161. According to the consumer bill of rights, the idea that consumers’ interests should receive full and sympathetic
consideration in the formulation of government policy is known as the right to:
a. be heard.
b. choose.
c. be informed.
d. safety.
e. listen.
162. How would marketers most likely benefit from the consumer’s right to be heard?
a. Consumers will also tell others about their bad experience with the company.
b. The company can use the information to make its products better.
c. They gain valuable information about their competitors.
d. Consumers are more loyal to companies who have wronged them.
e. More information about the products can be posted online.
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
163. According to the consumer bill of rights, the right to be informed means that:
a. consumers’ interests will receive full and sympathetic consideration in the formulation of government policy.
b. consumers should have access to a variety of goods and services at competitive prices.
c. consumers should have access to and the opportunity to review all relevant information about a product
before buying it.
d. marketers have an obligation not to knowingly market a product that could harm consumers.
e. consumers should be informed when the quality of a product has changed.
164. Ethical standards for acceptable conduct for a company should:
a. be clearly dictated by top management and enforced by all management staff.
b. consider only the point of view of the customers and the employees.
c. reflect the desires of the company’s employees for a quality working environment.
d. be based on company, industry, government, customer, and society viewpoints.
e. be derived only from federal, state, and local laws and regulatory agencies.
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
165. When is the best time to deal with marketing exchange problems concerning ethics?
a. Right before the problem is made public
b. After the problem has received extensive media attention
c. Immediately after the problem is discovered
d. When lawsuits are brought against the company
e. During the strategic planning process
166. A marketing ethics issue likely exists when:
a. company members disagree about a marketing decision.
b. an activity does not benefit the organization but benefits the environment.
c. an activity results in increased prices for the consumer.
d. a consumer is dissatisfied with a marketing decision.
e. an individual or organization must choose from among several actions that must be evaluated as right or
wrong.
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
167. Reese has recently joined PharmaTec, a large pharmaceutical firm, as a sales representative. He was briefed on
the recent lawsuit a physician has filed against PharmaTec alleging that he did not receive the necessary
informationaboutthenegativesideeffectsofoneofitscholesteroldrugs.Reese’ssalesmanagerhassaidthatif
Reesecomesacrossanydocumentationintheformersalesrepresentative’sofficeaboutvisitstothephysician,he
isnottosayanythingtoanyone,andnotifythemanagerimmediately.Reesecertainlydoesn’twanttojeopardizehis
new, and potentially profitable job. He has identified four possible courses of action he could take. Which of the
following criteria should Reese use to evaluate each possible action in order to choose the most ethical?
a. ItslevelofpositiveornegativeimpactonPharmaTec’sreputation
b. Itspotentialtoincrease(ordecrease)PharmaTec’sprofit
c. Whether the action is inherently right or wrong
d. Whether he will be appreciated or unappreciated by his coworkers afterward
e. Whether it will be courageous or cowardly on his part
168. An ethical issue is:
a. likely to arise when an employee’s moral philosophy is consistent with the organization’s expectations of the
employee’s behavior.
b. an identifiable problem, situation, or opportunity requiring an individual to choose from among several actions
that must be evaluated as right or wrong.
c. most often found in personal selling situations.
d. easily resolved by consulting written laws and regulations.
e. characterized by a blatant disregard for human rights and equality.
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
169. _____ ethical issues generally surface when companies fail to disclose risks associated with a product or
information regarding its function, value, or use.
a. Promotion-related
b. Distribution
c. Corporate
d. Product-related
e. Safety
170. Product-related ethical issues arise when marketers:
a. provide consumers with inadequate information about how a product is priced.
b. force channel intermediaries to behave in a specific manner.
c. bribe salespeople to push one product over another.
d. fail to disclose information to consumers about the risks associated with using a product.
e. manufacture a product that is very similar to a competing product.
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
171. Bridgewater, Inc. produces its industrial components in several developing countries outside the United States. One
ofBridgewater’scustomersisCraftCare,whousesBridgewatercomponentsintheproductionofchildcarseats.
Recently,therewasarecallofCraftCare’scarseatsduetoseriousinjuries,whichthecompanyhastracedback
toBridgewater’scomponents.IfBridgewaterknewaboutthefaultycomponents,butfailedtonotifyCraftCare,it
would have been engaging in unethical behavior with regard to which of the following marketing issue areas?
a. Planning and strategy
b. Distribution-related
c. Promotion-related
d. Product-related
e. Quality-related
172. Achipsmanufacturerintroducesanew,largersizedcanofpotatochipsusingthewords“newsize”onthelabel.
However, the can is larger while the contents are slightly smaller than the original sizes. The correct weight is
printed on the can. In this case, a _____ ethical issue exists.
a. decision-making
b. promotion-related
c. product-related
d. pricing-related
e. distribution-related
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
173. Beth is responsible for the product line of Avenger Transformer action figures. In testing her firm’s new TV ads,
Beth discovers some children think many of the toys can actually fly. Beth knows that there are only a few children
in the groups aged 3 to 5 that believe this, so she decides to use children over age 5 as her target market. Since the
ads will be shown on programs that have her target market as its viewers, Beth decides to include a statement
“figuresdonotactuallyfly”onthebottomofthescreen.However, she still faces an ethical decision regarding
which element(s) of the marketing mix?
a. Product-related
b. The right to know
c. Performance-related
d. Promotion-related
e. Strategy-related
174. A cereal company advertises that its newly launched product can lower cholesterol although the company cannot
provide evidence to substantiate this claim. This situation involves an ethical issue related to which element of the
marketing mix?
a. Product
b. Pricing
c. Promotion
d. Distribution
e. Production
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
175. When a purchasing agent for a processor manufacturer is offered a bribe by a silicon manufacturer salesperson:
a. a promotion-related ethical issue has been created.
b. the purchasing agent is free to accept the bribe without consequences.
c. an ethical issue primarily related to the pricing of products exists.
d. there is an ethical dilemma for the purchasing agent that is product related.
e. no ethical issue exists under these circumstances.
176. After a hurricane strikes the U.S. Gulf Coast, a tremendous demand for gas-powered generators occurs. Many of
the local hardware and home supply stores have limited supplies of these items. However, Ace Hardware has a
large inventory of these items. Traditionally, Ace has lower prices than the other competitors. What major ethical
decisions is Ace likely to face with regard to the current issue?
a. Product-related and pricing-related
b. Advertising-related and distribution-related
c. Distribution-related and product-related
d. Publicity-related and advertising-related
e. Pricing-related and promotion-related
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
177. Distribution-related ethical issues arise when marketers:
a. do not provide intermediaries with enough information about how a product is priced.
b. force channel intermediaries to behave in a specific manner.
c. bribe salespeople to push one product over another.
d. fail to disclose information to consumers about the risks associated with using a product.
e. distribute a product that is very similar to a competing product.
178. At times, large retailers may be accused of coercion in dealing with intermediaries because of the amount of power
and control these large companies have over many of their suppliers. This is most potentially a _____ related
ethical issue.
a. promotion
b. pricing
c. culture
d. product
e. distribution
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
179. _____ are formalized rules and standards that describe what a company expects of its employees in terms of
ethical behavior.
a. Job descriptions
b. Ethics clauses
c. Behavior contracts
d. Codes of conduct
e. Ethics contracts
180. Codes of conduct are also frequently known as:
a. ethics mandates.
b. codes of ethics.
c. corporate culture.
d. ethics compliance programs.
e. moral codes.
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
181. Which one of the following statements about codes of conduct (ethics) is false?
a. They are formalized rules and standards that describe what a company expects of its employees.
b. They must be detailed enough to take into account many possible situations.
c. They encourage ethical behavior by eliminating opportunities for unethical behavior because employees know
what is expected of them.
d. They help marketers deal with marketing issues by prescribing and limiting certain activities.
e. Top management must provide leadership in implementing codes of ethics.
182. What is the major difference between social responsibility and marketing ethics?
a. Marketing ethics varies by industry whereas social responsibility involves universal rules of conduct.
b. There is legislation that deals with marketing ethics, but none for socially responsible practices.
c. Marketing ethics is concerned with organizational practices, and social responsibility is concerned with
individual behavior.
d. There is no difference; they are synonymous terms.
e. Social responsibility deals with the total effect of marketing decisions on society, whereas marketing ethics
relates to individual and group evaluations in marketing situations.
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
183. Companies that incorporate ethics and social responsibility into their strategic plans are likely to face:
a. improved marketing performance.
b. increased lawsuits.
c. negative publicity.
d. reduced costs.
e. disappointed shareholders.
184. Refer to Scenario 3.1. Milton Hershey contributed resources to the community to improve the overall quality of life
for consumers, employees, and the community in general. This reflected his ____ responsibility.
a. philanthropic
b. ethical
c. legal
d. economic
e. shareholder
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
Scenario 3.3
Use the following to answer the questions.
Hershey Foods was founded in the nineteenth century by Milton Hershey, who had a strong ethical value
system฀always show integrity, be honest, and respect others. Hershey felt it was important to provide high-quality
goods and services of real value at competitive prices that provide an adequate return on investment. He also
goods and services of real value at competitive prices that provide an adequate return on investment. He also
founded the Milton Hershey School, operating today as a cost-free, private home and school dedicated to helping
children with social needs and limited resources. The company also focuses on environmental issues, such as
reducing waste by 360,000 pounds annually by redesigning Hershey’s Syrup caps. Hershey Foods has an ethics
compliance program that includes a code of ethics and training, guidelines for handling legal and ethical issues, an
800 number for assistance with ethical issues, and support from supervisors and human resource managers in
dealing with ethical issues. However, in the last few years, Hershey has been criticized by several advocacy groups
concerning the sourcing of its chocolate from West Africa where many of the companies use child labor. While
Hershey is the largest chocolate candy producer in America, it lags behind other major chocolate producers with
regard to certifying its chocolate as child labor-free.
185. Refer to Scenario 3.3. The fact that the Hershey company has recently reduced its waste by 360,000 pounds
through a packaging redesign is evidence of its focus on:
a. a philanthropic culture.
b. an ethical culture.
c. social responsibility.
d. the legal climate.
e. the economic environment.
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
186. RefertoScenario3.3.ThecriticismofHershey’ssourcingforchocolateisanexampleof_____,whilethe
potential use of child labor to produce Hershey products impacts its level of commitment to _____.
a. consumerism; organizational culture
b. ethics; social responsibility
c. shareholder orientation; social responsibility
d. ethical climate; ethics
e. consumerism; sustainability practices
187. Refer to Scenario 3.3. Hershey and its employees benefit in many ways from its strong ethics compliance program.
Which of the following is not one of the benefits of such a program?
a. Enforcement and discipline of ethical infractions
b. Better employee understanding of ethical issues
c. Free-flowing communication within the firm regarding ethical issues
d. These programs are expensive to develop and maintain
e. High level of organizational guidance for employees
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
Scenario 3.4
Use the following to answer the questions.
WhiteWave Foods, producer of brands such as Silk Soymilk, specializes in manufacturing innovative and nutritious
food products. Silk Soymilk was first launched in 1996, and is committed to the health of its customers, as well as
the health of the planet. At Silk, they have offset all of their energy consumption with wind power, preventing over
16,000 tons of greenhouse gasses from entering the atmosphere each year. Silk Soymilk is made from a mixture of
organic and natural, non-genetically modified soy beans, reducing the amount of pesticides in the air, soil, and water.
Since 2002 they have been sponsoring the FarmAid concert, whose mission is to keep family farmers on their own
land and ensure a safe, healthy food supply for all Americans.
188. Refer to Scenario 3.4. Silk Soymilk’s sponsorship of the FarmAid concert is best thought of as an example of its:
a. cause-related marketing effort.
b. ethical responsibility.
c. green marketing strategy.
d. philanthropic activities.
e. environmental strategy.
189. Refer to Scenario 3.4. Silk Soymilk’s use of organic, non-genetically modified soybeans in its product is an example
of:
a. green marketing.
b. social consciousness.
c. ethical responsibility.
d. cause-related marketing.
e. corporate benevolence.
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
190. Refer to Scenario 3.4. The use of wind power to offset energy consumption by Silk Soymilk’s parent company
demonstrates its commitment to:
a. consumerism.
b. ethical marketing.
c. social responsibility.
d. philanthropic strategy.
e. environmental marketing.
191. Refer to Scenario 3.4. Silk Soymilk’s parent company, WhiteWave Foods, is currently operating at the _____ level
of the social responsibility pyramid.
a. economic
b. philanthropic
c. ethical
d. legal
e. cause-related
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
192. The marketing environment consists of external forces that directly or indirectly influence an organization’s
acquisition of inputs and generation of outputs.
a. True
b. False
193. Environmental analysis is the process of collecting information about forces in the marketing environment.
a. True
b. False
194. Environmental analysis helps managers identify potential threats and opportunities linked to environmental changes.
a. True
b. False
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
195. Brand competitors market products with similar features, benefits, and prices to the same customers.
a. True
b. False
196. Product competitors provide very different products that solve the same problem or satisfy the same basic
customer need.
a. True
b. False
197. The number of firms that control the supply of a product may affect the strength of competition.
a. True
b. False
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
198. A monopoly exists when a firm with many potential competitors attempts to develop a marketing strategy to
differentiate its products.
a. True
b. False
199. An oligopoly exists when a firm offers a product that has no close substitutes, making the firm the sole source of
supply.
a. True
b. False
200. Pure competition is a common competitive environment.
a. True
b. False
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics
201. Monitoring the competitive environment guides marketers in developing competitive advantages.
a. True
b. False
202. Economic forces determine the size and strength of demand for products.
a. True
b. False
203. A prolonged period of recession is characterized by extremely high unemployment, very low wages, minimal total
disposable income, and lack of consumer confidence in the economy.
a. True
b. False
Chapter 3 – The Marketing Environment, Social Responsibility, and Ethics