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Chapter 03: Ethics and Social Responsibility
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1. A person who follows the deontological theory will produce very inconsistent decisions because they will be based on
the individual's choices.
a.
True
b.
False
ANSWER:
False
2. Business gift giving is considered the most unacceptable business practice in China.
a.
True
b.
False
ANSWER:
False
3. Morals are rules people develop as a result of cultural values and norms.
a.
True
b.
False
ANSWER:
True
4. Preconventional morality moves from an egocentric viewpoint toward the expectations of society.
a.
True
b.
False
ANSWER:
False
5. Ethical beliefs vary widely from culture to culture.
a.
True
b.
False
ANSWER:
False
6. Cause-related marketing is a marketing relationship based on a straight donation.
a.
True
b.
False
ANSWER:
False
7. Anything that is legal is ethical.
a.
True
b.
False
ANSWER:
False
8. Postconventional morality represents the morality of the mature adult.
a.
True
b.
False
ANSWER:
True
9. Conventional morality is the most basic level of ethical development.
a.
True
b.
False
ANSWER:
False
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10. A virtue is a character trait valued as being good.
a.
True
b.
False
ANSWER:
True
11. An ethical decision is solely based on the number of people who are benefitted by the decision.
a.
True
b.
False
ANSWER:
False
12. The local community is not a stakeholder of an organization.
a.
True
b.
False
ANSWER:
False
13. The pyramid of corporate social responsibility portrays philanthropic performance as the foundation for the other
responsibilities.
a.
True
b.
False
ANSWER:
False
14. Social responsibility can produce only an indirect profit.
a.
True
b.
False
ANSWER:
False
15. The utilitarian theory is a belief in time-and-place ethics, that is, ethical truths depend on the individuals and groups
holding them.
a.
True
b.
False
ANSWER:
False
16. Quasio Foods Inc. is a large food manufacturing corporation that earns more profits than its competitors. The company
uses only organically grown grains and fruits. It also promotes organic farming and helps nonprofit agencies who focus on
food and nutrition causes. The company has now decided to use a third-party recycling logo. In this scenario, Quasio
Foods is most likely to have adopted the concept of _____.
a.
relationship marketing
b.
event marketing
c.
green marketing
d.
affinity marketing
ANSWER:
c
17. Which of the following is a disadvantage of cause-related marketing?
a.
It does not increase the sale of products.
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b.
It can lead to consumer cause fatigue.
c.
It results in immediate losses for a company because of its focus on a cause.
d.
It requires corporations to use anticompetitive measures.
ANSWER:
b
18. In the context of rule utilitarianism, which of the following statements is true?
a.
Ethical truths depend on the individuals and groups holding them.
b.
Decisions must benefit the most people but through the fairest and most just means available.
c.
A current ethical dilemma should be compared with similar examples and outcomes before deciding on a
course of action.
d.
Intuition and personal feelings should guide decision making in case of dilemmas.
ANSWER:
b
19. Which of the following is one of the four major components of the pyramid of corporate social responsibility?
a.
Opportunism
b.
Self-dealing
c.
Creativity
d.
Philanthropy
ANSWER:
d
20. In the context of ethical decision making, the greater the degree of agreement among managerial peers that an action is
harmful:
a.
the more likely that marketers will recognize a problem as unethical.
b.
the lesser the likelihood that the action will result in a harmful outcome.
c.
the fewer the individuals in the organization that are likely to get affected by the action.
d.
the fewer the number of people affected by the negative outcome.
ANSWER:
a
21. A code of ethics:
a.
should include operations schedule of day-to-day activities.
b.
should be limited to a list of dos and don'ts.
c.
should be in written form to avoid confusion.
d.
should be kept confidential from a firm's employees.
ANSWER:
c
22. Mark is a friend of Ryan, who has been accused of attempt to murder. Even after knowing that Ryan is guilty, Mark
lies when the police interrogates him. Mark believes that his behavior will benefit his family and him, and hence he is not
concerned about the legality of his behavior. In the context of ethical theories, Mark displays _____.
a.
act utilitarianism
b.
rule utilitarianism
c.
casuist relativism
d.
moral absolutism
ANSWER:
a
23. Ronald Systems Inc. has developed a line of appliances that run on solar energy and cause no harm to the
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environment. Which of the following concepts is illustrated in this scenario?
a.
Divestment
b.
Opportunism
c.
Green marketing
d.
Cause-related marketing
ANSWER:
c
24. _____ is a business's concern for the long-range welfare of both the company and its relationship to the society within
which it operates.
a.
Preconventional morality
b.
Moral relativism
c.
Corporate self-dealing
d.
Corporate social responsibility
ANSWER:
d
25. In the context of ethics in other countries, which of the following statements is true?
a.
Corruption seldom occurs in international business dealings.
b.
Usage of illegal payments is accepted and expected in various countries.
c.
Ethical beliefs vary widely from culture to culture.
d.
Prosecutions under the Foreign Corrupt Practices Act have significantly declined.
ANSWER:
b
26. Which of the following statements is a feature of the Foreign Corrupt Practices Act (FCPA)?
a.
It prohibits U.S. corporations from involving in international business dealings.
b.
It prohibits U.S. corporations from making illegal payments to foreign governments.
c.
It declines prosecutions against bribery.
d.
It offers significant advantages to several U.S. businesses abroad.
ANSWER:
b
27. Which of the following statements is true of a utilitarian?
a.
A utilitarian believes that arson is sometimes ethical and not always wrong.
b.
A utilitarian will always keep his promises to a friend and follows the law.
c.
A utilitarian is not necessarily concerned with the welfare of others.
d.
A utilitarian compares similar predicted solutions and uses a point system.
ANSWER:
d
28. Which of the following is a similarity between act utilitarianism and rule utilitarianism?
a.
Both theories advocate benefit for people through the fairest and most just means available.
b.
Both theories compare a current ethical dilemma with similar examples.
c.
Both theories have flaws associated with predicting the future.
d.
Both theories are beliefs based on time-and-place ethics.
ANSWER:
c
29. Which of the following statements is true of the deontological theory and the utilitarian ethical theory?
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a.
The deontological theory considers the welfare of the people, while the utilitarian ethical theory does not
consider the welfare of the people.
b.
The deontological theory compares a current ethical dilemma, while the utilitarian ethical theory is a belief in
time-and-place ethics.
c.
The deontological theory states that people should adhere to their duties when analyzing an ethical dilemma,
while the utilitarian ethical theory is founded on the ability to predict the consequences of an action.
d.
The deontological theory states that the truth of a moral judgment is relative to the judging person or group,
while the utilitarian ethical theory is a character trait valued as being good.
ANSWER:
c
30. In the context of ethical theories, which of the following statements is true of moral relativism?
a.
Moral activists believe that an act that is legally wrong is always ethically wrong.
b.
It does not believe in absolute rules.
c.
Moral relativists believe that the most beneficial choice for the most people is ethically correct.
d.
It is a belief based on rules and individual obligations.
ANSWER:
b
31. Which of the following companies is an advocate of green marketing?
a.
Poldoid Inc., a manufacturer of plastic products, uses biodegradable plastics to reduce the generation of
hazardous wastes.
b.
Harlose Brothers, an ice cream manufacturer, offers discounts on its ice creams during summer.
c.
Magnira Inc., a textile company, uses cost-effective strategies to generate higher profits.
d.
Laelle Corp.'s management believes that its employees are the most important and valuable resource of the
company.
ANSWER:
a
32. Hallie has a tendency to be egocentric. She follows the rules of her company mainly to avoid punishment and to gain
respect. When making decisions, she always focuses on what immediate benefits she will gain from an alternative. Which
of the following levels of ethical development is illustrated by Hallie?
a.
Preconventional morality
b.
Postconventional morality
c.
Conventional morality
d.
Ethnocentric morality
ANSWER:
a
33. Jordon is a sales manager. He operates at the postconventional level of morality while making ethical decisions. In this
case, which of the following statements is true?
a.
He will be concerned about how he sees and judges himself over the long run.
b.
He will be concerned about how people will view his decisions.
c.
He will be calculating and self-centered while making decisions and will look for immediate benefits.
d.
He will make decisions that are not beneficial for most people.
ANSWER:
a
34. Who among the following is most likely to disapprove of unethical practices more strongly than others?
a.
Rebecca, who has noticed that most of her colleagues often use office supplies for personal use
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b.
Jason, an editor, who has noticed that all his managers agree that it is okay to plagiarize content to a small
extent
c.
Sarah, a manager, whose organization does not provide guidelines on ethical behavior
d.
David, who noticed for the first time a colleague misrepresenting data in a report
ANSWER:
d
35. In which of the following situations are marketers most likely to recognize a practice as unethical?
a.
If the practice has very few benefits
b.
If the practice is widely used throughout an organization
c.
If the practice does not have any immediate consequences
d.
If the practice is very likely to result in a harmful outcome
ANSWER:
d
36. A person who follows the deontological theory:
a.
chooses an alternative that adheres to laws and standards set by government without considering his or her
obligations toward society.
b.
adopts an approach that is concerned with the welfare of others.
c.
chooses an alternative based on a comparison of his or her current ethical dilemma with examples of similar
ethical dilemmas.
d.
follows his or her obligations to another individual or society because upholding one's duty is what is
considered ethically correct.
ANSWER:
d
37. Which of the following is a similarity between the deontological theory and moral relativism?
a.
Both theories are concerned with the welfare of others.
b.
Both theories may lead to actions that are not ethically correct.
c.
Both theories are free from flaws.
d.
Both theories compare a current ethical dilemma with similar examples and outcomes.
ANSWER:
b
38. In the context of the utilitarian ethical theory, uncertainty in predicting the future can lead to:
a.
indulging the utilitarian in illegal behaviors.
b.
boosting the public image of an organization.
c.
protecting the welfare of people.
d.
making the utilitarian look unethical as time passes.
ANSWER:
d
39. Which of the following statements is true of cause-related marketing?
a.
It is the cooperative efforts of a for-profit firm and a nonprofit organization for mutual benefit.
b.
It is a marketing relationship based on a straight donation.
c.
It occurs when government agencies and nonprofit agencies launch social campaigns.
d.
It seldom helps companies increase the sale of their products.
ANSWER:
a
40. Which of the following statements is true of morals?
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a.
They are universal and seldom vary.
b.
They are independent of factors such as culture and religion.
c.
They reflect the laws and regulations that affect social and economic behavior.
d.
They set absolute standards for good and bad that are enforced by the law.
ANSWER:
c
41. Stakeholder theory of corporate social responsibility:
a.
considers the management of an organization as one of the stakeholders.
b.
excludes customers and government agencies from the list of stakeholders.
c.
does not consider the owners of an organization as the stakeholders.
d.
pays attention to the unaffected stakeholder in every aspect of a firm's operation.
ANSWER:
a
42. Which of the following statements is true about the pyramid of corporate social responsibility?
a.
It states that philanthropy should be the most important function of a corporation.
b.
It states that ethical responsibilities of a corporation provide the basis for other responsibilities.
c.
It states that if a company does not make a profit, then the other responsibilities are moot.
d.
It states that social responsibility efforts should be focused on the external and not the internal stakeholders of
a corporation.
ANSWER:
c
43. According to the levels of ethical development, at the preconventional morality level, people:
a.
focus on the long-term results of their actions.
b.
tend to have an egocentric orientation.
c.
tend to focus on adhering to social norms and laws.
d.
focus on being loyal to an organization.
ANSWER:
b
44. Robin, a police sergeant, believes that bribing is illegal. He does not accept bribes irrespective of the amount of
money. Robin displays _____.
a.
act utilitarianism
b.
rule utilitarianism
c.
ethical relativism
d.
moral relativism
ANSWER:
b
45. In the context of the determinants of a civil society, _____ involves the voluntary acceptance of standards established
by nongovernmental entities.
a.
self-regulation
b.
media
c.
cause marketing
d.
green marketing
ANSWER:
a
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46. A business firm is collaborating with a nonprofit organization in an initiative to provide public relations training to
working professionals throughout a country. Twenty percent of the fee that the working professionals would pay is given
to the nonprofit organization. The money is then used by the nonprofit organization to fund the training program. This
scenario illustrates _____.
a.
relationship marketing
b.
effect-related marketing
c.
cause-related marketing
d.
green marketing
ANSWER:
c
47. In the context of corporate social responsibility, which of the following statements is true of stakeholder theory?
a.
It states that companies should only focus on increasing shareholder wealth.
b.
It states that social responsibility is best carried out by government agencies.
c.
It states that a company is expected to be a good citizen in its community.
d.
It states that the top management should not be involved in corporate social responsibility.
ANSWER:
c
48. According to the three levels of ethical development, which of the following statements is true of conventional
morality?
a.
It is the most basic level of ethical development.
b.
A person at this level performs unethical and manipulative actions.
c.
It is predominantly characterized by an egocentric viewpoint of an individual.
d.
A person at this level is concerned how an action will be viewed by others.
ANSWER:
d
49. The _____ states that people should adhere to their obligations and duties when analyzing an ethical dilemma.
a.
deontological theory
b.
moral relativism theory
c.
casuist ethical theory
d.
utilitarian ethical theory
ANSWER:
a
50. Which of the following statements is an argument for corporate social responsibility?
a.
The primary responsibility of social welfare rests with governments and not business firms.
b.
The free market should decide what is best for the world.
c.
Businesses have resources, so businesses should be given the chance to solve social problems.
d.
Businesses never aid to social problems as the primary objective of businesses is making profits.
ANSWER:
c
51. Mark is the sales manager of a reputed firm. Over his tenure, he has witnessed numerous ethical misconducts. In this
case, he will observe less ethical misconduct when:
a.
his coworkers have a strong ethical culture.
b.
a code of ethics is absent in his firm.
c.
organizational rules are absent in his firm.
d.
the top managers of his firm have little control over organizational culture.
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Chapter 03: Ethics and Social Responsibility
ANSWER:
a
52. Allan voices against those who litter on roads because he believes that society expects cleanliness from people. This
illustrates _____.
a.
preconventional morality
b.
utilitarianism
c.
moral relativism
d.
conventional morality
ANSWER:
d
53. The _____ compares a current ethical dilemma with examples of similar ethical dilemmas and their outcomes.
a.
deontological theory
b.
moral relativism theory
c.
casuist ethical theory
d.
utilitarian ethical theory
ANSWER:
c
54. Which of the following statements is true of a code of ethics?
a.
It is most effective when it is in the form of a long list of dos and don'ts.
b.
It is an effective internal control of behavior.
c.
It is typically drafted by government agencies.
d.
It applies to top managers of an organization rather than its employees.
ANSWER:
b
55. Explain green marketing and outline its impact.
ANSWER:
Answers will vary. An outgrowth of the social responsibility and sustainability movements is green
marketing. Green marketing is the development and marketing of products designed to minimize negative
effects on the physical environment or to improve the environment. One approach that firms use to indicate
that they are part of the green movement is to use third-party eco-logos. Examples include the chasing-
arrows recycling logo (the product is either recyclable or contains recycled materials); the Energy Star logo
(the product is energy efficient); and Certified Organic (the U.S. Department of Agriculture created standards
relative to soil quality, animal raising practices, pest and weed control, and the use of additives). These logos
can enhance a product's sales and profitability.Nearly four in 10 Americans (about 93 million people) say
that they are dedicated to buying green products and services. Green purchasing is driven by young adults
(age 18 to 34) and Hispanics; about half of the respondents in these groups report that they regularly seek out
green products. Young adults are also more likely to be interested in a company's green practices and to
avoid companies with poor environmental records.
56. Explain cause-related marketing.
ANSWER:
Answers will vary. A sometimes controversial subset of social responsibility is cause-related marketing.
Sometimes referred to as simply "cause marketing," it is the cooperative efforts of a for-profit firm and a
nonprofit organization for mutual benefit. The for-profit firm hopes to generate extra sales, and the nonprofit
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Chapter 03: Ethics and Social Responsibility
public relations for the firm and will often stimulate sales of the brand. Nevertheless, the huge growth of
cause-related marketing can lead to consumer cause fatigue. Researchers have found that businesses need to
guard against being perceived as exploiting a cause simply to sell more of a product.
57. Briefly explain the factors that tend to influence ethical decision making and judgments.
ANSWER:
Answers will vary. Ethical questions rarely have cut-and-dried answers. Studies show that the following
factors tend to influence ethical decision making and judgments:(1) The extent of ethical problems within an
organization: The healthier the ethical environment, the more likely it is that marketers will take a strong
stand against questionable practices.(2) Top management actions on ethics: Top management can have a
profound influence on the ethical behavior of marketing professionals by performing actions that encourage
ethical behavior or discourage unethical behavior. Setting an example communicates an ethical
philosophy.(3) Potential magnitude of the consequences: The greater the harm, the more likely it is that
marketers will recognize the action as unethical.(4) Social consensus: The greater the degree of agreement
among managerial peers that an action is harmful, the more likely it is that marketers will recognize it as
unethical.(5) Probability of a harmful outcome: Higher probabilities of harmful outcomes mean that
marketers are more likely to realize that the actions are unethical.(6) Length of time between the decision and
the onset of consequences: The shorter the time frame between the action and the onset of negative
consequences, the more likely it is that marketers will perceive a problem as unethical.(7) Number of people
to be affected: The greater the number of persons affected by a negative outcome, the more likely it is that
marketers will recognize the decision as unethical.
58. Define the pyramid of corporate social responsibility and list its components.
ANSWER:
Answers will vary. One theorist suggests that total corporate social responsibility has four components:
economic, legal, ethical, and philanthropic. The pyramid of corporate social responsibility portrays economic
performance as the foundation for the other three responsibilities. At the same time that it pursues profits
(economic responsibility), however, a business is expected to obey the law (legal responsibility); to do what
is right, just, and fair (ethical responsibilities); and to be a good corporate citizen (philanthropic
responsibility). These four components are distinct but together constitute the whole. Still, if the company
does not make a profit, then the other three responsibilities are moot.
59. List and describe the three levels of ethical development.
ANSWER:
Answers will vary. The three levels of ethical development are—preconventional morality, conventional
morality, and postconventional morality.Preconventional morality, the most basic level, is childlike. It is
calculating, self-centered, and even selfish, based on what will be immediately punished or
rewarded.Conventional morality moves from an egocentric viewpoint toward the expectations of society.
Loyalty and obedience to the organization (or society) become paramount.Postconventional morality
represents the morality of a mature adult. At this level, people are less concerned about how others might see
them and more concerned about how they see and judge themselves over the long run.
60. Differentiate between the casuist ethical theory and moral relativism.
ANSWER:
Answers will vary. The casuist ethical theory compares a current ethical dilemma with examples of similar
ethical dilemmas and their outcomes. This allows one to determine the severity of the situation and to create
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Chapter 03: Ethics and Social Responsibility
moral relativist, for example, arson is not always wrong—if you live in a neighborhood where drug dealers
are operating a crystal meth lab or crack house, committing arson by burning down the meth lab may be
ethically justified. If you are a parent and your child is starving, stealing a loaf of bread is ethically correct.
The proper resolution to ethical dilemmas is based upon weighing the competing factors at the moment and
then making a determination to take the lesser of the evils as the resolution. Moral relativists do not believe
in absolute rules. Their beliefs center on the pressure of the moment and whether the pressure justifies the
action taken.
