c.
to report relevant information to law enforcement agencies.
d.
to impose penalties on companies that engage in unethical business practices.
53. In order to make an ethical decision, the key to problem definition is to
a.
go with the obvious solution.
b.
look at the surface of the problem.
c.
find the most cost effective solution.
d.
identify the root of the problem.
54. The most widely recommended principle for ethical behavior is to do what
a.
is best for yourself.
b.
will yield the most profits.
c.
you would want others to do for you.
d.
will reduce product prices.
55. When evaluating alternatives, the entrepreneur will select one that is truthful, beneficial to all parties,
fair, and
a.
exploitable.
b.
publishable
c.
profitable
d.
repeatable.
56. PortionPac Chemical’s dedication to its customers, employees, and the environment is an example of:
a.
a sustainable small business.
b.
ethical relativism.
c.
social entrepreneurship.
d.
ethical imperialism.
57. Environmentalism poses the greatest threat to small
a.
medical waste disposal businesses.
b.
drugstores.
c.
movie theaters.
d.
auto repair shops.
58. An example of an industry especially vulnerable to efforts to protect the environment is the _____
industry.
a.
glass manufacturing
b.
military construction
c.
restaurants
d.
asbestos removal
59. An example of a small business that actually benefits from the growing interest in environmentalism
would be
a.
a fast-lube and oil change center.
b.
a producer of ethanol from farm waste.
c.
a self-service car wash.
d.
an asbestos removal service.
60. A baker looking for new retail space has returned from a seminar on environmentalism and wishes to
act responsibly in this area. Which action will best accomplish this purpose?
a.
Looking into leasing a LEED certified space
b.
Reduce product prices
c.
Eliminate undesirable processing odors
d.
Increase service to customers
61. U.S. Government assistance is available to lead the entrepreneur in compliance with environmental
law through the
a.
Small Business Administration.
b.
Department of Energy.
c.
Department of Commerce.
d.
Interior Department.
COMPLETION
1. Millicent, founder of a small company that markets baked goods made from organic ingredients,
emphasis honesty in all transactions. In this respect, Millicent acts with ____________.
2. Among the many __________ of any small business are owners, employees, and customers.
3. Suppliers, creditors, and the community are examples of ______________ of a business.
4. Owners, customers, and employees are considered to be the _________ ____________ of a business.
5. Milton Friedman believed the only ________ ____________ of a business is to make a profit while
operating within the rules of the game.
6. Sales people are often asked to walk a fine line between _________ and ____________.
7. Malcolm is careful to share with his employees information about customer orders, financial
performance, and quality concerns. Malcolm is exercising _________ __________.
8. Rhoda, the bookkeeper for a small company, has been diverting company funds into her personal bank
account. Rhoda is engaging in ____________.
9. Tyrone gives 1% of the profits of his company to local organizations like the Little League and the
Boys and Girls Club. In this way, Tyrone is fulfilling his _________ ______________.
10. Entrepreneurs should think carefully about their community commitments because charitable acts may
be a _________ to the organization.
11. Ralph has vending machines on his business property for the convenience of his employees. He
reports on his income tax form only half the cash collected by these machines. The rest is hidden
Ralph’s personal account. This practice is an example of ___________.
12. Sometimes Vincent doesn’t have enough cash on hand to send in the monthly taxes withheld from his
employees’ paychecks. This could be the result of a single-minded focus on production or because of
a casual ____________ ___________.
13. William wants everyone to think his business is growing faster than it actually is so he built an
impressive website with an exaggerated company history. His efforts to mislead are known as
____________ ______.
14. Entrepreneurs would do well to remember that customers who have questions about the ________
____________ (products, representatives, or the organization) are less likely to make purchases.
15. Richard believes the United States is the greatest nation on earth and that all other countries should
subscribe to our system of democracy and human rights. Therefore, he expects his overseas sales reps
to follow American business practices. This is an example of _________ _____________.
16. Carlos understands that cultures develop different standards and practices that govern how business is
conducted. He is careful to observe local customs when he interacts with foreign companies. Carlos
is practicing ___________ _____________.
17. Franco treats his customers with respect. He is always truthful, even if it means losing a sale. He
uses high quality materials and careful craftsmanship. If he can’t meet a customer’s deadline, he says
so. His customers appreciate his integrity, which has helped to build ________ between them and
Franco.
18. When her employees review a situation, they sometimes ask themselves, “What would Marcella do in
this situation?” They know her __________ ____________ have helped to build the business on a
foundation of integrity and serve as a guide for their own decisions.
19. As her business grew, Gretchen could not spend as much time individually with her employees. She
wanted to make sure her values and beliefs permeated the entire organization so she prepared a ____
__ ______ for distribution to all her employees so everyone could follow the same guiding principles.
20. The purpose of the ___________ _________ _________ is to promote ethical conduct on the part of
all businesses in a region.
21. Itzakh uses a list of questions to help him decide among alternatives. These questions include:
1. Is it the ________?
2. Is it ______ to all concerned?
3. Will it build __________?
4. Will it be _________ to all concerned?
22. Waverly Corporation ensures the temperature of water released back into the river is the same
temperature as water drawn from the river for its production needs. It does the same for its exhausted
air. Its products are made with a minimal environmental impact and it has won many awards in its
industry. Waverly Corporation is an example of a __________ ______ ________.
23. PQR Company promotes is practice of using only recycled and recyclable materials in its products.
In the customer waiting area, recycle bins are available for plastic, glass, and aluminum drink
containers. PQR is riding the wave of _____________, a concern for the protection of nature.
24. Companies that use renewable resources, reduce emissions of harmful chemicals into the environment,
and help other firms reduce their waste have taken advantage of ______ _____________.
25. Small businesses are learning that sustainable business practices can hold down _________, attract
_________, and generate value for ___________.
ESSAY
1. How can integrity and financial success be related? Use PortionPac Chemical as an example to
strengthen the argument.
2. Explain how integrity applies to various stakeholder groups, including owners, customers, employees,
the community and the government.
3. What are some important social responsibilities of small businesses?
4. Discuss the relationship between profits and social responsibility in the small firm.
5. Describe the five fundamental principles that an ethics policy should address.
6. List the six-step decision making process in order and comment on each of the steps in resolving
ethical issues.
7. Using examples discussed in the book, discuss how sustainability has resulted in different goals for
small businesses.
8. Describe PRO factors and how these factors relate to customers.
9. Discuss the issues related to Internet usage and personal privacy from both a business perspective and
employee standpoint. What should a small business do to decrease conflict?