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| 1 | |
Ethical principles in business: |
| | A) | concern the behavioral guidelines a company's top management and board of directors set for company personnel regarding "what is right" and "what is wrong" in conducting the company's business. |
| | B) | deal chiefly with the actions and behaviors required to operate companies in a socially responsible manner. |
| | C) | are arrived at by picking and choosing among the consensus ethical standards of society to come up with a set of ethical standards that apply directly to operating a business. |
| | D) | are not materially different from ethical principles in general and have to be judged in the context of society's standards of right and wrong, not by a special set of rules that business people decide to apply to their own conduct. |
| | E) | involve behavioral guidelines for balancing the interests of non-owner stakeholders (customers, employees, suppliers, and the communities in which the company has operations) against the interests of company shareholders. |
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| 2 | |
According to the school of ethical universalism,: |
| | A) | what behaviors are "ethically right" and "ethically wrong" vary across religions, but the boundaries of what is ethical or not are universal within religions. |
| | B) | concepts of right and wrong universally apply to all business situations within a given country but can vary across countries or cultures. |
| | C) | ethical guidelines exist only when there is universal agreement as to what behaviors are "ethically right" and "ethically wrong"; anything not universally viewed as unethical is thus within the bounds of what is ethically permissible. |
| | D) | all societies and countries have some definition of what is ethically permissible (in this sense ethics are universal); however, the definitions of what is ethically permissible vary according to the prevailing religious doctrines in each country. |
| | E) | many of the same standards of what's ethical and what's unethical resonate with peoples of most societies regardless of local traditions and cultural norms—hence, to the extent there is common moral agreement about right and wrong actions, common ethical standards can be used to judge the conduct of personnel at companies operating in a variety of country markets and cultural circumstances. |
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| 3 | |
The thesis that since different societies and cultures have divergent values and standards of what is "ethically right" and "ethically wrong" it is appropriate to judge behavior as ethical/unethical in the light of local customs and social mores: |
| | A) | is the basis for the theory of ethical variation. |
| | B) | defines what is meant by "integrated social contracts theory." |
| | C) | is a view that characterizes the school of ethical relativism. |
| | D) | accounts for why there is no such thing as ethical standards for business enterprises. |
| | E) | is the reason why codes of ethical and social morality have been established country by country. |
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| 4 | |
If one adopts the thinking of the school of ethical relativism, then: |
| | A) | there are multiple sets of ethical standards because what is ethical or unethical depends on local customs and social mores and can vary from one culture or nation to another. |
| | B) | there is a "one-size-fits-all" set of authentic ethical standards. |
| | C) | the preferred set of ethical standards is the one which society at large has put in place in the form of laws and regulations. |
| | D) | the prevailing ethical standards are the product of a system of "integrated social contracts." |
| | E) | no ethical standards are ever truly "authentic"—they exist only to the extent that there is a temporary shared conviction among company managers and company personnel that a particular behavior is either ethically permissible or ethically impermissible. |
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| 5 | |
Paying bribes and kickbacks to expedite winning orders from customers or to facilitate business transactions: |
| | A) | is ethically acceptable according to both the school of ethical relativism and the school of ethical universalism, provided the payment of such bribes and kickbacks is permitted by local laws. |
| | B) | is a thorny ethical issue for multinational companies because in some countries such payments are considered unethical whereas in other countries the payment of bribes and kickbacks is very much in accord with local customs and social mores (which makes such payments "ethically acceptable" according to the school of ethical relativism). |
| | C) | is a clear violation of ethical principles in all countries. |
| | D) | is ethically acceptable according to "integrated social contract theory." |
| | E) | is a clear violation of ethical standards only if one accepts the arguments and reasoning of the school of ethical relativism. |
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| 6 | |
The prevailing view of the school of ethical universalism is that: |
| | A) | all different societies and countries have essentially the same ethical standards of right and wrong in the conduct of business affairs, despite somewhat different customs and traditions. |
| | B) | concepts of right and wrong are universal as applied to a given ethical issue or any one particular set of circumstances—that is, there's a universally correct way to handle every ethics-related situation. |
| | C) | the most important moral standards travel well across countries and cultures and thus are universal—universal norms include honesty or trustworthiness, respecting the rights of others, practicing the Golden Rule, avoiding unnecessary harm to workers or to the users of the company's product or service, and respect for the environment. |
| | D) | concepts of right and wrong within a particular company are universal but they are not universal across companies. |
| | E) | concepts of right and wrong are universally defined by religious principles. |
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| 7 | |
According to integrated social contracts theory,: |
| | A) | the views and principles of the school of ethical universalism are definitely wrong; the correct view is that ethics is a matter of personal responsibility not a matter of management concern. |
| | B) | the ethical standards a company should try to uphold are governed both by (1) a limited number of universal ethical principles that are widely recognized as putting legitimate ethical boundaries on actions and behavior in all situations and (2) the circumstances of local cultures, traditions, and shared values that further prescribe what constitutes ethically permissible behavior and what does not—however, universal ethical norms take precedence over local ethical norms. |
| | C) | the standards of what is ethically permissible and what is not should be based on a code of ethical and moral conduct which each society/country/culture adopts and then enacts into law. |
| | D) | the standards of what is ethically permissible should be determined by the terms of an "ethics contract" which each company employee signs as a condition of employment. |
| | E) | the only valid ethical standards are those which are universal—and then only if the standards are not absolute and provide some wiggle room according to the circumstances of the each situation. |
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| 8 | |
Multinational companies that are serious about enforcing a code of ethical conduct that extends to all company employees worldwide: |
| | A) | are misguided and doomed to failure, given that a majority of company managers are immoral. |
| | B) | are misguided in their efforts because it is not possible to write a code of ethical conduct with worldwide applicability. |
| | C) | have an uphill struggle unless they subscribe to the school of ethical relativism. |
| | D) | have no special problems given the universal nature of ethical standards. |
| | E) | might well conclude that adopting the principle of ethical relativism regarding the payment of bribes/kickbacks is a slippery slope and that the right ethical standard is one of refusing to condone bribery and kickbacks on the part of company personnel no matter what the local custom is. |
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| 9 | |
Unintentionally amoral managers: |
| | A) | are nearly always ethically-principled in their personal behavior but can inadvertently violate the principles of business ethics because they are unsure of the differences between standards of business ethics and standards of personal ethics. |
| | B) | do not violate ethical principles deliberately but rather because they have not been instructed by their superiors to steadfastly observe ethical principles in doing their jobs. |
| | C) | believe that ethical standards apply only to one's personal life but not to conduct in matters of business. |
| | D) | end up sometimes violating ethical principles merely because they are simply casual about, careless about, or inattentive to the fact that certain kinds of business decisions or company activities are unsavory or may have deleterious effects on others—in short, they go about their jobs as best they can without giving serious thought to the ethical dimension of decisions and business actions. |
| | E) | end up sometimes violating ethical principles because they believe that whatever is legal is also ethical. |
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| 10 | |
According to the information presented in Table 10.1, the perceived degree of governmental corruption is: |
| | A) | highest in such places as Germany, France, Hong Kong, Chile, and Finland and lowest in such countries as India, Paraguay, Indonesia, and South Africa. |
| | B) | is highest in Finland, Denmark, New Zealand, and Sweden and lowest in Indonesia, Kenya, Paraguay, and Bangladesh. |
| | C) | about the same in all countries that were surveyed. |
| | D) | is lowest in the U.S., Japan, and Spain. |
| | E) | is lowest in Finland, New Zealand, Denmark, and Sweden. |
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| 11 | |
According to the information presented in Table 10.3, paying bribes and kickbacks to grease business transactions: |
| | A) | is perceived to occur most frequently in public works/construction, arms and defense, oil and gas, and real estate and less frequently in agriculture, light manufacturing, and fisheries. |
| | B) | is perceived to occur more frequently in industries like fast food, retailing, and electronics than in such industries as government contracting, arms and defense, and oil and gas. |
| | C) | is perceived to occur most frequently in the motor vehicle industry and the banking industry. |
| | D) | is perceived to occur more frequently in Western Europe than in Asia and Africa. |
| | E) | is perceived to occur more frequently in dealings with a company's suppliers than in dealings with a company's customers. |
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| 12 | |
Unethical managerial behavior tends to be driven by such factors as: |
| | A) | overzealous or obsessive pursuit of personal gain, wealth, and other selfish interests; a company culture that puts the profitability and good business performance ahead of ethical behavior; and heavy pressures on company managers to meet or beat performance targets. |
| | B) | the lack of a company code of ethics. |
| | C) | a lack of training in what is ethical and what is not. |
| | D) | confusing differences between what is ethical behavior in one's personal life and what is ethically permissible in business. |
| | E) | All of the above factors. |
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| 13 | |
According to the chapter discussion and the summary in Table 10.4, the underlying belief of the "unconcerned or non-issue" approach to dealing with or managing ethics-related issues and ethics conduct is that: |
| | A) | a company needs to make only a token gesture in the direction of having acceptable ethical standards (usually adopting a code of ethics and instituting very light enforcement is sufficient). |
| | B) | the business of business is business not ethics. |
| | C) | unethical behavior should be punished only if it results in a public scandal which cannot be ignored by management. |
| | D) | ethics is a matter of personal responsibility not a matter of management concern. |
| | E) | what is right and what is wrong is a matter for each individual to decide and not something that a company should try to impose on its personnel. |
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| 14 | |
According to the chapter discussion and the summary in Table 10.4, the underlying belief of the "damage control" approach to dealing with or managing ethics-related issues and ethics conduct is that: |
| | A) | a company needs to make only a token gesture in the direction of having acceptable ethical standards (usually adopting a code of ethics and instituting very light enforcement is sufficient); the primary objective is to protect the company against any fallout from unethical strategies and behavior. |
| | B) | a company does not need a code of ethics so long as top management makes a show of punishing unethical conduct whenever its shady actions are put in the public spotlight. |
| | C) | unethical behavior should be punished only if it results in a public scandal which cannot be ignored by management. |
| | D) | a reputation for high ethical standards is important to every company. |
| | E) | the business of business is business not ethics. |
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| 15 | |
Which one of the following is not a key trait of the ethical culture approach to managing ethical conduct? |
| | A) | The ethical culture approach is favored at companies where top managers are very concerned about gaining employee buy-in to the company's ethical standards, business principles, and corporate values and see the company's code of ethics and/or its statement of corporate values as integral to the company's identity and ways of operating. |
| | B) | The ethical culture approach is especially well-suited for companies that favor a light approach to ethics compliance. |
| | C) | There are strong peer pressures from coworkers to observe ethical norms. |
| | D) | Compliance procedures need to be an integral part of the ethical culture approach to help send the message that management takes the observance of ethical norms seriously and that behavior that fall outside ethical boundaries will have negative consequences. |
| | E) | The integrity of the ethical culture approach depends heavily on the ethical integrity of the executives who create and nurture the culture. |
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| 16 | |
Which of the following is not an action typically taken by companies that adopt a compliance approach to managing ethical conduct or that are serious about company employees observing high ethical standards? |
| | A) | Making the company's code of ethics a visible and regular part of communications with employees, establishing ethics committees to give guidance on ethics matters, and conducting ethics audits to measure and document compliance |
| | B) | Implementing ethics training programs and giving ethics awards to employees for outstanding efforts to create an ethical climate and improve ethical performance |
| | C) | Requiring all job applicants to sign a form stating that they will faithfully observe the company's ethical standards, subject to immediate dismissal if they are found guilty of any ethical violations or ethical misconduct |
| | D) | Trying to deter violations by setting up ethics hotlines for anonymous callers to use in reporting possible violations |
| | E) | Appointing a chief ethics officer or ethics ombudsperson charged with giving guidance on ethics matters and/or instituting formal procedures for investigating alleged ethics violations |
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| 17 | |
Which one of the following is false when it comes to making a case for why a company's strategy should be ethical? |
| | A) | An unethical strategy can put a company's reputation at risk and do lasting damage, especially when the misdeeds get into the public spotlight and make media headlines. |
| | B) | An ethical strategy is in the best interest of shareholders. |
| | C) | An unethical strategy reflects badly on the character of the company personnel involved. |
| | D) | Shareholders profits are not greatly reduced by using ethical strategies. |
| | E) | A strategy that is unethical in whole or in part is morally wrong. |
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| 18 | |
Which of the following is not something a company should normally consider in crafting a social responsibility strategy? |
| | A) | Actions to promote workforce diversity |
| | B) | Actions to raise worker wages and salaries and/or provide attractive incentive compensation for good performance |
| | C) | The resources it will devote to charitable contributions, communityservice endeavors, various worthy organizational causes, and reaching out to make a difference in the lives of the disadvantaged |
| | D) | Actions to protect or enhance the environment and, in particular, to minimize or eliminate any adverse impact on the environment stemming from the company's own business activities (such actions must be over and above what is legally required) |
| | E) | Actions to create a work environment that enhances the quality of life for employees and makes the company a great place to work |
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| 19 | |
Which one of the following is not part of the moral case for why businesses should act in a socially responsible manner? |
| | A) | Because businesses operate on the basis of an implied "social contract" with society—according to the terms of this implied contract, society grants a business the right to conduct its business affairs and pursue a profit for the goods or services it provides and, in return for its "license to operate", a business is obligated to act as a responsible citizen and do its fair share to promote the general welfare |
| | B) | Because "it's the right thing to do" |
| | C) | Because it is unjust for a company to be so greedy as to not use a portion of the revenues collected from customers (who are a part of society at large) to finance company efforts to do good deeds on behalf of society (and thereby demonstrate its goodwill towards customers) |
| | D) | Because businesses have a duty to be good corporate citizens and do what's best for shareholders within the confines of discharging its duties to operate honorably, provide good working conditions to employees, and be a good environmental steward |
| | E) | Because ordinary decency, civic-mindedness, and concern for the well-being of society should be expected of any business |
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| 20 | |
Which one of the following is false as concerns the merits of why acting in a socially responsible manner is "good business"? |
| | A) | To the extent that a company's socially responsible behavior wins applause from consumers and fortifies its reputation, a company may win additional patronage. |
| | B) | Acting in a socially responsible manner reduces the risk of reputation-damaging incidents. |
| | C) | Acting in a socially responsible manner is in the overall best interest of shareholders. |
| | D) | Acting in a socially responsible manner results in above-average after-tax profits. |
| | E) | Acting in a socially responsible manner can generate internal benefits (as concerns employee recruiting, workforce retention, training, and improved worker productivity). |
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