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1. Business ethics provides a guarantee of profitability.
a. True
b. False
2. Unethical behavior is not necessarily illegal behavior.
a. True
b. False
3. A lack of business ethics can result in a lack of business goodwill.
a. True
b. False
4. Business ethics is the application of standards for moral reasoning to business dilemmas.
a. True
b. False
5. Situational ethics is also known as moral relativism.
a. True
b. False
6. Natural law and positive law are one and the same theories of moral standards.
a. True
b. False
7. Milton Friedman's standard for business social responsibility is one that requires a company to do all that it can for
its community.
a. True
b. False
8. The inherence school is one that follows the standard of society's interest coming first.
a. True
b. False
9. The enlightened self-interest school manager serves only the shareholder.
a. True
b. False
10. Invisible hand managers do not become involved in social issues.
a. True
b. False
11. The social-responsibility school holds that businesses profit by being responsive to society.
a. True
b. False
12. Business self-regulation has been effective in solving social problems.
a. True
b. False
13. Giving a false impression, although not actually an untruth, is still an ethical violation.
a. True
b. False
14. A code of ethics is an individual firm's behavior standard for employees.
a. True
b. False
15. Most businesses today do not have a code of ethics.
a. True
b. False
16. Condoning unethical behavior is an ethical breach.
a. True
b. False
17. Personal choices and lifestyles have no impact on one's business ethics.
a. True
b. False
18. The "front page of the newspaper test" is an application of whether conduct gives the appearance of impropriety.
a. True
b. False
19. The first question of the Blanchard/Peale model for resolving ethical dilemmas is whether the conduct is legal.
a. True
b. False
20. Whether everyone else does it is one method for evaluating the ethics of a particular course of action.
a. True
b. False
21. "I was just following orders," is a defense in law and a test for ethical behavior.
a. True
b. False
22. Sexual harassment is a form of interpersonal as well as organizational abuse.
a. True
b. False
23. A relativist asks why someone is engaged in unethical or illegal conduct before determining whether the conduct is
right or wrong.
a. True
b. False
24. "That's the way it has always been done," is a phrase that often signals ethical difficulties.
a. True
b. False
25. The first question of the Wall Street Journal model is whether the conduct complies with the law.
a. True
b. False
26. In the Parable of the Sadhu, the hikers are certain the religious pilgrim survived.
a. True
b. False
27. In the Parable of the Sadhu, the hikers' climb is successful.
a. True
b. False
28. Ethics can provide a strategic advantage for companies.
a. True
b. False
29. A 2012 Joseph Institute study found nearly half of high school students copied homework from other students.
a. True
b. False
30. Rationalization is an effective means of analysis for ethical issues.
a. True
b. False
31. An ombudsperson and/or ethics hotline are both critical to an ethical culture in a company.
a. True
b. False
32. The least corrupt countries have the most stable economies.
a. True
b. False
33. “Everybody else does it” is a valid test for determining whether conduct is ethical.
a. True
b. False
34. Warren Buffett follows the Front-Page-of-the-Newspaper test as a guide for his businesses.
a. True
b. False
35. Compliance with the law meets all ethical standards.
a. True
b. False
36. The level of cheating in high schools and colleges is declining.
a. True
b. False
37. Sarbanes-Oxley is the most extensive regulation of companies since the 1933 and 1934 Securities laws.
a. True
b. False
38. An anonymous reporting system is a requirement for companies under Sarbanes-Oxley.
a. True
b. False
39. Having a code of ethics does not reduce a company’s sentence under the federal sentencing guidelines.
a. True
b. False
40. A company that self-reports a legal violation risks a higher penalty.
a. True
b. False
41. Training employees in ethics is a factor that reduces a company’s sentence under the federal sentencing guidelines.
a. True
b. False
a. True
b. False
42. The either/or conundrum is an example of moral relativism.
a. True
b. False
43. Pressure contributes to the use of the either/or test for resolving ethical dilemmas.
a. True
b. False
44. The 2012 corruption index shows that Somalia is considered the most corrupt country.
a. True
b. False
45. Trust is not critical to investment or economic success.
a. True
b. False
46. Ethics consists of the unwritten rules we apply in both business and personal lives.
a. True
b. False
47. “When in Rome, do as the Romans do,” is an example of moral relativism.
a. True
b. False
48. Conflicts of interest can result in the use of quid pro quo.
a. True
b. False
49. The 2009 Corruption Perceptions Index lists Denmark as the least corrupt country.
50. “It’s a gray area,” if it applies, means that the conduct you are evaluating is ethical, so long as you stay in the gray
area.
a. True
b. False
51. Rationalization is one form of ethical analysis.
a. True
b. False
52. When Hilton Hotels hired Ross Klein and Amar Lalvani from Starwood Hotels, Klein and Lalvani took many
electronic documents with them from Starwood. What they did was simply good business and presented no ethical
problems.
a. True
b. False
53. The “Tony Bennett Factor” refers to the importance of adhering to values as a key to long-term success.
a. True
b. False
54. The regulatory cycle provides an opportunity for self-regulation during the latency stage.
a. True
b. False
55. Once a legal loophole has been used to the advantage of business and the disadvantage of a customer, the number
of options for self-regulation declines.
a. True
b. False
56. When Danica Patrick stated she would take performance-enhancing drugs if she would never get caught, she was
just saying what everyone else does in a highly competitive field, so it is not unethical.
a. True
b. False
57. To obtain the protections and benefits of the sentencing guidelines, companies must have a code of ethics.
a. True
b. False
58. To obtain the protections and benefits of the sentencing guidelines, companies must have some form of anonymous
reporting.
a. True
b. False
59. Ethics are key to the success of economic systems.
a. True
b. False
60. Corruption impedes economic development.
a. True
b. False
61. The statement, "What's good for GM is good for the country," is an example of the thoughts of a manager from the:
a. inherence school.
b. enlightened self-interest school.
c. social responsibility school.
d. invisible hand school.
62. According to the 2012 Corruption Perception Index, which country is perceived as the least corrupt?
a. Denmark
b. Somalia
c. New Zealand
d. Iceland
63. Which of the following statements is true about an ethical business?
a. It will always be profitable.
b. It will always satisfy all stakeholders.
c. It will always survive over the long run.
d. It will avoid the consequences of unethical behavior.
64. Which of the following is not always a result of unethical behavior?
a. loss of trust
b. loss of goodwill
c. loss of profits
d. strained relations with regulators
65. A manager at a chemical weapons plant discovered that toxic by-products from chemical manufacturing at the
plant are simply put in barrels and stacked near the boundary lines of the plant property. Children in the homes near
these boundaries have an unusually high rate of kidney disease. The manager does not want to disclose the barrels'
contents because he will lose his job and the town will lose its major employer. Which of the following ethical tests
would support the manager's decision?
a. Wall Street Journal model
b. ethical relativism
c. Blanchard/Peale model
d. "front page of the newspaper test"
66. Which of the following models has a question that requires analysis of the effect of a decision on stakeholders?
a. Blanchard/Peale
b. Wall Street Journal model
c. Does the conduct comply with the law?
d. all of the above
67. Milton Friedman's philosophy on corporate behavior is:
a. a business serves its shareholders best by serving the community.
b. a business serves its shareholders best by serving society at large.
c. a business serves its shareholders best by serving regulatory interests.
d. a business serves its shareholders best by serving shareholders.
68. An inherence school company would become involved in a residential property tax for schools only if:
a. the community would benefit from the tax.
b. government leaders are in favor of the tax.
c. the issue would affect the company's performance.
d. community leaders favored it.
69. The invisible hand school and the inherence school:
a. both serve society primarily.
b. both refuse involvement in social issues.
c. are proactive in legislation for social issues.
d. believe long-term success comes from social responsibility.
70. Which of the following is not an ethical breach?
a. taking things that do not belong to you
b. giving or allowing false impressions
c. perpetrating interpersonal abuse
d. All of the above are ethical breaches.
