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Which of the following statements is decisive in determining whether or not to study business ethics?
Ethical concerns are as unavoidable in business as are concerns of marketing, accounting, finance, and human resources.
Formal study of business ethics helps address these concerns
 
The unexamined life, according to Socrates, is not worth living.
True
 
Philosophical ethics distinguishes what people do value from what they should value.
True
 
Unlike Generally Accepted Accounting Principles (GAAP) for accountants, there are no principles, standards,
concepts or values common to business ethics.
True
 
In 2002, the U.S. Congress passed the Sarbanes-Oxley Act to address the wave of corporate and financials scandals.
True
 
Gatekeepers are those people and institutions whose role is to provide checks to illegal and unethical behavior.
True
 
Consumer boycotts based on allegations of unethical conduct have targeted firms such as Nike, Gap, Shill and Wal-Mart.
False
 
A company's core values are a description of what the company does and what it hopes to achieve in the future.
False
 
Which statement correctly describes the relationship between philosophical ethics and ethos?
Philosophical ethics distinguishes what people do value from what they should value. …
 
The major reason to study ethics is that whether or not we examine the questions "what should I do?" or "what type of person should I be?"
or "how shall we live in community?" we answer them in the course of living our everyday lives.
True
 
The word "ethics" is derived from the Greek word "ethos," meaning customary or unconventional.
True
 
Consumer boycotts based on allegations of unethical conduct have targeted firms such as Nike, Gap, Shill and Wal-Mart.
True
 
Ethical behavior and an ethical reputation can provide a competitive advantage in the marketplace and with customers, suppliers, and employees.
True
 
If something is seriously wrong, the law will prohibit it. Consequently, it's enough to rely on the law for deciding what's right or wrong.
False
 
The role of an ethics course should be to convey information to a passive audience, while treating students as passive learners.
False
 
Consumer boycotts based on allegations of unethical conduct have targeted firms such as Nike, Gap, Shill and Wal-Mart.
False
 
The word "ethics" is derived from the Greek word "ethos," meaning customary or unconventional.
True
 
The major reason to study ethics is that whether or not we examine the questions "what should I do?" or "what type of person should I be?"
or "how shall we live in community?" we answer them in the course of living our everyday lives.
True
 
Question 20 (2 points)
Philosophical ethics distinguishes what people do value from what they should value.
True
 
There is no reason to believe that ad hoc attempts to repair market failures—like determining shadow prices for unpriced social goods, or by exempting social goods from the market, or by use of the law to address social goods that are unattainable through individual choice—are socially inadequate.
True
False
 
If the costs of externalities like air pollution, ground water contamination and depletion, soil erosion, and nuclear waste disposal are borne by parties who are not involved in the exchange between buyer and seller, the exchange price does not represent an equilibrium between costs and benefits.
True
False
 
The free market, classical, theory of corporate social responsibility relies on utilitarianism and the concepts o individual rights to freedom and property for its ethical justification.
True
False
 
The stakeholder theory of corporate social responsibility is totally incompatible with utilitarian ethical theory because the stakeholder concept requires balancing the interests of all the parties affected by business decisions.
True
False
 
According to the private property defense of the classical model of corporate social responsibility, any use of a corporation's resources for any purpose other than maximizing profits is a violation of the owners' property rights, amounts to theft.
True
False
 
According to the private property defense of the classical model of corporate social responsibility, managers who use corporate funds for projects that are not directly devoted to maximizing profits are stealing from their owners. Which statement supports this view?
Investors buy their stocks with the hope of maximizing return on their investment.
 
A wider interpretation of the meaning of a stakeholder as any affected party places an impossible burden on managers who would have to account for everyone who might be affected by a business decision.
True
 
Which statement represents a challenge to Evan's and Freedman's defense of the stockholder theory against the classical model of corporate social responsibility?
Stakeholder theory cannot answer the question as to how, exactly, a manager should go about balancing the diverse and competing claims of all parties.
 
The ethical roots of the classical model of corporate social responsibility are found in which statement:
 The free-market theory which holds that managers are ethically obliged to make as much money as possible for their stockholders because to do otherwise would undermine the very foundations of our free society.
 
The free market theory provides the rationale for the responsibility of managers to make as much money for their stockholders as possible.
True
 
Which of the following reasons might a free market economic theorist use to justify the hostile takeover of a company?
The takeover target company's stock is undervalued. That is evidence that the resources are being inefficiently used.
If current management is not maximizing profits, it is violating the utilitarian imperative to maximize the overall good.
The organization seeking to take over the target company will maximize profits for the stockholders and will be serving the public's interests because it is only by satisfying consumer (public) demand that a business can make profits.
All of the above.
 
The most influential theory of corporate responsibility of the past century is:
The classical model.
 
Which statement is true of Bowie's Kantian approach to business ethics?
While it is ethically good for managers to prevent harm or do some good, their duty to stockholders overrides these concerns.
 
Bowie's Kantian model of corporate social responsibility obliges managers to do no harm, but they must also be prepared at times to do some good or prevent some harm.
False
 
Milton Friedman did not recognize that there are limits to the pursuit of profits.
False
 
Responsible decision making must rely on the personal values and principles of the individuals involved.
True
 
An ethics course will change one's capacity to think.
False
 
At its most basic level, ethics is concerned with how we act and how we live our lives.
True
 
To say that ethics is a descriptive discipline is to say that it deals with norms.
False
 
It was the failure of personal ethics among companies like Enron and WorldCom that led to the creation of the Gramm-Leach-Bliley Act.
False
 
The Grayson-Himes Pay for Performance Act of 2009 was passed to amend the executive compensation provisions of the:
Emergency Economic Stabilization Act of 2008.
 
According to philosophical ethics, teaching ethics must:
challenge students to think for themselves.
 
Philosophers often emphasize that ethics is normative in nature. What does this mean?
It deals with our reasoning about how we should act.
 
Which of the following set the standards or guidelines for determining what one should do, how one should act, and what type of person one should be?
Norms
 
Reasoning about what we should do is referred to as _____.
practical reasoning
 
The first step in making decisions that are ethically responsible is to consider the available alternatives.
False
 
Speaking on a cell phone while driving and, as a result, missing a highway turn-off by mistake is an example of normative myopia.
False
 
Change blindness occurs when decision makers fail to notice gradual changes over time.
True
 
"Stakeholders" include all of the groups and/or individuals affected by a decision, policy, or operation of a firm or individual.
True
 
Using a simple decision rule might appear to relieve us of accountability for the decision, even if it may not be the best possible decision.
True
 
Identify the consequence in an ethical decision-making process when you are presented with an issue from the start. The identification of the ethical issues involved becomes the first step _________________.
of the ethical decision-making process.
 
Normative myopia is referred to as:
Shortsightedness about values
 
According to Bazerman and Chugh, focusing failures lead to _____.
inattentional blindness
 
Creativity in identifying options is one element that distinguishes good people who make ethically responsible decisions from good people who do not. It is also known as _____.
Moral imagination
 
Selecting the alternative that meets the minimum decision criteria is also known as _____.
Satisficing
 
Principle-based frameworks direct us to act on the basis of moral principles.
True
 
The "market" version of utilitarianism encourages government intervention in business regulations.
False
 
According to principle-based ethical frameworks, contracts and promises should be honored in spite of unfavorable consequences.
True
 
The virtue tradition claims that our fundamental human rights and the duties that follow from them are derived from our nature as free and rational beings.
False
 
Altruism is a view which holds that people act only out of a self-interest.
False
 
Utilitarianism is a social philosophy that emphasizes on _____.
producing the greatest good for the greatest number
 
An individual who strongly believes in the principle "maximize the
overall good" follows a _____.
Utilitarian ethical tradition
 
Which of the following traditions emphasizes ethical duties that bind us to act in certain ways?
Principle-based
 
_____ seeks a full and detailed description of those character traits that constitute a good and full human life.
Virtue ethics
 
A view that shifts the focus from questions about what a person should do, to a focus on who that person is follows the:
Virtue ethical tradition
 
The values of an organization cannot influence an individual in making a right or wrong decision.
False
 
Defining the specific culture within an organization is not an easy task since it is partially based on each participant's perception of the culture.
True
 
Ethical leaders do not make decisions that are inconsistent with their
organizations and their own personal values.
True
 
Ethical leaders achieve their goals through intimidation.
False
 
Whistleblowing to external groups such as the press can never be harmful to the whistleblower or the firm.
False
 
Which of the following is an ethical environment or culture?
An environment where employees are empowered to act responsibly despite the law not requiring it.
 
A(n) _____ is one that reinforces a particular set of values rather than a particular set of rules.
Integrity-based culture
 
_____ creates a built-in risk management system for internal decision making.
A code of conduct
 
Which of the following is true of the challenges faced during cultural integration in a corporate structure?
Employees are not always comfortable raising questions.
 
An ongoing ethics audit allows an organization to:
uncover silent vulnerabilities.
 
From an ethical perspective, what is considered the most reasonable
decision a person can make?
 
According to free-market proponents, free markets maximize overall happiness by _____.
providing an environment within which individuals can decide what they want and bargain for it
 
According to free-market economics, the most efficient method of maximizing overall happiness requires that _____.
business managers aim to maximize profits
 
How do utilitarian policy experts improve their ability to predict outcomes that will maximize overall happiness?
Through careful observation
 
A movement within utilitarian thought points to the line of thinking that originated with Adam Smith. It claims that _____.
free and competitive markets are the best ways for achieving utilitarian ends
 
The goal of economic activity in free-market economics is to _____.
meet consumer demand
 
Free-market economics requires businesses to pursue profits to ensure that businesses _____.
allocate resources to people who value them the most
 
According to the philanthropic model of corporate social responsibility (CSR), the social responsibility of business managers is to pursue profit within the law.
False
 
The economic model of corporate social responsibility (CSR) denies that business has any social responsibilities beyond the economic and legal ends for which it was created.
True
 
The philanthropic model in which business support for a social cause is done simply because it is the right thing to do differs from the reputational version only in terms of the underlying motivation.
True
 
The social web model of corporate social responsibility (CSR) fully integrates the economic and social goals of a firm.
False
 
The practice of attending to the "image" of a firm is sometimes referred to as reputation management.
True
 
Legislators created a form of business called corporations to: limit the liability of individuals for the risks involved in business
activities.
 
According to the economic model of corporate social responsibility (CSR), _____ is a direct measure of how well a business firm is meeting society's expectations.
Profit
 
Identify the situation where the philanthropic model of corporate social responsibility (CSR) is similar to the economic model of CSR.
A firm does charity work to improve the reputation of the firm
 
According to philosopher Norman Bowie, respecting human rights is the "moral minimum" that we expect of every person, whether they are acting as individuals or within corporate institutions. Identify Bowie's approach to business ethics.
Kantian theory
 
Which of the following is true of David Vogel's view of corporate social responsibility?
A market for firms with strong CSR missions caters to only a small group of consumers or investors.
 
What is the big question of ethics? and what is the answer to this question
can business make us better human beings?


In business there are three types of responsibility. What are they?
Ethical Responsibility
Legal Responsibility
Economical Responsibility
 
What are the six steps in the Leeds model for decision making?
1. define the dilema
2. Identify alternatives for responding
3. determine options that might be right
4. choose what is right
5. communicate the decision
6. reflect on the decision
 
Which type of ethics sets a standard for how we OUGHT to behave, and justifies why people ought to behave this way
normative ethics
 
The behavior we exhibit defines us for ______________ ethics
descriptive ethics
 
The choices of action define us for _____________ ethics
normative ethics
 
Because different people have different values in business, this means that values must be private.
False
 
What do underrepresented values in the marketplace show us about our ethical responsibility as professionals?
we should live out our values in business so that we can actualize the world we want to live in
 
How does defining values outline two different worlds?
shows us about our ethical responsibility
shows us the world as it might be
 
Which of the following best describes social responsibility?
Adoption by a business of a strategic focus for fulfilling the economic, legal, ethical, and philanthropic responsibilities expected of it by its stakeholders
 
In order for any social responsibility initiative to have strategic significance in a company, it must be fully supported and valued by
top management
 
Which of the following is one of the four types of corporate social responsibility?
Philanthropic
 
Society's primary method of enforcing its requirements regarding business behavior is through:
the legal system
 
Developing a code to aid employees in their decision making is an example of an activity for which type of social responsibility?
Ethical
 
Companies that have a stakeholder orientation refer to which of the following?
They are focused on stakeholder concerns
 
The financial crisis and the collapse of many well-known institutions in the early 2000s led to which of the following?
Renewed interest in ethics and social responsibility
 
In the 1990s, employees turned to a more holistic approach to work and life, characterized by which of the following?
Employee volunteerism in the community
 
Implementing social responsibility on a global level is complex because..
of the need to balance economic responsibility with other responsibilities
 
What holds organizations together and allows them to focus on efficiency, productivity, and profits?
Trust
 
Many studies have identified a positive relationship with social responsibility and ___________________?
financial performance
 
An employee refrains from being on the hiring committee because one of the applicants is related to her. The company's code of ethics has strict warnings against perceived conflict of interest. Which of the four stages of social responsibility is the employee adhering to?
Ethical
 
A company with strong efforts and results in social responsibility is generally not
penalized by market forces
 
Values are defined as which of the following?
enduring beliefs and ideals that are socially enforced
 
Which type of investor causes the most problems for CEOs when developing strategic plans?
Shareholders seeking short-term gains