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Business Ethics


advantageous comparison

when a person tries to justify their conduct by comparing it to a more extreme alternative


when sellers advertise products or services that are generally not available, with the intention of drawing in interested people to buy other products or services

corporate social responsibility

organization's obligation to contribute in a positive way to its stakeholders and itself, as well as to society as a whole


process of seeing people as less human, making them more deserving of unethical treatment

displacement of responsibility

when a person defends their actions by stating that they were just following the orders of another person, usually a person with authority

disregard of the consequences

when a person ignores or minimizes the consequences of their conduct


study of good and bad conduct that examines how people should behave

euphemistic labeling

substituting mild or indirect language to make a situation seem less harsh

failure to disclose full price

when advertised prices do not inform the customer of extra fees or costs the customer will have to pay as part of the purchase

horizontal price-fixing

illegal agreement or cooperation between two or more competitors to set prices for a product or service, either directly or indirectly


the practice of forming or pursuing systems of thought that are based on ideals and spiritual values


type of ethics that focuses on whether an action is right or wrong by itself, not on the goals or consequences of the action


system of rules that regulates the actions of people

moral awareness

person's ability to recognize that their conduct could affect others in a way that may conflict with one or more ethical standards

moral disengagement

when people convince themselves that ethical standards do not apply to the particular conduct at issue

moral judgment

opinion that is formed when a person decides whether certain conduct is ethical or unethical

moral justification

process where a person who is examining potentially unethical conduct tries to make it seem right

predatory pricing

when an organization sets prices below the average variable cost to drive out competition

price discrimination

when sellers charge different customers different prices for the same product based on what they are willing to pay

price gouging

when a seller suddenly increases prices following a need for its products


belief that there are no absolute truths and that a decision may be right even if it does not match one's own ethical standards

triple bottom line

accounting framework that measures social responsibilities, environmental responsibilities, and financial responsibilities to determine an organization's corporate social responsibility performance

Truth in Lending Act (TILA)

act that prohibits unfair, abusive, or deceptive home mortgage lending practices by requiring the disclosure of total loan costs


theory that the best course of action maximizes overall happiness and minimizes overall pain, thereby maximizing utility and producing the greatest net benefit

vertical price-fixing

when a manufacturer illegally dictates the price at which the retailer sells the product