Chapter 1 Which The Following Not Question The

Document Type
Test Prep
Book Title
Business Ethics: Case Studies and Selected Readings 8th Edition
Authors
Marianne M. Jennings
Business Ethics, 8e Jennings
59. James Dodgsen is a student in a graduate course in business. The professor in the course has
given Dodgsen and his classmates a surprise quiz in class. Dodgsen did not do the reading for
class that day because he had been grading papers as part of his TA position. He has been
prepared for every other class that semester. As he glances as the quiz questions, he realizes
that he does not know any of the answers. However, he sees that Jane Frampton, the student
who sits next to him, is well prepared and answering the questions with great ease. He can see
her answers because of her large, block-style printing. Dodgsen copies her answers.
60. Which of the following is not a question in the Laura Nash model for resolution of ethical
dilemmas?
61. Into which of the following categories do patent and copyright infringement fall?
62. Which of the following best describes the “Parable of the Sadhu” events?
63. Which of the following does the mountain climb represent in the “Parable of the Sadhu”?
64. Which of the following does the Sadhu represent in the “Parable of the Sadhu”?
Business Ethics, 8e Jennings
65. Which of the following would be a breach of trust and ethics?
66. An ad contains the following: Restaurant Critic, Jose Winfrey, on Mama Leone’s Italian Eatery,
‘Mama Leone’s is simply the best. It is a surprising new entrant into the competitive Italian bistro
market and it is a mighty one.’” Jose Winfrey is the cousin of the owner of Mama Leone’s and
knows restaurants, but is not a critic for any publication or other media outlet. The ad:
67. Stephen Ambrose, a popular historian with many books to his credit, admitted that some
segments of one of his recent books had language taken from the books of other historians that
was not in quotes. Mr. Ambrose did footnote the work of authors he relied upon in doing his book.
68. Which of the following ethical theorists subscribes to self-interest?
69. The contractarians are best represented by:
70. Which best describes the Categorical Imperative?
71. Which is Warren Buffett’s test for ethics?
Business Ethics, 8e Jennings
72. There are no laws that cover cutting in line. However, those who do take cuts in line are viewed
with disdain by others because:
73. Customer A has $250 in his account. Six checks, totaling $325, have come in for payment. One
check is for $257.00, with the remaining five checks making up the difference to the $325 total.
First Bank pays the five smallest checks first, honors the $257.00 with overdraft protection, and
charges the customer one overdraft fee. Second Third Bank pays the largest ($257) check first,
pays the five remaining smaller checks with overdraft protection, and then charges the customer
five overdraft fees. Which of the following is correct?
74. The Graduate Management Admissions Council announced that it was canceling the GMAT
scores of 84 applicants and students. The Council found that the students were active users of a
now shut-down website, Scoretop.com, a site with origins in China that posted live questions from
the GMAT. The site had 5,000 to 6,000 subscribers who paid $30 per month for access, but the
Council is only canceling the scores of those against whom it feels it has an airtight case. Two of
the students whose scores were canceled are currently enrolled at the University of Chicago’s
MBA program and another has already graduated from Stanford’s MBA program. Twelve of the
students whose scores were canceled had posted questions on Scoretop.com and the remaining
72 allowed the site to post their testimonials that they had seen the Scoretop.com questions on
their GMAT. Ten of the 72 students had applied to Stanford but were denied admission. Which
ethical category does the conduct of the students who posted live questions fit into?
75. The Graduate Management Admissions Council announced that it would begin using a “palm
vein” scan to eliminate proxy test taking after the FBI broke up a ring of six test takers who had
taken the GMAT for 590 applicants, for a price of $3,000 each. Which ethical category does the
conduct of the proxy test takers fit into?
76. Which statement best describes the moral of the story in “The Parable of the Sadhu”?
Business Ethics, 8e Jennings
77. The former CEO of Countrywide Mortgage (now a part of Bank of America), offered favorable
loans to members of Congress, Countrywide government regulators, and members of the board
and officers of Fannie Mae, the quasi-government agency that bought Countrywide’s mortgages
in the secondary market. The loans were jumbo loans at below-market rates. Countrywide sold
90% of its mortgages to Fannie Mae. Congress was responsible for the creation, funding, and
policies of Fannie Mae. The members of Congress who received the Fannie Mae favorable loans
sat on House and Senate Banking Committees. Which of the following categories of ethical
breaches, if any, applies to this practice?
78. Former NBA referee Tim Donaghy entered a guilty plea to two federal felony charges in
connection with his bets and tips to others on NBA games. Mr. Donaghy picked teams to win in
games he was scheduled to referee. Experts have said that Donaghy committed the equivalent
of insider trading on Wall Street by providing outsiders with information about games, players,
and referees. He got $5,000 from his tippees for correct picks. Apart from the criminal charges,
what category of ethical breach does Mr. Donaghy’s conduct fall into?
79. Priscilla Ceballos’s 6-year-old daughter is a fan of Hannah Montana and wanted to go to a
Hannah Montana concert. A radio station was offering two tickets to the Hannah Montana
concert for the child who wrote the winning essay. Ms. Ceballos and her daughter wrote an
essay that detailed an account of their husband/father dying in the war on Iraq. The problem was
that their husband/father was not in Iraq and certainly not dead. When the fake essay was
uncovered, Ms. Ceballos said, We did the essay, and that’s what we did to win. . . We did
whatever we could to win.” The company revoked the prize and the award of the tickets.
Suppose the contest rules did not spell out that the essay had to be based on true and verifiable
facts. What could the radio station rely on in revoking the prize and still have public support for its
decision?
80. LeAnn Rimes, a country western singer, signed a contract at age 12 with Curb Records. Curb
Records is owned by Mike Curb, a long-standing presence in the music industry who began his
career with a group known as The Mike Curb Congregation. Under the terms of that contract as it
Business Ethics, 8e Jennings
originally existed, and as it was signed by Ms. Rimes’ guardians, Ms. Rimes would have been 35
before she had delivered the 21 albums required under the agreement. “At 12, I didn’t understand
everything in my contract. All I know is that I really wanted to sing,” was the explanation Ms.
Rimes offered when she later testified before the California Senate Select Committee on the
Entertainment Industry looking into the labor issues surrounding long-term album requirements
contracts. Which of the following would apply to Curb Records’ conduct with regard to Ms.
Rimes?
81. Minnesota has a statewide smoking ban for public places. However, the state statute includes an
exemption that permits smoking by actors in theatrical performances. In order to take advantage
of the exemption, the Old Clover Inn, located in Vadnais Heights, Minnesota, has begun holding
theater night, every night. The Old Clover Inn has placed its pool tables in an area that is framed
with theater curtains and refers to the pool players as its actors. The Inn also has a stage for its
cribbage players who sit and play cribbage and smoke.
The Inn calls the nightly production, “As the Clover Turned,” and it distributes a playbill that
describes the nightly plays as involving “numerous uncredited actors in the role of bar patrons.”
The Inn distributes buttons for $1 to patrons. The buttons read, “Act Now!”
The Minnesota Health Department has warned the Inn that what it is doing is an attempt to
circumvent the law. Which statement best describes the Old Clover Inn’s approach to ethics?
82. A group of Wachovia (now part of Wells Fargo) customers filed a class action lawsuit against
Wachovia Bank because fraudulent telemarketers had taken money from their accounts and that
the telemarketers did so with the knowledge of bank executives who were aware of the fraud but
did nothing to stop it. Banks executives insisted that they knew nothing about the thefts.
However, internal e-mails released during discovery in the case showed that executives were
discussing the frauds and providing warnings.
“YIKES!!!!”
“DOUBLE YIKES!!!!”
“There is more, but nothing more that I want to put into a note.”
Warning from a Wachovia bank executive to colleagues that the bank had received 4,500
complaints of fraud in two months from customers who had been fleeced of $400 million by
marketing firms who paid the bank large fees for access and on returned checks.
“We are making a ton of money from them.”
What test for resolving ethical dilemmas would have helped the executives at Wachovia reach a
better decision as they debated the issue on their e-mails?
83. The UCLA Medical Center is facing sanctions from California’s Department of Health because
several of its employees viewed records of famous patients, patients with whom the employees
had no contact or care responsibilities. The employees viewed the records of, among others,
Maria Shriver (wife of Governor Arnold Schwarzenegger), the late Farrah Fawcett, and Britney
Spears.
The unauthorized access to the records was uncovered when the story of the late Ms. Fawcett’s
recurrence of cancer was published in The National Enquirer before Ms. Fawcett had disclosed
her health condition to family or friends. Ms. Fawcett’s lawyers then notified the hospital of the
only possible source of the information.
Which category of an ethical breach applies to the conduct of the hospital employees?
84. Which model for ethical decision analysis requires managers to seek additional perspectives on
ethical issues?
85. Matt Walsh, a golf pro from Hawaii, was a video operator for the New England Patriots from
1999-2002. Walsh says that he taped the Patriots’ opponents’ signals, information that he says
was then used by the Patriots when they next met that team. If you know the signals, then you
know what defense has planned. Offense is then a tad easier.
Some quotes emerged from the situation:
From Patriots’ coach, Bill Belichick, “I misinterpreted the rules.”
From Jacksonville Coach Jack Del Rio on the videotaping, I think all teams do that. That’s been
going on forever.”
From Matt Walsh, “I had always been a big Patriots fan. I wasn’t going to question what they
wanted me to do.”
From Pennsylvania Senator Arlen Specter, “If you can cheat in the NFL, you can cheat in college,
you can cheat in high school, you can cheat on your grade-school math test. There’s no limit as
to what you can do. I think they owe the public a lot more candor and a lot more credibility.”
What rationalization is the Jacksonville coach applying?
86. With respect to #85, what rationalization did Matt Walsh follow?
Business Ethics, 8e Jennings
87. With respect to #85, what is Senator Specter concerned about?
88. Into which group would the students at Stuyvesant High School fall?
89. Which of the following categories does hazing fit into?
90. What rationalization did the students at Stuyvesant High School offer for cheating?
91. What rationalization do most speeders use to justify driving in excess of the speed limit?
92. Which category of ethical dilemma applies to dog walkers who do not scoop up after their pets?
93. Pam purchased a quesadilla at Taco Bell for lunch. She also asked for a water cup, which is free
94. Megyn Kelly, a Fox News Anchor, is interviewing a physician about the impact of Obamacare.
The physician is a partner with Ms. Kelly's ex-husband.
95. What was the occupation of the author of "The Parable of the Sadhu" piece?
96. Ralph has used all but one day of his personal leave time (PLT). His company's policy is that
PLT can be used for illness, family needs, or medical appointments. Ralph has used his PLT
days when he was hung over or when a friend wanted to spend the day with him. Ralph's
grandmother, to whom he is very close, passed away, and he would like to go to her funeral, but
it will take a day of travel, a day for the funeral, and a day to return. Ralph has asked his
supervisor for additional time off in order to go to the funeral. Which of the following is correct?
97. Lance Armstrong says that he looked up the meaning of the word "cheat" in the dictionary when
he was using performance-enhancing drugs (PEDs). The dictionary defined cheating as "using
an unfair advantage in a competition." Mr. Armstrong believed that PEDs were used by his
competitors and felt it was ethical to continue using them. Which rationalization did Mr.
Armstrong use?
99. Edward Snowden released classified documents that were stored at his employers' archives. He
works for a government agency. He released them because he felt U.S. citizens should know
what kind of information their government was keeping about them. Which of the following is a
correct statement?
100. Randy White is the executive director of a non-profit preschool for special needs children. Part of
Randy’s responsibilities include fundraising for the preschool. Because of his experience and
success in operating specialty pre-schools, Randy is sought after as a consultant at locations
around the country to assist in the start-up and operation of such facilities. Randy does so quite
frequently. Randy does not take vacation time for this work, and his consultant fees (which range
from $750 - $1500 per day) are kept by him as personal income. Randy uses his secretary at the
preschool to book his travel arrangements and prepare his consultant reports and bills for these
outside engagements.
101. What was the American Bar Association’s position on enhanced interrogation techniques used
during the Bush administration?
Short Answer/Essay Questions
1. Explain what ethics is. Give a definition here.
SUGGESTED ANSWER:
2. List and briefly describe the schools of ethical thought.
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3. List the categories of ethical dilemmas.
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4. Give the ways we avoid facing ethical dilemmas.
SUGGESTED ANSWER:
Give it a different label:
Rationalizations:
5. Give a description of the simple tests that can be used to resolve ethical dilemmas.
SUGGESTED ANSWER:
6. List the six steps you should follow for analyzing an ethical dilemma.
SUGGESTED ANSWER:
7. List those affected when employees cheat on their travel expenses.
SUGGESTED ANSWER:
8. Define wi-fi piggybacking and explain why it is an ethical issue.
SUGGESTED ANSWER:
Business Ethics, 8e Jennings
9. List those who are affected by wi-fi piggybacking.
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10. Dr. Phil Hayes has received an offer of full funding for his research on a new drug manufactured
by Eli Mentin. The drug would be a competitor for Prozac without the questioned side-effects of
possible violent behavior. Eli Mentin has, however, attached a condition to the funding. That
condition is that Dr. Hayes may not publish his findings until Eli Mentin executives and its
attorneys have had the opportunity to review them.
List the ethical issues Dr. Hayes faces with this offer.
SUGGESTED ANSWER:
11. Susan Wade is the president of the Illinois Hospice Organization (IHO). IHO is a state
organization affiliated with a national non-profit organization, the National Hospice Organization.
Both the state and national organizations have members from both for-profit and non-profits
hospices. Susan Wade is the director of a non-profit hospice in Illinois.
A Chicago newspaper has printed a story about hospices and what they do. Susan was
interviewed extensively for the piece. In one quote in the article, Susan expressed her concerns
about for-profit hospices. "It has become the sort of franchise of the decade. They're not all bad,
but I think the original spirit of hospice is becoming very adulterated. There's one time in a
person's life when he shouldn't be looked at as a number, as a piece of an actuarial problem. If
your first and last priority is making money, it flies in the face of what hospice is all about. It's the
end of the health-care chain. It's the place of last hope for patients. Dollars should not be the
issue here."
A chief operating officer of a for-profit hospice has written to Susan complaining that her remarks
are libelous and misinform the public about for-profit hospices.
a. Does Ms. Wade have a conflict of interest?
b. Is Ms. Wade properly executing her role as the president of the state organization?
SUGGESTED ANSWERS:
12. Henry Rauzi, the controller for Sunbeam, issued an offer to Linda Croce for an entry-level
accounting position at Sunbeam at a salary of $34,000 per year. Ms. Croce accepted the offer
and gave notice to her employer. When then-CEO of Sunbeam, Paul Kazarian, was informed of
the offer, he demanded that Mr. Rauzi rescind it because Kazarian had not approved it prior to it
being made. Mr. Rauzi called Ms. Croce at 10:00 P.M. three days before she was scheduled to
being work and told her of Mr. Kazarian's action. Ms. Croce had no job and remained
unemployed for several months while she searched for a new job.
Evaluate the legality and ethics of Sunbeam's officer's actions with respect to Ms. Croce.
SUGGESTED ANSWER:
13. In 1991, James McElveen fell 30 feet from a waterfall and broke his back. He was employed by a
small business and had no medical insurance. His lifetime friend, Benny Milligan, was with him
when the fall occurred. Benny took James to the emergency room. Moved by his friend's severe
injuries and pain and suffering and realizing that James did not have insurance, Benny switched
IDs with James in the hospital emergency room. James required surgery to fuse his back to
avoid what doctors said would have been certain paralysis. The cost of the surgery and
hospitalization was $41,107.45. Neither James, employed as a mechanic, nor Benny, employed
as a painter, could have paid for the surgery and follow-up care. Benny's employer's insurance
paid for the surgery because the hospital took the information from Benny's ID found in James'
pockets.
While Benny was contemplating telling his employer, someone notified the insurance company of
the switch. Benny, James, and Benny's wife, Tammy Milligan, were charged and convicted of
mail fraud, wire fraud and conspiracy. Tammy, because of the Milligans' three young daughters,
is serving her sentence through home confinement, Benny is serving 9 months and James is
serving 7 months. All three will serve three years on probation and pay restitution.
Benny states, "I know what I did was wrong. But I look back on it, and I feel that I had to do it at
the time. I don't feel like I'm a criminal in the sense of rapers, muggers and murderers." Benny
said he did not understand that a hospital has an obligation to treat someone who is dying.
Business Ethics, 8e Jennings
Friends testified that as they were racing James to the hospital they told Benny that hospitals in
the area had routinely refused to provide medical treatment.
Benny said he wanted to tell his employer, but he was afraid he would be fired and then be stuck
with the bill. Tammy adds that the government is right to demand restitution but wrong to
imprison them. James asked the judge if he could go to prison for all three of them, "I would be
lost without my friendship with Benny. I probably would be dead."
a. Benny and James committed an illegal act. Was it unethical?
b. What punishment is appropriate in the case?
c. If you were Benny's employer, what would you have done?
SUGGESTED ANSWERS:
14. Althea Caldwell is the director of Arizona's Department of Health Services (DHS). DHS is
charged the administration of the state's behavioral health system and is responsible for
contracting with private providers for millions of dollars of mental health care each year for eligible
patients.
Business Ethics, 8e Jennings
Ms. Caldwell accepted a $20,000 per year director position for a hospital group corporation. One
of the hospitals in the group was one to which state contracts for mental health treatment had
been awarded.
One month after accepting the position, Ms. Caldwell asked the state's attorney general for an
opinion as to whether she had a conflict of interest.
Does Ms. Caldwell have a conflict of interest?
SUGGESTED ANSWER:
15. Stanford University medical researchers conducted a study on the correlation between the use of
fertility drugs and ovarian cancer. Their study, published in the American Journal of
Epidemiology, concludes that the use of the fertility drugs, Pergonal and Serophene, may
increase the risk of ovarian cancer by three times. The lead author of the studies, Professor Alice
Whittemore, stated, "Our finding in regard to fertility drugs is by no means certain. It is based on
very small numbers and is really very tenuous."
FDA Commissioner David Kessler would like the infertility drug manufacturers to disclose the
study findings and offer a warning on the drug packages. He notes, "Even though the
epidemiology study is still preliminary, women have a right to know what is known. We're not
looking to make more of this than there is."
If you were a manufacturer of one of the drugs, would you voluntarily disclose the study
information?
SUGGESTED ANSWER:
16. Former-President George W. Bush has proposed reforming Social Security by asking those from
ages 18-40 to forego their social security and invest their own funds in a retirement/pension plan.
What ethical theory most applies to this proposal?
17. Applying ethical theories, discuss why you would not take food out in your pockets from an all-
you-can-eat buffet.
SUGGESTED ANSWER:
Business Ethics, 8e Jennings
18. In November 2009, world-class golfer Tiger Woods crashed his escalade into a tree near his
Florida home. One of the windows in his Escalade had been smashed with a golf club. Mr.
Woods’ wife pulled him from the car and he was taken to the hospital, treated for injuries, and
released. A sordid tale emerged over the next few days of a pattern of extra-marital affairs by Mr.
Woods with a resulting separation from his wife and their eventual divorce. Following these
public disclosures, sports writers, golf pros, country club staff members, and even CEOs of
companies said that they were all aware of Mr. Woods’ infidelity and that it was the best kept
widely known secret among and between those who were golf players and/or fans. One said,
“We just had a pact of silence.” When the news of Mr. Woods’ serial infidelity made international
news, some of his sponsors dropped him and others continued with him as a spokesperson. Are
there any ethical issues here? Who faces them? Discuss whether you would have gone along
with the pact.
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19. Discuss norm shifting and speeding.
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20. Explain who is affected when dog walkers don't scoop up after their dogs.
SUGGESTED ANSWER:
21. Susan Wade is the president of the Illinois Hospice Organization (IHO). IHO is a state
organization affiliated with a national non-profit organization, the National Hospice Organization.
Both the state and national organizations have members from both for-profit and non-profits
hospices. Susan Wade is the director of a non-profit hospice in Illinois.
A Chicago newspaper has printed a story about hospices and what they do. Susan was
interviewed extensively for the piece. In one quote in the article, Susan expressed her concerns
about for-profit hospices. "It has become the sort of franchise of the decade. They're not all bad,
Business Ethics, 8e Jennings
but I think the original spirit of hospice is becoming very adulterated. There's one time in a
person's life when he shouldn't be looked at as a number, as a piece of an actuarial problem. If
your first and last priority is making money, it flies in the face of what hospice is all about. It's the
end of the health-care chain. It's the place of last hope for patients. Dollars should not be the
issue here."
A chief operating officer of a for-profit hospice has written to Susan complaining that her remarks
are libelous and misinform the public about for-profit hospices.
a. Does Ms. Wade have a conflict of interest?
b. Is Ms. Wade properly executing her role as the president of the state organization?
SUGGESTED ANSWERS:
22. What are the values in conflict in the enhanced CIA interrogation case?
SUGGESTED ANSWER:

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