Deck 2: Ethics and Business Decision Making

Question 1

The legality of an action is always clear.

Answer 1

False

Question 2

Ethical codes of conduct can set the ethical tone of a firm.

Answer 2

True

Question 3

An action may be legal and ethical.

Answer 3

True

Question 4

Business ethics applies only to the owners,operators,and employees of corporations.

Question 5

The minimal acceptable standard for ethical behavior is compliance with the law.

Question 6

Business ethics focuses on ethical behavior in the business world.

Question 7

Setting realistic workplace goals can reduce the probability that employees will act unethically.

Question 8

The most common reason that ethical problems occur in business is an overemphasis on long-run profit maximization.

Question 9

Simply obeying the law does not fulfill all ethical obligations.

Question 10

A business firm can sometimes predict whether a given action is legal.

Question 11

An action may be legal but not ethical.

Question 12

Corporate ethical policies must be clearly communicated to be effective.

Question 13

Corporations can be perceived as owing ethical duties to groups other than their shareholders.

Question 14

Ethical standards based on religious teachings tend to be absolute.

Question 15

Managers must apply different standards to themselves than they apply to their employees.

Question 16

Ethics is concerned with the fairness or justness of an action.

Question 17

Business ethics is consistent only with short-run profit maximization.

Question 18

Acting in good faith gives a business firm a better chance of defending its actions in court.

Question 19

An ethics program can clarify what a company considers to be unacceptable conduct.

Question 20

Ethics is the branch of philosophy that focuses on what constitutes right and wrong behavior.

Question 21

If an action is ethical from an outcome-based perspective,it is always ethical from a duty-based perspective.

Question 22

In studying the legal environment of business,Professor Dooley's students also review ethics in a business context.Ethics includes the study of what constitutes

A)fair or just behavior.
B)financially rewarding behavior.
C)legal behavior.
D)religious behavior.

Question 23

According to utilitarianism,it does not matter how many people suffer a negative effect from an act.

Question 24

Under the principle of rights theory,one person's set of values is as "right" as another's.

Question 25

Bribery of foreign government officials is both an ethical and a legal issue.

Question 26

A business organization and its actions cannot be based on trust.

Question 27

Some U.S.bribery laws are directed toward accountants.

Question 28

Lia works for Media Marketing Company.Her job includes putting "spin" on the firm's successes and failures.In this context,ethics consist of

A)"bad" versus "good" publicity.
B)questions of rightness and wrongness.
C)the firm's quarterly revenue.
D)whatever is legal.

Question 29

Ethical reasoning is the process through which an individual rationalizes whatever action he or she chooses to take.

Question 30

According to utilitarianism,an action that affects the majority adversely is morally wrong.

Question 31

A business firm's profits may suffer if the firm is not a "good corporate citizen."

Question 32

Corporations can be good citizens by promoting goals that society deems worthwhile.

Question 33

In ethical terms,a cost-benefit analysis is an assessment of the negative and positive effects of alternative actions on individuals.

Question 34

One guideline to evaluating the ethics of a particular action is to "let your conscience be your guide."

Question 35

To be ethical is to "do the right thing" but it does not otherwise "pay."

Question 36

John is sales manager for Kleen 'N Brite Products,Inc.Compared to John's personal activities,his business activities most likely involve

A)more complex ethical issues.
B)no ethical issues.
C)simpler ethical issues.
D)the same ethical issues.

Question 37

Businesspersons who would choose to act unethically may be deterred from doing so because of public opinion.

Question 38

Mariah works in the public relations department of New Trends Sales Company.Her job includes portraying New Trends's activities in their best light.In this context,ethics consist of

A)a different set of principles from those that apply to other activities.
B)the same moral principles that apply to non-business activities.
C)those principles that produce the most favorable financial outcome.
D)whatever saves New Trends's "face."

Question 39

Any decision by the management of Fast-Food Franchise Corporation may significantly affect its

A)operators only.
B)operators,owners,suppliers,the community,or society as a whole.
C)owners only.
D)suppliers,the community,or society as a whole only.

Question 40

The role played by women may present some difficult ethical problems for firms doing business internationally.

Question 41

Bob,research manager for CornAgri Products,Inc.,applies utilitarian ethics to determine that an action is morally correct when it produces the greatest good for

A)Bob.
B)CornAgri.
C)the fewest people.
D)the most people.

Question 42

Sharon,the human resources director for Tempo Corporation,attempts to comply with the law in dealing with applicants and employees.One of the challenges Sharon faces is that the legality of an action is

A)always clear.
B)never clear.
C)sometimes clear.
D)usually clear.

Question 43

Lyle,vice-president of sales for Mi-T Electric,Inc.,adheres to Judeo-Christian religious ethical standards.With respect to their application,these standards are

A)absolute.
B)analytical.
C)discretionary.
D)utilitarian.

Question 44

Eden,the chief executive officer of Flo-Thru Piping Corporation,wants to ensure that Flo-Thru's activities are legal and ethical.The best course for Eden and Flo-Thru is to act in

A)good faith.
B)ignorance of the law.
C)regard for the firm's shareholders only.
D)their own self interest.

Question 45

Ryan,the owner of SuperMart Stores,Inc.,adheres to the "principle of rights" theory.Under this theory,a key factor in determining whether a business decision is ethical is how that decision affects

A)the right determination under a cost-benefit analysis.
B)the rights of others.
C)the "right" thing to do.
D)the right to make a profit.

Question 46

Kennedy Capital Corporation provides other firms with funds to expand operations.If Kenney strictly complies with existing laws,the firm will

A)fulfill all business ethics obligations.
B)fulfill no business ethics obligations.
C)fulfill some business ethics obligations.
D)not need to fulfill any business ethics obligations.

Question 47

DeLouse Plastics Corporation pays its executives an excessive amount relative to other employees and to what executives at competitive companies are paid.This is most likely to be challenged as

A)illegal and unethical.
B)illegal only.
C)neither illegal nor unethical.
D)unethical only.

Question 48

Bess runs Creditors Asset Recovery.She recruits clients by misrepresenting the facts and pretending to be licensed in various occupations in Michigan.Bess's conduct most likely warrants

A)an ethical admonishment but no other sanctions.
B)an injunction plus other sanctions.
C)no sanctions but no praise.
D)praise for her aggression in recovering the assets of "deadbeat" debtors.

Question 49

In business deals,Felipe,the chief executive officer of Glazed Donuts,Inc.,follows duty-based ethical standards.These are most likely derived from

A)a corporate ethics code.
B)a cost-benefit analysis.
C)philosophical reasoning.
D)the law.

Question 50

Halley,a lawyer on the staff of International Group,applies the utilitarian theory of ethics in business contexts.Utilitarianism focuses on

A)moral values.
B)religious beliefs.
C)the consequences of an action.
D)the nature of an action.

Question 51

Dion,an accountant for Entertainment Sports,Inc.,attempts to apply a duty-based approach to ethical reasoning in conflicts that occur on the job.This approach is based on the idea that a person must

A)achieve the greatest good for the most people.
B)avoid unethical behavior regardless of the consequences.
C)conform to society's ethical standards.
D)place his or her employer's interest first.

Question 52

Flexo Trucking Company transports hazardous waste.Garn is a Flexo driver,whom the company knows drives longer hours than federal regulations permit.One night,Garn exceeds the limit and has an accident.Spilled chemicals contaminate Hill City's water source,forcing the residents to move away.Flexo acted unethically because

A)Flexo showed reckless disregard for Hill City's residents and others.
B)Garn exceeded the federal time limit.
C)harm was caused by an unfortunate accident.
D)Hill City should have better protected its water source.

Question 53

Tilly,the chief financial officer for USA Products Corporation,attempts to apply Christian precepts in making ethical decisions and in doing business.In applying duty-based ethical standards that are derived from a religious source,Tilly would consider the motive behind an act to be

A)irrelevant.
B)the least important consideration.
C)the most important consideration.
D)the only consideration.

Question 54

Housemate,Inc.,makes and sells a variety of household products.With a fair amount of certainty,Housemate's decision makers can predict whether a given business action would be legal in

A)all situations.
B)many situations.
C)no situations.
D)practically no situations.

Question 55

In making decisions for United Merchandising Company,Vance uses a cost-benefit analysis.This is part of

A)duty-based ethics.
B)Kantian ethics.
C)the principle of rights.
D)utilitarianism.

Question 56

In making business decisions,Glenda,personnel manager for HVAC Maintenance,Inc.,applies his belief that all persons have fundamental rights.This is

A)a religious rule.
B)the categorical imperative.
C)the principle of rights.
D)utilitarianism.

Question 57

Solid Tool Company's decision makers view a particular risk in the use of Solid's product as open and obvious.Continuing to market the product without telling consumers of the risk could be justified from a perspective of

A)duty-based ethics.
B)Kantian ethics.
C)rights-based ethics.
D)utilitarian ethics.

Question 58

Made4U Goods,Inc.,asks its employees,many of whom are members of the National Machinists Union,to apply the utilitarian theory of ethics.This theory does not require

A)a choice among alternatives to produce the maximum so?cietal utility.
B)a determination of whom an action will affect.
C)an assessment of the effects of alternatives on those affected.
D)the acquiring of the means of production by workers.

Question 59

Global Distribution Corporation suggests that its employees apply the "categorical imperative" to ethical issues that arise at work.This requires that the employees

A)categorize the issues according to legality,morality,and profitability.
B)consider only the benefits that would accrue to them personally.
C)look only at the result,regardless of the means to attain it.
D)weigh the consequences that would follow if everyone acted the same.

Question 60

Peak & Vale Accountants provides other firms with accounting services.Questions of what is ethical involve the extent to which Peak & Vale has

A)a legal duty beyond those duties mandated by ethics.
B)an ethical duty beyond those duties mandated by law.
C)any duty beyond those mandated by both ethics and the law.
D)any duty when it is uncertain whether a legal duty exists.

Question 61

Chuckie,president of DrinkUp Fresh Beverages,Inc.,does not apply utilitarianism to business ethical issues.One problem with utilitarianism is that it

A)gives business profits priority over production costs.
B)ignores the practical costs of a given set of circumstances.
C)requires complex cost-benefit analyses of simple situations.
D)tends to justify human costs that many find unacceptable.

Question 62

In deciding questions of corporate social responsibility,Valley Disposal & Recycling,Inc.,is concerned with

A)how the corporation can best fulfill any ethical duty to society.
B)the effect on corporate profits of ignoring any ethical duty to society.
C)whether the corporation owes any ethical duty to society.
D)all of the choices.

Question 63

Recreation & Sports Equipment Corporation sells a product that is capable of seriously injuring consumers who misuse it in a foreseeable way.Does the firm owe an ethical duty to take this product off the market What conflicts might arise if the firm stops selling this product

Question 64

To assist in detecting illegal bribes,Cut Rite Contractors,Inc.,and all U.S.companies,must

A)conceal financial records that reveal past bribes.
B)keep records that "accurately and fairly" reflect financial activities.
C)make bribes through third parties rather than directly to officials.
D)permit payments to foreign officials that are unlawful in that country.

Question 65

Applied Business Corporation makes and markets its products nationwide.Under the stakeholder approach,to be considered socially responsible when making a business decision,Applied must take into account the needs of

A)its consumers,the community,and society only.
B)its employees and owners only.
C)its employees,owners,consumers,the community,and society.
D)no one.

Question 66

Olaf,an executive with Pharma Product Distribution,Inc.,has to decide whether to market a product that might have undesirable side effects for a small percentage of users.How should Olaf decide whether to sell the product How does the standard of ethics that is applied affect this answer

Question 67

Ethical standards would most likely be considered violated if Retail Mart Corporation deals with a company in a developing nation that

A)agrees to produce goods at Retail Mart's desired price.
B)goes unnoticed by "corporate watch" groups.
C)exploits its workers.
D)pays its workers less than the U.S.minimum wage.

Question 68

A common ethical dilemma faced by the management of General Holdings Corporation involves the effect that its decision will have on

A)one group as opposed to another.
B)the firm's competitors.
C)the government.
D)the U.S.Chamber of Commerce.

Question 69

Bilt-Well Construction Corporation makes a side payment to a government official in Nigeria to obtain a contract.In the United States,this is

A)illegal and unethical.
B)illegal but not unethical.
C)unethical but not illegal.
D)legal and ethical.

Question 70

Spencer Hydraulics Corporation's ethics committee is asked a business ethics question-should the firm bid low to obtain a contract that it knows it can fulfill only at a higher price A practical method to investigate and solve this question involves all of the following steps except

A)absolution.
B)decision.
C)inquiry.
D)justification.

Question 71

Superior Energy Corporation engages in ethical behavior solely for the purpose of getting good publicity and thereby increasing profits.Superior is

A)acting unethically in its pursuit of publicity.
B)acting unethically in its pursuit of profits.
C)acting unethically in its setting of priorities.
D)not acting unethically.

Question 72

Fealty Credit Corporation asks its employees to evaluate their actions and get on the ethical business decision-making "bandwagon." Guidelines for judging individual actions include all of the following except

A)an individual's conscience.
B)business rules and procedures.
C)loopholes in the law or company policies.
D)promises to others.