Deck 4: Ethics and Social Responsibility

Question 1

An employee who feels he is being underpaid steals company merchandise to sell for his own profit.What act is this employee engaged in?

A) inventory shrinkage
B) production deviance
C) property deviance
D) employee shrinkage

Answer 1

D
Theft of company merchandise by employees is called "employee shrinkage."

Question 2

Which term is used to describe the degree of concern people have about activities that question moral standards?

A) ethical intensity
B) social consensus
C) temporal immediacy
D) magnitude of consequences

Answer 2

A

Question 3

In 1997 an International Code of Ethics was released by a group of Canadian companies.Why did they do this?

A) To help lobby the federal government to create ethical legislation in Canada.
B) To provide a general guideline for acceptable standards of conduct when doing business at home and in other countries.
C) To encourage investment in Canadian companies by foreigners.
D) To stop the white collar fraud that was becoming uncontrollable in Canadian corporations.

Answer 3

B

Question 4

What issues are covered by the International Code of Ethics for Canadian Business Principles?

A) minimum wage, overseas outsourcing, full disclosure, environmental protection, human rights
B) equality in pay, business conduct, full disclosure, minimum wage, and child labour
C) community participation, environmental protection, human rights, business conduct, and employee rights
D) child labour, community participation, equality in pay, overseas outsourcing, and internal training

Question 5

A company's accounting clerk realizes that an error has been made-the period's income is overstated.The clerk will soon be leaving for another job and knows that the error will not be found for several months after she has gone.To avoid having to work longer to fix the error,she decides she won't say anything.Which of the following factors affected the intensity of the clerk's decision?

A) resource consequences
B) magnitude of influence
C) temporal immediacy
D) probability of response

Question 6

On which of the following does ethical intensity partly depend?

A) magnitude of dilemma
B) social acceptance
C) intent of the manager
D) temporal immediacy

Question 7

A plant worker is unhappy with his performance review.He considers purposely spilling a hazardous chemical to cause an evacuation of the plant.He decides against this,however.A spill could put many of his fellow workers at risk of injury from inhaling the chemical's fumes or evacuating.Which of the following influenced this worker's ethical decision making?

A) magnitude of consequences
B) enormity of influence
C) location immediacy
D) probability of response

Question 8

A female employee was passed over for a promotion that was awarded to a new and younger male employee.Disgruntled,the older female employee gives the younger employee who got the job false information,thereby making his work more difficult.What behaviour is the older female employee engaged in?

A) production deviance
B) employee shrinkage
C) political deviance
D) personal aggression

Question 9

Shell Oil Company's plan to sink Brent Spar,an abandoned offshore oil-storage buoy,had a massive effect on employee motivation and recruitment.The number of qualified people applying for jobs at Shell plummeted,and many employees looked for positions in other companies.The plan caused much greater harm than Shell's managers had ever imagined it would.Which of the following was much greater than predicted?

A) synergistic effect
B) impact proximity
C) concentration of synergy
D) magnitude of consequences

Question 10

What is ethics as it relates to workplace behaviour?

A) Ethics is behaving in a way that makes actions easier than acting unethically.
B) Ethics is the mindset employees must have to eliminate risks of misconduct when making choices about how to behave.
C) Ethics is the unseen rules that guide the behaviour of employees.
D) Ethics is the set of moral principles or values that defines right and wrong for a person or group.

Question 11

Every day before he leaves work,Doug takes a headset,stapler,or other company item and puts it in his lunch box to bring home.Doug sees nothing wrong with his behaviour since he feels inadequately paid.What level of moral development is Doug operating at?

A) conventional
B) legally mandated
C) preconventional
D) postconventional

Question 12

According to Dwight Sharon Allen,Chairman of Deloitte LLP,what kinds of leaders do people want to work for?

A) leaders who have similar experiences
B) leaders who are easy going
C) leaders they can trust
D) leaders who are charismatic

Question 13

Which of the following is strong when a decision has large,certain,immediate consequences,and when we are physically or psychologically close to those affected by it?

A) ethical variance
B) ethical involvement level
C) ethical compliance
D) ethical intensity

Question 14

A dissatisfied employee purposely puts less oil in a machine used in manufacturing products to increase the risk of the machine failing.Which activity is this employee engaged in?

A) production deviance
B) employee deviance
C) property deviance
D) operational deviance

Question 15

When addressing certain issues,managers more aware of the large impact their decisions will have on others are more likely to worry about doing the right thing.Which type of issue does this situation best describe?

A) social consensus
B) ethical intensity
C) temporal immediacy
D) proximity of effect

Question 16

Why would the intentional tampering of a car's brake line have greater ethical intensity than driving 10 km over the speed limit?

A) social consensus
B) magnitude of consequences
C) temporal immediacy
D) probability of effect

Question 17

A disgruntled employee who feels he is being underpaid purposely works slowly when his supervisor is not present and often arrives late for work and leaves early.What kind of behaviour is this employee engaged in?

A) production deviance
B) employee shrinkage
C) product shrinkage
D) property deviance

Question 18

Which of the following factors contributes to ethical intensity?

A) temporal immediacy
B) probability of efficiency
C) proximity of behaviour
D) social commitment

Question 19

A new employee is requested to cooperate in a scheme to cheat on worker time cards.The employee refuses to cooperate,and two colleagues write him a letter with threats of physical harm if he does not comply.In what behaviour are the employees who wrote the threatening letter engaged?

A) employee shrinkage
B) personal aggression
C) political deviance
D) personal deviance

Question 20

What are the three levels of moral development identified by Kohlberg?

A) amoral, moral, and post-moral
B) preconventional, conventional, and postconventional
C) introductory, growth, and maturity
D) individual, organizational, and industry-wide

Question 21

What is the next step in the basic model of ethical decision making after the problem is identified?

A) diagnose the situation
B) identify the constituents
C) determine alternative solutions
D) analyze the options

Question 22

Which type of integrity test indirectly estimates honesty by measuring psychological traits?

A) overt
B) psychographic-based
C) covert
D) personality-based

Question 23

Former Wal-Mart vice chairman Tom Coughlin allegedly engineered to defraud the company for personal gain.Operations vice president Jared Bowen asserted that information he provided to Wal-Mart spawned the investigation that led to the discovery of Coughlin's activities.Bowen is suing Wal-Mart because the company fired him.What issue does his lawsuit point to?

A) the importance of discretionary responsibility
B) a problem with too-specific codes of ethics
C) one of the problems of being a whistle blower
D) the creation of a sustainable ethical climate

Question 24

What is the last step in the basic model of ethical decision making?

A) monitor the results
B) determine benchmarks
C) act
D) make a choice

Question 25

What can employees and persons outside of the company easily attain with a click of a mouse to read about Johnson and Johnson's beliefs about moral behaviour and activity?

A) Johnson and Johnson's overt statement of integrity
B) Johnson and Johnson's vision for the future
C) Johnson and Johnson's mission statement of principle
D) Johnson and Johnson's specific ethical business practices

Question 26

Why is it often difficult for an employee to assume the role of whistle blower?

A) because managers have such broad spans of management
B) because the employee is often the one punished
C) because the organization is decentralized
D) because the employee needs empowerment

Question 27

What discourages most people from becoming whistle blowers?

A) lack of company action on their complaints
B) retaliation from supervisors and fellow workers
C) causing trouble for friends who are acting unethically
D) the risk of losing their jobs

Question 28

Which of the following is an objective of ethics training?

A) reducing costs
B) pushing ethics training throughout the entire organization
C) improving negotiations with suppliers
D) encouraging customers to purchase more from the company

Question 29

How many steps are there in the basic model of ethical decision making?

A) six steps
B) five steps
C) four steps
D) three steps

Question 30

Historically,which type of responsibility means making a profit by producing something valued by society?

A) discretionary
B) ethical
C) legal
D) economic

Question 31

For what purpose can managers use integrity tests?

A) to select and hire ethical employees
B) to force the use of the principle of distributive justice when dealing with customers
C) to determine which principle of ethical decision making is most appropriate to a situation
D) to assess the ethical intensity of an issue

Question 32

Which of the following is the least important factor in the creation of an ethical business climate?

A) personal examples set by company management
B) official approval of the company's ethics code by government regulators
C) fair but consistent punishment of violators
D) a system that encourages whistle-blowers to report potential ethics violations

Question 33

What information source should employees of Canadian Tire consult if they are unsure of how to respond to an invitation to a business function?

A) standards and procedures specific to the retail industry
B) the company's business code of ethics
C) the company's mission statement
D) someone in the company's publicity department

Question 34

What should managers do to encourage more ethical decision making in an organization?

A) They should carefully select and hire new employees.
B) They should let the employees be the ethical leaders in the company.
C) They should forgive employees that steal inventory.
D) They should promote based on gender.

Question 35

In 1995,Mark Graf,a security specialist at the Rocky Flats nuclear facility,became alarmed about the temporary removal of 450 kg of plutonium oxide from a vault-like room to a "soft room" protected by drywall anyone could punch a hole through.Graf eventually had to take his concerns to the media before the plutonium was stored once again in a safe location.What is Graf's role in this instance?

A) whistle blower
B) ethical ombudsman
C) secondary stakeholder
D) covert stakeholder

Question 36

According to Kohlberg's model,which level of moral development are people at when they always use internalized ethical principles to solve ethical dilemmas?

A) the amoral level
B) the preconventional level
C) the unconventional level
D) the postconventional level

Question 37

According to Kohlberg's model,which level of moral development are people at when they make decisions that conform to societal expectations?

A) the unconventional level
B) the preconventional level
C) the conventional level
D) the postconventional level

Question 38

A company's chief financial officer was found guilty of extorting large sums of corporate funds and depositing them into an offshore bank account.The officer had been arrested after a financial manager uncovered suspicious financial records.Which of the following best describes the financial manager?

A) whistle blower
B) ethical ombudsman
C) covert manager
D) covert stakeholder

Question 39

What written test estimates honesty by directly asking job applicants what they think or feel about theft or about punishment of unethical behaviours?

A) situational-based integrity test
B) personality-based integrity test
C) behavioural integrity test
D) overt integrity test

Question 40

According to Kohlberg's model,which level of moral development are people at when they make decisions based on selfish reasons?

A) the amoral level
B) the preconventional level
C) the conventional level
D) the postconventional level

Question 41

Management's most important responsibility is long-term survival (not just maximizing profits),which is achieved by satisfying the interests of multiple corporate stakeholders.What type of model does this statement represent?

A) economic
B) stakeholder
C) societal
D) shareholder

Question 42

Bayer AG,Syndial SpA,Crompton Corp.,DuPont Dow Elastomers,and Zeon Chemicals are all international manufacturers of rubber chemicals.They have all been indicted as participants in a price-fixing scheme that drove up the costs of rubber chemicals used to make shoes,tires,and other products.Which model would they most likely use to justify their actions?

A) the economic model
B) the stakeholder model
C) the shareholder model
D) the accounting model

Question 43

What type of stakeholders are groups,such as shareholders,employees,customers,suppliers,governments,and local communities,on which the organization depends for long-term survival?

A) primary
B) secondary
C) functional
D) conventional

Question 44

According to Milton Friedman,which of the following is a problem with corporate social responsibility?

A) Social responsibility comes with a high cost that is borne by company shareholders.
B) The time, money, and attention diverted to social causes undermine market efficiency.
C) Companies publicize socially responsible actions while they quietly pollute and mistreat the environment.
D) The marketplace will ultimately determine the importance of social causes.

Question 45

According to the stakeholder model,which of the following stakeholder groups is theoretically the least important to the company?

A) investors
B) customers
C) suppliers
D) lobbyists

Question 46

Why are secondary stakeholders important to a company?

A) The company depends on them for long-term survival.
B) They can affect public perceptions and opinions.
C) The company is endangered by a termination of their relationship.
D) They have the direct power to control management decisions.

Question 47

In an article about BP Amoco,the company's CEO said that BP Amoco must align its policies,values,and behaviour with those of the societies in which it operates because,ultimately,superior performance means being in touch.To what did the CEO want the company committed?

A) to social consensus
B) to social munificence
C) to social responsibility
D) to social respect

Question 48

What are the two general categories of stakeholders?

A) primary and secondary
B) reactive and proactive
C) business and nonbusiness
D) relevant and irrelevant

Question 49

What are various persons or groups with a legitimate interest in a company's actions called?

A) stakeholders
B) shareholders
C) indirect investors
D) boundary spanners

Question 50

Which of the following is an example of a stakeholder group that an organization must satisfy to ensure long-term survival?

A) suppliers
B) Statistics Canada
C) the general public
D) the media

Question 51

When media in India informed the public that Coca-Cola products bottled in India contained a high level of certain cancer-causing pesticides,the Indian government ordered Coca-Cola to stop production in its Indian bottling plant until further analysis could be done.Which role did the Indian government thereby serve?

A) primary shareholder
B) primary stakeholder
C) secondary shareholder
D) secondary stakeholder

Question 52

Which of the following is a secondary stakeholder group?

A) the government
B) suppliers
C) the media
D) employees

Question 53

Which of the following groups is least important for an organization to satisfy when it comes to assuring long-term survival?

A) investors
B) customers
C) the media
D) employees

Question 54

What is the term for the group that can influence or be influenced by the company and can affect public perceptions about its socially responsible behaviour?

A) preliminary stakeholders
B) secondary stakeholders
C) conventional stakeholders
D) reactive stakeholders

Question 55

What is social responsibility?

A) a business's obligation to pursue policies, make decisions, and take actions that benefit society
B) a business tactic used to create relationship bonds with customers
C) the actions the law obliges companies to take to protect their external environments
D) a business's responsibility to its shareholders

Question 56

Kowalski's Markets expanded in 2002 by purchasing four existing stores.One of the stores was located in a lower-class community unlike the business's typical upscale-customer demographic.Rather than sell the property,the owners decided to provide a neighbourhood grocery store to that community.What did Kowalski's Markets exercise?

A) equitable responsibility
B) fiscal responsibility
C) organizational responsibility
D) social responsibility

Question 57

In which of the following roles were the media in India acting when they informed the public that Coca-Cola products bottled in India contained a high level of certain cancer-causing pesticides?

A) overt constituents
B) covert constituents
C) secondary shareholders
D) secondary stakeholders

Question 58

Which model holds that as long as a company is operating legally,its only social responsibility is to maximize profits?

A) the economic model
B) the stakeholder model
C) the shareholder model
D) the accounting model

Question 59

Which of the following is an example of a stakeholder group that neither engages in regular transactions with the company nor is critical to its long-term survival but can still affect public perceptions and opinions about the company's socially responsible behaviour?

A) the media
B) suppliers
C) the government
D) employees

Question 60

In recent years,Kowalski's Markets expanded by purchasing four existing stores.One of the stores was located in a lower-class community,unlike the store's typical upscale-customer demographic.Rather than sell the property,the owners decided they had an obligation to provide a neighbourhood grocery store to that community.Which of the following is an example of a primary stakeholder group for Kowalski's Markets?

A) community activists
B) city parks board
C) customers in the lower-class neighbourhood
D) newspapers that carry ads for stores

Question 61

Bayer AG,Syndial SpA,Crompton Corp.,DuPont Performance Elastomers,and Zeon Chemicals have all been indicted as participants in a price-fixing scheme that drove up the costs of rubber chemicals used to make shoes,tires,and other products.Which responsibilities did these companies ignore?

A) economic responsibilities
B) ethical responsibilities
C) legal responsibilities
D) discretionary responsibilities

Question 62

GlaxoSmithKline (GSK)has been making anti-AIDS drugs such as Retrovir and Epivir available in hard-hit areas of Africa at up to 75 percent off the global price.Still,it managed to outrage AIDS prevention groups.GSK decided to use the patent protection rules of the World Trade Organization (WTO)to take action against governments importing lower-cost drug versions.At which level of social responsibility was GSK acting by using the WTO's regulation?

A) economic
B) fiscal
C) legal
D) discretionary

Question 63

Video Arts Inc.,a business training company,is currently marketing The Grapevine,a 30-minute training video designed to teach companies how to deal with and prevent damaging gossip.Which of the following is an example of a secondary stakeholder group for Video Arts?

A) companies that use the video for training
B) actors in the video
C) distributors of the training video
D) business magazines that run ads for the training video

Question 64

A Canadian metals broker advertises,"95 percent of orders shipped from stock" even though the company has no warehouses and no inventory.When questioned about the falseness of the ad,the broker responded,"We do ship 95 percent of our orders from stock,but from suppliers' stocks,not ours." Which type of strategy did the broker use to respond to the ethical question?

A) reactive
B) offensive
C) accommodative
D) proactive

Question 65

A consumer advocacy group is critical of ads by a delivery company that claim its priority service is a low-cost,two-day service while failing to disclose that their regular service generally reaches the destination just as quickly and for a tenth of the cost.The consumer advocacy group wants the delivery company to take responsibility for its actions and do what is right.What term defines this type of responsibility?

A) utilitarian
B) fiscal
C) legal
D) ethical

Question 66

The Rainforest Action Network launched a bruising PR campaign against The Home Depot to stop it from selling old-growth lumber.After two years of bad publicity and resistance to new store locations,The Home Depot surrendered.Today,its suppliers work with environmental and forestry groups to certify that their wood products are not from endangered areas.What type of strategy did The Home Depot use to respond to demands that it be socially responsible?

A) proactive
B) accommodative
C) predictive
D) defensive

Question 67

Which of the following terms best applies to the expectations that a company will voluntarily serve a social role beyond its economic,legal,and ethical responsibilities?

A) stakeholder responsibilities
B) overt responsibilities
C) discretionary responsibilities
D) social responsibilities

Question 68

Narrative 4-1
IBM has a long-standing "Reinventing Education" program, which involves intensive research into how educational institutions can use the fruits of new technologies to transform what they do and thereby improve education. In the process, the program is helping to shape a market of significant interest to IBM. IBM views the program as an investment rather than as a charitable contribution.
Refer to the Narrative 4-1.The IBM program is an example of the positive relationship between social responsibility and which of the following?

A) social consensus
B) secondary shareholders
C) economic performance
D) covert stakeholders

Question 69

A company faced with a social problem decides to demonstrate the greatest possible willingness to meet or exceed society's expectations of how it should respond.Which type of strategy is the company implementing?

A) reactive
B) productive
C) proactive
D) accommodative

Question 70

GlaxoSmithKline (GSK)has been making anti-AIDS drugs such as Retrovir and Epivir available in hard-hit areas of Africa at up to 75 percent off the global price.At which level of social responsibility was GSK acting by providing the drugs at a fraction of their usual costs?

A) discretionary
B) global
C) altruistic
D) economic

Question 71

Which type of strategy is a company implementing if it chooses to accept responsibility for a problem and does all that society expects to solve the problem?

A) reactive
B) defensive
C) accommodative
D) proactive

Question 72

Which type of responsibility can companies fail to fulfill and still be considered ethical?

A) legal
B) fiscal
C) discretionary
D) overt

Question 73

Narrative 4-1
IBM has a long-standing "Reinventing Education" program, which involves intensive research into how educational institutions can use the fruits of new technologies to transform what they do and thereby improve education. In the process, the program is helping to shape a market of significant interest to IBM. IBM views the program as an investment rather than as a charitable contribution.
Refer to the Narrative 4-1.Which type of strategy is IBM using to show its social responsibility?

A) proactive
B) accommodative
C) predictive
D) defensive

Question 74

Shell's efforts to sink Brent Spar,an abandoned offshore oil-storage buoy,got derailed by Greenpeace in Germany,which mounted a well-orchestrated public relations blitz that caused Shell's gasoline sales to plunge by 50 percent at some German stations.Which type of stakeholder influenced Shell's organizational strategy?

A) covert
B) functional
C) reactive
D) secondary

Question 75

Indonesia had ramin wood listed as endangered.Thus,exporting of the wood must be regulated by the government.In spite of attempts to control the sale of ramin wood,it is still being carried across Indonesia's national borders and sold in Malaysia,where government officials pretend that the wood was legally acquired.If companies buy this wood,what kind of responsibility to society would they be ignoring?

A) economic
B) ethical
C) legal
D) discretionary

Question 76

When does a social responsibility problem exist?

A) when there is inequality in pay for same work between genders
B) when known product flaws are not communicated to stakeholders
C) when company actions do not meet stakeholder expectations
D) when company activities harm the environment

Question 77

Bayer AG was indicted as a participant in an international price-fixing scheme that drove up the costs of rubber chemicals used to make shoes,tires,and other products.Bayer AG paid its fine but did not admit culpability.Instead,the company announced paying the fine was less costly than litigation.Which type of strategy did Bayer AG implement?

A) offensive
B) reactive
C) proactive
D) accommodative

Question 78

Lever's most successful product in India is Fair & Lovely,a skin-whitening agent that is sold to dark-skinned women in India to help them conform to their culture's definition of beauty.Lever is emphasizing one type of responsibility,to make a profit,and ignoring another type of responsibility,which is to help women realize that appearance is superficial.What are these two types of responsibilities,respectively?

A) legal; ethical
B) discretionary; ethical
C) economic; legal
D) economic; discretionary

Question 79

Which of the following social responsiveness strategies could be considered a public relations approach?

A) reactive
B) defensive
C) communicative
D) proactive

Question 80

When media in India informed the public that Coca-Cola products bottled in India contained a high level of certain cancer-causing pesticides,Coca-Cola responded by saying that all of India's water was contaminated and that by using the local water supply,it was not doing anything wrong.Which kind of strategy did Coca-Cola use to respond to its social responsibility problems?

A) reactive strategy
B) prospective strategy
C) defensive strategy
D) accommodative strategy