimes referred to as A) reputation management.

B) branding.

C) crisis management.

D) gentrification.

383)

Which of the following is a benefit of a firm having a good reputation?

A) It has no impact within the firm’s community of stakeholders.

B) It begins viewing social responsibility as a mere social marketing tool.

C) It ensures that stakeholders never hear something negative about the firm.

D) It builds a type of trust bank with its consumers, employees, and other stakeholders.

384)

Enlightened self-interest, an important justification offered for CSR, presumes that A) measurement of bottom-line impact of ethical decision making is unimportant.

B) profits are independent of ethics.

C) bottom-line impact of ethical decision making can be measured and compared.

D) good ethics can also be good business.

385)

Which of the following is a challenge associated with ethical pay offs?

A) They ruin the reputation of the concerned organization.

B) They are very small as compared to the profits.

C) They are very difficult to measure.

D) They can easily be duplicated by competitors.

386)

According to David Vogel, which of the following should a firm be most cautious about when engaging in CSR activities?

A) Investing in CSR when consumers are not willing to pay higher prices to support that investment.

B) Employees may become over-indulgent in activities related to social causes.

C) Attrition levels may rise because of indifference among employees engaging in activities related to social responsibility.

D) The easily measurable ethical payoff can turn out to be lower than the anticipated levels.

387)

The most obvious case in which business takes on a responsibility to do good is ________.

388)

Business organizations in general, and corporations specifically, are ________ created by the community to serve itself.

389)

Managers are employees, or ________, of those owners and have a strict duty to work to further the owners’ interests, primarily by maximizing profits.

390)

From the perspective of the ________ of CSR, only philanthropy done for reputational reasons and financial ends is ethically responsible.

391)

The theory that the primary obligation of business managers is to serve the interests of stockholders by maximizing profits is referred to as ________.

Nobel Prize-winning economist ________ claimed that “there is one and only one social responsibility of business—to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud.”

392)

393)

________ is assumed to be an indication that business is efficiently and successfully producing the goods and services that society demands, hence it is a direct measure of how well a business firm is meeting society’s expectations.

394)

The ________ is a model of corporate social responsibility that holds that business managers have ethical responsibilities to a range of stakeholders that go beyond a narrow view that the primary responsibility of managers is to stockholders.

395)

The corporate ________ provides all stakeholders with financial and other information regarding a firm’s economic, environmental, and social performance.

396)

In the ________ model of CSR, social goals are brought into the core of a firm’s business model, and economic goals are balanced against social goals.

397)

The ________ version of CSR suggests that the long-term financial well-being of every firm is directly tied to questions of how the firm both affects and is affected by the natural environment.

398)

Philosophers distinguish between three different types of responsibilities on a scale from more to less demanding or binding. Explain these responsibilities.

399)

How can corporations encourage people to engage in business activities?

“The social responsibility of business managers is simply to pursue profit within the law.”

How does the economic model of CSR justify this statement?

400)

401)

The economic model is a narrow view of CSR. What are the alternative broader models of CSR?

402)

403)

Discuss the philanthropic perspective of the economic model of CSR.

According to the narrow view of economic model of CSR, only philanthropy done for reputational reasons and financial ends is ethically responsible. What is the justification for this statement?

404)

How does the stakeholder model of CSR view businesses?

405)

How does philosopher Norman Bowie defend the version of CSR that would fall within the social web model?

“People have a strong ethical duty to cause no harm, and only a prima facie duty to prevent harm or to do good.” Discuss Norman Bowie's view on this statement.

406)

407)

What is stakeholder theory?

408)

Discuss the arguments between the economic model and stakeholder theory.

409)

Can non-profit organizations be categorized under the integrative model of CSR? Elaborate.

410)

What are the implications of sustainability in the integrative model of CSR?

411)

Explain the concept of reputation management and discuss the controversies associated with publicizing corporate good deeds.

412)

What are some of the precautions that a firm must take when investing in CSR?

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

38) D 39) B 40) A 41) C 42) A 43) B 44) B 45) B 46) B 47) C 48) A 49) A 50) C 51) A 52) A 53) B 54) D 55) A 56) A 57) D 58) D 59) C 60) A 61) corporate philanthropy 62) social institutions 63) fiduciary agents 64) economic model 65) managerial capitalism 66) Milton Friedman 67) Profit 68) stakeholder theory 69) sustainability report 70) integrative 71) sustainability 72) Essay 73) Essay 74) Essay 75) Essay 76) Essay 77) Essay

78) Essay 79) Essay 80) Essay 81) Essay 82) Essay 83) Essay 84) Essay 85) Essay 86) Essay

Student name:__________ 413)

Companies that place employees at the core of their strategies produce lower long-term returns to shareholders than do industry peers. ⊚ true ⊚ false

414)

Employment law has successfully covered the entire gamut of employment issues that occur in business. ⊚ true ⊚ false

415)

The law is clear and unambiguous on complex human resource issues in business and other places of employment. ⊚ true ⊚ false

416)

Fundamental questions of justice arise because employees are subject to considerable harms from a lack of security in their jobs and do not have much power to create security. ⊚ true ⊚ false

417)

In a philosophical context, due process is the right to be protected against the arbitrary use of authority. ⊚ true ⊚ false

418)

A mistreatment needs to be physically threatening to be termed as “bullying.” ⊚ true ⊚ false

The doctrine of “employment at will” (EAW) holds that, unless an agreement specifies otherwise, employers are free to fire an employee at any time and for any reason. ⊚ true ⊚ false

419)

420)

According to a study, 78% of employees who experience unethical or uncivil behavior at work experience a decline in their commitment to the organization, and 66% experience a decline in their work performance. ⊚ true ⊚ false

421)

According to Larry Fink, employees should be treated well as a means to produce greater workplace harmony and productivity and, as several studies have demonstrated, higher levels of innovation. ⊚ true ⊚ false

422)

The Kantian, principle-based, and deontological approach to ethics of workplace relationships suggests that employees should be treated well because “it is the right thing to do.” ⊚ true ⊚ false

423)

The life of one who dies in a workplace accident has instrumental value that can be measured, in part, by the lost wages that would have been earned had that person lived. ⊚ true ⊚ false

424)

If a workplace is only as risky as other common activities such as smoking or jogging, management can conclude that they have fulfilled their responsibility to provide a healthy and safe workplace. ⊚ true ⊚ false

425)

In a market-based, individual bargaining approach, rejecting cost-benefit analysis in setting standards is the same as rejecting cost-effective strategies in implementing those standards. ⊚ true ⊚ false

426)

If the risks in a workplace have been reduced to the lowest feasible level and employees are fully aware of them, then a society that respects its citizens as autonomous decision makers has done its duty. ⊚ true ⊚ false

427)

An ethically valid contract based on informed consent consists of two parties that (a) have freely and voluntarily entered into the contract and (b) have understood the terms of the contract. ⊚ true ⊚ false

428)

Some employers might decide to treat employees well as a means to produce greater workplace harmony and productivity. This approach is reminiscent of ________ ethics.

A) deontological B) utilitarian C) normative D) Kantian

429)

In legal contexts, due process refers to ________.

A) the process of comparing the probabilities of harm involved in various activities B) the high instrumental value of health and safety C) the procedures that police and courts must follow in exercising their authority over citizens D) the ability to control the manner in which work is performed

430)

Philosophically, the right of ________ is the right to be protected against the arbitrary use of authority.

A) continuance B) freedom of association C) due process D) self-determination

431)

Identify a true statement about the right of due process.

A) In the employment context, due process specifies the conditions for basic fairness within the scope of an employer’s authority over its employees.

B) Few dispute that the state, through its police and courts, has the authority to punish citizens and this authority of the state is the right of due process.

C) Due process in the legal context acknowledges the indisputable authority of the judicial system over a citizen.

D) In legal contexts, due process refers to the unlimited authority that police and courts have over citizens to create a safe and orderly society.

432)

Which of the following is true of “bullying” in the workplace?

A) The mistreatment of an employee needs to be physically threatening to be termed bullying.

B) Bullying can involve a boss who is constantly yelling dictates at workers because that is his job.

C) When a coworker spreads rumors about another in order to sabotage his position, he is not regarded a bully as he is not higher than the other employee in the hierarchy of authority.

D) Bullying is independent of emotional abuse that results in a complete loss of personal dignity.

433)

The issue of workplace bullying is more predominant in the service sector because A) it lacks the right of due process.

B) that work relies significantly on interpersonal relationships and interaction.

C) of its strong hierarchy of authority.

D) most of the organizations in this sector are decentralized.

434)

Identify the doctrine which holds that employers are free to fire an employee at any time and for any reason unless an agreement specifies otherwise.

A) the doctrine of estoppel B) the doctrine of constructive notice C) the doctrine of constructive dismissal D) the doctrine of employment at will

435)

436)

Identify a true statement about the doctrine of employment at will (EAW).

A) Employment at will holds that employers can fire an employee at any time but have to provide them with a valid reason.

B) The freedom to terminate the employer-employee relationship is mutual, both theoretically and practically.

C) Until and unless an exception can be demonstrated, courts will rely on employment at will as the default position.

D) An employment at will worker may decide to quit a job at any time and for any reason only if he or she is ready to offer notice.

Under the ________ approach, the employer need not actually control the work but must merely have the right or ability to control the work for a worker to be classified an employee.

A) caveat emptor B) principle-based C) common-law agency D) virtue ethics

437)

In the context of downsizing in an organization, allowing a worker to remain in a position for a period of time after she or he has been informed of impending termination might not be the best course of action. Identify a supporting argument for this statement.

A) Workers are less likely to interpret early notice as an effort to allow them time to come to grips with the loss of their jobs.

B) Terminated workers are more likely to be inclined to put their best effort, which might result in temporary improvement in customer service.

C) Workers who are not terminated are likely to have a very bad impression about the organization for terminating their coworkers.

D) Terminated workers rarely interpret early notice as a measure to get the most out of them before departure.

438)

According to John Rawl’s ________, managers are likely to consider what decision they would make if they did not know what role they would be playing following the decision.

A) categorical imperative thesis B) integrative theory of corporate social responsibility C) separation thesis D) theory of distributive justice

439)

440)

The term “sweatshops” refers to workplaces where A) employers constantly supervise and evaluate employees.

B) employee interests are protected by rights from being subjected to utilitarian and financial calculations.

C) employers treat employees well as a means to produce greater workplace harmony.

D) employees lack even the most basic health and safety protections.

The life of one who dies in a workplace accident has ________ value that can be measured, in part, by the lost wages that would have been earned had that person lived.

A) absolute B) instrumental C) intrinsic D) extrinsic

441)

A true statement about health and safety at a workplace is that ________.

A) they can be completely replaced by financial compensation B) they have low instrumental value C) they have intrinsic value in addition to their instrumental value D) they are interpreted as ideals that are impossible to realize

442)

Identify a true statement about health and safety at a workplace.

A) Health and safety are “goods” that are valued both as a means for attaining other valuable ends and as ends in themselves.

B) Employers are responsible for providing a completely safe and healthy workplace.

C) Financial compensation can replace the value of life lost due to lack of health and safety measures.

D) Health and safety have a very low instrumental value.

443)

With regard to health and safety at a workplace, ________ can be defined as the probability of harm.

A) obstacles B) impediments C) risks D) barriers

444)

With regard to health and safety at a workplace, ________ can be determined by comparing the probabilities of harm involved in various activities.

A) variable obstacles B) absolute impediments C) relative risks D) comparative barriers

445)

Discussions in ethics about employee health and safety tend to focus on the relative risks workers face and the level of acceptable workplace risk because A) workers’ compensation is easier to calculate.

B) employers cannot be responsible for providing an ideally safe and healthy workplace.

C) insurance laws mandate the focus on relative risks and acceptability of workplace risk.

D) they results in a completely safe and healthy workplace.

446)

Comparison of the probabilities of harm involved in various activities would determine the ________.

A) acceptable level of risks B) absolute risks C) speculative risks D) relative risks

447)

448)

When can we conclude that an activity has an “acceptable level of risk?”

A) if it can be determined that the probability of harm involved in a specific work activity is manageable B) if the probability of harm involved in a specific work activity is acceptable by insurance and workers’ compensation laws C) if it can be determined that the probability of harm involved in a specific work activity is equal to or less than the probability of harm of some more common activity D) if the employers are willing to compensate the harm caused to workers for a specific activity

Which of the following approaches to health and safety at a workplace can be considered paternalistic decision making which treats employees like children and makes crucial decisions for them?

A) government-regulated ethics approach B) diversifiable risk approach C) acceptable level of risk approach D) market controlled approach

449)

One of the challenges in the acceptable risk approach to workplace health and safety is that it A) is a liberal approach to workplace health and safety that allows employees to recognize the risk they are likely to face.

B) involves the determination of “relative risks,” the calculation of which is a complicated process and not always reliable.

C) assumes an equivalency between workplace risks and other types of risks when there are significant differences between them.

D) It treats health and safety merely as an instrumental value and denies its intrinsic value.

450)

Which of the following is a challenge faced by the acceptable risk approach to health and safety?

A) It is a liberal approach to health and safety that allows employees to recognize the risk they are likely to face.

B) It involves the determination of “relative risks”, the calculation of which is a complicated process and not always reliable.

C) It does not assume equivalency between workplace risks and other types of risks when there are significant similarities between them.

D) It improperly places incentives because the risks faced at work could be controlled by others who might stand to benefit by not reducing them.

451)

A true statement about the market-controlled approach to health and safety is that this approach A) enables employers treat their employees disrespectfully by ignoring their inputs as stakeholders.

B) can support compensation to injured workers when it can be shown that employers were responsible for causing the harm.

C) assumes an equivalency between workplace risks and other types of risks when there are actually significant differences between them.

D) ignores the utilitarian concern for the consequences of an unsafe working environment on the social fabric.

452)

Enlightened self-interest would be a valuable theory to introduce and apply in the ________ approach to health and safety.

A) market-controlled B) integrative C) acceptable risk D) government-regulated

453)

454)

Identify a challenge associated with the market-controlled approach to health and safety.

A) Employees lack the kinds of free choices that the free-market theory would require in order to attain optimal satisfactions.

B) This approach ignores the fundamental deontological right an employee might have to a safe and healthy working environment.

C) This approach assumes an equivalency between workplace risks and other types of risks when there are significant differences between them.

D) Employees in a free market are treated disrespectfully by ignoring their inputs as stakeholders.

In the context of government-regulated ethics approach to health and safety, a true statement about government standards is that A) they address the “first generation” problem of the market-controlled approach to health and safety by focusing on compensation rather than prevention.

B) they favor individual bargaining between employers and employees as the approach to workplace health and safety.

C) they prevent employees from having to face the fundamentally coercive choice between job and safety.

D) they are set based on assumptions rather than best available scientific knowledge and thus add to market failures that result from insufficient information.

455)

Identify a true statement about the Occupational Safety and Health Administration (OSHA) established by the U.S. Congress in 1970.

A) When OSHA was first established, regulations were aimed at achieving the safest feasible standards.

B) The integrative approach allowed OSHA to make trade-offs between health and economics.

C) It takes away the burden of proof of high health standards from industries.

D) It holds that health and safety standards are required irrespective of the economic feasibility.

456)

Critics in both industry and government argue that OSHA should aim to achieve the optimal, rather than highest feasible, level of safety. Which of the following can be used to achieve this goal?

A) market analysis B) minimum-value index C) cost-benefit analysis D) profitability analysis

457)

Which of the following is a distinguishing feature between cost-benefit analysis and costeffectiveness?

A) Cost-effectiveness requires that an economic value be placed on one’s life and bodily integrity.

B) Cost-benefit analysis adopts the most efficient means available to achieve a particular standard.

C) Cost-benefit analysis treats health and safety merely as an instrumental value and denies its intrinsic value.

D) Cost-effectiveness uses economic criteria before setting the standards.

458)

________ requires that an economic value be placed on one’s life and bodily integrity.

A) Human morality B) Cost-benefit analysis C) Financial ethics D) Mortality index

459)

The ________ is an agency of the federal government that publishes and enforces welfare regulations for U.S. businesses.

A) Occupational Safety and Health Administration (OSHA) B) Environmental Protection Agency (EPA) C) U.S. Department of Health & Human Services (HHS) D) U.S. Chemical Safety and Hazard Investigation Board

460)

Which of the following statements is true about child labor?

A) The risk that child labor will be passed on to the next generation increases because children who work are more likely to earn low wages as adults.

B) Research suggests that legalizing child labor will result in an increased number of children who work.

C) Regions with a high prevalence of child labor are characterized by low levels of childhood morbidity associated with HIV/AIDS and malaria.

D) Nation-specific studies show that high levels of child labor are associated with high literacy levels.

461)

The country of ________ allows children to work legally from the youngest age of 10 years old.

A) Bolivia B) Colombia C) Peru D) Ecuador

462)

The Ethical Trade Initiative (ETI), an alliance of corporations, trade unions, and voluntary organizations dedicated to improving the conditions of workers, has established a ________ of ethical standards that all signatories commit to uphold.

A) Conduct Canon B) principle-based framework C) Base Code D) categorical imperative

463)

The Title VII of the ________, passed in 1964, created the prohibited classes of discrimination.

A) International Labor Act B) U.S. Civil Rights Act C) Equal Employment Opportunity Commission Act D) Uniform Employment Termination Act

464)

Bram, a Caucasian in their mid-thirties, is a high-ranking manager at an insurance firm.

They are well qualified and has received multiple accolades for his good work. When the firm receives news of potential business from a corporation that has primarily African American stakeholders, Bram gets overlooked and the opportunity to handle this account is given to their colleague, Autry, who is of African American descent. In this scenario, Bram is a victim of ________.

A) reverse discrimination B) affirmative action C) inverse discrimination D) backward discrimination

465)

466)

Which of the following is an example of reverse discrimination in America?

A) An African American interviewer rejects an African American interviewee based on ethnicity.

B) A female interviewer rejects a male interviewee because of gender.

C) A white interviewer rejects an African American interviewee based on ethnicity.

D) A female interviewer rejects a female interviewee because of gender.

An organization hires a lot of African American women and a few disabled people in an attempt to avoid discrimination suits filed against it. Which of the following is most likely to occur?

A) The performance of the organization will increase.

B) The organization will win an award for equity.

C) There will be an increase in the number of diversity training sessions.

D) A white man or a woman will file a reverse discrimination suit.

467)

Which of the following refers to a policy or a program that tries to respond to instances of past discrimination by implementing proactive measures to ensure equal opportunity today?

A) gentrification B) bully broads C) just cause D) affirmative action

468)

All of the following are ways through which affirmative action can arise at the workplace except A) legal requirements.

B) judicial affirmative action.

C) consultant based affirmative action.

D) voluntary affirmative action plans.

469)

The law relating to affirmative action applies only to about 20% of the workforce who are subject to Executive Order 11246, which requires affirmative action efforts to ensure equal opportunity. Which of the following is required by courts in order to remedy a finding of past discrimination when Executive Order 11246 is not applicable?

A) voluntary affirmative action B) judicial affirmative action C) quasi-affirmative action D) executive affirmation action

470)

Which of the following affirmative action plans would include training plans and programs, focused recruiting activity, or the elimination of discrimination?

A) quasi-affirmative action B) executive affirmation action C) judicial affirmative action D) voluntary affirmative action

A claim which states that people who “pay” for wrongs are unfairly burdened and should not bear the responsibility for the acts of others is opposing ________.

A) reverse discrimination B) judicial activity within organizations C) affirmative action D) authoritative leadership

471)

472)

Employment at will (EAW) is the default position on which courts will rely until and unless an exception can be demonstrated. The burden of proof lies with the dismissed employee to show that she or he was unjustly or illegally fired. Due process and ________, whether instituted as part of internal corporate policy or through legislation, would reverse this burden of proof and require employers to show cause to justify the dismissal of an employee.

473)

The ________ test is a test by which courts consider whether a worker is economically dependent on a business or is in business for himself or herself.

474)

The process of ________ is the reduction of human resources at an organization through terminations, retirements, corporate divestments, or other means.

475)

Like work itself, health and safety are ________ that are valued both as a means for attaining other valuable ends and also as ends in themselves.

476)

In the context of health and safety, ________ seeks to compensate workers for injuries they incur by paying the employees for the wages they lose as a result of being unable to work.

477)

The definition of ________ has taken on the meaning of exploitative work that involves some harm to a child who is not of an age to justify his or her presence in the workplace.

478)

The use of ________ in setting workplace health and safety standards commits us to treating worker health and safety as just another commodity, another individual preference, to be traded off against competing commodities.

479)

________ refers to the presence of differing cultures, languages, ethnicities, races, affinity orientations, genders, religious sects, abilities, social classes, ages, and national origins of the individuals in a firm.

480)

________ refers to the principle of tolerance and inclusion that supports the coexistence of multiple cultures while encouraging each to retain that which is unique or individual about that particular culture.

481)

The Executive Order 11246 for affirmative action only applies tofederal contractorswith ________ employees, so it reaches only about 20% of the workforce.

482)

Describe in brief the two approaches to employee treatment discussed in this chapter.

483)

Correlate the right of due process to the workplace.

484)

Discuss the various aspects associated with employment at will (EAW).

485)

Discuss the crucial aspect of employment at will (EAW) where it is given first preference.

486)

Discuss in brief the guidelines suggested for tackling downsizing within an organization.

487)

Discuss the issue of giving notice to the employees about organizational downsizing.

488)

Correlate health and safety issues at workplace with ideals.

489)

Explain the various problems associated with workplace health and safety as a marketcontrolled approach.

490)

How do mandatory government standards work?

491)

Explain the concept of standards and cost-benefit analysis. Discuss the advantages of cost-effectiveness as against the cost-benefit analysis.

492)

Contrast the two dominant perspectives on sweatshops.

493)

What are the different ways in which women experience discrimination at the workplace?

494)

Summarize the influences of diversity within a workplace.

495)

What is affirmative action?

496)

Discuss the various ways through which affirmative action can arise within a workplace.

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

38) D 39) B 40) A 41) A 42) C 43) A 44) C 45) C 46) B 47) A 48) A 49) A 50) C 51) B 52) A 53) B 54) D 55) D 56) C 57) B 58) D 59) C 60) just cause 61) economic realities 62) downsizing 63) goods 64) insurance 65) child labor 66) cost–benefit analysis 67) Diversity 68) Multiculturalism 69) fifty or more 70) Essay 71) Essay 72) Essay 73) Essay 74) Essay 75) Essay 76) Essay 77) Essay

78) Essay 79) Essay 80) Essay 81) Essay 82) Essay 83) Essay 84) Essay

Student name:__________ In 2019 law professor Jeffrey Hirsch warned of an impending onset of the “split life,” a concept that saw the clean separation of work and home. ⊚ true ⊚ false

497)

498)

A social contract restricts the right to privacy by preventing people from infringing on someone else’s right to his or her personal autonomy. ⊚ true ⊚ false

499)

Values that are fundamental across culture and theory are not hypernorms. ⊚ true ⊚ false

500)

According to Donaldson and Dunfee, the right to personal freedom is an example of a hypernorm. ⊚ true ⊚ false

501)

The value of privacy to civilized society is as great as the value of hypernorms to civilized existence. ⊚ true ⊚ false

502)

The concept of property rights excludes personal information. ⊚ true ⊚ false

503)

The Constitution’s Fourth Amendment protection against an unreasonable search and seizure governs only the private-sector workplace. ⊚ true ⊚ false

The “invasion of privacy” claim developed through case law called intrusion into seclusion. ⊚ true ⊚ false

504)

505)

The European Union’s General Data Protection Regulation (GDPR) is limited in its powers in Europe only; it cannot collect data around the world. ⊚ true ⊚ false

506)

In the United States, the Constitution’s Bill of Rights provides a few protections for an individual’s right to privacy against government intrusion. ⊚ true ⊚ false

507)

In the United States, employees surrender most of their rights to privacy when they enter and use company property. ⊚ true ⊚ false

According to the “Hawthorne Effect,” merely knowing one is being studied might make one a better worker. ⊚ true ⊚ false

508)

509)

Employers in all parts of the United States are prohibited from making employment decisions on the basis of weight, even if they are not in violation of the Americans with Disabilities Act (ADA). ⊚ true ⊚ false

510)

Discrimination laws do not necessarily protect workers against adverse action based on the identity of the person they married. ⊚ true ⊚ false

511)

Two general and connected understandings of privacy have been identified: privacy as a right to be “left alone” within a personal zone of solitude, and privacy as the A) right to understand one’s emotions.

B) right to understand others’ emotions.

C) right to control information about others.

D) right to control information about oneself.

________ is an individual’s right to be “left alone” within a personal zone of solitude and the right to control information about himself or herself.

A) Autonomy B) Privacy C) Morality D) Psychological egoism

512)

513)

Identify a true statement about hypernorms.

A) They are values that are determined within free moral space.

B) They are values that are fundamental across culture and theory.

C) They determine who maintains control over tangibles and intangibles.

D) They are limited to an individual’s property rights.

514)

Which of the following is at the core of many of the examples of hypernorms?

A) moral free space B) public information C) individual privacy D) transparency

515)

According to ethicists Thomas Donaldson and Thomas Dunfee, the right to ________ is an example of a hypernorm.

A) armed protest B) public information C) intelligence gathering D) physical movement

516)

In the context of the approach to ethical analysis developed by Donaldson and Dunfee, as long as a decision is not in conflict with a hypernorm, it rests within ________, and reasonable minds may differ as to what is ethical.

A) the exclusion zone B) the zone of proximal development C) moral free space D) moral imagination

517)

Identify a true statement about privacy.

A) The right to privacy is not restricted by any social contract.

B) Privacy is not related to liberty and autonomy.

C) Privacy can be legally protected by the constitution.

D) The right to privacy is provided only for certain sections of society.

518)

________ refers to the body of law comprised of the decisions handed down by U.S. courts, rather than specified in any particular statutes or regulations.

A) Statutory law B) Common law C) Civil law D) Constitutional law

519)

The Constitution’s Fourth Amendment protection against an unreasonable search and seizure governs only the public sector workplace because A) unions exist only in public sector organizations.

B) the private sector does not cater to appeals of unreasonable search or seizure.

C) the Constitution applies only to state action.

D) only public sector organizations deal with classified information.

Which of the following prohibits the “interception” or unauthorized access of stored communications?

A) the Electronic Communications Privacy Act of 1986 B) the Computer Security Act of 1987 C) the Privacy Act of 1974 D) the Computer Fraud and Abuse Act of 1986

520)

521)

In the context of the Electronic Communications Privacy Act (ECPA) of 1986, interception applies only A) to employees who work part time.

B) when monitoring is done without consent.

C) when employees resign from a company.

D) to messages in transit.

522)

Which of the following statements about the Electronic Communications Privacy Act of 1986 is true?

A) Courts have ruled that the “interception” of stored communications applies only to messages that have actually reached company computers.

B) A firm that secures employee consent to monitoring at the time of hire is immune from ECPA liability.

C) The impact of the ECPA is to punish electronic monitoring only by employers.

D) The ECPA does not allow interception even when consent has been granted.

523)

Identify a legal violation that occurs when someone intentionally interferes in the private affairs of another when the interference would be “highly offensive to a reasonable person.”

A) battery B) conflict of interest C) intrusion into seclusion D) defamation

524)

If the basis for finding an invasion of privacy is often an employee’s legitimate and reasonable expectation of privacy, then a situation where there is no real expectation of privacy occurs when the A) employee has actual notice.

B) work involves handling huge amounts of money.

C) work requires complete transparency from the employee.

D) employee belongs to a minority group.

525)

Which of the following statements is true regarding the laws on employer monitoring?

A) Increasingly, states in the United States are enacting laws to limit employer monitoring powers.

B) All states in the United States require employers to notify workers when they are being monitored.

C) The U.S. Supreme Court has prohibited employers from monitoring their employees.

D) The U.S. Supreme Court has prohibited employers from reviewing employees’ Internet use.

526)

Which of the following is true about the European Union’s Directive on Personal Data Protection?

A) It prohibits EU firms from transferring personal information to a non-EU country unless that country maintains adequate data privacy laws of its own.

B) It is also known as the European Union Safe Harbor Act. C) It encourages member countries to maintain myriad standards for information gathering and protection.

D) It states that United States is the only non-member country that maintains “adequate protection” of personal data.

527)

Which of the following is true of the European Union’s General Data Protection Regulation (GDPR)?

A) It provides that personal information cannot be collected or shared by companies without individuals’ permission.

B) It impacts electronic monitoring only by third parties and not by employers.

C) It provides worldwide service of search warrants for electronic evidence.

D) It denies the government from regulating small companies.

528)

According to economist Antonio Argandoña, which of the following elements would include issues relating to company secrets, espionage, and intelligence gathering?

A) truthfulness and accuracy B) respect for property and safety rights C) respect for privacy D) accountability

529)

Fitbits and Nike+ FuelBands are examples of ________ that allow employers to gather employee information, such as the number of steps they take in a day, their heart rate, and even their hormone levels, and incorporate this information into employee wellness programs.

A) biotracking technology B) surveillance technology C) biofeedback mechanism D) reverse charge mechanism

530)

One of the attributes of technology and its usage is that it A) prohibits access to any information that was once easily accessible.

B) ensures that the lines between people’s personal lives and professional lives are not blurred.

C) keeps employees within the boundaries of their workplace even in the outside world.

D) reduces the privacy concerns of individuals.

531)

When we do not get to know a person because we do not have to see that person in order to do our business, we often do not take into account the impact of our decisions on them.

This is a challenge posed by the A) facelessness that results from the use of new technology accessible in the workplace.

B) knowledge gap that exists between people who understand the technology and others who do not understand it.

C) lack of clear boundaries between people’s personal and professional lives.

D) assumption by users of technology that the Internet is safe.

532)

533)

Which of the following statements is true of monitoring?

A) Monitoring enables employers to legally access confidential medical information about their employees.

B) Monitoring tends to create a friendly workplace without any suspicions.

C) Monitoring allows workers to control their environment.

D) Monitoring ensures effective performance by preventing the loss of productivity to inappropriate technology use.

The desire to place workers in appropriate positions, to ensure compliance with affirmative action requirements, or to administer workplace benefits is sufficient reason for employers to undertake employee ________.

A) training B) orientation C) monitoring D) drug testing

534)

The utilitarian view holds that individual rights to privacy or right to control information about oneself may be outweighed in cases where A) public safety is at risk.

B) an employee has prior notice on possible privacy invasion.

C) an employee has access to his or her employer’s money.

D) employee productivity is low.

535)

Which of the following statements is true of the Genetic Information Nondiscrimination Act (GINA) of 2008?

A) It makes it legal to discriminate against applicants because of genetic information.

B) It limits the disclosure of genetic information.

C) It contains a tenuous confidentiality provision.

D) It became effective in December 2008.

Which of the following acts stipulates that employers cannot use “protected health information” in making employment decisions without prior consent?

A) the Personal Information Protection and Electronic Documents Act B) the Federal Information Security Management Act C) the Personal Information and Health Documents Act D) the Health Insurance Portability and Accountability Act

536)

537)

Identify a true statement about the Genetic Information Non-Discrimination Act (GINA) of 2008.

A) It mandates all employees to disclose their genetic information to their employers.

B) It does not include the family medical history of a person.

C) It prevents employers from monitoring their employees.

D) It prohibits discriminatory treatment in employment based on genetic information.

538)

Identify a true statement about the Genetic Information Non-Discrimination Act (GINA) of 2009.

A) It allows employers to collect genetic information from employees in order to monitor the biological effects of toxic substances in the workplace.

B) It excludes family medical history from one’s genetic information.

C) It prevents employers from collecting genetic information in order to comply with the Family Medical Leave Act. D) It prevents employers from releasing genetic information about an employee to a public health agency.

539)

Which of the following is a disadvantage of monitoring?

A) Monitoring tends to constrain effective performance since it can cause increased stress and pressure.

B) Monitoring prevents employers from managing their workplaces to place workers in appropriate positions.

C) Monitoring does not allow managers to ensure compliance with affirmative action requirements.

D) Monitoring cannot be utilized to prevent the loss of productivity due to inappropriate technology use.

540)

Which of the following statements is true about monitoring?

A) It improves workers’ right to control their work environment.

B) It has the potential to cause physical disorders such as carpal tunnel syndrome.

C) It improves the level of worker autonomy and respect.

D) It can lead to mental pressures, but health problems have not been reported.

541)

Which of the following parameters is likely to be included in an employee monitoring policy?

A) No advance notice is required for secret monitoring.

B) Employer is allowed to collect personal and job-related information.

C) No monitoring in private areas.

D) Monitoring should be extended to areas outside of the workplace.

542)

Identify a true statement about the “Hawthorne Effect.”

A) It maintains that workers’ productivity improves when they are singled out.

B) It holds that workers show poor performance when they know that they are being monitored.

C) It holds that managers should not monitor their employees in any situations.

D) It occurs only when the mechanisms used to monitor employees are unethical.

543)

Employees will be on their best behavior during phone calls if they know that those calls are being monitored. This can be attributed to the A) placebo effect.

B) observer-expectancy effect.

C) Hawthorne effect.

D) halo effect.

544)

545)

An employer can resolve the concerns related to the “Hawthorne Effect” through A) notified, random monitoring.

B) consented, selective monitoring.

C) selective, notified monitoring.

D) random, anonymous monitoring.

Some companies have a(n) ________ policy under which an employer refuses to hire or terminates a worker on the basis of the spouse’s working at the same firm.

A) antinepotism B) conflict-of-interest C) anti-fraternization D) antitrust

546)

Which of the following statements about the regulation of off-work acts in the United States is true?

A) Many states ban discrimination on the basis of weight.

B) Laws that protect employees against discrimination based on marital status exist in just under half of the states.

C) Only a small minority of states protect employees against discrimination on the basis of political involvement.

D) Lifestyle discrimination tends to be lawful if the imposition of the rule treats one protected group differently than another.

547)

Identify a policy under which an employer refuses to hire or terminates a worker whose spouse works at a competing firm.

A) anti-nepotism policy B) antitrust policy C) affirmative action policy D) conflict-of-interest policy

548)

Most statutes or common law decisions provide for employer defenses for all of the following <i>except</i> those rules that A) are reasonable and rationally related to the employment activities of a particular employee.

B) treat one group differently from another considering lifestyle practices.

C) are necessary to avoid a conflict of interest or the appearance of conflict of interest.

D) constitute a “bona fide occupational requirement.”

According to legal scholar Jennifer Moore, “maintaining ________ gives you a degree of control over your role and identity, which you would not have if everyone were aware of all available information about you.”

A) a zone of privacy B) total anonymity C) a public image D) a dignified silence

549)

Who among the following links the moral worth of individuals to “the supreme value of their rational capacities for normative self-determination” and considers privacy a categorical moral imperative?

A) Thomas Dunfee B) Patricia Werhane C) Immanuel Kant D) Jennifer Moore

550)

551)

According to economist Antonio Argandoña, technology must allow for greater anonymity and distance, requiring a concurrent increased exigency for personal responsibility and answerability. This pertains to the necessary element of ________.

A) truthfulness and accuracy B) accountability C) privacy D) respect for property and safety rights

552)

According to the National Council on Alcoholism and Drug Dependence, which of the following is a warning sign of drug use pertaining to an individual’s job performance?

A) complaints, excuses, and time off for vaguely defined illnesses or family problems B) poor concentration and lack of focus C) frequent financial problems D) avoidance of friends and colleagues

553)

Apple’s CEO ________ described privacy as a “human right” and “civil liberty”.

554)

According to philosopher Patricia Werhane, for an individual to expect respect for her or his personal autonomy, that individual has a ________ to respect the autonomy of others.

555)

________ depend on the existence and enforcement of a set of rules that define who has a right to undertake which activities on their own initiative and how the returns from those activities will be allocated.

556)

The impact of the Electronic Communications Privacy Act (ECPA) is to punish electronic monitoring only by ________ and not by employers.

557)

In the context of testing an employee for possible drug use, frequent financial problems is a warning sign that pertains to________ as opposed to job performance.

558)

The ________is based on the psychological stimulus of being singled out, which makes an employee feel more important.

559)

Philosopher William Parent conceives the right to privacy as the right to ________.

560)

New York’s ________ statute prohibits employment decisions or actions based on four categories of off-duty activity.

561)

An impairment that substantially limits a major life activity is called a(n) ________.

562)

In the context of the Americans with Disabilities Act (ADA), ________ is the only U.S. state that has banned discrimination on the basis of weight.

563)

How do privacy issues at the workplace raise ethical issues involving individual rights as well as those involving utilitarian consequences?

564)

Summarize how the definition of privacy gives rise to two streams of thought about rights.

565)

Describe “reciprocal obligation” as an ethical source of the right to privacy.

566)

Explain the concept of hypernorms and moral free space.

567)

Explain the ethical source of privacy using the perspective of property rights.

568)

Explain how privacy can be legally protected. Summarize the Electronic Communications Privacy Act of 1986 (ECPA). Discuss the “intrusion into seclusion” concept.

569)

Explain the implications of giving “notice” about monitoring.

570)

Briefly discuss the circumstances which violate an employee’s privacy rights.

571)

Summarize what economist Antonio Argandoña says about information and data in the age of technology, and the moral requirements associated with that information.

572)

Briefly outline the challenges of technology discussed in the text.

573)

Why do firms monitor technology usage?

574)

Discuss the nuances associated with drug testing and outline the arguments for and against it.

575)

What is the difference between Genetic Information Nondiscrimination Act (GINA) and Health Insurance Portability and Accountability Act (HIPAA)?

576)

Describe the Health Insurance Portability and Accountability Act (HIPAA).

577)

Outline the business reasons to limiting monitoring.

578)

Discuss the facts pertaining to laws against discrimination based on marital status.

579)

Discuss the use of genetic information as a form of monitoring employees.

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

38) A 39) B 40) D 41) D 42) A 43) A 44) B 45) C 46) A 47) C 48) D 49) A 50) B 51) D 52) B 53) A 54) C 55) B 56) B 57) Tim Cook 58) reciprocal obligation 59) Private property rights 60) third parties 61) workplace behavior 62) Hawthorne effect 63) liberty 64) lifestyle discrimination 65) disability 66) Michigan 67) Essay 68) Essay 69) Essay 70) Essay 71) Essay 72) Essay 73) Essay 74) Essay 75) Essay 76) Essay 77) Essay

78) Essay 79) Essay 80) Essay 81) Essay 82) Essay 83) Essay

Student name:__________ 580)

The American Marketing Association defines marketing in a way that echoes the stakeholder model of corporate social responsibility (CSR). ⊚ true ⊚ false

581)

While approaching an ethical issue in marketing, the utilitarian tradition would ask to what degree the participants are respected as free and autonomous agents rather than treated simply as means to the end of making a sale. ⊚ true ⊚ false

582)

Digital technology has unimaginably increased the amount of information that marketers can compile about consumers; the speed at which that information can be collected, analyzed, and used; and the specificity of both who the consumers are and the details of their behavior and psychology. ⊚ true ⊚ false

583)

584)

The condition where lesser consumption leads to unhappiness is termed “affluenza.” ⊚ true ⊚ false

To manipulate something is to guide or direct its behavior; it need not involve total control, and in fact it more likely suggests a process of subtle direction or management. ⊚ true ⊚ false

585)

A transaction is ethically legitimate as long as someone wants to buy something and someone else is willing to sell it. ⊚ true ⊚ false

586)

Externalities show that as long as both parties to an exchange receive actual benefits from the exchange, other parties external to the exchange are unimpacted. ⊚ true ⊚ false

587)

In a strict liability case, if it can be proved that a business was as careful as possible about its product or service, it is not held liable for the harm that results from its use. ⊚ true ⊚ false

588)

The implied warranty of merchantability holds that in selling a product a business implicitly offers assurances that the product is reasonably suitable for its purpose. ⊚ true ⊚ false

589)

Most courts will allow a business to disclaim the implied warranty of merchantability on the grounds that the business is legally liable. ⊚ true ⊚ false

590)

Cell phone companies, search engines, apps, internet and cable providers, and social networks compile huge amounts of information on consumer behavior and use it for marketing. ⊚ true ⊚ false

A “digital native” is described as a person who grew up in the information age and therefore has been familiar with digital technology all their life. ⊚ true ⊚ false

591)

592)

When consumers are injured by a product and no one is at fault, the legal doctrine of strict product liability holds manufacturers accountable. ⊚ true ⊚ false

593)

The utilitarian tradition in ethics would have the strongest objections to manipulation. ⊚ true ⊚ false

594)

Consumer vulnerability occurs when a person has an impaired ability to make an informed consent to the market exchange. ⊚ true ⊚ false

595)

Which of the following is a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit an organization and its stakeholders?

A) procuring B) branding C) marketing D) copywriting

596)

The concept of ________ is central to the market economy and is the core idea behind marketing.

A) ceaseless procurement and production B) earning and maximizing profits C) an exchange between a seller and a buyer D) quality control

597)

The ________ ethical tradition would see a simple situation of an agreement for an exchange between two parties as upholding respect for individuals by treating them as autonomous agents capable of pursuing their own ends.

A) role-based B) rights-based C) rules-based D) strategy-based

598)

The ________ ethical tradition would take an agreement between two parties as evidence that both are better off than they were prior to the exchange and thus conclude that overall happiness has been increased by any exchange freely entered into.

A) utilitarian B) hedonic C) consequential D) deontological

599)

A simple situation in which two parties come together and freely agree to an exchange is only prima facie ethically legitimate because A) research studies prove that a simple exchange does not involve unethical situations.

B) it involves the consent of both parties involved and leaves no room for unethical acts.

C) certain conditions must be met before it can be concluded that autonomy has been respected and mutual benefit has been achieved.

D) it rejects the assumption that individuals are capable of pursuing their own ends.

600)

Which of the following is true of the rights-based tradition while approaching an ethical issue in marketing?

A) It asks to what degree the participants are respected as free and autonomous agents rather than treated simply as means to the end of making a sale.

B) It focuses on the benefits and costs of each exchange.

C) It attempts to find out about other values that are affected by an exchange.

D) It focuses on knowing the degree to which a transaction provided actual as opposed to merely apparent benefits for each participant.

601)

While approaching an ethical issue in marketing, the utilitarian tradition would want to know A) the degree to which individuals freely participate in an exchange.

B) the degree to which a transaction provided actual as opposed to merely apparent benefits.

C) about other values that are affected by the exchange.

D) about the personal characters of the parties that are involved in the exchange.

602)

A consumer’s consent to purchase a product is not informed if that consumer is A) unwilling to listen to the product details from the salesperson.

B) injured after using the product and filed a product liability suit.

C) asked to buy the product without a warranty.

D) being misled or deceived about the product.

603)

According to empirical studies, greater consumption is likely to lead to unhappiness. This condition is called ________.

A) affluenza B) caveat emptor C) caveat lector D) third world syndrome

604)

605)

Identify a true statement about the legal doctrine of strict liability.

A) It frees manufacturers from any kind of liability as soon as a product is sold to a consumer.

B) It allows consumers to assume that products are safe for use.

C) It is favored by business corporations in the United States.

D) It makes producers compensate consumers for any and all harms caused by their products.

Which of the following approaches holds that the only responsibility of a business is to provide a good or service at an agreed-upon price?

A) the merchantability approach B) the implied warranty approach C) the caveat emptor approach D) the caveat venditor approach

606)

In selling a product, a business offers tacit assurances that the product is reasonably suitable for its purpose. The law refers to this as the A) doctrine of caveat emptor.

B) implied warranty of merchantability.

C) doctrine of caveat lector.

D) implied warranty of productivity.

607)

Identify a true statement about the implied warranty of merchantability.

A) It assumes that every purchase involves the informed consent of a buyer.

B) It shifts the burden of proof from producers to consumers.

C) It allows a business to completely disown any promise or warranty.

D) It holds that a business has a duty to ensure that its products will accomplish their purpose.

608)

The ethics implicit within the ________ approach assumes that when consumers adequately understand products well enough, they can reasonably be expected to protect themselves.

A) contract B) caveat venditor C) tort D) caveat lector

609)

The implied warranty of merchantability shifts the burden of proof from A) producers to consumers.

B) producers to suppliers.

C) consumers to producers.

D) suppliers to consumers.

610)

Which of the following is the ethical basis for implied warranty of merchantability?

A) Manufacturers would not sell a product if they had reason to believe that their product would harm consumers during normal use.

B) Consumers would not consent to purchase a product if they had reason to believe that they would be harmed by it during normal use.

C) Consumers understand products fully, and they are free to choose not to purchase certain things.

D) A prudent business will never seek to limit its liability by explicitly disowning any promise or warranty.

611)

Unlike tort law, contract law states that A) the only duties that a person owes are those that have been explicitly promised to another party.

B) one owes other people certain general duties, even if one has not voluntarily assumed them.

C) no matter how careful a business is in its product, if harm results from use, the business is liable.

D) the reasonable person standard can be interpreted in various ways.

612)

________, a concept of tort law, provides an avenue for consumers to hold producers responsible for their products.

A) Extortion B) Negligence C) Malpractice D) Battery

613)

Tort law holds that A) the only duties that a person owes are those that have been explicitly promised to another party.

B) manufacturers are accountable in cases where consumers are injured by products and no one is at fault.

C) consumers need complex contracts to protect themselves from all harms that products might cause.

D) people do not owe other people any general duties, if they have not voluntarily assumed them.

614)

Which of the following statements is true about negligence?

A) It is not a central component of tort law.

B) One can be negligent by doing something that one should not.

C) One cannot be held negligent by failing to do something that one should have done.

D) It excludes acts of both commission and omission.

615)

In the context of negligence, by applying the standard of ________, a person could escape liability by not actually thinking about the consequences of his or her acts.

A) caveat emptor B) strict liability C) respondeat superior D) actual foresight

616)

617)

Which of the following is the ethical perspective that underlies tort law?

A) If it is unfair to hold businesses accountable for harms caused by their products, it is equally unfair to hold injured consumers accountable.

B) Every purchase involves the informed consent of the buyer, and, therefore, it is assumed to be ethically legitimate.

C) We all owe other people certain general duties, even if we have not explicitly and voluntarily assumed them.

D) Consumers would not give their consent to a purchase if they had reason to believe that they would be harmed by it when used in a normal way.

BuildWell Constructions Company is in the process of building a road through a suburb.

While building the road, the crew comes across a rocky promontory and decides to blast it irrespective of being aware of a nearby housing district. Flying debris from the blast hit a child playing in a nearby yard and caused a deep laceration on his face. Although BuildWell Constructions was responsible enough to take the usual precautions for such blasting, the child’s parents sue the company for the medical bills, as well as for the child’s distress and misery. Since BuildWell Constructions is held accountable in this scenario, which of the following is the legal approach to product safety that is exemplified here?

A) caveat emptor B) normative myopia C) moral imagination D) strict liability

618)

Identify a true statement about strict product liability laws in the United States.

A) They are highly favored by the business community.

B) They hold that the government must pay consumers in situations where neither the producer nor the consumer is at fault.

C) They hold a business responsible for any harm from product use, even if it is not the result of business negligence.

D) They are similar to the strict liability standards adopted by the European Union.

619)

Society creates a strong incentive for businesses to produce safer goods and services by holding them responsible for any harm their products cause. This claim supports the A) strict product liability standard.

B) actual foreseeability standard.

C) reasonable person standard.

D) consent and informed decision standard.

620)

Along with product safety, ________ is another area of marketing that has received significant legal and philosophical attention within business ethics.

A) customer service B) distribution C) advertising D) manufacturing

621)

622)

Manipulation focuses on ________.

A) total control of direction or management B) deceiving a person C) taking total control over an individual’s actions D) guiding or directing the behavior of something

A major element of marketing is ________, the attempt to influence a buyer to complete a purchase.

A) sales promotion B) marketing automation C) lead nurturing D) attribution reporting

623)

Which of the following are important elements of product placement that seek to determine which audience is most likely to buy and which audience is mostly likely to be influenced by product promotion?

A) lead management and marketing automation B) target marketing and marketing research C) pricing strategy and price mix D) sales pitch and sales promotion

624)

Identify a true statement about manipulation of a person.

A) It involves permission and autonomy.

B) Manipulation is an example of consented exchange of power.

C) Manipulation is a clear example of disrespect.

D) It is explicit and generates self-confidence in both parties.

625)

Which of the following statements about manipulation would a strong believer of the principle-based ethical tradition most likely support?

A) Cases of paternalistic manipulation, in which someone is manipulated for their own good, are acceptable.

B) Manipulation executed without deception is acceptable.

C) Even unsuccessful manipulations are guilty of ethical wrong.

D) The ethical consequence of manipulation depends on the personal characteristics of the manipulator.

626)

Marketing practices targeted at elderly individuals for goods, such as supplemental health insurance, and funerals, are subject to criticism because A) that population is vulnerable.

B) interest gained on such investments are not highly profitable.

C) they target the considered and rational desires of the consumers.

D) they do not abide by the principles of welfare economics.

627)

In the context of ethical issues in advertising, which of the following is true of manipulation?

A) Utilitarians would be inclined to think that manipulation increases overall happiness.

B) It is mainly done to further the needs of those manipulated at the expense of the manipulator.

C) It can undermine the very social practices that it is thought to promote as the reputation of sales is lowered.

D) The principle-based tradition in ethics would have the least strong objections to manipulation.

628)

According to economist John Kenneth Galbraith, advertising and marketing were creating the very consumer demand that production then aimed to satisfy. The assertion that consumer demand relies upon what producers have to sell is termed the A) Hawthorne effect.

B) dependence effect.

C) reverse channel effect.

D) supplemental effect.

629)

Which of the following is an implication of the “dependence effect”?

A) Advertising and marketing create consumer wants that result in supply being a function of demands.

B) Advertising and marketing create consumer wants that support the entire economy.

C) Consumer autonomy is being improved by advertising.

D) Consumers are being manipulated by advertising.

630)

By creating consumer wants, advertising and other marketing practices violate A) rights-based ethical tradition.

B) consumer autonomy.

C) free market economy.

D) consumer demand.

631)

Advertising distorts the economy by A) manipulating prices for promotion to gain a foothold in a market.

B) preventing free market economy.

C) internalizing market externalities.

D) creating irrational and trivial consumer wants.

632)

A behavioral psychologist is most likely to claim that advertising A) cannot create non-autonomous behavior in consumers.

B) cannot violate consumer autonomy by controlling consumer behavior.

C) can control consumer behavior by providing them with all the relevant information.

D) can control consumer behavior by controlling their choices.

633)

Consumer vulnerability occurs when A) a person has an impaired ability to make an informed consent to the market exchange.

B) a person has access to too much information about a product and the market exchange process.

C) the consumer is treated as an end in itself.

D) there are too many manufacturers in the market.

634)

Identify an example of consumer vulnerability.

A) Elderly people are susceptible to expensive health care bills.

B) Alcoholics are susceptible to alcohol abuse.

C) Children are susceptible to any bright, attractive items of no practical value.

D) Single women walking alone at night are susceptible to sexual assault.

635)

Which of the following is true of general vulnerability?

A) It occurs when a person has an impaired ability to make an informed consent to the market exchange.

B) It occurs when a person is susceptible to some specific physical, psychological, or financial harm.

C) It results from an unsatisfactory market exchange.

D) It results from manufacturers’ inability to satisfy consumer desires.

636)

Consumers are vulnerable when they are not aware that they are subject to a marketing campaign. This type of campaign is called A) imminent marketing.

B) word-of-mouth marketing.

C) network marketing.

D) undercover marketing.

637)

Stealth marketing occurs when consumers A) receive too much information about a product or service.

B) are subjected to directed commercial activity without their knowledge.

C) fail to properly respond to advertising.

D) understand the true marketing element of an interaction.

638)

Marketing experts consider stealth marketing extraordinarily effective because A) a consumer does not question the message as she might challenge a traditional advertising campaign.

B) a consumer’s guard is not down while accepting a message.

C) consumers do not see the communication as too personal and often tend to trust an advertisement or other marketing material much more than they would trust the communicator.

D) consumers seek out the communicator’s vested interest.

639)

An employer is held liable for damages caused by an accident involving an employee driving the company car on company business. Identify the law underlying this decision.

A) the doctrine of caveat emptor B) the doctrine of respondeat superior C) implied warranty of merchantability D) the doctrine of caveat lector

640)

UniCo—a multinational corporation that specializes in designing, developing, and selling consumer electronics—outsources manufacturing products to a third-world country company.

Human rights activists have criticized UniCo for operating inhumane sweatshops at the manufacturing plants to gain profits. Although UniCo is not directly liable for the labor exploitation, it threatens to pull out its business from the contracted company if the laborers are not provided with dignified wages and good working conditions. Which of the following responsibilities did the company fulfill in this scenario?

A) caveat emptor B) implied merchantability C) respondeat superior D) strict liability

641)

The word ________ means being the cause of something as well as being accountable.

642)

Under the ________, consumers who were injured by a product that was deceptively or fraudulently marketed would have legal recourse to recover damages from the seller.

643)

________ has received a great deal of attention in the medical ethics literature because patients are at a distinct informational disadvantage when dealing with health care professionals.

644)

An adequate ethical analysis of marketing must consider _____, those costs that are not integrated within the exchange of the buyer and the seller.

645)

According to the ________ approach, every purchase involves the informed consent of the buyer and therefore it is assumed to be ethically legitimate.

646)

In a(n) ________ case, no matter how careful the business is in its product or service, if harm results from use, the individual or business is liable.

647)

The ________ standard of tort law focuses on the sense of responsibility that involves liability or fault.

648)

Economist John Kenneth Galbraith claimed that advertising and marketing were creating the very consumer demand that production then aimed to satisfy. Dubbed the ________, this assertion held that consumer demand relied on what producers had to sell.

649)

________ occurs when the harm is other than the financial harm of an unsatisfactory market exchange.

650)

Marketing campaigns that are based on environments or activities where the subject is not aware that he or she is the target of a marketing campaign are included under ________ marketing.

651)

List out all the factors considered and the decisions made in the process of marketing.

652)

Describe the ethical framework for marketing ethics.

653)

Explain the rights-based and the utilitarian perspectives on the situation of an exchange between two parties coming together freely.

654)

Summarize the three issues pertaining to marketing ethically.

655)

Outline the implication of the social contract tradition within business.

656)

Explain the contractual standards for product safety.

657)

Describe the ethical manifestations associated with a contractual standard of product safety.

658)

Outline the duties under a contract model, and the ethical perspective that underlies tort law.

659)

Explain the concept of negligence.

660)

Discuss the constraints of the concept of negligence and explain the reasonable person concept.

Outline how the “reasonable person” concept can be interpreted in different ways. How can it lead to one interpreting this concept normatively?

661)

662)

Discuss the claims made by the defenders of the strict product liability standard to justify strict product liability.

663)

Explain what the ethical and the unethical means of influencing others include. What is its impact in advertising?

664)

Explain the utilitarian perspective of manipulation.

665)

Discuss the ethical issues associated with advertising.

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

38) D 39) C 40) A 41) C 42) D 43) A 44) B 45) C 46) C 47) A 48) C 49) B 50) D 51) B 52) D 53) D 54) A 55) C 56) B 57) D 58) B 59) A 60) B 61) C 62) responsible 63) contractual market exchange 64) Informed consent 65) externalities 66) caveat emptor 67) strict liability 68) negligence 69) dependence effect 70) General vulnerability 71) stealth 72) Essay 73) Essay 74) Essay 75) Essay 76) Essay 77) Essay

78) Essay 79) Essay 80) Essay 81) Essay 82) Essay 83) Essay 84) Essay 85) Essay 86) Essay

Student name:__________ 666)

Environmental challenges typically create a burden on business, and environmental and business interests are usually in conflict. ⊚ true ⊚ false

667)

Environmental issues exist at the periphery of business decisions as burdens to be managed because they are external regulatory constraints in managerial decision making. ⊚ true ⊚ false

668)

Electric vehicles produce zero emissions and are the most environment-friendly option possible. ⊚ true ⊚ false

669)

The preservationist approach to environmentalism values aspects of the natural environmental as valuable in their own right and not just as means to human well-being. ⊚ true ⊚ false

670)

A market-based approach to resolving environmental challenges denies that environmental problems are economic problems that deserve economic solutions. ⊚ true ⊚ false

671)

According to William Baxter, there is an optimal level of pollution that would best serve society’s interests. ⊚ true ⊚ false

From a strict market economic perspective, resources are “finite” and have to be used efficiently to gain maximum economic benefits. ⊚ true ⊚ false

672)

673)

According to the market approach to resolving environmental challenges, standards like corporate average fuel economy that address pollution and pollution-related disease are considered mainly because of people’s reliance on market solutions to sustain the environment. ⊚ true ⊚ false

674)

Environmental pollution is an example of market failure. ⊚ true ⊚ false

675)

People learn about market failures and thereby prevent harms in the future only by sacrificing a first generation as a means of gaining information. ⊚ true ⊚ false

676)

Before the introduction of the environmental legislation in the 1970s, the primary legal avenue open for addressing environmental concerns was contractual law. ⊚ true ⊚ false

677)

From an environmental standpoint, the regulatory model assumes that economic growth is environmentally and ethically benign. ⊚ true ⊚ false

678)

The three goals of economic, environmental, and ethical sustainability are often referred to as the three pillars of sustainability. ⊚ true ⊚ false

679)

The circular flow model differentiates natural resources from the other factors of production. ⊚ true ⊚ false

680)

The ultimate goal of biomimicry is to eliminate waste altogether rather than reducing it. ⊚ true ⊚ false

681)

The triple bottom line approach involves measuring business success of sustainable businesses and sustainable economic development in terms of A) economic, legal, and environmental sustainability.

B) economic, ethical, and environmental sustainability.

C) economic, legal, and competitive sustainability.

D) legal, competitive, and environmental sustainability.

682)

Knowing what the future must be, creative businesses look backward to the present and determine what must be done to arrive at that future. This process is known as A) backward integration.

B) forecasting.

C) forward integration.

D) backcasting.

683)

Which of the following is true of the conservation movement?

A) It advocated that the natural world should not be used as a capital resource.

B) It considered natural resources to be able to provide an inexhaustible supply of material.

C) It recommended a restrained and prudent approach to the natural world.

D) It argued against the natural world being used to provide indirect benefits.

684)

Identify an indirect benefit of the natural world.

A) clean air B) pure water C) produced goods D) natural foods

685)

Reminiscent of the ________ tradition, a view supporting animal rights suggests that some animals have the cognitive capacity to possess a conscious life of their own and people have a duty not to treat these animals as mere objects and means to their own ends.

A) Kantian B) virtue ethic C) neoclassical D) social web

686)

687)

According to the market-based approach, environmental problems A) are caused by conservationists.

B) are caused by the inexhaustible supply of resources.

C) deserve economic solutions.

D) need to be solved through corporate social responsibility.

Which of the following is involved in environmental problems according to the marketbased approach to resolving environmental challenges?

A) lack of knowledge of producing renewable resources B) inability of businesses to produce and sell limited resources C) limited use of appropriate substitutes for limited resources D) allocation and distribution of limited resources

688)

Which of the following environmental legislations was enacted in the United States in the 1970s?

A) the Humane Slaughter Act B) the Wilderness Act C) the Federal Coal Mine Health and Safety Act D) the Federal Water Pollution Act

689)

William Baxter argued that A) there is an optimal level of pollution that can be achieved through competitive markets.

B) the natural world is still valued as a resource, providing humans with both direct benefits and indirect benefits.

C) there is a legal solution for every economic problem.

D) all resources can be replaced by substitutes.

690)

In economic terms, all resources A) are infinite because they can be replaced by substitutes.

B) are distributed fairly by the government.

C) can be made available everywhere.

D) are distributed efficiently in the market.

691)

In economic terms, resources that are not being used to satisfy consumer demand A) are being conserved.

B) are being wasted.

C) can be used to preserve the environment.

D) can be used for animal welfare.

692)

Market failure occurs when A) no markets exist to create a price for important social goods.

B) manufacturers use substitutes for certain resources.

C) businesses conform to regulatory requirements.

D) no economic solutions are used to address environmental problems.

693)

Market failure can lead to serious environmental harm by A) creating a price for important social goods.

B) making no distinction between individual decisions and group consequences.

C) eliminating all kinds of externalities in the economic exchange system.

D) internalizing external costs.

694)

Which of the following is a reason for the inadequacy in ad hoc attempts—internalizing external costs and assigning property rights to unowned goods such as wild species—to repair market failures?

A) the backcasting problem B) the fungibility problem C) the biomimicry problem D) the first-generation problem

695)

Markets can work to prevent harm only through information supplied by the existence of market failures. This is better known as the A) biomimicry effect.

B) backcasting problem.

C) first-generation problem.

D) primary market effect.

696)

Which of the following legal avenues was primarily used for addressing environmental concerns before the environmental legislation was enacted in the 1970s?

A) tort law B) contract law C) commercial law D) criminal law

697)

Identify a true statement about the environmental legislation enacted in the 1970s.

A) It overestimated the influence that businesses can have in establishing a law.

B) It focused mainly on providing compensation after the occurrence of pollution or any other environmental harm.

C) It shifted the burden from those threatened with harm to those who would cause the harm.

D) It primarily addressed environmental concerns using tort law.

698)

Established by the U.S. Energy Policy Conservation Act of 1975, ________ is the salesweighted average fuel economy, expressed in miles per gallon (mpg), of a manufacturer’s fleet of passenger cars or light trucks.

A) mean fuel economy (MFE) B) corporate average fuel economy (CAFE) C) adjusted average fuel economy (AAFE) D) graduated fuel efficiency (GFE)

699)

Which of the following is a problem associated with the regulatory approach to environmental challenges?

A) The regulatory model assumes that economic growth is environmentally and ethically benign.

B) If people rely on the law to protect the environment, environmental protection will extend beyond the law.

C) Business passively responds to consumer desires, and consumers are unaffected by the messages that business conveys.

D) National regulations are the only means to effectively address international environmental challenges.

700)

Which of the following is true about the concept of sustainable development and sustainable business practice?

A) It suggests a radically new vision for integrating financial and environmental goals, compared with the growth model that preceded it.

B) According to this concept, only individuals who can prove that they had been harmed by pollution can raise legal challenges.

C) According to this concept, any harm to the environment can be adequately compensated.

D) It focuses only on the costs that businesses incur in pursuing environmental goals.

701)

As per the text, the third factor that explains and justifies the need for a model of economic development that stresses sustainability rather than growth pertains to A) severe poverty.

B) the productive capacity of the earth’s biosphere.

C) poor health care infrastructure in third world countries.

D) the after-effects of war.

702)

Which of the following was charged with developing recommendations for paths toward economic and social development that would not achieve short-term economic growth at the expense of long-term environmental and economic sustainability?

A) the Bluewash Commission B) the Binding Commission C) the Barentsburg Commission D) the Brundtland Commission

703)

704)

Which of the following is true of the Brundtland Commission?

A) It was named after the place in Norway where the summit was conducted for the first time.

B) It was charged with developing recommendations for paths toward economic and social development at the expense of underdeveloped and developing countries.

C) It defined sustainable development as development that meets the needs of the present without compromising the ability of future generations to meet their own needs.

D) It criticized the report from the United Nations’ World Commission on Environment and Development published in 1987.

Which of the following models explains the nature of economic transactions in terms of a flow of resources from businesses to households and back again?

A) the circular flow model B) the triple bottom line model C) the pyramidal flow model D) the neoclassical model

705)

Which of the following is true of the circular flow model?

A) It differentiates natural resources from the other factors of production.

B) It suggests that to keep up with the economy, the population must grow.

C) It treats economic growth as both the solution to all social ills and also as boundless.

D) It argues that the economy cannot grow indefinitely.

706)

The possibility that the economy cannot grow indefinitely is simply not part of the A) three pillars of sustainability approach.

B) circular flow model.

C) triple bottom line approach.

D) bilinear model.

707)

According to economist Herman Daly, neoclassical economics, with its emphasis on economic growth as the goal of economic policy, will inevitably fail to meet sustainability challenges A) if it suggests that the population of the world needs to be controlled.

B) unless it recognizes that the economy is but a subsystem within earth’s biosphere.

C) unless it recognizes that resources are infinite.

D) if it focuses on recycling and reusing the by-products of the production process.

According to the ________, neither matter nor energy can truly be “created,” but can only be transferred from one form to another.

A) first law of thermodynamics B) Bruun rule C) Doppler effect D) Newton’s second law of motion

708)

709)

Over the long term, resources and energy cannot be used, nor waste produced, at rates at which the biosphere cannot replace or absorb them without jeopardizing its ability to sustain life. These are what Herman Daly calls the A) “economic limitations.”

B) “backcasting effect.”

C) “biophysical limits to growth.”

D) “un-expandable boundaries.”

710)

Identify a true statement about the circular flow model.

A) It differentiates natural sources from other factors of production.

B) It does not explain the origin of resources.

C) It does not treat economic growth as a solution to all social ills.

D) It highlights the possibility that the economy cannot grow indefinitely.

711)

Identify a true statement about Herman Daly’s model of the economy as a subset of the biosphere.

A) It does not differentiate natural resources from other factors of production.

B) It treats economic growth both as the solution to all social ills and also as boundless.

C) It recognizes that wastes are produced at each stage of economic activity.

D) It treats natural resources as an undifferentiated and unexplained factor of production emerging from households.

712)

One of the attributes of sustainability is that it A) reduces competitive advantage.

B) cannot be used in the long term.

C) is a good risk management strategy.

D) can lead to huge expenses.

“Doing more with less” has been an environmental guideline for decades. This can be achieved through the first principle of sustainability known as A) eco-diversity.

B) eco-efficiency.

C) the cradle-to-cradle responsibility.

D) the take-make-waste model.

713)

714)

“Closed-loop” production seeks to A) integrate what is presently waste back into production.

B) reduce waste rather than eliminating it totally.

C) double the existing productivity from one-half the resource use.

D) dispose waste with minimal damage to the environment.

715)

In an ideal situation, the waste of one firm becomes the resource of another, and such synergies can create eco-industrial parks. This principle is often referred to as A) biomimicry.

B) eco-efficiency.

C) open-loop production.

D) bioinspiration.

716)

Business takes resources, makes products out of them, and discards whatever is left over.

This approach is known as A) cradle-to-grave approach.

B) take-make-waste.

C) open-loop production.

D) closed-loop production.

717)

Which of the following holds that a business is responsible for the entire life of its products, including the ultimate disposal even after the sale?

A) the cradle-to-grave model B) the take-make-waste approach C) the cradle-to-cradle model D) the eco-efficiency principle

718)

Identify the sustainability model that would hold a business liable for groundwater contamination caused by its products even years after they had been buried in a landfill.

A) the bioinspiration model B) the open-loop production model C) the take-make-waste model D) the cradle-to-grave model

719)

According to the cradle-to-cradle model, a business should A) take resources, make products out of them, and discard whatever is left over.

B) incorporate the end results of its products back into the productive cycle.

C) find effective ways to dispose waste with minimal damage to the environment.

D) double its existing productivity from one-half the resource use.

720)

Which of the following is true of a service-based economy?

A) A service-based economy tends to consumers’ demands for clothes cleaning, floor covering, illumination, entertainment, and so forth.

B) A service-based economy interprets consumer demand as a demand for washing machines, carpets, lights, consumer electronics, and so forth.

C) A service-based economy weakens the production efficiencies.

D) A service-based economy increases material and energy costs significantly.

721)

As per the text, the second factor cited to justify a model of economic development that stresses sustainability pertains to A) scarcity of health care.

B) the population growth.

C) economic activity.

D) severe poverty.

722)

723)

An often-overlooked aspect of advertising is its A) pricing function.

B) planning function.

C) educational function.

D) legal function.

________ is the practice of promoting a product by misleading consumers about the environmentally beneficial aspects of the product.

A) Greenwashing B) Redlining C) Biomimicry D) Backcasting

Labelling products with such terms as “environmentally friendly,” “natural,” “eco,” “energy efficient,” “biodegradable,” and the like can help promote products that have little or no environmental benefits. This practice is known as A) greenskinning.

B) redlining.

C) gentrification.

D) greenwashing.

724)

725)

________ refers to the growing marketing practice of taking back one’s products after their useful life.

A) Rebranding B) Reverse channels C) Disintermediation D) Vertical channels

726)

In the context of green marketing, ________ provides strong incentives for redesigning products in ways that make it easier to reuse and recycle.

A) take-back legislation B) hypernorms C) due process D) categorical imperative

727)

The ________ offered what has become the standard definition of sustainable development. Sustainable development is “development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”

728)

According to the second law of thermodynamics (entropy increased within a closed system), the amount of usable energy ________ over time.

729)

According to Herman Daly, the ultimate environmental responsibility of business is to find a rate and type of sustainable economic and business practices that are within the ________.

730)

For a business to have a prudent, long-term competitive advantage and risk management strategy, ________ is the solution.

731)

The concept of ________ can be traced to a 1987 report from the United Nations’ World Commission on Environment and Development (WCED), more commonly known as the Brundtland Commission.

732)

The ________ model does not differentiate natural resources from the other factors of production.

733)

While the regulatory and compliance model tends to interpret environmental responsibilities as constraints upon business, the ________ model is more forward looking and may present business with greater opportunities than burdens.

734)

The marketing of products on the basis of their environmentally friendly nature is called ________ marketing.

735)

Economist ________ argues that neoclassical economics, with its emphasis on economic growth as the goal of economic policy, will inevitably fail to meet these challenges unless it recognizes that the economy is but a subsystem within earth’s biosphere.

736)

The term ________ refers to the growing marketing practice of taking back one’s products after their useful life.

737)

Explain how business understands the opportunities available in the age of sustainability.

738)

Elaborate on the conservation movement.

739)

Discuss the view of the free-market approach on resource conservation.

740)

What is an optimal level of pollution?

741)

Discuss the challenges associated with the efficient market approach to environmental responsibilities.

742)

What do defenders of the market approach to environmental responsibilities state about the ability of economic markets to achieve a sound environmental policy? Discuss if their responses are environmentally adequate.

743)

List the various laws related to governmental regulation of the environment. Describe the method of addressing environmental concerns prior to the establishment of laws.

744)

Describe the challenges associated with the regulatory approach to environmental concerns.

745)

Why was the Brundtland Commission formed?

Describe Herman Daly’s concepts of sustainable development and the “circular flow model.”

746)

747)

Explain Herman Daly’s economic system model, also known as the sustainable model.

748)

Briefly describe the reasons supporting the practice of sustainability within businesses.

749)

What are the general principles that will guide the movement of businesses toward sustainability?

750)

Explain, with an example, how eco-efficiency can be implemented on an individual and a business scale.

751)

Explain the concepts of eco-efficiency, biomimicry, and cradle-to-cradle responsibility.

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

38) C 39) A 40) C 41) B 42) B 43) A 44) C 45) B 46) C 47) C 48) B 49) A 50) A 51) B 52) A 53) D 54) B 55) A 56) B 57) C 58) A 59) D 60) B 61) A 62) Brundtland Commission 63) decreases 64) biophysical limits to growth 65) sustainability 66) sustainable development 67) circular flow 68) sustainability 69) green 70) Herman Daly 71) reverse channels 72) Essay 73) Essay 74) Essay 75) Essay 76) Essay 77) Essay

78) Essay 79) Essay 80) Essay 81) Essay 82) Essay 83) Essay 84) Essay 85) Essay 86) Essay

Student name:__________ 752)

Milton Friedman believes that markets can function effectively and efficiently only when certain safeguards are in place and that among these conditions stands the value of trust. ⊚ true ⊚ false

753)

The most basic ethical issue facing professional gatekeepers and intermediaries in business contexts involves conflicts of interest. ⊚ true ⊚ false

754)

The European Union 8th Directive, effective in 2005, covers many of the same issues as Sarbanes-Oxley but applies these requirements and restrictions to companies traded on European Union exchanges. ⊚ true ⊚ false

755)

From a virtue ethics perspective, skyrocketing executive compensation packages best represent greed and avarice in the moral character of the people involved in the salarymaking decisions. ⊚ true ⊚ false

756)

While the Sarbanes-Oxley Act is an internal mechanism to ensure ethical corporate governance, the Committee of Sponsoring Organizations (COSO) is an external mechanism. ⊚ true ⊚ false

757)

The profession of Certified public accountants (CPAs) is complex and dangerous as they work daily with and are hired by a management team that itself might have interests that conflict with the interests of the firm represented by the board of directors. ⊚ true ⊚ false

758)

Crony capitalism can occur on many levels, ranging from systemic to individual corruption. ⊚ true ⊚ false

759)

COSO is one of the first efforts to address corporate culture in a quasi-regulatory framework in recognition of its significant impact on the satisfaction of organizational objectives. ⊚ true ⊚ false

760)

The COSO controls and the Sarbanes-Oxley requirements must be supported by a culture of accountability. ⊚ true ⊚ false

761)

A board member has the right to use information obtained through her or his position as a board member for personal gain. ⊚ true ⊚ false

762)

In the United States, other than the traditional SEC rules, no legal rules exist on insider training. ⊚ true ⊚ false

763)

Since audits are paid for by audited clients, there is an inherent conflict found in that financial arrangement. ⊚ true ⊚ false

764)

In terms of ethical theory, lofty compensation packages have a utilitarian function when they act as incentives for executives to produce greater overall results. ⊚ true ⊚ false

765)

One of the fastest ways to increase stock price is through layoffs of employees. ⊚ true ⊚ false

766)

Insider trading is considered patently fair and ethical because it encourages employees to work hard to get access to company information. ⊚ true ⊚ false

767)

Gatekeepers are professionals who A) decide the board members of a company.

B) hold private inside information about a company.

C) serve as intermediaries between market participants.

D) are employed by the government to ensure fair marketplace activities.

768)

________ rely on gatekeepers for fair and effective functioning of economic markets.

A) Bankers B) Politicians C) District attorneys D) Social workers

769)

The function of auditors as gatekeepers is to A) verify a company’s financial statements so that investors’ decisions are free from fraud and deception.

B) evaluate a company’s financial prospects or creditworthiness, so that banks and investors can make informed decisions.

C) ensure that decisions and transactions conform to the law.

D) function as intermediaries between a company’s stockholders and its executives.

770)

Identify the role of analysts as “gatekeepers.”

A) They function as intermediaries between a company’s stockholders and its executives.

B) They verify a company’s financial statements.

C) They ensure that decisions and transactions conform to the law.

D) They evaluate a company’s financial prospects or creditworthiness.

771)

Which of the following is the role of attorneys as “gatekeepers?”

A) verifying a company’s financial statements B) ensuring that a company’s decisions and transactions conform to the law C) evaluating a company’s financial prospects or creditworthiness D) functioning as intermediaries between a company’s stockholders and its executives

772)

Identify the provision of the Sarbanes-Oxley Act of 202 that requires that management file an internal control report with its annual report each year in order to delineate how management has established and maintained effective internal controls over financial reporting.

A) Section 407 B) Section 201 C) Section 404 D) Section 307

773)

Identify the gatekeepers who guarantee that executives act on behalf of the stockholders’ interests.

A) underwriters B) board of directors C) auditors D) district attorneys

774)

A ________ exists where a person holds a position of trust that requires that he exercise judgment on behalf of others, but where his personal concerns are in dispute with those of others.

A) duty of care B) community of interest C) conflict of interest D) duty of loyalty

775)

A professional is said to have ________ if he has a professional and ethical obligation to clients rooted in trust that overrides his personal interests.

A) statutory duties B) executive rights C) creditor claims D) fiduciary duties

776)

777)

Which of the following statements is true of conflicts of interests?

A) Self-interest makes it easy for individuals to fulfill their gatekeeper duties.

B) Legal protection cannot shield professionals from conflicts of interests.

C) Cross-selling of consulting services reduces conflicts of interests.

D) Excessive executive compensation involves conflicts of interests.

________ refers to situations in which economic winners and losers are determined by collusion between business and government officials.

A) Insider trading B) Positional trading C) Managerial capitalism D) Crony capitalism

778)

Which of the following statements is true of the Sarbanes-Oxley Act? A) It is also known as the Financial Services Modernization Act of 2002.

B) It is enforced by the Financial Accounting Standards Board.

C) It was passed by Congress because corporate boards failed to police themselves.

D) It fails to provide oversight in terms of direct lines of accountability and responsibility.

779)

Unlike the Sarbanes-Oxley Act, the European Union 8th Directive does not A) contain a whistle-blower protection section.

B) provide for cooperation with regulators in other countries.

C) mandate external quality assurances through audit committee requirements.

D) allow greater auditing transparency.

780)

Which of the following statements is true of Section 201 of the Sarbanes-Oxley Act? A) It prohibits various forms of professional services that are determined to be consulting rather than auditing.

B) It requires a company’s management to file an internal control report with its annual report each year.

C) It provides the codes of ethics for senior financial officers.

D) It mandates that members of public company audit committees should be independent with a total absence of current or prior business relationships.

781)

Which of the following provisions of the Sarbanes-Oxley Act addresses the services outside the scope of auditors?

A) Section 201 B) Section 301 C) Section 404 D) Section 407

782)

Identify a true statement about Section 301 of the Sarbanes-Oxley Act. A) It prohibits various forms of professional services that are determined to be consulting rather than auditing.

B) It mandates that a majority of a public company’s board should be independents.

C) It outlines the rules of professional responsibility for attorneys.

D) It outlines the codes of ethics for senior financial officers.

783)

Which of the following provisions of the Sarbanes-Oxley Act addresses the rules of professional responsibility for attorneys?

A) Section 201 B) Section 307 C) Section 406 D) Section 407

784)

Section 307 of the Sarbanes-Oxley Act requires A) disclosure of audit committee financial expert.

B) management assessment of internal controls.

C) corporates to disclose codes of ethics for senior financial officers.

D) lawyers to report concerns of wrongdoing if not addressed.

785)

Which of the following provisions of the Sarbanes-Oxley Act addresses the management assessment of internal controls?

A) Section 201 B) Section 301 C) Section 307 D) Section 404

786)

Which of the following is addressed by Section 406 of the Sarbanes-Oxley Act? A) the tone or culture of a firm B) codes of ethics for senior financial officers C) management assessment of internal controls D) policies and procedures that support the control environment

787)

Which of the following statements is true of Section 407 of the Sarbanes-Oxley Act? A) It mandates that all members of a public company audit committee must be independents.

B) It requires that management file an internal control report with its annual report each year.

C) It addresses the disclosure of audit committee financial expert.

D) It outlines the codes of ethics for senior financial officers.

788)

Which of the following statements is true of the Sarbanes-Oxley Act? A) It includes requirements for certification of documents by officers.

B) It focuses mainly on the tone or culture of a firm.

C) It does not require lawyers to report concerns of wrongdoing if not addressed.

D) It does not require codes of ethics for senior financial officers.

789)

Identify an external mechanism that seeks to ensure ethical corporate governance.

A) the Sarbanes-Oxley Act B) the COSO framework th C) the European Union 7 Directive D) the European Union 4th Directive

790)

Which of the following is an internal mechanism that seeks to ensure ethical corporate governance?

A) European Union 8th Directive B) the Sarbanes-Oxley Act C) the COSO framework D) European Union 7th Directive

791)

Which of the following statements is true of the Committee of Sponsoring Organizations?

A) It improves financial reporting through a combination of controls and governance standards called the External Control-Integrated Framework.

B) It is an external mechanism that seeks to ensure ethical corporate governance.

C) It describes control as encompassing those elements of an organization that, taken together, support people in the achievement of an organization’s objectives.

D) It replaces the Sarbanes-Oxley Act to ensure ethical corporate governance.

792)

In the context of elements of the Committee of Sponsoring Organizations, which of the following statements is true of control environment?

A) It focuses on uncovering vulnerabilities.

B) It focuses on providing assessment capabilities.

C) It addresses the risks that may hinder the achievement of corporate objectives.

D) It sets the tone or culture of a firm.

793)

Which of the following elements of the Committee of Sponsoring Organizations refers to policies and procedures that support the cultural issues such as integrity, ethical values, competence, philosophy, and operating style?

A) ongoing monitoring B) information and communications C) control environment D) risk assessment

794)

In the context of elements of the Committee of Sponsoring Organizations, identify a true statement about information and communications.

A) They address the policies and procedures that support the control environment.

B) They are directed at supporting the control environment through fair and truthful transmission of information.

C) They set the tone of an organization, influencing the control consciousness of its people.

D) They are directed at providing assessment capabilities and uncovering vulnerabilities.

795)

Which of the following elements of the Committee of Sponsoring Organizations provides assessment capabilities and uncovers vulnerabilities?

A) risk assessment B) information and communications C) control activities D) ongoing monitoring

796)

Which of the following statements is true of the Committee of Sponsoring Organizations standards for internal controls?

A) It prohibited various forms of professional services that are determined to be consulting rather than auditing.

B) It ensured ethical corporate governance by establishing regulations enforced by laws.

C) It was passed by the U.S. Congress as a response to the string of corporate scandals that occurred since the beginning of the millennium.

D) It moved audit, compliance, and governance from a numbers orientation to concern for the organizational environment.

797)

Which of the following is true of the Committee of Sponsoring Organizations controls and the Sarbanes-Oxley requirements?

A) They result in less transparency in ensuring ethical corporate governance.

B) They encourage greater accountability for financial stewardship.

C) They result in a lesser emphasis to prevent any financial misconduct.

D) They do not impact executives, boards, and internal audits.

798)

Which of the following is true of the Enterprise Risk Management–Integrated Framework published in 2004?

A) It does not contain a whistle-blower protection section.

B) It assists an organization in resolving ethical dilemmas based on the organization’s mission, its culture, and its appetite and tolerance for risk.

C) It assumes that individuals can put their own interests on hold and be sufficiently motivated to act on behalf of another.

D) It was developed by the Financial Accounting Standards Board (FASB).

799)

________ is the provision of the Sarbanes-Oxley Act of 202 that requires a code of ethics for senior financial officers.

A) Section 407 B) Section 201 C) Section 406 D) Section 307

800)

Identify the duty of obedience according to which board members should strive toward corporate objectives and are not permitted to act in a way that is inconsistent with the central goals of an organization.

A) duty of care B) duty of good faith C) duty of candor D) duty of loyalty

801)

Which of the following duties of board members suggests that conflicts of interest are always to be resolved in favor of the corporation?

A) duty of care B) duty of good faith C) duty of candor D) duty of loyalty

802)

803)

According to the Federal Sentencing Guidelines (FSG) for boards, a board must A) work with executives to analyze the incentives for ethical behavior.

B) avoid exercising reasonable oversight with respect to the effectiveness and implementation of an ethics program.

C) leave the evaluation of all board policies, procedures, governance structure, and position descriptions to the executives.

D) always resolve conflicts of interest in favor of an individual board member.

Which of the following statements is true of additional ethical responsibilities board members should have beyond legal obligations?

A) They should maintain closed conversations within the firm.

B) They should refrain from providing oversight.

C) They should be critical in their inquiries about corporate vulnerabilities.

D) They should pay out a significant amount of the company’s sustainable growth dollars to its chief executives in compensation.

804)

In the context of corporate boards, which of the following is true of board members?

A) Board members are denied the legal right to question the ethics of their firm’s executives and others.

B) Board members should continually engage in closed conversations to determine what they do or do not know.

C) Board members need to understand where the company is heading and whether it is realistic that it will get there.

D) Board members have a fiduciary duty to each other by U.S. law.

805)

Identify a true statement about accounting.

A) It includes those elements of an organization that support people in the achievement of the organization’s objectives.

B) It is a system of principles applied to present the ethical and environmental position of a business.

C) It offers corporate boards some specifics regarding ways to mitigate eventual fines by paying attention to ethics and compliance.

D) It offers a system of rules and principles that govern the format and content of financial statements.

806)

Tapas, an employee of Electronixx, adjusted credits and debits of the company’s ledger to show high profits. They also created false documents, underreported the company’s income, and evaded paying taxes for a year. Tapas can be convicted for ________.

A) unethical insider trading B) conflicts of interest in corporate governance C) conflicts of interest in accounting D) unfair executive excessive compensation

807)

According to Kevin Bahr, which of the following is a cause for conflicts in the financial markets?

A) the independence and expertise of audit committees B) the presence of shareholder activism C) long-term executive greed versus short-term shareholder wealth D) self-regulation of the accounting profession

808)

Which of the following is true of excessive compensation packages?

A) When executive compensation is tied to stock price, executives have a strong incentive to focus on long-term corporate interests rather than short-term stock value.

B) When huge amounts of compensation depend on quarterly earnings reports, there is a strong incentive to manipulate those reports in order to achieve the money.

C) Economic fairness and personal morality always exists in executives receiving lofty compensation packages.

D) Excessive compensation packages serve corporate interests when they provide an incentive that is not based on executive performance or accomplishments.

809)

Which of the following scenarios gives rise to conflicts of interests in corporate governance?

A) senior executives determining the compensation received by board members B) board members hand-selecting employees in their company C) a CEO not chairing the board of directors D) the absence of cross-fertilization of boards

810)

811)

Misappropriation of proprietary knowledge is an example of ________.

A) corporate espionage B) asset overstating C) insider trading D) inventory theft

Shinam, an employee of PentaComp Incorporated, passed on confidential information of their company to a friend. The friend benefitted from selling PentaComp’s stock based on the information shared by Shinam. In this scenario, Shinam can be convicted of ________.

A) insider trading B) falsifying documents C) underreporting income D) evading taxes

812)

________ undermines investor confidence in the fairness and integrity of the securities markets.

A) Insider trading B) Crony capitalism C) Categorical imperative D) Psychological egoism

813)

Ethics in the ________ arenas has been the most visible issue in business ethics during the first decades of the new millennium.

814)

The watershed event that brought the ethics of finance to prominence at the beginning of the 21st century was the collapse of ________ and of its accounting firm Arthur Andersen, at the time one of the largest accounting firms in the world.

815)

When a person’s ethical obligations in their professional duties clash with their personal interests, ________ arise.

816)

The Committee of Sponsoring Organizations (COSO) describes ________ as encompassing “those elements of an organization that, taken together, support people in the achievement of the organization’s objectives.”

817)

________ mechanisms are processes established internally, by boards and management, to ensure compliance with financial reporting laws and regulations.

818)

________ refers to cultural issues such as integrity, ethical values, competence, philosophy, and operating style.

819)

The Enterprise Risk Management–Integrated Framework, developed in 2004, intentionally includes ________ as one of its interrelated components, recognizing that both the culture and the propensity toward risk are determined by a firm’s overarching mission and objectives.

820)

According to scholar Kevin Bahr, there exists a lack of ________ in financial markets due to the diversity of ownership in the market based on individual investors.

821)

________ is often defined as the process by which any business keeps track of its financial activities by recording its debits and credits and balancing its accounts.

822)

The definition of ________ is trading by shareholders who hold private inside information that would materially impact the value of the stock and that allows them to benefit from buying or selling stock.

823)

Explain the significance of gatekeepers.

824)

Discuss how conflicts of interests can arise in a profession.

825)

Which provisions of the Sarbanes-Oxley Act have the most impact on corporate governance and boards?

826)

What are the requirements of and the most significant criticism of the Sarbanes-Oxley Act?

827)

Discuss the control structure elements of the COSO framework.

828)

What is control environment?

829)

Explain Enterprise Risk Management–Integrated Framework.

830)

Discuss the duties of care and good faith.

831)

Explain the Federal Sentencing Guidelines for boards.

832)

What are the ethical responsibilities of board members?

833)

Discuss the significance of accounting.

834)

How does the lack of shareholder activism and the conflicts between services offered by public accounting firms cause conflicts in financial markets?

835)

How can lofty executive compensation serve corporate interests?

836)

Briefly discuss the conflicts of interests involved in excessive executive compensation.

837)

What is insider trading?

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

38) A 39) C 40) C 41) D 42) C 43) B 44) D 45) D 46) B 47) B 48) C 49) B 50) D 51) A 52) C 53) C 54) D 55) C 56) D 57) B 58) A 59) C 60) A 61) A 62) governance and financial 63) [Answer, Enron Corporation] 64) conflicts of interest 65) control 66) Internal control 67) Control environment 68) objective setting 69) shareholder activism 70) Accounting 71) insider trading 72) Essay 73) Essay 74) Essay 75) Essay 76) Essay 77) Essay

78) Essay 79) Essay 80) Essay 81) Essay 82) Essay 83) Essay 84) Essay 85) Essay 86) Essay