Which of the following statements is true of behavior in the context of behavioral ethics
experiments?
a) The lower the cost (moral or otherwise) of acting ethically, the less likely is ethical
behavior.
b) Greater social distance increases the cost of acting ethically and decreases the
likelihood of ethical behavior.
c) Socialization through the sharing of information about how others behave can
weaken a reciprocity norm.
d) Relational contracts enforced through two-sided reciprocity cannot be beneficial.
Answer:
________ involves turning the crisis into a manageable nonmarket issue.
a) Escalation
b) Resolution
c) Identification
d) Intervention
Answer:
The North American Free Trade Agreement (NAFTA) established, subject to certain
exceptions, free trade among ________.
a) Great Britain, the United States, and Japan
b) Canada, Mexico, and the United States
c) Great Britain, France, and Canada
d) the United States, India, and Japan
Answer:
________ can take direct action against firms to force them to change their policies or
can appeal to the public for support.
a) Special interest groups
b) Watchdog groups
c) Advocacy groups
d) Activist groups
Answer:
Which of the following is true with regard to products liability law?
a) Products are held to have an implied warranty of merchantability.
b) The common law of products liability has changed very little since the 1950s.
c) Products liability cases that are litigated are not considered as legal precedents for
future cases.
d) The law pertaining to product safety developed from the laws of property and
entitlements.
Answer:
Which of the following EU institutions is responsible for reviewing large mergers?
a) the Advisory Committee on Restrictive Practices and Monopolies
b) the European Chamber of Commerce
c) the European Parliament
d) the European Commission
Answer:
Which of the following is true of microfinance?
a) It is a not-for-profit concept.
b) The effects of lending are lower for higher-income borrowers.
c) It is subject to nonmarket risks.
d) Those borrowing for non-business purposes decreased household consumption.
Answer:
Which of the following examples illustrates the weakness of act utilitarianism?
a) Firm A refrains from accepting bribes even if that decreases its aggregate utility.
b) Firm A takes Firm B’s practice of offering bribes as a given and offers a matching
bribe because that increases its aggregate utility.
c) Firm B believes that offering a bribe is ethical because it boosts competition.
d) Firms A and B consider bribery ethical in situations where a rational observer would
understand the reason for the action.
Answer:
Which of the following is a nonmarket function of trade associations?
a) development of technical standards
b) research
c) collection of industry statistics
d) reducing the cost of information acquisition
Answer:
The ________ is an advisory body whose members represent employees, employers,
farmers, trades, and other interests.
a) Committee of Permanent Representatives
b) European Economic and Social Committee
c) European Chamber of Commerce
d) Advisory Committee on Restrictive Practices
Answer:
Which of the following is true with regard to the Regional Greenhouse Gas Initiative
(RGGI)?
a) RGGI was formed to deal with the United State’s solid waste disposal crisis.
b) RGGI failed to generate any funds through auctions.
c) In 2006, 35 U.S. states formed the RGGI to address the problem concerning the
fast-dwindling capacity of the nation’s landfills.
d) The failure of RGGI to affect environmental goals led states to consider withdrawing
from the initiative.
Answer:
Which of the following is the final stage of the nonmarket issue life cycle?
a) interest group formation
b) legislation
c) administration
d) enforcement
Answer:
Which of the following Acts does not provide for private lawsuits?
a) Federal Trade Commission Act
b) Robinson-Patman Act
c) Sherman Act
d) Clayton Act
Answer:
Since the economic reforms that began in 1991, the growth in Indian economy has been
rapid, creating ________.
a) an increment in protectionism
b) fewer opportunities for local joint ventures
c) a decrease in corruption
d) an attractive domestic market for companies
Answer:
The ________ is the executive and administrative body of the European Union.
a) European Commission
b) European Parliament
c) EU Court of Justice
d) Council of Ministers
Answer:
Which of the following is true with regard to the Fair Labor Association (FLA)?
a) The FLA code of workplace standards does not cover forced labor.
b) The FLA code of workplace standards does not cover collective bargaining.
c) The FLA code does not provide for a “living wage.”
d) The FLA lacks the characteristics of a government institution.
Answer:
A ________ is established by moral consensus or by government and is accompanied
by a clear assignment of the corresponding duty.
a) moral standard
b) norm
c) claim
d) granted right
Answer:
Which of the following is true with regard to bribe payments?
a) A rule under which bribes are allowed is universalizable.
b) Competition is most efficient when bribes replace value and merit as the basis for
decisions.
c) Bribes paid to government officials undermine the impartiality of government and
hence the equality of political rights.
d) Bribes are expected to indirectly benefit the least advantaged persons.
Answer:
________ is a market imperfection that results when sellers have incomplete
information about customers.
a) Adverse selection
b) Pecuniary externality
c) Nonpecuniary externality
d) Deadweight loss
Answer:
In 1995 most EU member states signed the ________, which eliminated border checks
so as to allow the free flow of people within the signatory states.
a) Maastricht Treaty
b) Treaty of Lisbon
c) Schengen Agreement
d) Treaty of Rome
Answer:
FreeWorld is a non-profit campaigning organization that has discovered that
Shine4Ever Corp. is dealing in conflict diamondsdiamonds from the coasts of Liberia
that originate from areas controlled by forces that fund anti-government operations.
After several demonstrations, boycotts, and advertising campaigns by FreeWorld,
Shine4Ever agrees to an external certification process to ensure that the diamonds are
“clean”. This social pressure is a result of ________.
a) private politics
b) business intelligence
c) market demand
d) competitive analysis
Answer:
TMX, a manufacturing company based in the U.S. decides to expand to emerging
market countries in Africa. The company uses individualized incentives to motivate
employees in its new branches but find that such incentive programs are not working.
Which of the following is the most likely explanation for its failure?
a) The transparency of regulation and the nonservicing of payments is high in emerging
markets
b) The demand side of corruption is high.
c) The collectivist culture of the country is hostile to such incentive programs.
d) The performance of employees in emerging markets is independent of the incentives
provided.
Answer:
________ Amendment protects the right of corporations to make expenditures and
participate in political competitions on a state ballot proposition.
a) First
b) Second
c) Tenth
d) Sixteenth
Answer:
Confucius considered ________ as the ultimate object of moral self-cultivation.
a) li
b) danwei
c) ren
d) guanxi
Answer:
Which of the following statements describes the trust gap in private politics?
a) negative information provided by a firm can have more impact on an issue than that
provided by an NGO
b) negative information provided by an NGO can have more impact on an issue than
that provided by a firm
c) negative information provided by an NGO does not affect a firm due to the lack of
trust gap
d) negative information provided by an NGO does not provide the adequate threat as
firms are more trustworthy
Answer:
Which of the following statements is true of the effectiveness of nonmarket action?
a) The lower the number of members of an interest group, the greater is its potential
effectiveness.
b) The greater the coverage by the members of an interest group, the less effective is its
nonmarket action.
c) The costs of organizing interests are low when the costs of identifying and
mobilizing those with common interests are high.
d) The greater the resources available to an interest group, the greater the set of
activities that can be funded.
Answer:
Although the national government has greater powers, the ________ are important
components of the government with some independent authority and responsibilities for
implementing policies.
a) metropolises
b) municipal centers
c) constituencies
d) states
Answer:
The approach to nonmarket strategy formulation ________.
a) requires the delegation of administrative responsibility to an agency or a regulatory
commission
b) addresses nonmarket issues of a firm directly in public institutions
c) does not require nonmarket strategies to focus on initial institutional arena as there is
no competition between different interests of a firm
d) resolves nonmarket issues by voluntary agreements and thus, does not need strategy
formulation
Answer:
________ is present when the actions of one economic agent affect other economic
agents through changes in the prices of goods and services.
a) Natural monopoly
b) Asymmetric information
c) Pecuniary externalities
d) Nonpecuniary externalities
Answer:
Utilitarianism provides a basis for a(n) ________ in which the choice between private
institutions and public institutions is made according to which maximizes aggregate
well-being.
a) moral claim
b) ethical claim
c) moral philosophy
d) political philosophy
Answer:
Which of the following provides an assessment of political risk “based on criteria
including stability, democratic accountability, and economic risk”?
a) Country Watch
b) Deutsche Bank Research
c) IMD Switzerland
d) Transparency International
Answer: