Deck 2: Business Ethics and Social Responsibility

Question 1

Personal choices and lifestyles have no impact on one's business ethics.

Answer 1

False

Question 2

Natural law and positive law are one and the same theories of moral standards.

Answer 2

False

Question 3

The "front page of the newspaper test" is an application of whether conduct gives the appearance of impropriety.

Answer 3

True

Question 4

Most businesses today do not have a code of ethics.

Question 5

A code of ethics is an individual firm's behavior standard for employees.

Question 6

Invisible hand managers do not become involved in social issues.

Question 7

Business self-regulation has been effective in solving social problems.

Question 8

Milton Friedman's standard for business social responsibility is one that requires a company to do all that it can for its community.

Question 9

Giving a false impression, although not actually an untruth, is still an ethical violation.

Question 10

A lack of business ethics can result in a lack of business goodwill.

Question 11

Business ethics is the application of standards for moral reasoning to business dilemmas.

Question 12

The first question of the Blanchard/Peale model for resolving ethical dilemmas is whether the conduct is legal.

Question 13

The enlightened self-interest school manager serves only the shareholder.

Question 14

Whether everyone else does it is one method for evaluating the ethics of a particular course of action.

Question 15

Unethical behavior is not necessarily illegal behavior.

Question 16

The inherence school is one that follows the standard of society's interest coming first.

Question 17

The social-responsibility school holds that businesses profit by being responsive to society.

Question 18

Condoning unethical behavior is an ethical breach.

Question 19

Situational ethics is also known as moral relativism.

Question 20

Business ethics provides a guarantee of profitability.

Question 21

Warren Buffett follows the Front-Page-of-the-Newspaper test as a guide for his businesses.

Question 22

"That's the way it has always been done," is a phrase that often signals ethical difficulties.

Question 23

"Everybody else does it" is a valid test for determining whether conduct is ethical.

Question 24

The level of cheating in high schools and colleges is declining.

Question 25

"I was just following orders," is a defense in law and a test for ethical behavior.

Question 26

An ombudsperson and/or ethics hotline are both critical to an ethical culture in a company.

Question 27

Ethics can provide a strategic advantage for companies.

Question 28

In the Parable of the Sadhu, the hikers' climb is successful.

Question 29

A company that self-reports a legal violation risks a higher penalty.

Question 30

Sexual harassment is a form of interpersonal as well as organizational abuse.

Question 31

Compliance with the law meets all ethical standards.

Question 32

Having a code of ethics does not reduce a company's sentence under the federal sentencing guidelines.

Question 33

A 2012 Joseph Institute study found nearly half of high school students copied homework from other students.

Question 34

In the Parable of the Sadhu, the hikers are certain the religious pilgrim survived.

Question 35

Sarbanes-Oxley is the most extensive regulation of companies since the 1933 and 1934 Securities laws.

Question 36

Rationalization is an effective means of analysis for ethical issues.

Question 37

An anonymous reporting system is a requirement for companies under Sarbanes-Oxley.

Question 38

The first question of the Wall Street Journal model is whether the conduct complies with the law.

Question 39

The least corrupt countries have the most stable economies.

Question 40

A relativist asks why someone is engaged in unethical or illegal conduct before determining whether the conduct is right or wrong.

Question 41

When Danica Patrick stated she would take performance-enhancing drugs if she would never get caught, she was just saying what everyone else does in a highly competitive field, so it is not unethical.

Question 42

Ethics consists of the unwritten rules we apply in both business and personal lives.

Question 43

Once a legal loophole has been used to the advantage of business and the disadvantage of a customer, the number of options for self-regulation declines.

Question 44

Conflicts of interest can result in the use of quid pro quo.

Question 45

The either/or conundrum is an example of moral relativism.

Question 46

The 2012 corruption index shows that Somalia is considered the most corrupt country.

Question 47

"When in Rome, do as the Romans do," is an example of moral relativism.

Question 48

Corruption impedes economic development.

Question 49

To obtain the protections and benefits of the sentencing guidelines, companies must have a code of ethics.

Question 50

The statement, "What's good for GM is good for the country," is an example of the thoughts of a manager from the:

A) inherence school.
B) enlightened self-interest school.
C) social responsibility school.
D) invisible hand school.

Question 51

Pressure contributes to the use of the either/or test for resolving ethical dilemmas.

Question 52

"It's a gray area," if it applies, means that the conduct you are evaluating is ethical, so long as you stay in the gray
area.

Question 53

Rationalization is one form of ethical analysis.

Question 54

Training employees in ethics is a factor that reduces a company's sentence under the federal sentencing guidelines.

Question 55

When Hilton Hotels hired Ross Klein and Amar Lalvani from Starwood Hotels, Klein and Lalvani took many electronic documents with them from Starwood. What they did was simply good business and presented no ethical problems.

Question 56

Ethics are key to the success of economic systems.

Question 57

To obtain the protections and benefits of the sentencing guidelines, companies must have some form of anonymous reporting.

Question 58

The "Tony Bennett Factor" refers to the importance of adhering to values as a key to long­term success.

Question 59

According to the 2012 Corruption Perception Index, which country is perceived as the least corrupt?

A) Denmark
B) Somalia
C) New Zealand
D) Iceland

Question 60

The regulatory cycle provides an opportunity for self-regulation during the latency stage.

Question 61

The "front page of the newspaper test":

A) was developed by Laura Nash.
B) is the same as the Wall Street Journal test.
C) was developed by Blanchard/Peale.
D) uses the perspective of an objective reporter.

Question 62

Which of the following is not an ethical breach?

A) taking things that do not belong to you
B) giving or allowing false impressions
C) perpetrating interpersonal abuse
D) All of the above are ethical breaches.

Question 63

Which of the following statements is true about an ethical business?

A) It will always be profitable.
B) It will always satisfy all stakeholders.
C) It will always survive over the long run.
D) It will avoid the consequences of unethical behavior.

Question 64

Which of the following is not a question for the Blanchard/Peale test for ethical behavior?

A) Is it legal?
B) Does it follow industry code?
C) Is it balanced?
D) How does it make me feel?

Question 65

A law firm in the Phoenix area provides "sick care" for employees' children. Sick care can be used when the child is too ill to go to school or its regular care facility. The law firm manager claims the program has cut down on sick days taken by employees to care for sick children. The program is an illustration of which type of social responsibility school?

A) inherence school
B) enlightened self-interest school
C) invisible hand school
D) social responsibility school

Question 66

The invisible hand school and the inherence school:

A) both serve society primarily.
B) both refuse involvement in social issues.
C) are proactive in legislation for social issues.
D) believe long-term success comes from social responsibility.

Question 67

A parents' group and the National Association of Teachers is concerned about the lyrics on the albums of some rock music groups and has expressed the concern publicly. Capitol Records adopted a voluntary labeling system that provides warning labels on albums that contain explicit lyrics about sex, drugs, or satanic worship. Capitol's action is an example of a:

A) nonmandated ethical response.
B) waste of shareholder dollars according to Milton Friedman.
C) violation of shareholder rights.
D) none of the above

Question 68

Which of the following is not a benefit of using ethics as a business strategy?

A) firm's profits increase
B) affords opportunity for planning
C) creates goodwill in the community
D) All of the above are benefits.

Question 69

Which of the following models has a question that requires analysis of the effect of a decision on stakeholders?

A) Blanchard/Peale
B) Wall Street Journal model
C) Does the conduct comply with the law?
D) all of the above

Question 70

Under which of the schools is the corporation best served by serving only the shareholders?

A) inherence school
B) enlightened self-interest school
C) invisible hand school
D) social responsibility school

Question 71

A manager at a chemical weapons plant discovered that toxic by-products from chemical manufacturing at the plant are simply put in barrels and stacked near the boundary lines of the plant property. Children in the homes near these boundaries have an unusually high rate of kidney disease. The manager does not want to disclose the barrels' contents because he will lose his job and the town will lose its major employer. Which of the following ethical tests would support the manager's decision?

A) Wall Street Journal model
B) ethical relativism
C) Blanchard/Peale model
D) "front page of the newspaper test"

Question 72

Which of the following is not always a result of unethical behavior?

A) loss of trust
B) loss of goodwill
C) loss of profits
D) strained relations with regulators

Question 73

Milton Friedman's philosophy on corporate behavior is:

A) a business serves its shareholders best by serving the community.
B) a business serves its shareholders best by serving society at large.
C) a business serves its shareholders best by serving regulatory interests.
D) a business serves its shareholders best by serving shareholders.

Question 74

Which of the following is not an indication of a company environment ripe for unethical behavior?

A) intense competition threatening survival
B) employees with few or no personal values
C) employees who are independent
D) compensation incentive system tied only to sales

Question 75

Which school most parallels the Friedman model for social responsibility?

A) inherence school
B) enlightened self-interest school
C) invisible hand school
D) social responsibility school

Question 76

An inherence school company would become involved in a residential property tax for schools only if:

A) the community would benefit from the tax.
B) government leaders are in favor of the tax.
C) the issue would affect the company's performance.
D) community leaders favored it.

Question 77

Which of the following is not a consequence of poor ethical choices by company?

A) loss of reputation
B) loss of earning power
C) additional regulation
D) All of the above are consequences of poor ethical choices.

Question 78

The policy on travel reimbursement at Public Service Company is that receipts for meals under $25.00 are not required. Internal auditors at Public Service have recently discovered that 80 percent of all meal submissions are in a range from $12.50 to $12.99. When one manager is questioned about his submissions and those of his employees he responds, "So, they make a little bit on meals - it helps their miserable salaries." The manager's evaluation:

A) demonstrates an ethical commitment to his employees.
B) is ethical since no one is really harmed.
C) demonstrates a lapse in the company's ethical culture.
D) is an example of Christian consequentialism.

Question 79

An employer instituted a wellness program for all employees. The wellness program includes an exercise facility and several pay incentives for losing weight, quitting smoking, or beginning an exercise program. The program is not required under any state or national laws. Which of the following schools of social responsibility applies to this employer?

A) inherence school
B) enlightened self-interest school
C) invisible hand school
D) social responsibility school

Question 80

Which of the following actions would be permitted under the Friedman philosophy of business involvement in social issues?

A) a corporate contribution to a shelter program for runaway teenagers
B) a corporate contribution to a pro-choice organization
C) a corporate contribution to Mother Teresa's worldwide organization
D) a corporate contribution to a mass transit system that will serve the offices of the company throughout the city