In contrast to corporate social performance, corporate social responsibility need not be
motivated by moral considerations but instead could be strategic or a response to the
social pressure a firm faces.
Answer:
The size of the Chinese economy implies that resources cannot be readily mobilized by
the government in the domestic capital and factor input markets.
Answer:
Under antitrust laws, the burden of proof to show that the act committed is not
unreasonable is on the defendant.
Answer:
Root cause analysis is the most important component of a crisis management program.
Answer:
The Obama administration’s $787 billion economic stimulus program gave tax credits
to first-time homebuyers, new car buyers who turned in a clunker, and homeowners
who made their homes more energy efficient.
Answer:
When a firm chooses a market strategy and a nonmarket strategy, the strategies compete
with the strategies of other participants in the market.
Answer:
In terms of remedies, the European Commission is limited to imposing fines and
supervising conduct.
Answer:
To use a country to export goods to better developed countries and markets requires
foreign markets to be closed, which if generally the case in developing countries.
Answer:
Nonmarket positioning should be a conscious choice rather than dictated by a firm’s
market positioning or by those in its environment.
Answer:
When markets are competitive and institutions are in place that align self-interest with
societal well-being, the maximization of profit by a firm results in the greatest
aggregate societal well-being.
Answer:
Regulation takes place through a private process that is relatively closed and
low-profile.
Answer:
Act utilitarianism focuses on a general rule of behavior to be followed by all individuals
in all similar situations.
Answer:
A simple agreement accepting the issues is usually sufficient where the stakes are high
and monitoring of the firm’s actions is difficult.
Answer:
Utilitarianism does not take altruism into account.
Answer:
Antitrust law includes only statutes and not the court decisions interpreting those
statutes.
Answer:
Incentives for nonmarket action may be moral or distributive.
Answer:
A firm that interacts with Congress on a variety of issues must maintain access to
several committees and their relevant subcommittees.
Answer:
Transparency can reduce social distance and make it easier to develop trust and
reciprocity.
Answer:
Punitive damages awards are governed by clear constitutional guidelines.
Answer:
The majority of members of the Financial Crisis Inquiry Commission concluded that
over-the-counter derivatives contributed significantly to the financial crisis.
Answer:
Nonmarket issues are addressed largely in the shadow of public institution.
Answer:
The societal significance perspective would emphasize an issue having a human cause.
Answer:
Guanxi ties resemble legally circumscribed contracts or quid pro quo
arrangements.
Answer:
Substantial economic inefficiency is an inherent consequence of a natural monopoly.
Answer:
The distributive politics spreadsheet is used as a substitute for the analysis of benefits
and costs of nonmarket action.
Answer:
Between two cases of man-made risks and natural risks, the societal significance
perspective would emphasize on the man-made risk.
Answer:
India is a union of states with a parliamentary system of government and a federal
structure.
Answer:
The courts judge the discharge of the obligations of directors according to a civil law
standard referred to as the duty of care rule.
Answer:
The OECD Anti-Bribery Convention does not view small “facilitation” payments that
are not made to “obtain or retain business” as an offense.
Answer:
The Federal Reserve is governed by a seven-member board of governors.
Answer:
Breaches are permissible under circumstances where it is economically efficient not to
fulfill the conditions of the contract.
Answer:
The OECD Anti-Bribery Convention pertains to private-to-private bribery and does not
impose record-keeping obligations on business.
Answer:
The demand-side subsidies decreased the supply of renewable power and increased the
negative externalities from emissions.
Answer:
The legal standard for imposing compensatory damages is higher than that for punitive
damages.
Answer:
A crisis is a situation in which harm to people or property either has occurred or is
imminent.
Answer:
Ad hoc coalitions include firms from a number of industries and thus represent a range
of interests.
Answer:
Which of the following companies would most likely feel obliged to undertake
corporate social responsibility?
a) a company that manufactures industrial lighting, material handling equipment, and
industrial supplies
b) a company that sells commercial furniture and furniture components
c) a biotechnology firm that is involved in industrial and environmental biotechnology
products as well as research and development
d) a bank that take deposits, have branches, and interacts directly with consumers and
communities
Answer:
________ are only a necessary condition for regulation to improve economic efficiency.
a) Market imperfections
b) Nonmarket issues
c) Corporate campaigns
d) Grassroots campaigns
Answer:
________ Amendment places a limit on the application of regulation.
a) First
b) Fourteenth
c) Eighth
d) Nineteenth
Answer:
Private politics focuses on ________.
a) changing the behavior of the government through regulation and legislation
b) changing the behavior of private economic agents through social pressure
c) changing the behavior of private economic agents through government action
d) changing the behavior of the state through economic policy
Answer:
The control of an externality in a tradable permits system has three components. The
first component ________.
a) is allowing parties to respond to incentives by choosing the most efficient means of
abatement
b) is providing incentives for abatement by internalizing the cost of the harm done by
the pollution.
c) involves reflecting in the prices of goods and services, the costs of abatement
and the social costs of the harm from the remaining pollution.
d) is allowing states to decide how best to decrease dangerous air pollution in the most
cost effective manner.
Answer:
In legal space, ________ provide the most important protection for intellectual property
for many industries.
a) trademarks
b) patents
c) copyright laws
d) logos
Answer:
Which of the following is true with regard to the SOEs (State-Owned Enterprises)?
a) The labor policies of the SOEs were in conflict with the socialist economic system.
b) Since the late 1970s, SOE reform has been systematically ignored by the Chinese
leaders.
c) In addition to production, SOEs provided virtually all the major social services
required by employees, their families, and retirees.
d) Subsidies provided to SOEs increased steadily from 1989 to 1996.
Answer:
The adoption of the ________ made human and civil rights enforceable by the
European Union.
a) Charter for Fundamental Rights
b) Common Agricultural Policy
c) State Aid Directive
d) Maastricht Treaty
Answer:
________ is an act of paying an individual in an organization with the intention of
influencing that person’s exercise of his or her responsibilities;
a) Lobbying
b) Bribery
c) Extortion
d) Casuistry
Answer:
More recently, researchers have turned to ________ to try to understand how
individuals make choices when facing a moral issue.
a) Laboratory experiments
b) Ethnographic research
c) Direct observation
d) Internet-based experiments
Answer:
________ is the last component of a crisis management program?
a) Escalation
b) Preparedness
c) Root cause analysis
d) Budgeting
Answer:
Which of the following is true with regard to corporate social performance?
a) Responsive corporate social performance increases social pressure that affects
financial performance.
b) Responsive corporate social performance is always rewarded by customers.
c) Moral considerations do not motivate corporate social performance.
d) Corporate social performance need not be motivated by moral considerations but
instead could be strategic or a response to the social pressure a firm faces.
Answer:
Resolution involves turning the crisis into a manageable ________ issue.
a) inorganic
b) market
c) cross-subsidization
d) nonmarket
Answer:
Indian patent law allowed Indian pharmaceutical companies to produce drugs patented
in Europe and the United States, provided they used a different ________.
a) name
b) logo
c) production process
d) business model
Answer:
The Ethics in Government Act of 1978 ________.
a) requires lobbyists to register with the clerk of the House and the secretary of the
Senate
b) restricts the contacts of former executive branch officials and regulators with their
former agencies for a 2-year period
c) prohibits gifts to the members of Congress, including dinners and privately paid
travel to conventions and events
d) requires registration of those who lobby the executive branch and the staffs of
Congress members
Answer:
________ avoids interpersonal comparisons, since it requires only that an action make
at least one person better off and no one worse off, evaluated in terms of the preferences
of each person.
a) The Calabresi and Melamed principle
b) The Pareto criterion
c) Self-confirming equilibrium
d) Tragedy of the commons
Answer:
Instrumental rights are justified in a(n) ________, such as utilitarianism.
a) deontological system
b) pluralistic system
c) consequentialist system
d) secondary system
Answer:
Which of the following industries has the least government control?
a) Local communications service
b) Biotechnology
c) Automobile
d) Consumer electronics
Answer:
Which of the following is an example of a nongovernmental institution in the
nonmarket environment?
a) WTO
b) the social media
c) the judiciary
d) the executive branch
Answer:
Which of the following represents a centralized activity used by activists to apply
pressure on firms?
a) Activists arrange a campaign led by labor unions to lower emission rates for workers’
safety.
b) Activists pressure firms to lower emission rates after reading annual list of
companies’ emission rates.
c) Activists send emails to spread information about the increasing emission rates of
companies.
d) Activists form an online community that shares relevant information on emission
rates and signs petitions.
Answer:
The principal and most comprehensive source of institutional guidance on safety is the
law of ________.
a) contracts
b) warranties
c) property
d) torts
Answer:
Why was the ban on the importation of solar panels criticized?
a) It would lead to domestic companies decreasing their prices.
b) It would give Europe a trade monopoly.
c) It would cut Indian companies off from technological innovations in solar power.
d) It would destroy the solar ecosystem, killing innovation and entrepreneurship.
Answer:
TRUEware is a leading computer hardware manufacturer based in California. Two
dealers of TRUEware compete against each other to make higher sales and profit
margin. Which of the following is applicable to this situation?
a) entry deterrence
b) intraband competition
c) interband competition
d) horizontal arrangement
Answer:
Mergers ________.
a) encourage competition in supply and distribution channels
b) eliminate inefficient cross-subsidization
c) yields cost inefficiencies that bring losses to customers
d) remove effective management
Answer:
Which of the following issues is most often the subject of private politics?
a) intellectual property protection
b) privacy
c) liability reform
d) antitrust laws
Answer:
Which of the following is true with regard to Deng Xiaoping’s economic reforms?
a) Deng’s economic reforms did not focus on defense.
b) Foreign investments were strongly discouraged in the Special Economic Zones.
c) Small, household-run enterprises were made illegal.
d) Deng’s economic reforms were headlined by the “Four Modernizations.”
Answer:
Which of the following is the legal manifestation for equal employment opportunity?
a) Neutrality Act of 1935
b) Title VII of the Civil Rights Act of 1964
c) Neutrality Act of 1939
d) Civil Rights Act of 1866
Answer:
Which of the following is true with regard to the NAFTA?
a) NAFTA was an expansion of the United StatesJapan Free Trade Agreement that had
been in effect since 1981.
b) NAFTA excluded transition provisions and favored a rapid phaseout of trade barriers.
c) NAFTA was an expansion of the United States-Canada Free Trade Agreement that
had been in effect since 1988.
d) NAFTA did not provide for the elimination of tariff and nontariff barriers.
Answer:
Which of the following is true with regard to the Foreign Corrupt Practices Act
(FCPA)?
a) The FCPA prohibits payments to private businesses.
b) Under the FCPA, it is lawful to offer gifts to influence a decision of a company.
c) The FCPA does not provide imprisonment for an individual making a payment or
offer covered by the act.
d) The FCPA makes bribery of foreign officials, political parties, candidates for office,
and public international organizations a criminal offense.
Answer:
________ is a necessary condition for lobbying.
a) Bargaining
b) Government allies
c) Access
d) Testimony
Answer:
The extent of corporate social responsibility (CSR) activities by firms depends on
________.
a) the number of vacant job positions in a firm
b) the role of the firm’s business in society
c) the financial profits of the past five years
d) the extent of compliance with national laws and regulations
Answer:
The first New Deal legislation enacted was the ________.
a) Glass-Steagall Act of 1933
b) Consumer Protection Act of 2010
c) Securities Act of 1933
d) Securities Exchange Act of 1934
Answer:
Which of the following characterizes advocacy groups?
a) They pursue issues because of the benefits that accrue to their members.
b) They monitor the activities of firms and call those activities to the attention of the
media, government, and public.
c) They represent the interests of individuals, such as those affected by pollution.
d) They take direct action against firms to force them to change their policies or can
appeal to the public for support.
Answer:
The politics of Social Security are ________.
a) majoritarian
b) interest group
c) client
d) entrepreneurial
Answer:
Supply side considerations imply that the ________.
a) costs of organizing interests are high when the costs of identifying and mobilizing
those with common interests are high
b) costs of organizing interests are low when the free-rider problem is more prevalent
and fewer means are available to mitigate it.
c) costs of organizing interests are low when the costs of identifying and mobilizing
those with common interests are high
d) strategies that increase the costs of collective action will increase the impact of the
group’s nonmarket action.
Answer: