Deck 4: Ethics and Business Decision Making

Question 1

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

Answer 1

True

Question 2

If an action is ethical from an outcome-based perspective,then it cannot be ethical from a duty-based perspective.

Answer 2

False

Question 3

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

Answer 3

False

Question 4

Ethical standards based on religious teachings tend to be absolute.

Question 5

Corporate ethical policies must be clearly communicated to be effective.

Question 6

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

Question 7

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

Question 8

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

Question 9

Under the principle of rights theory,one person's principles are as "right" as another's.

Question 10

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

Question 11

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

Question 12

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

Question 13

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

Question 14

Simply obeying the law does not fulfill all ethical obligations.

Question 15

An action may be legal but not ethical.

Question 16

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

Question 17

Stock buybacks are illegal and serve no legitimate purposes.

Question 18

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

Question 19

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

Question 20

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

Question 21

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 22

Whirlwind Financial Corporation sends its executives to a resort in Mexico-at taxpayers' expense-to consider using the firm's cash to buy back its stock and thereby prop up the value.Many of its competitors are doing the same thing.One of the best ways to learn about the ethical responsibilities inherent in operating a business is to look at

A)the mistakes made by other companies.
B)the benefits of pursuing profit despite the appearance of impropriety.
C)the prevalence of a practice among other corporations.
D)who is footing the bill for a particular action.

Question 23

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 24

Straitway Company encourages its managers to behave ethically,reasoning that the employees will take their cues from management.One of the most important ways to create and maintain an ethical behavior workplace is for management to

A)demonstrate a commitment to ethical decision making.
B)discreetly engage in unethical or illegal acts.
C)look the other way when an employee engages in an unethical act.
D)direct employees to "do as we say,not as we do."

Question 25

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 26

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 27

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 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

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 30

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 31

Sunny Energy Corporation engages in ethical behavior solely for the purpose of getting good publicity and thereby increasing profits.Sunny 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 32

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 33

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 34

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 35

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

A)Fess.
B)Greenergy.
C)the fewest people.
D)the most people.

Question 36

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 37

BarBQ Sushi Taco Company considers the impact of its corporate decisions on various groups and often acts in the interest of a group that has a greater stake in a decision than BarBQ's shareholders.This is most likely to attract potential employees who are

A)investors focused on short-term profits.
B)irresponsible slackers.
C)politically-motivated complainers.
D)recent college graduates.

Question 38

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 39

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 40

Rio Business Corporation pays potential clients,including private foreign companies and the representatives of foreign labor organizations to facilitate business.If Rio knows that the payments will be passed on to a foreign government,this practice is

A)illegal if the payments violate the Foreign Corrupt Practices Act.
B)legal because a third party acts as a "go-between."
C)legal because private parties are involved on both sides of the deal.
D)legal because the payments are intended to facilitate business.

Question 41

Quixotic Corporation decides to respond to what it sees as a moral obligation to correct for past gender discrimination by adjusting pay differences among its male and female employees.Does this raise an ethical conflict among those employees ?Between the employer and the employees ?Between the corporation and its shareholders? If so,how should it be resolved?

Question 42

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?