Management, 3e (Hitt)
Chapter 2 Social Responsibility and Managerial Ethics
1) Managerial ethics begin at the top of the organization.
2) Having to make a choice between two competing but arguably valid options is known as an
ethical dilemma.
3) Ethnocentricity tends to hurt managerial effectiveness, especially in culturally diverse
contexts.
4) According to the utilitarian approach to ethical decision making, the most ethical course of
action is the one that results in the greatest good for the greatest number of people.
5) The utilitarian approach to ethical decision making advocates making decisions based on
moral principles rather than on the positive or negative consequences of an action.
6) According to the universal approach to ethical decision making, if two courses of action have
equal moral standing, managers should determine the more ethical course by considering the
positive and negative consequences of each one.
7) According to the concept of distributive justice, all employees should receive equal rewards
and punishments.
8) Moral intensity refers to the impact of ethics and morality on a group of people.
9) According to Adam Smith, the best way to advance the well-being of society is to place
resources in the hands of government officials and allow politicians to allocate scarce resources
to satisfy the demands of society.
10) The efficiency perspective of social responsibility states that it is irresponsible to maximize
shareholders’ wealth because they are not the only ones responsible for a firm’s existence.
11) From the perspective of social responsibility, shareholders are stakeholders.
12) Accommodator companies obey the letter of the law but do not make changes that might
restrict profits unless they are required to do so.
13) Reactor firms tend to believe that they are obligated to a variety of stakeholders.
14) In the “inside-out” approach of the strategic corporate social responsibility perspective,
managers can look inside the company at issues that are more rather than less important as a
function of the company’s strategy and business activities.
15) In the “outside-in” approach of the strategic corporate social responsibility perspective,
managers look at social issues in general terms of the extent to which they are problematic.
16) In the “outside-out” approach of the strategic corporate social responsibility perspective,
managers can look outside the company at issues the company can influence.
17) Employees are unlikely to conform to a corporate code of ethics unless other actions taken
by the organization reinforce the code.
18) The greater the psychological and emotional involvement of participants in ethics training,
the greater their retention of learning points will be.
19) As a group, whistleblowers tend to be disgruntled employees.
20) The Foreign Corrupt Practices Act was passed in 1977 in order to prevent foreign
government officials from making payments to U.S. firms.
21) ________ is concerned with morality and standards of business conduct, especially among
individuals.
A) Social consensus
B) Managerial ethics
C) Organizational behavior
D) Earned value management
22) A(n) ________ involves having to make a choice between two competing but arguably valid
options.
A) cognitive bias
B) ethical lapse
C) fallacy
D) ethical dilemma
23) A(n) ________ is a decision that is contrary to an individual’s stated beliefs and policies of
the company.
A) fallacy
B) cognitive bias
C) ethnocentric viewpoint
D) ethical lapse
24) ________ is the view that your perspective is correct and the views of people in other
cultures are inferior.
A) Ethnocentricity
B) Universality
C) Polycentricity
D) Regiocentricity
25) The ________ approach to ethical decision making focuses on consequences of an action.
A) moral rights
B) utilitarian
C) universal
D) justice
26) Which of the following is in accordance with the utilitarian approach to ethical decision
making?
A) Do onto others as you would have them do unto everyone, including yourself.
B) Choose the action that conforms with moral principles.
C) Try to make decisions that result in the greatest good.
D) Focus on the equity and process of outcomes.
27) An executive who justifies paying a bribe because it allows his company to provide the
greatest good for the greatest number of people adheres to the ________ approach to ethical
decision making.
A) justice
B) moral rights
C) universal
D) utilitarian
28) Mark heads his firm’s international division in China and has been approached by local
officials on several occasions to pay a bribe. After countless failed attempts, the officials are now
threatening to shut down the facility if Mark doesn’t pay up. Realizing that this would render
thousands of employees jobless, Mark decides to pay the bribe. Mark adopted the ________
approach in arriving at this decision.
A) utilitarian
B) universal
C) moral rights
D) justice
29) Which of the following is true regarding the utilitarian approach to ethical decision making?
A) It examines the moral standing of actions independent of their consequences.
B) The “goodness” or “badness” of an outcome is often subjective.
C) One should choose a course of action that can be applied to all people under all situations.
D) Culture and religion do not influence one’s judgment of what is good or bad.
30) Refer to the scenario above. Which of the following is similar to the given scenario?
A) As an owner of a retail store, Jeremy decides to cut off his supplier in order to switch to a
different supplier with lower prices.
B) A forest officer allows a tribal community living in the forest to cut trees for personal use.
C) Albert, who runs a sports goods store, declines a consignment of shoes from a manufacturer
after learning that working conditions at the factory were extremely poor.
D) Naomi, a designer in Georgia, refuses to pay for a damaged shipment of material that arrived
via courier from India.
31) According to the ________ approach to ethical decision making, some things are just right or
wrong, independent of their consequences.
A) universal
B) utilitarian
C) justice
D) moral rights
32) According to philosopher Immanuel Kant, ________ form the basis of all rights.
A) individuality and happiness
B) freedom and autonomy
C) fairness and equitability
D) justice and truth
33) The ________ approach to ethical decision making focuses on the equity of processes and
outcomes.
A) universal
B) utilitarian
C) justice
D) moral rights
34) According to the universal approach to ethical decision making, managers must first
determine whether a course of action can apply to all people in all situations, then ask themselves
whether ________.
A) the act has moral significance in the community
B) the costs and benefits of the act can be equitably distributed
C) the rewards of the act can be equitably distributed
D) they would want the same rule applied to themselves
35) At Pixel Inc, all promotions, pay raises, and bonuses are based on employees’ attainment of
their goals and the extent to which they help the organization reach its objectives. Managers are
strictly instructed to disregard irrelevant criteria such as the employee’s age, gender, race, and so
on when allocating rewards. This is indicative of ________.
A) procedural justice
B) distributive justice
C) compensatory justice
D) interactional justice
36) Even if a manager does not intend to discriminate against a particular minority group, legal
action can be brought against the firm if the minority group can prove ________.
A) temporal immediacy
B) disparate impact
C) compensatory justice
D) probability of effect
37) Which aspect of the justice approach to ethical decision making is concerned with the
impartial administration of decision-making processes?
A) procuratory justice
B) distributive justice
C) procedural justice
D) restorative justice
38) Pixel Inc has established a system to settle employee grievances. According to this system,
aggrieved employees must first approach their immediate supervisors with their problems. If the
employee considers the supervisor’s decision unsatisfactory, he or she may approach the next
person in the chain of command. If the grievance still remains unresolved, the matter may be
referred to voluntary arbitration. This system is indicative of ________.
A) procedural justice
B) distributive justice
C) interactional justice
D) compensatory justice
39) Which aspect of the justice approach to ethical decision making forms the basis of
affirmative action plans?
A) compensatory justice
B) distributive justice
C) procedural justice
D) restorative justice
40) ________ is the degree to which people see an issue as an ethical one.
A) Ethnocentricity
B) Disparate impact
C) Moral intensity
D) Social consensus
41) The ________ associated with the outcome of a given action is the anticipated level of
impact, independent of whether the consequences are positive or negative.
A) probability of effect
B) magnitude of the consequences
C) concentration of effect
D) temporal immediacy
42) Pixel Inc is planning to upgrade its technology infrastructure. However, this move is likely to
render more than half of its workforce redundant. Which of the following statements is true in
this scenario?
A) The magnitude of the consequence is high.
B) The concentration of effect is low.
C) There is a high degree of social consensus.
D) The probability of effect is low.
43) ________ involves the extent to which members of a society agree that an act is either good
or bad.
A) Social consensus
B) Probability of effect
C) Concentration of effect
D) Social order
44) According to a recent survey by BizMag.com, more than 60 percent of all employees believe
that pilfering office supplies for personal use is acceptable. Which of the following statements is
true in this scenario?
A) The magnitude of the consequence is high.
B) The concentration of effect is high.
C) There is a high degree of social consensus.
D) The probability of effect is high.
45) The moral intensity of an issue rises and falls depending on how likely people think the
consequences are. This is known as ________.
A) proximity
B) temporal immediacy
C) probability of effect
D) concentration of effect
46) Pixel Inc prohibits smoking in the workplace. According to company rules, any employee
found smoking on the work premises will be fined. However, managers are lax in implementing
this rule and employees are regularly seen smoking in the office corridors and cafeteria. Which
of the following is true in this scenario?
A) The probability of effect is low.
B) The concentration of effect is high.
C) The magnitude of the consequence is high.
D) The temporal immediacy is high.
47) Cigarette ads and smoking have not been completely outlawed in part because the ________
is not 100 percent.
A) probability of effect
B) anchoring effect
C) temporal immediacy
D) externality
48) ________ is a function of the interval between the time the action occurs and the onset of its
consequences.
A) Chronological order
B) Probability of effect
C) Proximity
D) Temporal immediacy
49) A factory continues to dump its chemical waste into the local river in spite of government
orders banning the dumping of industrial effluents in local water bodies. The company knows
that the effects of the chemicals on the water will not be detected until several years later. This is
an example of ________.
A) temporal immediacy
B) social consensus
C) concentration of effect
D) proximity
50) ________ refers to an individual’s physical and psychological closeness to the outcome of an
action.
A) Concentration of effect
B) Proximity
C) Social consensus
D) Spatial intelligence
51) ________ is the extent to which consequences are focused on a few individuals or dispersed
across many.
A) Proximity
B) Probability of effect
C) Concentration of effect
D) Social consensus
52) The ________ perspective of social responsibility states that a manager’s responsibility is to
maximize profits for the owners of the business.
A) effector
B) effectiveness
C) efficiency
D) efficacy
53) From an efficiency perspective, when the manager of a business ________, the self-interests
of the owner are best achieved by serving the interests of society.
A) is also its owner
B) plays a purely administrative role
C) has a strong concern for social welfare
D) is risk averse
54) Which of the following is true regarding the efficiency perspective of social responsibility,
according to Milton Friedman?
A) The welfare of the community is the firm’s responsibility.
B) Managers who are owners must act in the best interests of society and stakeholders.
C) Managers should maximize profits for the shareholders in the business.
D) Firms have obligations not only to shareholders but also to society.
55) A major concern with the efficiency perspective is that corporations can impose indirect
consequences that may not be completely understood or anticipated. In economic terms, such an
unintended consequence is called a(n) ________.
A) externality
B) ethical lapse
C) oligopoly
D) random error
56) Within the context of the efficiency perspective of social responsibility, externalities involve
________.
A) random consequences
B) marketplace interactions
C) unintended consequences
D) indirect acts of social responsibility