Exam 3: Conducting Business Ethically and Responsibly

The fair trade movement is designed to level the playing field with respect to trade between developing and developed countries.

A business firm can influence an individual's ethical behaviour through development of a written code of ethics.

Because it was the initial year of production, only 3000 units of a new model car were built. Some auto dealers got together and agreed that they would sell the cars only if the customer was willing to pay several thousand dollars over the sticker price. This is an example of price gouging. smart business practice. price fixing. collusion. price lining.

When a food company lists the ingredients that make up their products, which consumer right is it addressing? Right to choose Right to safe products Right to courteous service Right to be informed Right to be heard

Steve Beatty, the head salesperson of a computer company, contracts with a supplier for technical equipment. Just before the winter holiday, a greeting card comes to his home address from the president of the supplier. In it, he finds a Best Buy gift card worth $500, with a note that says, "Go buy some toys for the kids." His children are excited, because they had been looking forward to getting some newly released video game equipment. Beatty looks at his firm's formal code of ethics and finds that employees are cautioned not to accept gifts from suppliers for their own personal use. It does not specifically say that gifts for family members are included. He decides to keep the card. Which of the following, if true, strengthens Beatty's ethical position? The gift card has no expiration date, so he can wait to use it later, when he has moved to another position in his company where no conflict of interest exists. The greeting and the gift card were received at his home residence, not at his place of work. The salesman has just spent $500 of his own money on video game equipment for his children at Best Buy, so he has no immediate reason to use the gift card. The president of the supplier is Beatty's father-in-law, so the gift is a personal one for his grandchildren. On checking, Beatty learns that the supplier sent gift cards of lower value to other salespersons in his company.

The most conservative approach to social responsibility for a firm is the accommodative stance.

The Lexington Corporation's mission statement shows a primary commitment to compassionately improve the lives of elderly citizens. Which of the following is least likely to be true with respect to the company's ethical code? The well-being of others is valued. All people have worth. Age discrimination is prohibited when hiring employees. Elderly citizens are expected and required to contribute to society. All human beings should be treated fairly.

A firm is considering opening a new plant in an existing building at a business park. It is located in the middle of a coal-producing region, which remains visibly blighted by the effects of strip mining. The plant's heating system is based on coal heat, which is locally produced and relatively cheap, reducing the plant's operating expenses significantly. Company engineers note that the plant's roof is ideal for solar panels, which would reduce the firm's future dependence on coal, nuclear, and other conventional sources of energy. However, the cost of installing the panels is considerable and would mean that the new plant would not return a profit to the company for several years. The CEO feels that the panels should be installed. Which of the following, if true, tends to compromise the ethical standing of the CEO's position? The CEO was born and raised in the community where the new plant will be located. The CEO plans to purchase the solar energy panels for the new plant from an alternative energy business just started up by her grandson. The plant is located near a small lake that is heavily polluted by residue from strip mining. The firm recently instituted a policy of bonuses for environmentally responsible actions, which the managers assigned to the new plant would be certain to get. The CEO expects to sell some of the power generated by the solar panels back to the local energy grid, enhancing corporate profits.

Stealth advertising is unethical and illegal.

Biggar Foods wants to take a proactive stance towards social responsibility. This means that it should cover up any wrongdoing by its employees. it should focus on its profitability, even if that means breaking the law. it should seek out opportunities to contribute to the well-being of society. it should respond to social concerns if it is asked. it should take on only the minimal amount of responsibility required by law and standard business practice.

What is recycling?

People who would never think of stealing a candy bar from a grocery store may think it is perfectly legitimate to take home pens and pads of paper from their office.

The United Nations "cap and trade" system essentially give certain companies (i.e., those that have bought carbon credits. the right to pollute the atmosphere with carbon dioxide.

Social responsibility to investors requires firms to manage their resources and to represent their financial status honestly. Provide some examples of irresponsible behaviour by business firms.

Clarion Corp. has just established a committee of top managers to develop a plan detailing the level of support they will give to various social programs. What do they need to do next? Conduct a social audit Survey the various causes that they might support Give authority to one specific person to act as director of the firm's social agenda Develop a policy statement outlining the firm's commitment Form a committee of top managers to develop a detailed plan

Dangerous chemical and/or radioactive byproducts of various manufacturing processes are called solid waste. acid rain. toxic waste. incineration waste. biomass.

What distinguishes ethical behaviour from unethical behaviour is often subjective and influenced by differences of opinion.

Approximately ____ of Canadian firms have codes of ethics, while approximately _______ of U.S. firms have them. one-third; two-thirds two-thirds; nine-tenths one-fifth; one-fourth one-half; one-half one-half; three-quarters

What is insider trading?

What is the first step in making ethical judgments?