Question 1 2 points Save
What is the primary concern of a board of directors?
To determine whether or not to pay dividends to stockholders
To watch out for the interests of the employees
To develop short-term goals for the company
To make decisions about how to run the day-to-day affairs of the business
To monitor the decisions made by managers on behalf of the company
Question 2 2 points Save
How can a company align the interests of owners with managers through executive compensation?
By significantly reducing executive pay across the board
By setting executive compensation at a level equal to the industry average
By linking compensation to company performance and achievement of goals
By basing salaries on seniority with the company in order to increase longevity
By capping executive compensation at ten times that of the lowest paid employee
Question 3 2 points Save
One of the most effective methods of ethics training is
getting employees involved in resolving ethical dilemmas that relate to actual situations in the workplace.
discussing cognitive moral development.
providing a video of the ethics officer.
providing a CD-ROM of material for employees to view on their own.
testing employees on the code of conduct.
Question 4 2 points Save
Which of the following is not normally considered a primary stakeholder?
Business partners
Community
Employees
Employees
Media
Question 5 2 points Save
Which of the following statements best reflects a strategic approach to creating and maintaining an ethical corporate culture?
“Reducing unethical behavior is a business goal no different from increasing profits.”
“Our code of conduct is window-dressing.”
“Hiring and promoting good, ethical managers will automatically produce an ethical organization.”
“A decentralized approach to decision-making produces the most ethical corporate culture.”
“People are raised with strong personal values and should use them at work to resolve ethical conflict.”
Question 6 2 points Save
Minimal responsibility primarily involves
fulfilling social responsibilities including legal and ethical guidelines.
incorporating efforts in such a way as to benefit all stakeholders of the company.
satisfying the primary stakeholders regardless of the possible legal implications.
trying to maximize stockholder wealth.
addressing the concerns of contractual stakeholders in regards to legal and economic matters.
Question 7 2 points Save
Which of the following is not one of the four types of corporate social responsibility?
Philanthropic
Economic
Environmental
Ethical
Legal
Question 8 2 points Save
By banning the importation of goods made by children under the age of 15 through indentured or forced labor, the U.S. government exercised which type of power?
Legal
Symbolic
Legitimate
Utilitarian
Coercive
Question 9 2 points Save
When Nine West Group was found to have violated antitrust laws, they were required to do all of the following except
pay millions of dollars in fines.
stop including manufacturer’s suggested retail prices in product sales literature.
stop fixing dealer prices.
satisfy record keeping provisions to ensure future compliance.
not threaten to limit supplies to dealers that adopt their own resale prices.
Question 10 2 points Save
Corporate governance requires a system of _________ similar to the distribution of power between the executive, legislative, and judiciary branches of the U.S. government.
goals and values
priorities and divisions
decision making authorities
division of labor
checks and balances
Question 11 2 points Save
Which of the following is least likely to be considered destructive or unfair competition?
Stealing competitors’ trade secrets
Using a “bait and switch” method for selling products to customers
Collaborating with a competitor to establish prices so that each firm can ensure a certain level of profit
Obtaining information through competitive intelligence
Lowering prices significantly in an effort to drive competitors out of a market, and then raising prices afterwards
Question 12 2 points Save
Which of the following best describes the Better Business Bureau (BBB)?
The BBB is a federal government agency that helps resolve problems between businesses and consumers.
The BBB is a published list of companies to avoid doing business with due to their poor business practices.
The BBB is a state agency that helps resolve problems between businesses and consumers.
The BBB is a network of agencies that assesses financial penalties against unethical businesses.
The BBB is a self-regulatory association that helps resolve problems between businesses and consumers.
Question 13 2 points Save
Which of the following is not likely to be a benefit from an ethics training program?
To educate employees about the firm’s ethical policies and expectations
To make employees aware of available resources
To empower employees to ask tough questions and make ethical decisions
To ensure that employees’ personal values are in line with those of the organization
To demonstrate the importance the organization places on ethics
Question 14 2 points Save
What is the purpose of the Organisation for Economic Co-operation and Development’s (OECD) Corporate Governance Principles?
To override individual countries’ practices and implement identical policies throughout the forum’s members
To place most of the responsibility for corporate governance on the company’s managers
To outline an optimal system of corporate governance techniques that every developed country should strive to duplicate
To ensure the members of boards of directors are carefully selected to protect the interests of all stakeholders
To formulate minimum standards of fairness, accountability, transparency, and responsibility in business practice
Question 15 2 points Save
In the “bad apple-bad barrel” analogy,
a code of conduct is not taken seriously as a key component of an ethics program.
the code of conduct is used to solve all ethical dilemmas faced in the workplace.
“bad apples” refer to an unethical corporate culture.
no one has the right to label some conduct as unethical.
“bad apples” are people who will always do things in their own self-interest regardless of organizational standards of conduct.
Question 16 2 points Save
Which of the following is the best description of the possible legal ramifications of poor business conduct?
It is important to have an organizational mechanism for resolving all questionable issues.
Legal issues are usually cut and dry since the law has either been violated or has not been violated.
Legal issues brought by stakeholders outside of the organization are almost always resolved within the organization.
Ethical issues rarely become so important that they reach the courtroom for resolution.
The most cost effective way to resolve disputes is through the court system.
Question 17 2 points Save
Conflicts of interest exist when employees must choose whether to
report an unethical coworker.
accept bribes.
advance the interests of the organization or those of society.
advance their own interests, those of the organization, or those of some other group.
carry out an assignment they perceive as unethical.
Question 18 2 points Save
In the 1990s, employees turned to a more holistic approach to work and life, characterized by all of the following, except
finding a balance between work and personal responsibilities and time.
an interest in human and intellectual capital.
a decrease in dual-working parent families.
employee volunteerism in the community.
trust in the workplace.
Question 19 2 points Save
For a local beauty shop that is a privately owned business, which of the following is not likely to be a stakeholder?
Suppliers of hair coloring solutions
Tax authorities
Customers
Other businesses in the same neighborhood and shopping center
The New York Stock Exchange (NYSE)
Question 20 2 points Save
What are the three primary factors that together influence the ethical decision-making process?
Stakeholder relationships, trust, and corporate culture
Society, profits, and longevity
Personal ethics, group ethics, and business ethics
Values, norms, and regulations
Opportunity, individual factors, and organizational relationships
Question 21 2 points Save
Which of the following is the best way for a stakeholder to gain legitimacy?
Insisting that your group’s interests are extremely important to society in general
Letting the media know the horrible things the company has done so that the rest of the world will know
Making claims that you feel are reasonable, regardless of the view of other stakeholders
Exploring the issue from a variety of perspectives and then communicating your desires for change in a respectful manner
Committing acts of violence to show the company and the community that you are serious
Question 22 2 points Save
Which of the following statements best describes the current trends in corporate governance?
Businesses are moving towards a stakeholder orientation with looser corporate governance.
Businesses are gravitating towards the stakeholder orientation because the costs involved are decreasing.
Most companies are already using a shareholder orientation with formal governance.
Companies are turning to a shareholder orientation with a more informal corporate governance system.
Forces are driving businesses toward the stakeholder orientation and more formal governance.
Question 23 2 points Save
When fundamental expectations about social responsibility are not met by publicly-traded companies,
the government is most likely to pursue a self-regulatory approach with these firms.
stock markets perform better.
there is no effect on investors, customers, employees and business partners.
there is little that any stakeholder can do to remedy the situation.
the confidence that investors have in corporations, mutual fund managers, market analysts, and others will be severely tested.
Question 24 2 points Save
The Pet Food Institute, the Tobacco Institute, and the American Booksellers Association are all examples of
trade unions.
special-interest groups.
trade associations.
umbrella organizations.
PACs.
Question 25 2 points Save
Which of the following statements is true about codes of conduct?
Codes are informal ideals about organizational expectations.
Few organizations have written ethical guidelines.
Codes are designed to resolve every ethical dilemma a company may face.
Codes are mostly standardized throughout all industries.
Codes are formal statements describing organizational expectations.
Question 26 2 points Save
In the long run, the success of a company is built on
a company’s ability to negotiate with suppliers and vendors.
long-term relationships with customers built on mutual respect and cooperation that leads to repeat purchasing.
innovative integrated marketing communications programs.
a company’s commitment to be on the leading edge of technology.
its efficiency in operations.
Question 27 2 points Save
The ________ model represents the current view of the relationship between a firm and the groups that both affect and are influenced by the firm.
output
society
shareholder
input
stakeholder
Question 28 2 points Save
According to Kohlberg’s model, moral development
is focused primarily on each individual’s needs.
depends mostly on the first few years of a person’s life.
can be defined as six unrelated stages that a person progresses through.
differs for each individual, resulting in no universal values.
is accelerated by gaining education and experience in resolving conflicts.
Question 29 2 points Save
About half of the issues raised on ethics help or assistance lines relate to
improper quality standards.
questions about top management’s behavior.
human resource issues and complaints.
advertising and marketing concerns.
accounting and financial misrepresentations.
Question 30 2 points Save
Which of the following is not one of the components of the reputation management process?
Impression
Organizational identity
Reputation
Performance
Image
Question 31 2 points Save
“…corporations are bound by the law, and by the rules of what you might call ordinary decency. Beyond this however, they have no duty to pursue the collective goals of society.” This statement exemplifies which approach?
Shareholder model of corporate governance
Efficiency maximization goal of the firm
Broader conceptualization of corporate governance
Ethical approach of corporate governance
Stakeholder model of corporate governance
Question 32 2 points Save
What asset resides in relationships, is characterized by mutual goals and trust, and smoothes internal and external transactions and processes?
Relationship capital
Interpersonal capital
Social capital
Financial capital
Intellectual capital
Question 33 2 points Save
Which moral classification considers a decision right or acceptable if it accomplishes a desired result such as pleasure, knowledge, career growth, or utility?
Ethical formalism
Consequentialism
Justice
Egoism
Results theory
Question 34 2 points Save
Making voluntary contributions of money, time, and other resources to improve the community most closely resembles which type of social responsibility?
Economic
Ethical
Philanthropic
Environmental
Legal
Question 35 2 points Save
Which of the following is not one of the responsibilities that will affect boards of directors in the future?
Serving on boards will require less of a commitment than in the past.
Boards will need to work more effectively as teams.
The selection of board members will become increasingly formalized.
Annual reports and other company documents will include more nonfinancial information.
Boards will be responsible for developing company purpose statements that cover a range of aims and stakeholder concerns.
Question 36 2 points Save
About how many consumers said they would be likely to switch to brands associated with a good cause, if price and quality were equal?
Less than 5 percent
20 percent
40 percent
50 percent
80 percent
Question 37 2 points Save
Environmental regulations for social reasons have been necessary because of which of the following reasons?
Companies have felt pressured to “voluntarily” pay for environmental protection acts because they are afraid of the impact on their businesses if they are not viewed as environmentally responsible organizations.
Most companies eagerly pay for the costs involved with protecting their environment because they realize their future is closely linked with the future of the environment.
Consumers have willingly footed the bill for the costs of protecting the environment through paying higher prices for products and services.
Social reasons have led to regulations such as environmental protection and preservation because, although most companies voluntarily take on these responsibilities, a few companies have shirked their share of the responsibility.
Social reasons have led to regulations such as environmental protection since most companies are unwilling to pay for these costs voluntarily.
Question 38 2 points Save
According to reports published in Business Week and other sources, the best boards of directors
are not compensated.
are found in Japanese and European countries.
are generally more independent and more active than other boards.
rarely own stock in the company.
rate high on independence but low on innovation.
Question 39 2 points Save
In the United States, the major role that society delegates to government is to
keep prices of products low so that all consumers can purchase convenience and luxury goods.
provide laws based on the Constitution and Bill of Rights and enforce laws through the judicial system.
create more jobs.
encourage larger companies to conduct business in many other countries.
encourage competition by providing economic support to smaller companies in order to be competitive with powerful companies.
Question 40 2 points Save
The most basic of business ethical standards
have been uniformly implemented through every firm’s ethics code.
include developing trust in all business relationships.
are centered around the mutual desire to protect the environment.
have been codified as laws and regulations.
demonstrate a company’s desires to address the needs of society.
Question 41 2 points Save
Many claimed that Microsoft’s dominance in the computer operating systems market violated which corporate social responsibility?
Ethical
Economic
Environmental
Legal
Philanthropic
Question 42 2 points Save
Which type of investor causes the most problem for CEOs in developing strategic plans?
Institutional investors
Shareholders willing to sacrifice short-term gains for long-term income
Global investors who don’t understand the business
Employees who own stock
Shareholders seeking short-term gains
Question 43 2 points Save
Which of the following is not a method that the Federal Trade Commission (FTC) uses to influence business activities?
The FTC can file criminal charges against companies that break antitrust laws.
The FTC can seek civil penalties against an offending company.
The FTC can issue a formal complaint stating that a firm is in violation of the law.
The FTC helps to resolve complaints and issues rulings on areas of emerging concern in business.
The FTC can issue a cease-and-desist order that requires a company to stop engaging in a specified illegal behavior.
Question 44 2 points Save
Who are the principals and agents of a corporation?
Owners and executives, respectively
Customers and managers, respectively
Stockholders and employees, respectively
Managers and employees, respectively
Employees and stockholders, respectively
Question 45 2 points Save
When a company is denying responsibility and doing less than is required with a particular stakeholder, it is engaged in a(n) _____ strategy.
accommodative
defensive
inactive
proactive
reactive
Question 46 2 points Save
Which of the following is not a recommended step for changing the ethical culture of an organization?
Avoid the use of informal systems to communicate expectations
Avoid the perception of hidden agendas
State your position, philosophy or belief
Implement communications and education strategies
Reinforce the policy through measurements and rewards
Question 47 2 points Save
The process of working to persuade public and/or government officials to favor a particular position in decision making is known as
PAC.
special-interest pleading.
bribery.
lobbying.
influencing.
Question 48 2 points Save
What aspect of corporate culture relates to an organization’s expectations about appropriate conduct?
Ethical climate
Values
Regulations
Significant others
Organizational climate
Question 49 2 points Save
A behavioral simulation, or role play exercise, is a relatively new ethics training device that
has been found less effective than traditional lecture training methods.
recreates the complexities of organizational relationships and aids the development of analytical skills for resolving ethical issues.
requires the use of technology, including video and the computer.
can only be used in small organizations.
focuses on legal issues in the workplace and the skills that employees need to resolve legal concerns.
Question 50 2 points Save
Which of the following best describes ethics?
Choices and judgments about acceptable standards of conduct that guide the behavior of individuals and groups
Balancing the ever-changing and complex needs of society with the desire for profit
Beliefs held by all people
Guidelines that a company provides its employees to ensure that they will act in the best interest of society
Rules about how one should act in a business situation
