Chap002
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Chap002

Course Number: BLAW 3201, Fall 2012

College/University: LSU

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Chapter 02 - Business Ethics Chapter 02 Business Ethics True / False Questions 1. Ethical conversation is primarily about finding the one and only right thing to do. True False 2. Business ethics is the application of ethics to the special problems and opportunities experienced by businesspeople. True False 3. The social responsibility of business consists only of the expectations employees have of employers....

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02 Chapter - Business Ethics Chapter 02 Business Ethics True / False Questions 1. Ethical conversation is primarily about finding the one and only right thing to do. True False 2. Business ethics is the application of ethics to the special problems and opportunities experienced by businesspeople. True False 3. The social responsibility of business consists only of the expectations employees have of employers. True False 4. Ethics is not an issue in accounting because of the primarily objective data involved in that field. True False 5. In some countries, businesses must pay bribes in order to receive legitimate supplies. True False 6. In an ethical analysis using the WPH Framework referenced in the text, owners are the most important stakeholders and should receive the greatest consideration in decision making regardless of the type of problem addressed. True False 7. The definition of stakeholder is the same as the definition of shareholder. True False 2-1 Chapter 02 - Business Ethics 8. The community in which a firm operates would not be considered a stakeholder of the firm. True False 9. Situational ethics is the same thing as ethical relativism. True False 10. Consequentialism provides a rigid set of rules to follow regardless of the situation. True False 11. Utilitarianism is a form of consequentialism. True False Multiple Choice Questions 12. Which of the following is the application of ethics to special problems and opportunities experienced by those in business? A. Situational ethics B. Consequentialism C. Business ethics D. Sarbanes-Oxley principles E. Business utilitarianism 13. Which of the following is the study and practice of decisions about what is good, or right? A. Morals B. Ethics C. Consequences D. Law E. Business 2-2 Chapter 02 - Business Ethics 14. A local Chamber of Commerce plans a seminar on "the social responsibility of business in our community." What does that term reference? A. The responsibility of business to make profit for shareholders. B. The responsibility of business to have annual meetings. C. The expectations that the community imposes on firms doing business inside its borders. D. The expectations of employees regarding wage rates. E. The expectations of management in regard to adequate utility resources. 15. Reference: "Environmental Concerns." Connie, the president of a company that makes paper, has a new interest in the environment. She recently went to a seminar on environmental dangers and has decided to take steps to clean things up. She started at home and has now felt compelled to change things at work. Connie had to face the fact that her company has been cheating and is not in compliance with applicable environmental regulations due to dumping in the nearby river. Her company has never been cited because it employs a very large number of people in the community, including the mayor's wife and the chief-of-police's brother. On her mission to clean things up, Connie has decided to go even further than the law requires and install the very latest environmental protections. When she announced her plan, the chair of the company's board of directors, Brooke, had a meeting with Connie. Brooke told Connie to analyze the situation carefully because the cost of the additional equipment would mean no dividend to shareholders and no raise for employees. Furthermore, Brooke told Connie that installing all the new equipment would result in higher prices for the company's paper produce and could bankrupt the company because of foreign competition. Brooke hinted that Connie could be fired if she persisted. Brooke suggested that Connie just be concerned with a minimal standard of ethics. Which of the following is the minimal standard that a business must meet in a consideration of business ethics suggested by Brooke? A. Decisions must be legal. B. Decisions must meet the criteria of a follower of deontology. C. Decisions must meet the criteria of a follower of utilitarianism. D. Decisions must receive a majority vote of acceptance by employees. E. Decisions must be legal and decisions must receive a majority vote of acceptance by employees. 2-3 Chapter 02 - Business Ethics 16. Which of the following is true, as reflected in the case of Rexford Kipps v. James Cailler, regarding the immunity of public officials? A. Public officials are absolutely immune from suit based on their actions. B. Government officials are entitled to qualified immunity insofar as their conduct does not violate clearly established statutory rights of which a reasonable person would have known. C. Government officials are entitled to qualified immunity insofar as their conduct does not violate clearly established constitutional rights of which a reasonable person would have known. D. Government officials are entitled to qualified immunity insofar as their conduct does not violate clearly established statutory or constitutional rights of which a reasonable person would have known. E. Government officials are entitled to qualified immunity insofar as their conduct does not violate the First Amendment of the U.S. Constitution. 17. What was the result in the case of Rexford Kipps v. James Cailler in which the coach claimed that he was wrongfully fired based on where his son chose to attend college and play football? A. The court ruled in favor of the coach on the basis that he was wrongfully terminated in violation of a state statute. B. The court ruled in favor of the coach on the basis that his firing was unfair. C. The court ruled in favor of the coach because his First Amendment rights were violated under the U.S. Constitution. D. The court ruled against the coach because he failed to complain in a timely manner. E. The court ruled against the coach finding that the actions of the defendant were objectively reasonable. 18. Which of the following is true regarding a corporate code of ethics? A. A corporate code of ethics provides definitive lists of right and wrong decisions. B. A well-managed corporation does not need a code of ethics. C. A well-managed corporation tries to provide ethical leadership by establishing codes of ethics. D. A corporate code of ethics is legally mandated in all states pursuant to state law. E. A corporate code of ethics is required by federal law. 2-4 Chapter 02 - Business Ethics 19. What is the system of "guanxi" used in China? A. It refers to a system of relationship building woven together by social ties. B. It refers to a system of strict ethical rules. C. It refers to a prohibition against criticism of government rules and regulations. D. It refers to a system by which business people attempt to avoid strict Chinese regulations. E. It refers to a system of smuggling. 20. What do the letters "WPH" mean in reference to the "WPH Framework for Business Ethics" discussed in the text? A. Who, Purpose, and How B. When, Plan, and How C. Why, Procedure, and Hope D. Where, Plan, and Hope E. Where, Procedure, and How 21. Which of the following is true under the WPH process of ethical decision making? A. The interest of management is ranked higher than that of employees when decisions are made. B. The interest of owners is ranked higher than that of both employees and management when decisions are made. C. When decisions are made, the interest of the community as a whole is considered last. D. The interest of management is ranked higher than that of employees when decisions are made, but the interest of owners is ranked higher than the interest of any group. E. None of the above is true. 22. Which of the following are stakeholders of a business? A. Shareholders B. Employees C. Customers D. Management E. All the above 2-5 Chapter 02 - Business Ethics 23. Reference: "Environmental Concerns." Connie, the president of a company that makes paper, has a new interest in the environment. She recently went to a seminar on environmental dangers and has decided to take steps to clean things up. She started at home and has now felt compelled to change things at work. Connie had to face the fact that her company has been cheating and is not in compliance with applicable environmental regulations due to dumping in the nearby river. Her company has never been cited because it employs a very large number of people in the community, including the mayor's wife and the chief-of-police's brother. On her mission to clean things up, Connie has decided to go even further than the law requires and install the very latest environmental protections. When she announced her plan, the chair of the company's board of directors, Brooke, had a meeting with Connie. Brooke told Connie to analyze the situation carefully because the cost of the additional equipment would mean no dividend to shareholders and no raise for employees. Furthermore, Brooke told Connie that installing all the new equipment would result in higher prices for the company's paper produce and could bankrupt the company because of foreign competition. Brooke hinted that Connie could be fired if she persisted. Brooke suggested that Connie just be concerned with a minimal standard of ethics. Which of the following would be a stakeholder in the above company? A. The community only B. The shareholders only C. Future generations only D. The community and shareholders only E. The community, shareholders, and future generations 24. Positive abstractions that capture our sense of what is good or desirable are called ______. A. Ethical ideas B. Values C. Conscience demands D. Desirable principles E. Action goals 25. Which of the following are values in the WPH process of ethical decision making? A. Freedom only B. Security only C. Efficiency only D. Freedom and security, but not efficiency E. Freedom, security, and efficiency 2-6 Chapter 02 - Business Ethics 26. The idea that we should interact with other people in a manner consistent with the manner in which we would like them to interact with us is called the ______. A. Equalization Rule B. Ethical Realization Rule C. Silver Rule D. Golden Rule E. Ten Commandments Rule 27. Reference: "Environmental Concerns" Connie, the president of a company that makes paper, has a new interest in the environment. She recently went to a seminar on environmental dangers and has decided to take steps to clean things up. She started at home and has now felt compelled to change things at work. Connie had to face the fact that her company has been cheating and is not in compliance with applicable environmental regulations due to dumping in the nearby river. Her company has never been cited because it employs a very large number of people in the community, including the mayor's wife and the chief-of-police's brother. On her mission to clean things up, Connie has decided to go even further than the law requires and install the very latest environmental protections. When she announced her plan, the chair of the company's board of directors, Brooke, had a meeting with Connie. Brooke told Connie to analyze the situation carefully because the cost of the additional equipment would mean no dividend to shareholders and no raise for employees. Furthermore, Brooke told Connie that installing all the new equipment would result in higher prices for the company's paper produce and could bankrupt the company because of foreign competition. Brooke hinted that Connie could be fired if she persisted. Brooke suggested that Connie just be concerned with a minimal standard of ethics. Connie decides to go forward with her plan to clean things up under the theory that she wants to treat others in the same manner that she wants to be treated. Under Connie's theory, if she did not understand the importance of the environmental improvements, she would want them to be thrust upon her. Connie's idea is best referred to as ______. A. The Golden Rule B. The Disclosure Principle C. The Help Peers Test D. The Sarbanes-Oxley Rule E. The Greenhouse Rule 2-7 Chapter 02 - Business Ethics 28. What is the name of the law signed by President Bush in the wake of several corporate accounting scandals? A. The Sarbanes-Oxley Act B. The Public Accounting Act C. The Certified Public Accounting Act D. The Whaley-Mallicoat Act E. The Corporate Scandal Act 29. Which of the following does the Public Company Accounting Oversight Board do? A. Ensure that auditors and public accounting firms compile accurate and truthful financial reports for the companies they audit. B. Require that companies devise a system that allows employees to report suspicions of unethical behavior. C. Require that the universalization test be used as the primary ethical guideline. D. Ensure that auditors and public accounting firms compile accurate and truthful financial reports for the companies they audit and also requires that companies devise a system that allows employees to report suspicions of unethical behavior. E. None of the above - there is no such board. 30. According to the text, which of the following may be a part of the "how" in the WPH process of decision making? A. Public disclosure B. Values C. Profit maximization D. Whistle-blowing E. All the above 31. The "public disclosure" test for ethical behavior is sometimes referred to as the ______ test. A. Television B. Powell C. Self-conscious D. Golden E. Primary 2-8 Chapter 02 - Business Ethics 32. The ______ for ethical behavior seeks consideration of what the world would be like if a decision is copied by everyone else. A. Golden rule B. Universalization test C. Public disclosure D. Relevant disclosure E. World rule 33. Which of the following is true regarding the universalization test for ethical behavior? A. It is the same as the public disclosure test. B. It has been discredited. C. It is the same as the golden rule test. D. It has been enacted into law by the Sarbanes-Oxley Act. E. None of the above. 2-9 Chapter 02 - Business Ethics 34. Reference: "Accounting Advice." Brad, a newly hired Certified Public Accountant, who barely passed his boards, was asked by a business client, a chief executive officer, about the effect of the Sarbanes-Oxley Act on an accounting issue. Brad assured the client that the client should not be concerned about the Act because it is very vague, unspecific, and difficult to understand. Brad told the CEO that in any event, the CEO could not be held personally responsible regardless of what happened because only company business was involved. Brad also told the CEO that there is no oversight involved with the act. Later that same day, a coworker of Brad discovered that the CEO had been involved in misstating some financial reports and had also destroyed financial documents to cover up fraud. An employee at the company, Laura, had informed the coworker. When the issue was mentioned to the CEO, he immediately fired Laura. Which of the following is true regarding Brad's statement that the CEO could not be held liable for violations of the act? A. Brad is correct. Under no circumstances can a CEO be held personally responsible for violations under the act. Any fines would be imposed upon the business entity. B. Brad is incorrect. The act provides for harsh penalties, and a CEO who knows that the company's financial reports are incorrect but claims that they are truthful, can be heavily fined. There are no penalties, however, for destruction of financial documents. C. Brad is incorrect. The act provides for harsh penalties, and a CEO who destroys or changes financial documents to mislead can be heavily fined. There are no penalties, however, for misstatements of a company's financial reports because the company is solely responsible for its statements. D. Brad is incorrect, but any fine against a CEO under the act cannot exceed a nominal amount of $1,000. E. Brad is incorrect. The act provides for harsh penalties, and a CEO who knows that the company's financial reports are incorrect but claims that they are truthful, can be heavily fined. Additionally, a CEO who destroys or changes financial documents to mislead can be heavily fined. 2-10 Chapter 02 - Business Ethics 35. Reference: "Accounting Advice." Brad, a newly hired Certified Public Accountant, who barely passed his boards, was asked by a business client, a chief executive officer, about the effect of the Sarbanes-Oxley Act on an accounting issue. Brad assured the client that the client should not be concerned about the Act because it is very vague, unspecific, and difficult to understand. Brad told the CEO that in any event, the CEO could not be held personally responsible regardless of what happened because only company business was involved. Brad also told the CEO that there is no oversight involved with the act. Later that same day, a coworker of Brad discovered that the CEO had been involved in misstating some financial reports and had also destroyed financial documents to cover up fraud. An employee at the company, Laura, had informed the coworker. When the issue was mentioned to the CEO, he immediately fired Laura. Which of the following is true regarding the Act and Laura's firing? A. The act does not provide protection for whistle-blowers such as Laura. B. The act provides protection for whistle-blowers only if it can be shown that a significant amount of money, in excess of $5,000, was involved in any misstatement. C. The act provides protection for whistle-blowers only if it can be shown that a significant amount of money, in excess of $10,000, was involved in any misstatement. D. The act provides protection for whistle-blowers who work for an accounting firm, but not for any other employees. E. Laura's whistle-blowing would be protected under the act, and her firing was illegal. 36. Reference: "Accounting Advice." Brad, a newly hired Certified Public Accountant, who barely passed his boards, was asked by a business client, a chief executive officer, about the effect of the Sarbanes-Oxley Act on an accounting issue. Brad assured the client that the client should not be concerned about the Act because it is very vague, unspecific, and difficult to understand. Brad told the CEO that in any event, the CEO could not be held personally responsible regardless of what happened because only company business was involved. Brad also told the CEO that there is no oversight involved with the act. Later that same day, a coworker of Brad discovered that the CEO had been involved in misstating some financial reports and had also destroyed financial documents to cover up fraud. An employee at the company, Laura, had informed the coworker. When the issue was mentioned to the CEO, he immediately fired Laura. Contrary to Brad's statement, does the Sarbanes-Oxley Act create a board of oversight; and, if so, what is its name? A. Brad is correct. No oversight board was created. B. A board called the Public Company Accounting Oversight Board was created by the Act. C. A board called the Public Accountability Commission was created by the Act. D. A board called the CPA Oversight Commission was created by the Act. E. A board called the Federal Accountability Commission was created by the Act. 2-11 Chapter 02 - Business Ethics 37. The ethical theory that requires that we evaluate the morality of an action by imagining ourselves in the position of the person facing the ethical dilemma is called ______. A. Situational ethics B. Ethical relativism C. Absolutism D. Consequentialism E. Relativity ethics 38. How is absolutism different from ethical relativism and situational ethics? A. It applies utilitarianism. B. It holds that a cost-benefit analysis should be applied. C. It holds that whether an action is moral does not depend on the perspective of the person facing the ethical dilemma. D. It applies virtue ethics. E. It applies corporate ethics principles. 39. Which of the following is true regarding the relationship between ethical relativism and situational ethics? A. Like ethical relativism, situational ethics requires that we evaluate the morality of an action by imagining ourselves in the position of the person facing the ethical dilemma. B. Like ethical relativism, situational ethics allows us to judge the actions of others. C. Both theories hold that once we put ourselves in another person's shoes, we can evaluate whether that person's action was ethical. D. These theories are the same. E. There is no relationship between ethical relativism and situational ethics. 2-12 Chapter 02 - Business Ethics 40. Which of the following describes the theory of ethical relativism? A. Its only principle is the denial of the existence of objective moral standards. B. It holds that individuals must evaluate actions on the basis of what they feel is best for themselves based upon objective moral standards. C. It holds that since morality is relative, we have a basis upon which to criticize the behavior of others as immoral. D. It denies the existence of objective moral standards, it holds that individuals must evaluate actions on the basis of what they feel is best for them, but it does not hold that morality is relative. E. It denies the existence of objective moral standards; it holds that individuals must evaluate actions on the basis of what they feel is best for them; it holds that since morality is relative, no one can criticize another's behavior as immoral. 41. Which of the following requires that we see murder as a moral action as long as the murderer believes that the action is best for him or her? A. Absolutism B. Deontology C. Categorical Imperative D. Uncertainty of Thought E. Ethical Relativism 42. Which of the following theory of ethics denies the existence of objective moral standards? A. Ethical relativism B. Absolutism C. Social responsibility D. Ethical absolutism E. Absolute theory 43. Which of the following is also referred to as ethical fundamentalism? A. Ethical relativism B. Absolutism C. Social responsibility D. Ethical absolutism E. Absolute theory 2-13 Chapter 02 - Business Ethics 44. Reference: "Fast Food Dilemma." Richard, who just started at his new job as an assistant manager at a fast-food restaurant, wants to make a good impression. He thinks that things are going great. On only the second day on the job, however, he sees his boss Jill, the manager, slink out of the restaurant with a big box of hamburger that she puts in her car and then speeds away. Richard is fairly certain that she did not pay for the hamburger. Richard asks advice of his best friend, Bruce; his girlfriend, Sally; his sister, Jenny; and his dad, Frank. Bruce says that there are no real objective standards and that Richard should just decide what is best for him. Sally says that Richard should focus on the consequences and focus on the greatest benefit to all involved. She believes that it will do no real harm for Richard to keep his mouth shut because the fast-food restaurant is making plenty of money and probably does not pay Jill enough anyway. Plus, getting in trouble with Jill could cause problems at work, and if Richard loses his job, Richard and Sally might have to put off their marriage. Jenny says that on balance the greatest good would be to tell Jill because stealing does not generally produce the greatest satisfaction. Richard's dad says that as a matter of principle Richard should tell Jill because stealing is simply wrong. Which of the following theories most accurately fits the advice given by Bruce? A. Deontology B. Act utilitarianism C. Rule utilitarianism D. Ethical relativism E. Virtue ethics 45. Which of the following tells business managers to examine all the potential actions in each situation and choose the action that yields the greatest amount of pleasure over pain for all involved? A. Deontology B. Rule utilitarianism C. Act utilitarianism D. Absolutism E. Virtue ethics 46. What is the basis of consequentialism? A. Deontology B. Categorical imperatives C. Inquiry into the consequences D. Disregard of consequences E. Act utilitarianism 2-14 Chapter 02 - Business Ethics 47. Kantian ethics is involved with which of the following ethical theories? A. Deontology B. Act utilitarianism C. Rule utilitarianism D. Absolutism E. Situational ethics 48. An ethical theory that urges managers to take those actions that provide the greatest pleasure after having subtracted the pain or harm associated with the action in question is called ______. A. Deontology B. Utilitarianism C. Kantian ethics D. Absolutism E. Ethical relativism 49. A business manager who deceives everyone because the manager believes that deception maximizes pleasure over pain in a given situation is acting consistently with which ethical theory? A. Act deontology B. Ethical relativism C. Act utilitarianism D. Ethical fundamentalism E. Rule utilitarianism 2-15 Chapter 02 - Business Ethics 50. Reference: "Fast Food Dilemma." Richard, who just started at his new job as an assistant manager at a fast-food restaurant, wants to make a good impression. He thinks that things are going great. On only the second day on the job, however, he sees his boss Jill, the manager, slink out of the restaurant with a big box of hamburger that she puts in her car and then speeds away. Richard is fairly certain that she did not pay for the hamburger. Richard asks advice of his best friend, Bruce; his girlfriend, Sally; his sister, Jenny; and his dad, Frank. Bruce says that there are no real objective standards and that Richard should just decide what is best for him. Sally says that Richard should focus on the consequences and focus on the greatest benefit to all involved. She believes that it will do no real harm for Richard to keep his mouth shut because the fast-food restaurant is making plenty of money and probably does not pay Jill enough anyway. Plus, getting in trouble with Jill could cause problems at work, and if Richard loses his job, Richard and Sally might have to put off their marriage. Jenny says that on balance the greatest good would be to tell Jill because stealing does not generally produce the greatest satisfaction. Richard's dad says that as a matter of principle Richard should tell Jill because stealing is simply wrong. Which of the following theories most accurately fits the advice given by Sally? A. Deontology B. Act utilitarianism C. Rule utilitarianism D. Ethical relativism E. Virtue ethics 2-16 Chapter 02 - Business Ethics 51. Reference: "Fast Food Dilemma." Richard, who just started at his new job as an assistant manager at a fast-food restaurant, wants to make a good impression. He thinks that things are going great. On only the second day on the job, however, he sees his boss Jill, the manager, slink out of the restaurant with a big box of hamburger that she puts in her car and then speeds away. Richard is fairly certain that she did not pay for the hamburger. Richard asks advice of his best friend, Bruce; his girlfriend, Sally; his sister, Jenny; and his dad, Frank. Bruce says that there are no real objective standards and that Richard should just decide what is best for him. Sally says that Richard should focus on the consequences and focus on the greatest benefit to all involved. She believes that it will do no real harm for Richard to keep his mouth shut because the fast-food restaurant is making plenty of money and probably does not pay Jill enough anyway. Plus, getting in trouble with Jill could cause problems at work, and if Richard loses his job, Richard and Sally might have to put off their marriage. Jenny says that on balance the greatest good would be to tell Jill because stealing does not generally produce the greatest satisfaction. Richard's dad says that as a matter of principle Richard should tell Jill because stealing is simply wrong. Which of the following theories most accurately fits the advice given by Jenny? A. Deontology B. Act utilitarianism C. Rule utilitarianism D. Ethical relativism E. Virtue ethics 2-17 Chapter 02 - Business Ethics 52. Reference: "Fast Food Dilemma." Richard, who just started at his new job as an assistant manager at a fast-food restaurant, wants to make a good impression. He thinks that things are going great. On only the second day on the job, however, he sees his boss Jill, the manager, slink out of the restaurant with a big box of hamburger that she puts in her car and then speeds away. Richard is fairly certain that she did not pay for the hamburger. Richard asks advice of his best friend, Bruce; his girlfriend, Sally; his sister, Jenny; and his dad, Frank. Bruce says that there are no real objective standards and that Richard should just decide what is best for him. Sally says that Richard should focus on the consequences and focus on the greatest benefit to all involved. She believes that it will do no real harm for Richard to keep his mouth shut because the fast-food restaurant is making plenty of money and probably does not pay Jill enough anyway. Plus, getting in trouble with Jill could cause problems at work, and if Richard loses his job, Richard and Sally might have to put off their marriage. Jenny says that on balance the greatest good would be to tell Jill because stealing does not generally produce the greatest satisfaction. Richard's dad says that as a matter of principle Richard should tell Jill because stealing is simply wrong. Which of the following theories most accurately fits the advice given by Frank? A. Deontology B. Act utilitarianism C. Rule utilitarianism D. Ethical relativism E. Virtue ethics 53. A business manager may consider it wrong to terminate a person whose spouse has terminal cancer because a firm has an absolute obligation to support its employees when they are vulnerable. The business manager is acting consistently with which ethical theory? A. Deontology B. Ethical relativism C. Act utilitarianism D. Ethical fundamentalism E. Rule utilitarianism 54. A person who believes that they should not cheat on a drug test because if everyone did so, the drug test would be meaningless is applying a[n] ______. A. Ethics of care B. Virtual analysis C. Cost-benefit analysis D. Fundamentalist approach E. Categorical imperative 2-18 Chapter 02 - Business Ethics 55. Which of the following helps explain why the principle of deontology may be difficult to apply? A. People disagree about what duties we owe to one another. B. People disagree about whether consequences are positive or negative. C. People disagree about the ethics of care. D. People disagree about what duties we owe to one another and also whether consequences are positive or negative. E. People disagree about what duties we owe to one another, whether consequences are positive or negative, and about the ethics of care. 56. The ethical system in which the development of virtues, or positive character traits such as courage, justice, and truthfulness, is the basis for morality is called ______. A. Absolutism decision B. Virtual analysis C. Virtue ethics D. Fundamentalist approach E. Categorical imperative 57. Which of the following consists of acting on the basis of the recognition that certain actions are right or wrong, regardless of their consequences? A. Act utilitarianism B. Rule utilitarianism C. Situational ethics D. Virtue ethics E. Deontology 58. What is a difficulty with the application of virtue ethics? A. The applicable categorical imperatives. B. The lack of agreement about the meaning of "the good life." C. The applicable principle of rights. D. The ethics of care analysis. E. Both the applicable categorical imperatives and the lack of agreement about the meaning of "the good life." 2-19 Chapter 02 - Business Ethics 59. The ______ adherents believe that when one individual, the caregiver, meets the needs of one other person, the cared-for party, the caregiver is helping to meet the needs of all the individuals who fall within the cared-for party's web of care. A. Deontology B. Utilitarianism C. Absolutism D. Virtue ethics E. Ethics of care 60. The ______ holds that the right course of action is the option most consistent with the building and maintaining of human relationships. A. Ethics of care B. Principle of virtue ethics C. Deontology D. Act utilitarianism E. Rule utilitarianism Essay Questions 61. Assume you are hired as the president of a new company. Write a code of ethics for the firm. 2-20 Chapter 02 - Business Ethics 62. Sally is the president of AAA Components, a company that makes small parts for the automotive industry. Customers of AAA components are primarily auto manufacturers. Sally's cousin, Frank, works at the company as a sales representative. A promotion to the sales manager position is open. Frank has applied and so has Susan, another sales representative. While both Frank and Susan are good employees, they are skilled in different areas. Susan is excellent with technology, with placing orders, and she does an excellent job in following through with order deficiencies. Frank, on the other hand, is better with customer relations, and customers seem to like him better. Sally would like to promote Frank but she has two concerns. Her first concern is that she does not want it to be perceived that she is being unfair because Frank is family. Her second concern is that she has a suspicion that some customers are somewhat prejudiced against Susan because she is female. Most customers with whom the sales representatives deal are male, and Sally suspects that they may give Frank more consideration than Sally. Define and discuss the WPH framework for business ethics, and within that framework propose a solution. Be sure to fully address the populations, purposes, and guidelines included within "W," "P," and "H." 63. Describe and explain the following ethical principles: (a). Ethical relativism (b). Situational ethics (c). Consequentialism (d). Deontology (e). Virtue ethics (f). Ethics of care 2-21 Chapter 02 - Business Ethics 64. Define and discuss virtue ethics and the ethics of care. 65. Milly's best friend and roommate, Sarah, is getting ready for a big date. Sarah had her hair and nails done, bought a new dress, and spent two hours getting ready. Just as Milly sees Sarah's date coming down the street, Sarah comes out and asks Milly how she looks. Unfortunately, the stylish did a terrible job, the nails are an odd shade of purple, and the new dress is extremely unflattering. Sarah has no time to change. Discuss what Milly would say and why under the following principles: (a). Deontology (b). Act utilitarianism (c). Rule utilitarianism (d). Virtue ethics 2-22 Chapter 02 - Business Ethics Chapter 02 Business Ethics Answer Key True / False Questions 1. (p. 17) Ethical conversation is primarily about finding the one and only right thing to do. FALSE Ethical conversation is less about finding the one and only right thing to do; it is about finding the better thing to do. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Business Ethics 2. (p. 17) Business ethics is the application of ethics to the special problems and opportunities experienced by businesspeople. TRUE Business ethics is the application of ethics to the special problems and opportunities experienced by businesspeople. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Business Ethics and Social Responsibility 2-23 Chapter 02 - Business Ethics 3. (p. 18) The social responsibility of business consists only of the expectations employees have of employers. FALSE The social responsibility of business consists of the expectations that the community imposes on firms doing business inside its borders. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Business Ethics and Social Responsibility 4. (p. 18) Ethics is not an issue in accounting because of the primarily objective data involved in that field. FALSE The social responsibility of business consists of the expectations that the community imposes on firms doing business inside its borders. These expectations must be honored to a certain extent, even when a firm wishes to ignore them, because firms are always subject to the implicit threat that legislation will impose social obligations on them. 2-24 Chapter 02 - Business Ethics AACSB: Ethics Bloom's: Understand Difficulty: Hard Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Business Ethics and Social Responsibility 5. (p. 19) In some countries, businesses must pay bribes in order to receive legitimate supplies. TRUE In some countries, businesses must pay bribes to receive legitimate supplies. AACSB: Diversity Bloom's: Understand Difficulty: Medium Learning Objective: 02-02 How are business law and business ethics related? Topic: Business Ethics and Business Ethics 6. (p. 23) In an ethical analysis using the WPH Framework referenced in the text, owners are the most important stakeholders and should receive the greatest consideration in decision making regardless of the type of problem addressed. FALSE The WPH framework considers who the decision would affect, purpose (values), and how to make ethical decisions. AACSB: Ethics Bloom's: Apply Difficulty: Medium Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 2-25 Chapter 02 - Business Ethics 7. (p. 24) The definition of stakeholder is the same as the definition of shareholder. FALSE The stakeholders of a firm are the many groups of people affected by the firm's decisions. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 8. (p. 24) The community in which a firm operates would not be considered a stakeholder of the firm. FALSE The general community where a firm operates is a stakeholder of the firm. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 9. (p. 34) Situational ethics is the same thing as ethical relativism. FALSE Unlike ethical relativism, situational ethics allows us to judge other people's actions. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-26 Chapter 02 - Business Ethics 10. (p. 35) Consequentialism provides a rigid set of rules to follow regardless of the situation. FALSE In contrast to absolutism, consequentialism does not provide a rigid set of rules to follow regardless of the situation. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 11. (p. 35) Utilitarianism is a form of consequentialism. TRUE Utilitarianism is one form of consequentialism. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics Multiple Choice Questions 12. (p. 17) Which of the following is the application of ethics to special problems and opportunities experienced by those in business? A. Situational ethics B. Consequentialism C. Business ethics D. Sarbanes-Oxley principles E. Business utilitarianism Business ethics is the application of ethics to special problems and opportunities experienced by businesspeople. AACSB: Ethics Bloom's: Remember Difficulty: Easy Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Business Ethics and Social Responsibility 2-27 Chapter 02 - Business Ethics 13. (p. 17) Which of the following is the study and practice of decisions about what is good, or right? A. Morals B. Ethics C. Consequences D. Law E. Business Ethics is the study and practice of decisions about what is good, or right. AACSB: Ethics Bloom's: Remember Difficulty: Easy Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Business Ethics and Social Responsibility 14. (p. 18) A local Chamber of Commerce plans a seminar on "the social responsibility of business in our community." What does that term reference? A. The responsibility of business to make profit for shareholders. B. The responsibility of business to have annual meetings. C. The expectations that the community imposes on firms doing business inside its borders. D. The expectations of employees regarding wage rates. E. The expectations of management in regard to adequate utility resources. The social responsibility of business consists of the expectations that the community imposes on firms doing business inside its borders. AACSB: Ethics Bloom's: Understand Difficulty: Hard Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Business Ethics and Social Responsibility 2-28 Chapter 02 - Business Ethics 15. (p. 19) Reference: "Environmental Concerns." Connie, the president of a company that makes paper, has a new interest in the environment. She recently went to a seminar on environmental dangers and has decided to take steps to clean things up. She started at home and has now felt compelled to change things at work. Connie had to face the fact that her company has been cheating and is not in compliance with applicable environmental regulations due to dumping in the nearby river. Her company has never been cited because it employs a very large number of people in the community, including the mayor's wife and the chief-of-police's brother. On her mission to clean things up, Connie has decided to go even further than the law requires and install the very latest environmental protections. When she announced her plan, the chair of the company's board of directors, Brooke, had a meeting with Connie. Brooke told Connie to analyze the situation carefully because the cost of the additional equipment would mean no dividend to shareholders and no raise for employees. Furthermore, Brooke told Connie that installing all the new equipment would result in higher prices for the company's paper produce and could bankrupt the company because of foreign competition. Brooke hinted that Connie could be fired if she persisted. Brooke suggested that Connie just be concerned with a minimal standard of ethics. Which of the following is the minimal standard that a business must meet in a consideration of business ethics suggested by Brooke? A. Decisions must be legal. B. Decisions must meet the criteria of a follower of deontology. C. Decisions must meet the criteria of a follower of utilitarianism. D. Decisions must receive a majority vote of acceptance by employees. E. Decisions must be legal and decisions must receive a majority vote of acceptance by employees. The legality of the decision is the minimal standard that must be met. The existence of this minimum standard is essential for the development of business ethics. AACSB: Reflective Thinking Bloom's: Apply Difficulty: Medium Learning Objective: 02-02 How are business law and business ethics related? Topic: Business Law and Business Ethics 2-29 Chapter 02 - Business Ethics 16. (p. 20) Which of the following is true, as reflected in the case of Rexford Kipps v. James Cailler, regarding the immunity of public officials? A. Public officials are absolutely immune from suit based on their actions. B. Government officials are entitled to qualified immunity insofar as their conduct does not violate clearly established statutory rights of which a reasonable person would have known. C. Government officials are entitled to qualified immunity insofar as their conduct does not violate clearly established constitutional rights of which a reasonable person would have known. D. Government officials are entitled to qualified immunity insofar as their conduct does not violate clearly established statutory or constitutional rights of which a reasonable person would have known. E. Government officials are entitled to qualified immunity insofar as their conduct does not violate the First Amendment of the U.S. Constitution. Government officials are entitled to qualified immunity insofar as their conduct does not violate clearly established statutory or constitutional rights of which a reasonable person would have known. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-02 How are business law and business ethics related? Topic: Business Law and Business Ethics 2-30 Chapter 02 - Business Ethics 17. (p. 20) What was the result in the case of Rexford Kipps v. James Cailler in which the coach claimed that he was wrongfully fired based on where his son chose to attend college and play football? A. The court ruled in favor of the coach on the basis that he was wrongfully terminated in violation of a state statute. B. The court ruled in favor of the coach on the basis that his firing was unfair. C. The court ruled in favor of the coach because his First Amendment rights were violated under the U.S. Constitution. D. The court ruled against the coach because he failed to complain in a timely manner. E. The court ruled against the coach finding that the actions of the defendant were objectively reasonable. The court ruled that the defendant's action was reasonable based on the damage the son's attendance at another college would have on alumni relations and recruiting efforts. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-02 How are business law and business ethics related? Topic: Business Law and Business Ethics 18. (p. 21) Which of the following is true regarding a corporate code of ethics? A. A corporate code of ethics provides definitive lists of right and wrong decisions. B. A well-managed corporation does not need a code of ethics. C. A well-managed corporation tries to provide ethical leadership by establishing codes of ethics. D. A corporate code of ethics is legally mandated in all states pursuant to state law. E. A corporate code of ethics is required by federal law. Well-managed firms try to provide ethical leadership by establishing codes of ethics for the firm. The complications associated with managerial decisions do not permit any ethical guide to provide definitive lists of right and wrong decisions. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-02 How are business law and business ethics related? Topic: Business Law and Business Ethics 2-31 Chapter 02 - Business Ethics 19. (p. 22) What is the system of "guanxi" used in China? A. It refers to a system of relationship building woven together by social ties. B. It refers to a system of strict ethical rules. C. It refers to a prohibition against of criticism government rules and regulations. D. It refers to a system by which business people attempt to avoid strict Chinese regulations. E. It refers to a system of smuggling. "Guanxi" refers to a sort of relationship building and is an intricate system of interpersonal networks woven together by social ties. AACSB: Diversity Bloom's: Understand Difficulty: Medium Learning Objective: 02-02 How are business law and business ethics related? Topic: Business Law and Business Ethics 20. (p. 23) What do the letters "WPH" mean in reference to the "WPH Framework for Business Ethics" discussed in the text? A. Who, Purpose, and How B. When, Plan, and How C. Why, Procedure, and Hope D. Where, Plan, and Hope E. Where, Procedure, and How The WPH framework addresses whom a decision would affect, the purpose of the decision, and the guidelines on how to make ethical decisions. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 2-32 Chapter 02 - Business Ethics 21. (p. 23) Which of the following is true under the WPH process of ethical decision making? A. The interest of management is ranked higher than that of employees when decisions are made. B. The interest of owners is ranked higher than that of both employees and management when decisions are made. C. When decisions are made, the interest of the community as a whole is considered last. D. The interest of management is ranked higher than that of employees when decisions are made, but the interest of owners is ranked higher than the interest of any group. E. None of the above is true. The framework addresses whom a decision would affect, the purpose of the decision, and the guidelines on how to make ethical decisions. There is no reference to ranking stakeholders at a higher level. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 22. (p. 24) Which of the following are stakeholders of a business? A. Shareholders B. Employees C. Customers D. Management E. All the above The stakeholders of a firm are the many groups of people affected by the firm's decisions. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 2-33 Chapter 02 - Business Ethics 23. (p. 24) Reference: "Environmental Concerns." Connie, the president of a company that makes paper, has a new interest in the environment. She recently went to a seminar on environmental dangers and has decided to take steps to clean things up. She started at home and has now felt compelled to change things at work. Connie had to face the fact that her company has been cheating and is not in compliance with applicable environmental regulations due to dumping in the nearby river. Her company has never been cited because it employs a very large number of people in the community, including the mayor's wife and the chief-of-police's brother. On her mission to clean things up, Connie has decided to go even further than the law requires and install the very latest environmental protections. When she announced her plan, the chair of the company's board of directors, Brooke, had a meeting with Connie. Brooke told Connie to analyze the situation carefully because the cost of the additional equipment would mean no dividend to shareholders and no raise for employees. Furthermore, Brooke told Connie that installing all the new equipment would result in higher prices for the company's paper produce and could bankrupt the company because of foreign competition. Brooke hinted that Connie could be fired if she persisted. Brooke suggested that Connie just be concerned with a minimal standard of ethics. Which of the following would be a stakeholder in the above company? A. The community only B. The shareholders only C. Future generations only D. The community and shareholders only E. The community, shareholders, and future generations The stakeholders of a firm are the many groups of people affected by the firm's decisions. AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 2-34 Chapter 02 - Business Ethics 24. (p. 25) Positive abstractions that capture our sense of what is good or desirable are called ______. A. Ethical ideas B. Values C. Conscience demands D. Desirable principles E. Action goals Positive abstractions that capture our sense of what is good or desirable are called values. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 25. (p. 26) Which of the following are values in the WPH process of ethical decision making? A. Freedom only B. Security only C. Efficiency only D. Freedom and security, but not efficiency E. Freedom, security, and efficiency Exhibit 2-6; "Primary Values and Business Ethics" outlines an efficient way to apply this second step in the WPH framework referencing the values of freedom, security, justice, and efficiency. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 2-35 Chapter 02 - Business Ethics 26. (p. 27) The idea that we should interact with other people in a manner consistent with the manner in which we would like them to interact with us is called the ______. A. Equalization Rule B. Ethical Realization Rule C. Silver Rule D. Golden Rule E. Ten Commandments Rule The idea that we should interact with other people in a manner consistent with the manner in which we would like them to interact with us is called the Golden Rule. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 2-36 Chapter 02 - Business Ethics 27. (p. 27) Reference: "Environmental Concerns" Connie, the president of a company that makes paper, has a new interest in the environment. She recently went to a seminar on environmental dangers and has decided to take steps to clean things up. She started at home and has now felt compelled to change things at work. Connie had to face the fact that her company has been cheating and is not in compliance with applicable environmental regulations due to dumping in the nearby river. Her company has never been cited because it employs a very large number of people in the community, including the mayor's wife and the chief-of-police's brother. On her mission to clean things up, Connie has decided to go even further than the law requires and install the very latest environmental protections. When she announced her plan, the chair of the company's board of directors, Brooke, had a meeting with Connie. Brooke told Connie to analyze the situation carefully because the cost of the additional equipment would mean no dividend to shareholders and no raise for employees. Furthermore, Brooke told Connie that installing all the new equipment would result in higher prices for the company's paper produce and could bankrupt the company because of foreign competition. Brooke hinted that Connie could be fired if she persisted. Brooke suggested that Connie just be concerned with a minimal standard of ethics. Connie decides to go forward with her plan to clean things up under the theory that she wants to treat others in the same manner that she wants to be treated. Under Connie's theory, if she did not understand the importance of the environmental improvements, she would want them to be thrust upon her. Connie's idea is best referred to as ______. A. The Golden Rule B. The Disclosure Principle C. The Help Peers Test D. The Sarbanes-Oxley Rule E. The Greenhouse Rule The Golden Rule is referenced as the idea that we should interact with other people in a manner consistent with the way we would like them to interact with us. AACSB: Ethics Bloom's: Apply Difficulty: Hard Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 2-37 Chapter 02 - Business Ethics 28. (p. 29) What is the name of the law signed by President Bush in the wake of several corporate accounting scandals? A. The Sarbanes-Oxley Act B. The Public Accounting Act C. The Certified Public Accounting Act D. The Whaley-Mallicoat Act E. The Corporate Scandal Act The Corporate and Criminal Fraud Accountability Act, also known as the Sarbanes-Oxley Act, was signed by President Bush in 2002 in the wake of several corporate accounting scandals. AACSB: Ethics Bloom's: Remember Difficulty: Easy Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 29. (p. 29) Which of the following does the Public Company Accounting Oversight Board do? A. Ensure that auditors and public accounting firms compile accurate and truthful financial reports for the companies they audit. B. Require that companies devise a system that allows employees to report suspicions of unethical behavior. C. Require that the universalization test be used as the primary ethical guideline. D. Ensure that auditors and public accounting firms compile accurate and truthful financial reports for the companies they audit and also requires that companies devise a system that allows employees to report suspicions of unethical behavior. E. None of the above - there is no such board. This board is responsible for ensuring that auditors and public accounting firms compile accurate and truthful financial reports for the companies they audit. The act also requires that companies devise a system that allows employees to report suspicions of unethical behavior within the company. The act also protects these whistle-blowers from being fired or from retaliation by their employer for reporting a possible problem within the company. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 2-38 Chapter 02 - Business Ethics 30. (p. 23) According to the text, which of the following may be a part of the "how" in the WPH process of decision making? A. Public disclosure B. Values C. Profit maximization D. Whistle-blowing E. All the above Exhibit 2-4: The WPH Process of Ethical Decision Making. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 31. (p. 29) The "public disclosure" test for ethical behavior is sometimes referred to as the ______ test. A. Television B. Powell C. Self-conscious D. Golden E. Primary The "public disclosure" test for ethical behavior is sometimes referred to as the television test because it requires us to imagine that our actions are being broadcast on national television. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 2-39 Chapter 02 - Business Ethics 32. (p. 29) The ______ for ethical behavior seeks consideration of what the world would be like if a decision is copied by everyone else. A. Golden rule B. Universalization test C. Public disclosure D. Relevant disclosure E. World rule The universalization test for ethical behavior seeks consideration of what the world would be like if a decision is copied by everyone else. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 33. (p. 29) Which of the following is true regarding the universalization test for ethical behavior? A. It is the same as the public disclosure test. B. It has been discredited. C. It is the same as the golden rule test. D. It has been enacted into law by the Sarbanes-Oxley Act. E. None of the above. The universalization test for ethical behavior seeks consideration of what the world would be like if a decision is copied by everyone else. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 2-40 Chapter 02 - Business Ethics 34. (p. 29) Reference: "Accounting Advice." Brad, a newly hired Certified Public Accountant, who barely passed his boards, was asked by a business client, a chief executive officer, about the effect of the Sarbanes-Oxley Act on an accounting issue. Brad assured the client that the client should not be concerned about the Act because it is very vague, unspecific, and difficult to understand. Brad told the CEO that in any event, the CEO could not be held personally responsible regardless of what happened because only company business was involved. Brad also told the CEO that there is no oversight involved with the act. Later that same day, a coworker of Brad discovered that the CEO had been involved in misstating some financial reports and had also destroyed financial documents to cover up fraud. An employee at the company, Laura, had informed the coworker. When the issue was mentioned to the CEO, he immediately fired Laura. Which of the following is true regarding Brad's statement that the CEO could not be held liable for violations of the act? A. Brad is correct. Under no circumstances can a CEO be held personally responsible for violations under the act. Any fines would be imposed upon the business entity. B. Brad is incorrect. The act provides for harsh penalties, and a CEO who knows that the company's financial reports are incorrect but claims that they are truthful, can be heavily fined. There are no penalties, however, for destruction of financial documents. C. Brad is incorrect. The act provides for harsh penalties, and a CEO who destroys or changes financial documents to mislead can be heavily fined. There are no penalties, however, for misstatements of a company's financial reports because the company is solely responsible for its statements. D. Brad is incorrect, but any fine against a CEO under the act cannot exceed a nominal amount of $1,000. E. Brad is incorrect. The act provides for harsh penalties, and a CEO who knows that the company's financial reports are incorrect but claims that they are truthful, can be heavily fined. Additionally, a CEO who destroys or changes financial documents to mislead can be heavily fined. If the CEO or CFO knows that the company's financial reports are incorrect but claims they are truthful, or if he or she destroys or changes financial documents, the imposed fine can run into millions of dollars. AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 2-41 Chapter 02 - Business Ethics 35. (p. 29) Reference: "Accounting Advice." Brad, a newly hired Certified Public Accountant, who barely passed his boards, was asked by a business client, a chief executive officer, about the effect of the Sarbanes-Oxley Act on an accounting issue. Brad assured the client that the client should not be concerned about the Act because it is very vague, unspecific, and difficult to understand. Brad told the CEO that in any event, the CEO could not be held personally responsible regardless of what happened because only company business was involved. Brad also told the CEO that there is no oversight involved with the act. Later that same day, a coworker of Brad discovered that the CEO had been involved in misstating some financial reports and had also destroyed financial documents to cover up fraud. An employee at the company, Laura, had informed the coworker. When the issue was mentioned to the CEO, he immediately fired Laura. Which of the following is true regarding the Act and Laura's firing? A. The act does not provide protection for whistle-blowers such as Laura. B. The act provides protection for whistle-blowers only if it can be shown that a significant amount of money, in excess of $5,000, was involved in any misstatement. C. The act provides protection for whistle-blowers only if it can be shown that a significant amount of money, in excess of $10,000, was involved in any misstatement. D. The act provides protection for whistle-blowers who work for an accounting firm, but not for any other employees. E. Laura's whistle-blowing would be protected under the act, and her firing was illegal. The Sarbanes-Oxley Act protects whistle-blowers from being fired or from retaliation by their employer for reporting a possible problem within the company. AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 2-42 Chapter 02 - Business Ethics 36. (p. 29) Reference: "Accounting Advice." Brad, a newly hired Certified Public Accountant, who barely passed his boards, was asked by a business client, a chief executive officer, about the effect of the Sarbanes-Oxley Act on an accounting issue. Brad assured the client that the client should not be concerned about the Act because it is very vague, unspecific, and difficult to understand. Brad told the CEO that in any event, the CEO could not be held personally responsible regardless of what happened because only company business was involved. Brad also told the CEO that there is no oversight involved with the act. Later that same day, a coworker of Brad discovered that the CEO had been involved in misstating some financial reports and had also destroyed financial documents to cover up fraud. An employee at the company, Laura, had informed the coworker. When the issue was mentioned to the CEO, he immediately fired Laura. Contrary to Brad's statement, does the Sarbanes-Oxley Act create a board of oversight; and, if so, what is its name? A. Brad is correct. No oversight board was created. B. A board called the Public Company Accounting Oversight Board was created by the Act. C. A board called the Public Accountability Commission was created by the Act. D. A board called the CPA Oversight Commission was created by the Act. E. A board called the Federal Accountability Commission was created by the Act. The Sarbanes-Oxley Act created the Public Company Accounting Oversight Board. AACSB: Ethics Bloom's: Remember Difficulty: Easy Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 37. (p. 34) The ethical theory that requires that we evaluate the morality of an action by imagining ourselves in the position of the person facing the ethical dilemma is called ______. A. Situational ethics B. Ethical relativism C. Absolutism D. Consequentialism E. Relativity ethics Situational ethics requires that we evaluate the morality of an action by imagining ourselves in the position of the person facing the ethical dilemma. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-43 Chapter 02 - Business Ethics 38. (p. 34) How is absolutism different from ethical relativism and situational ethics? A. It applies utilitarianism. B. It holds that a cost-benefit analysis should be applied. C. It holds that whether an action is moral does not depend on the perspective of the person facing the ethical dilemma. D. It applies virtue ethics. E. It applies corporate ethics principles. Unlike ethical relativism and situational ethics, absolutism holds that whether an action is moral does not depend on the perspective of the person facing the ethical dilemma. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 39. (p. 34) Which of the following is true regarding the relationship between ethical relativism and situational ethics? A. Like ethical relativism, situational ethics requires that we evaluate the morality of an action by imagining ourselves in the position of the person facing the ethical dilemma. B. Like ethical relativism, situational ethics allows us to judge the actions of others. C. Both theories hold that once we put ourselves in another person's shoes, we can evaluate whether that person's action was ethical. D. These theories are the same. E. There is no relationship between ethical relativism and situational ethics. Like ethical relativism, situational ethics requires that we evaluate the morality of an action by imagining ourselves in the position of the person facing the ethical dilemma. AACSB: Ethics Bloom's: Understand Difficulty: Hard Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-44 Chapter 02 - Business Ethics 40. (p. 34) Which of the following describes the theory of ethical relativism? A. Its only principle is the denial of the existence of objective moral standards. B. It holds that individuals must evaluate actions on the basis of what they feel is best for themselves based upon objective moral standards. C. It holds that since morality is relative, we have a basis upon which to criticize the behavior of others as immoral. D. It denies the existence of objective moral standards, it holds that individuals must evaluate actions on the basis of what they feel is best for them, but it does not hold that morality is relative. E. It denies the existence of objective moral standards; it holds that individuals must evaluate actions on the basis of what they feel is best for them; it holds that since morality is relative, no one can criticize another's behavior as immoral. Ethical relativism denies the existence of objective moral standards; it holds that individuals must evaluate actions on the basis of what they feel is best for them; it holds that since morality is relative, no one can criticize another's behavior as immoral. AACSB: Ethics Bloom's: Understand Difficulty: Hard Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 41. (p. 34) Which of the following requires that we see murder as a moral action as long as the murderer believes that the action is best for him or her? A. Absolutism B. Deontology C. Categorical Imperative D. Uncertainty of Thought E. Ethical Relativism Ethical relativism denies the existence of objective moral standards. For example, ethical relativism requires that we see murder as a moral action as long as the murderer believes that the action is best for him or herself. Once a person accepts the appropriateness of criticizing behavior in some situations, the person has rejected ethical relativism and must develop a more complex ethical theory. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-45 Chapter 02 - Business Ethics 42. (p. 34) Which of the following theory of ethics denies the existence of objective moral standards? A. Ethical relativism B. Absolutism C. Social responsibility D. Ethical absolutism E. Absolute theory Ethical relativism is a theory of ethics that denies the existence of objective moral standards. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 43. (p. 34) Which of the following is also referred to as ethical fundamentalism? A. Ethical relativism B. Absolutism C. Social responsibility D. Ethical absolutism E. Absolute theory Absolutism, or ethical fundamentalism, requires that individuals defer to a set of rules to guide them in the ethical decision-making process. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-46 Chapter 02 - Business Ethics 44. (p. 34) Reference: "Fast Food Dilemma." Richard, who just started at his new job as an assistant manager at a fast-food restaurant, wants to make a good impression. He thinks that things are going great. On only the second day on the job, however, he sees his boss Jill, the manager, slink out of the restaurant with a big box of hamburger that she puts in her car and then speeds away. Richard is fairly certain that she did not pay for the hamburger. Richard asks advice of his best friend, Bruce; his girlfriend, Sally; his sister, Jenny; and his dad, Frank. Bruce says that there are no real objective standards and that Richard should just decide what is best for him. Sally says that Richard should focus on the consequences and focus on the greatest benefit to all involved. She believes that it will do no real harm for Richard to keep his mouth shut because the fast-food restaurant is making plenty of money and probably does not pay Jill enough anyway. Plus, getting in trouble with Jill could cause problems at work, and if Richard loses his job, Richard and Sally might have to put off their marriage. Jenny says that on balance the greatest good would be to tell Jill because stealing does not generally produce the greatest satisfaction. Richard's dad says that as a matter of principle Richard should tell Jill because stealing is simply wrong. Which of the following theories most accurately fits the advice given by Bruce? A. Deontology B. Act utilitarianism C. Rule utilitarianism D. Ethical relativism E. Virtue ethics According to ethical relativism, individuals must evaluate actions on the basis of what they feel is best for them. AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-47 Chapter 02 - Business Ethics 45. (p. 35) Which of the following tells business managers to examine all the potential actions in each situation and choose the action that yields the greatest amount of pleasure over pain for all involved? A. Deontology B. Rule utilitarianism C. Act utilitarianism D. Absolutism E. Virtue ethics Act utilitarianism tells business managers to examine all the potential actions in each situation and choose the action that yields the greatest amount of pleasure over pain for all involved. AACSB: Ethics Bloom's: Understand Difficulty: Hard Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 46. (p. 35) What is the basis of consequentialism? A. Deontology B. Categorical imperatives C. Inquiry into the consequences D. Disregard of consequences E. Act utilitarianism Consequentialism is a general approach to ethical dilemmas that requires that we inquire about the consequences to relevant people of our making a particular decision. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-48 Chapter 02 - Business Ethics 47. (p. 35) Kantian ethics is involved with which of the following ethical theories? A. Deontology B. Act utilitarianism C. Rule utilitarianism D. Absolutism E. Situational ethics When you see references to Kantian ethics, the analysis that follows the reference will be a discussion of the most famous of the deontological approaches to business ethics. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 48. (p. 35) An ethical theory that urges managers to take those actions that provide the greatest pleasure after having subtracted the pain or harm associated with the action in question is called ______. A. Deontology B. Utilitarianism C. Kantian ethics D. Absolutism E. Ethical relativism Like many consequentialist theories of ethics, utilitarianism urges managers to take those actions that provide the greatest pleasure after having subtracted the pain or harm associated with the action in question. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-49 Chapter 02 - Business Ethics 49. (p. 35) A business manager who deceives everyone because the manager believes that deception maximizes pleasure over pain in a given situation is acting consistently with which ethical theory? A. Act deontology B. Ethical relativism C. Act utilitarianism D. Ethical fundamentalism E. Rule utilitarianism According to act utilitarianism, a business manager who deceives an employee may be acting morally if the act of deception maximizes pleasure over pain for everyone involved. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-50 Chapter 02 - Business Ethics 50. (p. 35) Reference: "Fast Food Dilemma." Richard, who just started at his new job as an assistant manager at a fast-food restaurant, wants to make a good impression. He thinks that things are going great. On only the second day on the job, however, he sees his boss Jill, the manager, slink out of the restaurant with a big box of hamburger that she puts in her car and then speeds away. Richard is fairly certain that she did not pay for the hamburger. Richard asks advice of his best friend, Bruce; his girlfriend, Sally; his sister, Jenny; and his dad, Frank. Bruce says that there are no real objective standards and that Richard should just decide what is best for him. Sally says that Richard should focus on the consequences and focus on the greatest benefit to all involved. She believes that it will do no real harm for Richard to keep his mouth shut because the fast-food restaurant is making plenty of money and probably does not pay Jill enough anyway. Plus, getting in trouble with Jill could cause problems at work, and if Richard loses his job, Richard and Sally might have to put off their marriage. Jenny says that on balance the greatest good would be to tell Jill because stealing does not generally produce the greatest satisfaction. Richard's dad says that as a matter of principle Richard should tell Jill because stealing is simply wrong. Which of the following theories most accurately fits the advice given by Sally? A. Deontology B. Act utilitarianism C. Rule utilitarianism D. Ethical relativism E. Virtue ethics Act utilitarianism advises examining all the potential actions in each situation and choosing the action that yields the greatest amount of pleasure over pain for all involved. AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-51 Chapter 02 - Business Ethics 51. (p. 35) Reference: "Fast Food Dilemma." Richard, who just started at his new job as an assistant manager at a fast-food restaurant, wants to make a good impression. He thinks that things are going great. On only the second day on the job, however, he sees his boss Jill, the manager, slink out of the restaurant with a big box of hamburger that she puts in her car and then speeds away. Richard is fairly certain that she did not pay for the hamburger. Richard asks advice of his best friend, Bruce; his girlfriend, Sally; his sister, Jenny; and his dad, Frank. Bruce says that there are no real objective standards and that Richard should just decide what is best for him. Sally says that Richard should focus on the consequences and focus on the greatest benefit to all involved. She believes that it will do no real harm for Richard to keep his mouth shut because the fast-food restaurant is making plenty of money and probably does not pay Jill enough anyway. Plus, getting in trouble with Jill could cause problems at work, and if Richard loses his job, Richard and Sally might have to put off their marriage. Jenny says that on balance the greatest good would be to tell Jill because stealing does not generally produce the greatest satisfaction. Richard's dad says that as a matter of principle Richard should tell Jill because stealing is simply wrong. Which of the following theories most accurately fits the advice given by Jenny? A. Deontology B. Act utilitarianism C. Rule utilitarianism D. Ethical relativism E. Virtue ethics Rule utilitarianism holds that general rules that on balance produce the greatest amount of pleasure for all involved should be established and followed in each situation. AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-52 Chapter 02 - Business Ethics 52. (p. 36) Reference: "Fast Food Dilemma." Richard, who just started at his new job as an assistant manager at a fast-food restaurant, wants to make a good impression. He thinks that things are going great. On only the second day on the job, however, he sees his boss Jill, the manager, slink out of the restaurant with a big box of hamburger that she puts in her car and then speeds away. Richard is fairly certain that she did not pay for the hamburger. Richard asks advice of his best friend, Bruce; his girlfriend, Sally; his sister, Jenny; and his dad, Frank. Bruce says that there are no real objective standards and that Richard should just decide what is best for him. Sally says that Richard should focus on the consequences and focus on the greatest benefit to all involved. She believes that it will do no real harm for Richard to keep his mouth shut because the fast-food restaurant is making plenty of money and probably does not pay Jill enough anyway. Plus, getting in trouble with Jill could cause problems at work, and if Richard loses his job, Richard and Sally might have to put off their marriage. Jenny says that on balance the greatest good would be to tell Jill because stealing does not generally produce the greatest satisfaction. Richard's dad says that as a matter of principle Richard should tell Jill because stealing is simply wrong. Which of the following theories most accurately fits the advice given by Frank? A. Deontology B. Act utilitarianism C. Rule utilitarianism D. Ethical relativism E. Virtue ethics Deontology consists of acting on the basis of the recognition that certain actions are right or wrong, regardless of their consequences. AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-53 Chapter 02 - Business Ethics 53. (p. 35-36) A business manager may consider it wrong to terminate a person whose spouse has terminal cancer because a firm has an absolute obligation to support its employees when they are vulnerable. The business manager is acting consistently with which ethical theory? A. Deontology B. Ethical relativism C. Act utilitarianism D. Ethical fundamentalism E. Rule utilitarianism Deontology consists of acting on the basis of the recognition that certain actions are right or wrong, regardless of their consequences. For example, a business leader might consider it wrong to terminate a person whose spouse has terminal cancer because a firm has an obligation to support its employees when they are vulnerable. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 54. (p. 36) A person who believes that they should not cheat on a drug test because if everyone did so, the drug test would be meaningless is applying a[n] ______. A. Ethics of care B. Virtual analysis C. Cost-benefit analysis D. Fundamentalist approach E. Categorical imperative According to the categorical imperative, an action is moral only if it would be consistent for everyone in society to act in the same way. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-54 Chapter 02 - Business Ethics 55. (p. 36) Which of the following helps explain why the principle of deontology may be difficult to apply? A. People disagree about what duties we owe to one another. B. People disagree about whether consequences are positive or negative. C. People disagree about the ethics of care. D. People disagree about what duties we owe to one another and also whether consequences are positive or negative. E. People disagree about what duties we owe to one another, whether consequences are positive or negative, and about the ethics of care. Deontology is difficult to apply because people disagree about what duties we owe to one another and which duties are more important than others when they conflict. AACSB: Ethics Bloom's: Understand Difficulty: Hard Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 56. (p. 36) The ethical system in which the development of virtues, or positive character traits such as courage, justice, and truthfulness, is the basis for morality is called ______. A. Absolutism decision B. Virtual analysis C. Virtue ethics D. Fundamentalist approach E. Categorical imperative Virtue ethics is an ethical system in which the development of virtues, or positive character traits such as courage, justice, and truthfulness, is the basis for morality. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-55 Chapter 02 - Business Ethics 57. (p. 36) Which of the following consists of acting on the basis of the recognition that certain actions are right or wrong, regardless of their consequences? A. Act utilitarianism B. Rule utilitarianism C. Situational ethics D. Virtue ethics E. Deontology Deontology consists of acting on the basis of the recognition that certain actions are right or wrong, regardless of their consequences. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 58. (p. 37) What is a difficulty with the application of virtue ethics? A. The applicable categorical imperatives. B. The lack of agreement about the meaning of "the good life." C. The applicable principle of rights. D. The ethics of care analysis. E. Both the applicable categorical imperatives and the lack of agreement about the meaning of "the good life." A difficulty with the application of virtue ethics is the lack of agreement about the meaning of "the good life." AACSB: Ethics Bloom's: Understand Difficulty: Hard Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-56 Chapter 02 - Business Ethics 59. (p. 37) The ______ adherents believe that when one individual, the caregiver, meets the needs of one other person, the cared-for party, the caregiver is helping to meet the needs of all the individuals who fall within the cared-for party's web of care. A. Deontology B. Utilitarianism C. Absolutism D. Virtue ethics E. Ethics of care Ethics-of-care theorists argue that when one individual, the caregiver, meets the needs of one other person, the cared-for party, the caregiver is actually helping to meet the needs of all the individuals who fall within the cared-for party's web of care. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 60. (p. 37) The ______ holds that the right course of action is the option most consistent with the building and maintaining of human relationships. A. Ethics of care B. Principle of virtue ethics C. Deontology D. Act utilitarianism E. Rule utilitarianism The ethics of care holds that the right course of action is the option most consistent with the building and maintaining of human relationships. AACSB: Ethics Bloom's: Understand Difficulty: Medium Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-57 Chapter 02 - Business Ethics Essay Questions 61. (p. 21) Assume you are hired as the president of a new company. Write a code of ethics for the firm. Student responses may vary. The General Motors' Code of Business Conduct may serve as a guide. AACSB: Ethics Bloom's: Create Difficulty: Hard Learning Objective: 02-02 How are business law and business ethics related? Topic: Business Law and Business Ethics 62. (p. 23-27) Sally is the president of AAA Components, a company that makes small parts for the automotive industry. Customers of AAA components are primarily auto manufacturers. Sally's cousin, Frank, works at the company as a sales representative. A promotion to the sales manager position is open. Frank has applied and so has Susan, another sales representative. While both Frank and Susan are good employees, they are skilled in different areas. Susan is excellent with technology, with placing orders, and she does an excellent job in following through with order deficiencies. Frank, on the other hand, is better with customer relations, and customers seem to like him better. Sally would like to promote Frank but she has two concerns. Her first concern is that she does not want it to be perceived that she is being unfair because Frank is family. Her second concern is that she has a suspicion that some customers are somewhat prejudiced against Susan because she is female. Most customers with whom the sales representatives deal are male, and Sally suspects that they may give Frank more consideration than Sally. Define and discuss the WPH framework for business ethics, and within that framework propose a solution. Be sure to fully address the populations, purposes, and guidelines included within "W," "P," and "H." Students should reference the WPH process of decision making by identifying stakeholders, values, and guidelines. Students should also propose a solution. Solutions may vary. AACSB: Ethics Bloom's: Evaluate Difficulty: Hard Learning Objective: 02-03 How can we use the WPH framework for ethical business decisions? Topic: The WPH Framework for Business Ethics 2-58 Chapter 02 - Business Ethics 63. (p. 34-37) Describe and explain the following ethical principles: (a). Ethical relativism (b). Situational ethics (c). Consequentialism (d). Deontology (e). Virtue ethics (f). Ethics of care (a). Ethical relativism - Asserts that morality is relative. (b). Situational ethics - Requires that when we evaluate whether an action is ethical, we imagine ourselves in the position of the person facing an ethical dilemma. (c). Consequentialism - Considers the consequences (i.e., harms and benefits) of making a particular decision. (d). Deontology - Recognizes certain actions as right or wrong regardless of the consequences. (e). Virtue ethics - Encourages individuals to develop virtues (e.g. courage and truthfulness) that guide behavior. (f). Ethics of care - Holds that ethical behavior is determined by actions that care for and maintain human relationships. AACSB: Ethics Bloom's: Understand Difficulty: Hard Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 64. (p. 35-36) Define and discuss virtue ethics and the ethics of care. Virtue ethics is an ethical system in which the development of virtues, or positive character traits, is the basis for morality. Under this theory, the development of virtues occurs through practice. The ethics of care holds that the right course of action is the option most consistent with the building and maintaining of human relationships. According to this theory, when one person cares for another person, the first person is acting morally. AACSB: Ethics Bloom's: Understand Difficulty: Hard Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-59 Chapter 02 - Business Ethics 65. (p. 35-37) Milly's best friend and roommate, Sarah, is getting ready for a big date. Sarah had her hair and nails done, bought a new dress, and spent two hours getting ready. Just as Milly sees Sarah's date coming down the street, Sarah comes out and asks Milly how she looks. Unfortunately, the stylish did a terrible job, the nails are an odd shade of purple, and the new dress is extremely unflattering. Sarah has no time to change. Discuss what Milly would say and why under the following principles: (a). Deontology (b). Act utilitarianism (c). Rule utilitarianism (d). Virtue ethics Student answers will likely vary based upon the application of the facts to the ethical principles involved. Following are suggestions: (a). Under the principle of deontology, which consists of acting on the basis of the recognition that certain actions are right or wrong regardless of consequences, students will likely say that Sarah should be told the truth. (b). Act utilitarianism says that the action that yields the greatest amount of pleasure over pain for all involved should be chosen. Under this principle, Sarah would likely be told that she looks fine. (c). Rule utilitarianism holds that general rules that on balance produce the greatest amount of pleasure for all involved should be followed in each situation. Students may say that deception does not generally produce the greatest satisfaction. (d). Virtue ethics is an ethical system in which the development of virtues or positive character traits is the basis for morality. Students may say that it is virtuous to tell the truth, or some may say that it is more virtuous to spare Sarah's feelings. AACSB: Ethics Bloom's: Analyze Difficulty: Hard Learning Objective: 02-01 What are business ethics and the social responsibility of business? Topic: Theories of Business Ethics 2-60

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LSU - BLAW - 3201
Chapter 03 - The U.S. Legal SystemChapter 03The U.S. Legal SystemTrue / False Questions1. The word "jurisdiction" comes from the Latin terms "juris," meaning "law," and "diction,"meaning "to speak."True False2. In rem jurisdiction references jurisd
LSU - BLAW - 3201
Chapter 04 - Alternative Dispute ResolutionChapter 04Alternative Dispute ResolutionTrue / False Questions1. The term ADR refers to the resolution of legal disputes through methods other thanlitigation.True False2. Courts are generally critical and
LSU - BLAW - 3201
Chapter 05 - Constitutional PrinciplesChapter 05Constitutional PrinciplesTrue / False Questions1. The U.S. Constitution establishes a system of government based on the principle offederalism.True False2. Congress has the power to enact legislation,
LSU - BLAW - 3201
Chapter 06 - International and Comparative LawChapter 06International and Comparative LawTrue / False Questions1. The terms international law and comparative law do not mean the same thing.True False2. When doing business internationally, a foreign
LSU - BLAW - 3201
Chapter 07 - Crime and the Business CommunityChapter 07Crime and the Business CommunityTrue / False Questions1. The primary purpose of criminal law is to compensate a victim.True False2. Commission of the offense of grand larceny involves the theft
LSU - BLAW - 3201
Chapter 08 - Tort LawChapter 08Tort LawTrue / False Questions1. Tort law is primarily state law.True False2. When it comes to assault, apprehension and fear are considered as the same thing.True False3. Consent, if proven, is a defense to battery.
LSU - BLAW - 3201
Chapter 09 - Negligence and Strict LiabilityChapter 09Negligence and Strict LiabilityTrue / False Questions1. In some situations, the law specifies the duty of care one individual owes to another.True False2. The courts generally hold that landowner
LSU - BLAW - 3201
Chapter 10 - Product LiabilityChapter 10Product LiabilityTrue / False Questions1. A product may be found defective if a manufacturer fails to provide adequate warningsabout potential dangers associated with the product.True False2. No duty to warn
LSU - BLAW - 3201
Chapter 11 - Liability of Accountants and Other ProfessionalsChapter 11Liability of Accountants and Other ProfessionalsTrue / False Questions1. Accountants may not be sued for malpractice because that action is only available in themedical community.
LSU - BLAW - 3201
Chapter 12 - Intellectual PropertyChapter 12Intellectual PropertyTrue / False Questions1. The laws of intellectual property protect property that is primarily the result of mentalcreativity rather than physical effort.True False2. Network Solutions
LSU - BLAW - 3201
Chapter 13 - Introduction to ContractsChapter 13Introduction to ContractsTrue / False Questions1. The term "consideration" in relation to contracts involves parties acting in an ethicalmanner.True False2. The Restatement of the Law Second, Contract
LSU - BLAW - 3201
Chapter 14 - AgreementChapter 14AgreementTrue / False Questions1. Courts interpret contracts using an objective standard.True False2. Only the offeree to whom an offer is directed can accept the offer.True False3. Once an offer is made, an offeror
LSU - BLAW - 3201
Chapter 15 - ConsiderationChapter 15ConsiderationTrue / False Questions1. Consideration is optional in every contract.True False2. In a bilateral contract, the consideration for a promise is a completed act.True False3. An exception to the rule re
LSU - BLAW - 3201
Chapter 16 - Capacity and LegalityChapter 16Capacity and LegalityTrue / False Questions1. Today, married women have been removed from the category of those lacking contractualcapacity, although in a few states their capacity to enter into certain kin
LSU - BLAW - 3201
Chapter 17 - Legal AssentChapter 17Legal AssentTrue / False Questions1. A mistake of fact is an erroneous belief about the facts of the contract at the time thecontract is concluded.True False2. Mistakes in contract law result from untrue statement
LSU - BLAW - 3201
Chapter 18 - Contracts in WritingChapter 18Contracts in WritingTrue / False Questions1. There is federal U.S. legislation titled "Statute of Frauds".True False2. Contracts related to an interest in land fall within the statute of frauds.True False
LSU - BLAW - 3201
Chapter 19 - Third-Party Rights to ContractsChapter 19Third-Party Rights to ContractsTrue / False Questions1. There is no legally required wording to be used or forms to be filled out for assignments tobe valid.True False2. Most countries do not gr
LSU - BLAW - 3201
Chapter 20 - Discharge and RemediesChapter 20Discharge and RemediesTrue / False Questions1. Under ordinary circumstances, a party's duty to perform the promise agreed to in a contractis absolute.True False2. Contractual conditions may be expressly
LSU - BLAW - 3201
Chapter 21 - Introduction to Sales and Lease ContractsChapter 21Introduction to Sales and Lease ContractsTrue / False Questions1. Federal law is the primary method by which to interpret sales contracts.True False2. The UCC pertains to all business t
LSU - BLAW - 3201
Chapter 22 - Title, Risk of Loss, and Insurable InterestChapter 22Title, Risk of Loss, and Insurable InterestTrue / False Questions1. Good faith is generally relevant in determining whether someone with a void title can passa good title.True False2
LSU - BLAW - 3201
Chapter 23 - Performance and Obligations under Sales and LeasesChapter 23Performance and Obligations under Sales and LeasesTrue / False Questions1. Conforming goods are goods that conform to UCC specifications.True False2. Under the UCC when a buyer
LSU - BLAW - 3201
Chapter 24 - Remedies for Breach of Sales and Lease ContractsChapter 24Remedies for Breach of Sales and Lease ContractsTrue / False Questions1. The UCC adopts several common law principles.True False2. Contract actions are created to enforce the int
LSU - BLAW - 3201
Chapter 25 - WarrantiesChapter 25WarrantiesTrue / False Questions1. The UCC adopted the common law of warranties.True False2. Express warranties may be found in advertisements.True False3. The UCC assumes that the seller has defective title unless
LSU - BLAW - 3201
Chapter 26 - Negotiable Instruments: Negotiability and TransferabilityChapter 26Negotiable Instruments: Negotiability and TransferabilityTrue / False Questions1. A currency or cash substitution is a relatively new development in the law arising in the
LSU - BLAW - 3201
Chapter 27 - Negotiation, Holder in Due Course, and DefensesChapter 27Negotiation, Holder in Due Course, and DefensesTrue / False Questions1. In Russia a transaction involving a promissory note is a legitimate documentarytransaction.True False2. A
LSU - BLAW - 3201
Chapter 28 - Liability, Defenses, and DischargeChapter 28Liability, Defenses, and DischargeTrue / False Questions1. According to the UCC, a signature can be any name, word, mark, or symbol used by aparty to authenticate a writing.True False2. A par
LSU - BLAW - 3201
Chapter 29 - Checks and Electronic Fund TransfersChapter 29Checks and Electronic Fund TransfersTrue / False Questions1. According to the UCC, a check is a special kind of draft.True False2. Money orders are considered checks under the UCC.True Fals
LSU - BLAW - 3201
Chapter 30 - Secured TransactionsChapter 30Secured TransactionsTrue / False Questions1. Collateral is the property that is subject to a security interest.True False2. To become a secured party, the creditor must perfect a security interest in the co
LSU - BLAW - 3201
Chapter 31 - Other Creditors Remedies and SuretyshipChapter 31Other Creditors Remedies and SuretyshipTrue / False Questions1. Creating a mechanic's lien on property automatically ensures that the contractor who filedthe lien will receive money.True
LSU - BLAW - 3201
Chapter 32 - Bankruptcy and ReorganizationChapter 32Bankruptcy and ReorganizationTrue / False Questions1. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 included onlyminor changes to bankruptcy law.True False2. Before a debtor
LSU - BLAW - 3201
Chapter 33 - Agency Formation and DutiesChapter 33Agency Formation and DutiesTrue / False Questions1. Agency law is primarily federal law.True False2. An agency relationship may be created only for a lawful purpose.True False3. An individual who l
LSU - BLAW - 3201
Chapter 34 - Liability to Third Parties and TerminationChapter 34Liability to Third Parties and TerminationTrue / False Questions1. When making decisions about an agency relationship's liability to third parties, courts mustfirst identify whether pro
LSU - BLAW - 3201
Chapter 35 - Forms of Business OrganizationChapter 35Forms of Business OrganizationTrue / False Questions1. A sole proprietor is considered a separate legal entity.True False2. A limited partnership is one in which the partners share management resp
LSU - BLAW - 3201
Chapter 36 - Partnerships: Nature, Formation, and OperationChapter 36Partnerships: Nature, Formation, and OperationTrue / False Questions1. No partnership is created based upon an employer sharing profits with an employee aspayment for work.True Fal
LSU - BLAW - 3201
Chapter 37 - Partnerships: Termination and Limited PartnershipsChapter 37Partnerships: Termination and Limited PartnershipsTrue / False Questions1. Before a partnership may be terminated, the partnership must experience the winding-upstage, but not t
LSU - BLAW - 3201
Chapter 38 - Corporations: Formation and FinancingChapter 38Corporations: Formation and FinancingTrue / False Questions1. A corporation must be dissolved if over 50% of the shareholders die.True False2. Corporations have only those powers that state
LSU - BLAW - 3201
Chapter 39 - Corporations: Directors, Officers, and ShareholdersChapter 39Corporations: Directors, Officers, and ShareholdersTrue / False Questions1. Different agendas between officers and shareholders can lead to conflict within acorporation.True F
LSU - BLAW - 3201
Chapter 40 - Corporations: Mergers, Consolidations, TerminationsChapter 40Corporations: Mergers, Consolidations, TerminationsTrue / False Questions1. Today, consolidations are very rare.True False2. The boards of directors of all involved corporatio
LSU - BLAW - 3201
Chapter 41 - Corporations: Securities and Investor ProtectionChapter 41Corporations: Securities and Investor ProtectionTrue / False Questions1. If a violation of federal securities laws is serious enough to merit criminal prosecution, theFraud Sectio
LSU - BLAW - 3201
Chapter 42 - Employment and Labor LawChapter 42Employment and Labor LawTrue / False Questions1. The Fair Labor Standards Act covers employers engaged in intrastate commerce or theproduction of goods for interstate commerce.True False2. Leave provid
LSU - BLAW - 3201
Chapter 43 - Employment DiscriminationChapter 43Employment DiscriminationTrue / False Questions1. The concept of employment-at-will excludes the concept that an employee may quit atanytime.True False2. State laws may give employees less, but not mo
LSU - BLAW - 3201
Chapter 44 - Administrative LawChapter 44Administrative LawTrue / False Questions1. Administrative law consists of procedural, but not substantive, rules.True False2. Administrative agencies are located at the federal level only.True False3. There
LSU - BLAW - 3201
Chapter 45 - Consumer LawChapter 45Consumer LawTrue / False Questions1. A consumer law is a statute or administrative rule serving to protect consumer interests.True False2. The existence of deceptive advertisements is enough alone to prove damages
LSU - BLAW - 3201
Chapter 46 - Environmental LawChapter 46Environmental LawTrue / False Questions1. Pollution has not always been seen as a problem in the U.S.True False2. A nuisance arises when one person uses his or her property in a manner that unreasonablyinterf
LSU - BLAW - 3201
Chapter 47 - Antitrust LawChapter 47Antitrust LawTrue / False Questions1. A business arrangement in which stock owners appoint beneficiaries and place theirsecurities with trustees who manage the company and pay a share of their earnings to thestock
LSU - BLAW - 3201
Chapter 48 - The Nature of Property, Personal Property, and BailmentsChapter 48The Nature of Property, Personal Property, and BailmentsTrue / False Questions1. Ownership of property is referred to as "title."True False2. A promise to make a gift is
LSU - BLAW - 3201
Chapter 49 - Real PropertyChapter 49Real PropertyTrue / False Questions1. Real property is commonly referred to as "realty."True False2. Subleasing of leased property by the tenant to another party is permissible unlessspecifically prohibited by th
LSU - BLAW - 3201
Chapter 50 - Landlord-Tenant LawChapter 50Landlord-Tenant LawTrue / False Questions1. If a landlord retains control of and access to property, the relationship is likely not alandlord-tenant relationship because the tenant does not have an exclusive
LSU - BLAW - 3201
Chapter 51 - Insurance LawChapter 51Insurance LawTrue / False Questions1. Insurance is defined as a contract in which the insured party makes payments to the insurerin exchange for the insurer's promise to make payment or transfer goods to another pa
Kentucky - CS - 101
Cloud Computing Cloud computing is a general term used to describe a new class of network basedcomputing that takes place over the internet, basically a step on from Utility Computing. This is a collection/group of integrated and networked hardware, so
DePaul - ACCOUNTING - 102
Managerial Accounting Chapter 1 Homework1.award:4 out of4 pointsExercise 1-10 Classification of Costs as Variable or Fixed and as Selling and Administrative orProduct [LO3, LO6]Classify each cost as either variable or fixed with respect to the numb
DePaul - ACCOUNTING - 102
Managerial Accounting Chapter 1 Class notesWork of management and need for managerial accounting 3 main activities or functions of management at all levels or types a. Planning Identifying alternatives, selecting basic strategy, planning course of acti
DePaul - ACCOUNTING - 102
Managerial Accounting Chapter 1 Practice[The following information applies to the questions displayed below.]The PC Works assembles custom computers from components supplied by various manufacturers. The company isvery small and its assembly shop and r
DePaul - ACCOUNTING - 102
Managerial Accounting Chapter 2 Homework[The following information applies to the questions displayed below.]Estimated cost and operating data for three companies for the upcoming year follow:Company XCompany YCompany ZDirect labor-hours84,00048,0
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Managerial Accounting Chapter 2 Class NotesLogic of absorption costing for products-Most external financial reports require it to be used.Very commonly used for management reporting and decision making.Also titled fully absorbed costing since all cost
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Managerial Accounting Chapter 2 Practice1.award:1 out of1 pointWhich would be more appropriate in each of the following situationsjob-order costing or process costing?a.An Elmer's glue factory.b.A textbook publisher such as McGraw-Hill.c.An Exxon
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Managerial Accounting Chapter 3 HomeworkExercise 3-6 Cost Flows in Activity-Based Costing [LO2, LO5][The following information applies to the questions displayed below.]Sylvan Company uses activity-based costing to determine product costs for external
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Managerial Accounting Chapter 3 Class NotesProgression of overhead cost calculations (3 basic types) 1. Plant-wide overhead rate is simplest to compute, but inaccurately assigns costs toproducts when a variety of products exist. Relies on one driver fo
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Managerial Accounting Chapter 3 Practice[The following information applies to the questions displayed below.]Kramer Corporation is a diversified manufacturer of consumer goods. The company's activity-based costing systemhas the following seven activity
DePaul - ACCOUNTING - 102
Managerial Accounting Chapter 4 Homework1.award:2 out of2 pointsChocolaterie de Geneve, SA, is located in a French-speaking canton in Switzerland. The company makes chocolatetruffles that are sold in popular embossed tins. The company has two proces
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Managerial Accounting Chapter 4 Class NotesProcess costing versus job costing 1. Process costing is used for homogeneous or uniform products produced on a relativelycontinuous basis. Most products in the facility are very similar and use a similar proc