Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
77. In the past, “gentlemen’s agreements” were often used to avoid competition or to divide up a
market so that firms did not have to truly compete against each other. Which consumer right is being
violated when companies block competition?
a. Right to be heard
b. Right to choose
c. Right of consumers
d. Right to safety
e. Right to competition
Difficulty: 2 Page-Reference: 87
Question ID: 03-1-77 Skill: Comprehension
Objective: 3.3
78. There are four areas of concern regarding ethics in advertising. They are
a. truth-in-advertising, misleading pricing, bait-and-switch advertising, and stealth advertising.
b. advertising of counterfeit brands, stealth advertising, morally objectionable advertising, and truth-in–
advertising.
c. bait-and-switch advertising, advertising of counterfeit brands, stealth advertising, and morally
objectionable advertising.
d. truth-in-advertising, misleading price advertising, celebrity advertising, and morally objectionable
advertising.
e. misleading price advertising, truth-in-advertising, celebrity advertising, and advertising claims about
product performance that are not true.
Difficulty: 2 Page-Reference: 88–89
Question ID: 03-1-78 Skill: Knowledge
Objective: 3.3
79. With respect to the issue of counterfeit brands, it is correct to say that
a. counterfeit brands used to be a big problem, but new legislation in various countries has reduced
the problem considerably.
b. counterfeit brands are a big problem in products like perfume and designer clothing, but less of a
problem in pharmaceuticals and expensive wines.
c. consumers benefit from counterfeit goods because they can get good products for lower prices.
d. it is generally easy to tell the difference between counterfeit goods and the real thing.
e. none of the above are correct.
Difficulty: 2 Page-Reference: 88
Question ID: 03-1-79 Skill: Comprehension
Objective: 3.3
80. Canadians who buy products from vendors on Canal Street in New York City often encounter
what type of advertising?
a. Advertising of a counterfeit brand
b. Morally objectionable advertising
c. Lack of truth-in-advertising
d. Misleading price advertising
e. Stealth advertising
Difficulty: 2 Page-Reference: 88
Question ID: 03-1-80 Skill: Comprehension
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
Objective: 3.3
81. When Sony Ericsson hired models to pose as “tourists” who asked real tourists if they would take
their picture with Sony’s new camera cellphone, this was an example of
a. advertising of a counterfeit brand.
b. morally objectionable advertising.
c. lack of truth-in-advertising.
d. misleading price advertising.
e. stealth advertising.
Difficulty: 2 Page-Reference: 89
Question ID: 03-1-81 Skill: Comprehension
Objective: 3.3
82. Sam has noticed that the safety mechanism on the piece of equipment that he operates is not
working. After repeatedly telling management about the defect but getting no response, he decides to
report it to the provincial agency responsible for workplace safety. This is an example of
a. collusion.
b. insider trading.
c. stealth advertising.
d. violating the line of reporting.
e. whistle-blowing.
Difficulty: 2 Page-Reference: 91
Question ID: 03-1-82 Skill: Comprehension
Objective: 3.3
83. When Melvin Crothers, a WestJet employee, discovered that another WestJet employee was
accessing a restricted Air Canada website, he called a person at Air Canada and told that person what
was going on. When Crothers did this, he was engaged in
a. betrayal of company loyalty.
b. collusion.
c. whistle-blowing.
d. trading on inside information.
e. industrial espionage.
Difficulty: 2 Page-Reference: 91
Question ID: 03-1-83 Skill: Comprehension
Objective: 3.3
84. Jane is a whistle-blower because she has concerns about some of the actions of her company.
Whistle-blowers
a. tend to be employees who have just come to work for the firm.
b. are promoted by top management as a reward for pointing out activities that might hurt the
company.
c. tend to be younger than other employees and would like to be promoted.
d. often find themselves demoted or even fired for blowing the whistle on the company.
e. are hired away by other firms because of their high ethical values.
Difficulty: 2 Page-Reference: 91
Question ID: 03-1-84 Skill: Comprehension
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
Objective: 3.3
85. Which of the following is the best means of showing responsibility toward employees?
a. Provide employees with equal opportunities without regard to race, sex, or other irrelevant factors
b. Provide rewards for employees who go beyond the call of duty
c. Provide a stock ownership plan for employees
d. Provide a grievance system for employees
e. Recruit employees from minority groups
Difficulty: 2 Page-Reference: 90
Question ID: 03-1-85 Skill: Application
Objective: 3.3
86. In the case of irresponsibility toward investors, shareholders are reluctant to take action because
a. a management change may drive the stock price down.
b. it’s too much trouble.
c. the creditors probably wouldn’t support them.
d. the board of directors will overrule them.
e. company management will retaliate.
Difficulty: 2 Page-Reference: 93
Question ID: 03-1-86 Skill: Comprehension
Objective: 3.3
87. The president of a company has paid himself a large salary and a handsome bonus, received a
large number of lucrative stock options, and hired his family members at high salaries. The president is
probably guilty of
a. collusion.
b. improper financial management.
c. cheque kiting.
d. misrepresentation of finances.
e. insider trading.
Difficulty: 2 Page-Reference: 93
Question ID: 03-1-87 Skill: Comprehension
Objective: 3.3
88. Managers at American International Group became involved in very high-risk insurance that
caused the company to be on the hook for billions of dollars. The U.S. government ended up giving
hundreds of billions of dollars to the company to keep it afloat. This was an example of
a. improper financial management.
b. insider trading.
c. irresponsible behaviour toward employees
d. misrepresentation of finances.
e. insurance fraud.
Difficulty: 2 Page-Reference: 93
Question ID: 03-1-88 Skill: Comprehension
Objective: 3.3
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
89. In 2011, the Alberta securities regulator brought charges against several executives at Grand
Cache Coal Corp. because those executives sold company stock just before the company publicly
disclosed negative news about its sales. This was an example of
a. cheque kiting.
b. insider trading.
c. misrepresentation of finances.
d. improper financial management.
e. whistle-blowing.
Difficulty: 2 Page-Reference: 94
Question ID: 03-1-89 Skill: Comprehension
Objective: 3.3
90. The illegal practice of writing cheques against money that has not yet arrived at the bank on
which the cheque has been drawn is called
a. insider trading.
b. whistle blowing.
c. managing the monetary float.
d. kickbacks.
e. cheque kiting.
Difficulty: 1 Page-Reference: 93
Question ID: 03-1-90 Skill: Knowledge
Objective: 3.3
91. Your friend Bob works for an investment firm that is helping Computers-B-Us merge with Mega
Computers. The news won’t be released until next week. If you decide to act upon this information and
make some stock purchases intending to split the profits with Bob, what can be said about your actions?
a. They are unethical and illegal.
b. They are ethical and legal.
c. It is not possible to tell from the information given.
d. They are ethical and illegal.
e. They are unethical and legal.
Difficulty: 1 Page-Reference: 75-79, 94
Question ID: 03-1-91 Skill: Comprehension
Objective: 3.3
92. At a press conference, CEO I.R.D. Boss states that profits are going to be very good next year
when he knows that they will likely be bad. What can be said about his actions?
a. They are ethical and legal.
b. They are unethical and illegal.
c. They are ethical and illegal.
d. They are unethical and legal.
e. It is not possible to tell from the information that is given.
Difficulty: 2 Page-Reference: 93
Question ID: 03-1-92 Skill: Comprehension
Objective: 3.3
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
93. Which of the following is an example of a company acting irresponsibly toward its investors?
a. The board of directors does not declare a dividend.
b. Retained earnings are used to expand research and development instead of paying a dividend.
c. Top management misrepresents the firm’s financial situation.
d. The firm does not allow insider trading.
e. The firm uses retained earnings to finance growth.
Difficulty: 2 Page-Reference: 92
Question ID: 03-1-93 Skill: Comprehension
Objective: 3.3
94. Ken is using confidential information to gain from the purchase of sale of stock. Ken is guilty of
a. greenmail.
b. cheque kiting.
c. misrepresentation of finances.
d. a rollover.
e. insider trading.
Difficulty: 1 Page-Reference: 94
Question ID: 03-1-94 Skill: Comprehension
Objective: 3.3
95. Which of the following is an example of a company acting irresponsibly toward its investors?
a. Retained earnings are used to expand research and development instead of paying a dividend.
b. Top management misrepresents the firm’s financial situation.
c. The firm uses retained earnings to finance growth.
d. The board of directors does not declare a dividend.
e. All of these.
Difficulty: 2 Page-Reference: 93
Question ID: 03-1-95 Skill: Comprehension
Objective: 3.3
96. Which of the following illustrates how a company could be irresponsible with respect to its
investors?
a. The company uses profits to fund research and development.
b. The president overstates the positive impact of a new contract.
c. The board of directors declares a stock split.
d. Management accepts a takeover bid from another company.
e. No dividends are declared even though the company made a profit.
Difficulty: 2 Page-Reference: 93
Question ID: 03-1-96 Skill: Comprehension
Objective: 3.3
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
97. A chocolate company with a primary emphasis on ethical sourcing and procurement would MOST
likely avoid which of the following?
a. Neglecting the welfare of the farmers who grow cacao beans
b. Reducing the size of its marketing department
c. Developing new fat-free products
d. Hosting a holiday party for all employees
e. Reducing the funds allocated to the company health care program for employees
Difficulty: 2 Page-Reference: 83
Question ID: 03-1-97 Skill: Analysis
Objective: 3.3
98. Bristol Corp. plans to introduce an inexpensive line of shoes to the Canadian market. It has found
a manufacturer in Asia that can produce the shoes at a cost that will be cheaper than other brands of the
same quality. Which of the following is a potential ethical implication that the company should consider
before beginning production?
a. The country’s existing labour laws and the factory working conditions
b. The average exchange rate of the country’s currency over a ten-year period
c. The challenges of doing business in a country with a nonconvertible currency
d. The energy demands of the manufacturer’s facility
e. The basic international business strategy it will use
Difficulty: 2 Page-Reference: 94–95
Question ID: 03-1-98 Skill: Analysis
Objective: 3.3
99. Paramount Pizza wants to be seen as a socially responsibility company. It can support its claim of
being a socially responsible company by
a. using more nutritious ingredients even if they are more expensive.
b. cutting employees’ wages and benefits in order to boost the company‘s stock price.
c. reducing pizza size while holding the price constant.
d. packaging products in material that costs less, even if customers object to the change.
e. taking actions to force competitors into bankruptcy.
Difficulty: 2 Page-Reference: 94–95
Question ID: 03-1-99 Skill: Application
Objective: 3.3
100. Martha is the owner of a business that regularly imports certain agricultural commodities from
countries with poor economic conditions. If she wants to help the citizens of those countries, how can she
BEST do that?
a. By including labels on her products indicating where the commodities come from.
b. By hiring people who have visited these countries and are familiar with the conditions there.
c. By opening an outlet in these countries and creating jobs for the people there.
d. By purchasing more of the commodities.
e. By shipping free products to these nations.
Difficulty: 2 Page-Reference: 94–95
Question ID: 03-1-100 Skill: Analysis
Objective: 3.3
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
101. Carl and Kelly have opened a gymnastics center. If they want to behave in a socially
responsible fashion, which action should they definitely avoid?
a. Purchasing substandard gym equipment
b. Advertising methods that are intended to increase profit
c. Initiatives that decrease the satisfaction of investors
d. Doubling enrollment fees for the program
e. Providing attractive salaries for employees
Difficulty: 2 Page-Reference: 94–95
Question ID: 03-1-101 Skill: Analysis
Objective: 3.3
102. If the Lexington Corporation’s mission statement shows a primary commitment to
compassionately improve the lives of elderly citizens, which of the following is least likely to be true with
respect to the company’s ethical code?
a. The well-being of others is valued.
b. All people have worth.
c. Age discrimination is prohibited when hiring employees.
d. Elderly citizens are expected and required to contribute to society.
e. All human beings should be treated fairly.
Difficulty: 2 Page-Reference: 94–95
Question ID: 03-1-102 Skill: Analysis
Objective: 3.3
103. Lance owns a small business where he sells his own paintings. He really wants to help aspiring
artists, but hasn’t assisted very many of them to this point. What is the MOST likely reason for this?
a. He doesn’t have the time or money to help aspiring artists.
b. He is too involved in trying to make a big profit.
c. He is concerned that helping aspiring artists will simply create more competition for his company.
d. He doesn’t have an ethical code in place.
e. He isn’t interested in corporate philanthropy.
Difficulty: 2 Page-Reference: 94–95
Question ID: 03-1-103 Skill: Analysis
Objective: 3.3
104. Robert, a CEO, is trying to decide whether to cut a budget item that is allocated to help
construct shelters for the homeless. After getting advice from workers and considering his own ethical
views, Robet decides to not cut these funds, even though the decision means that the company will likely
make less profit as a result. What is the most likely reason Robert made this decision?
a. Robert’s concern for the company’s profitability did not figure into the decision.
b. When he asked several workers what they would do if they were in his shoes, he received mixed
responses.
c. His values and morals were not helpful to him as he made the decision.
d. If someone asks Robert to make a similar budget cut in the future, he won’t have to think about it
much.
e. Robert does not care about his company’s success.
Difficulty: 2 Page-Reference: 94–95
Question ID: 03-1-104 Skill: Analysis
Objective: 3.3
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
105. Managers at Lion Brand Oatmeal are touting the benefit of aligning the company with a national
nonprofit organization like the Canadian Heart Association, but the CEO is opposed to the idea. Which of
the following statements would support the CEO’s position?
a. Competitors might develop similar associations.
b. Government regulation of health-related claims has decreased in recent years.
c. The company would get public goodwill.
d. An association with a nonprofit could lead to better relations with government agencies.
e. If the nonprofit organization happened to receive some negative publicity in the future, consumers
might develop an aversion to the company‘s products.
Difficulty: 2 Page-Reference: 94–95
Question ID: 03-1-105 Skill: Analysis
Objective: 3.3
106. Silky Soap Co. recently received complaints that its product (which was recently reformulated to
use reduce costs) is causing users to experience skin rashes. Which of the following is NOT a strategic
option to deal with the problem?
a. Accept blame for the problem and assure the public that it will be corrected immediately.
b. Ignore the problem and hope it will go away.
c. Offer an apology and recall the product.
d. Deny that the company’s product is at fault but pull it from the market anyway.
e. Monitor the internet for negative publicity and take additional steps as necessary.
Difficulty: 2 Page-Reference: 94–95
Question ID: 03-1-106 Skill: Analysis
Objective: 3.3
107. The CEO of TRA Corp. has stated publicly that his company will do everything that is legally
required of it, but it will not contribute to charitable causes. TRA Corp.’s position is consistent with which
stance to social responsibility?
a. Proactive
b. Non-charitable
c. Obstructionist
d. Defensive
e. Accommodative
Difficulty: 2 Page-Reference: 95
Question ID: 03-1-107 Skill: Comprehension
Objective: 3.4
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
108. Which of the following illustrates the defensive stance to social responsibility?
a. Sears has started to support artists and performers.
b. Many firms sponsor youth athletic teams.
c. Tobacco companies place health warning labels on their products because they are required to do
so by the government.
d. Many organizations respond to requests for donations to community hockey teams, Girl Guides,
and youth soccer programs.
e. Many companies match employee contributions to approved causes.
Difficulty: 2 Page-Reference: 95
Question ID: 03-1-108 Skill: Comprehension
Objective: 3.4
109. Which of the following is a reason for businesses to assume a socially responsible role?
a. Business controls vast resources of money and talent which can be used to help society.
b. Business helped to create many of society’s problems and therefore should help to solve these
problems.
c. Statistics show that businesses that support social responsibility projects have higher return on
investments.
d. Corporations have civic responsibilities just like other citizens and should help to better our lives.
e. All of the above are reasons.
Difficulty: 2 Page-Reference: 83
Question ID: 03-1-109 Skill: Comprehension
Objective: 3.4
110. A(n) ________ stance to social responsibility involves denying or covering up violations.
a. obstructionist
b. proactive
c. defensive
d. accommodative
e. societal
Difficulty: 1 Page-Reference: 95
Question ID: 03-1-110 Skill: Knowledge
Objective: 3.4
111. Estevan Wire and Cable has taken a defensive stance towards social responsibility. This means
that
a. it should take a proactive position on social issues.
b. it should respond to social concerns but only after it is asked.
c. it should take care only of its profitability, even if it means breaking the law.
d. it should take on only the minimal amount of responsibility required by law and standard business
practice.
e. it should seek out opportunities to contribute to the well-being of society.
Difficulty: 2 Page-Reference: 95
Question ID: 03-1-111 Skill: Comprehension
Objective: 3.4
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
112. McDonald’s established Ronald McDonald House to provide lodging for families of children who
are hospitalized away from home. This approach to social responsibility would best be classified as a(n)
a. defensive stance.
b. obstructionist stance.
c. accommodative stance.
d. charitable stance.
e. proactive stance.
Difficulty: 1 Page-Reference: 95
Question ID: 03-1-112 Skill: Comprehension
Objective: 3.4
113. Which of the following social responsibility strategies is typically being used by a business firm
which supports the Girl Guides, hockey teams, and youth soccer?
a. Accommodative stance
b. Defensive stance
c. Reactive stance
d. Obstructionist stance
e. Proactive stance
Difficulty: 1 Page-Reference: 95
Question ID: 03-1-113 Skill: Comprehension
Objective: 3.4
114. Jays Inc. dumped toxic chemicals in the river next to their factory. Upon being caught, Jays Inc.
not only denied their wrongdoings, they went to great lengths to hide their behaviour. Jays Inc. is taking
a(n) ________ stance to social responsibility.
a. defensive
b. accommodative
c. proactive
d. obstructionist
e. reactive
Difficulty: 2 Page-Reference: 95
Question ID: 03-1-114 Skill: Comprehension
Objective: 3.4
115. Cartier Partners Financial Services Inc. provides the local swim team with a cash donation to
help pay for the swim meet each year, but the team has to make its case to the company each year.
Cartier’s stance to social responsibility is
a. defensive.
b. obstructionist.
c. accommodative.
d. proactive.
e. responsive.
Difficulty: 2 Page-Reference: 95
Question ID: 03-1-115 Skill: Comprehension
Objective: 3.4
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
116. Which of the following social responsibility strategies is used by the Trillium Foundation, which
requests proposals from charity organizations who require financial support?
a. Reactive
b. Adaptive
c. Proactive
d. Accommodative
e. Obstructionist
Difficulty: 1 Page-Reference: 95
Question ID: 03-1-116 Skill: Comprehension
Objective: 3.4
117. Exxon’s response to the Valdez oil spill in Alaska some years ago has been criticized on several
fronts. Some say the company waited too long to respond, and that when the response came it was very
weak. But Exxon points out that they cleaned up the spill and that they have gone out of their way to bring
the area back to conditions that existed before the spill. This stance to social responsibility would best be
classified as
a. defensive.
b. obstructionist.
c. charitable.
d. accommodative.
e. proactive.
Difficulty: 2 Page-Reference: 95
Question ID: 03-1-117 Skill: Comprehension
Objective: 3.4
118. Yorkton Electric has taken an accommodative stance towards social responsibility. This means
that
a. it will take care only of its profitability, even if it means breaking the law.
b. it will seek out opportunities to contribute to the well-being of society.
c. it will take a proactive position on social issues.
d. it will respond to social concerns beyond the bare minimum if specifically asked.
e. it will take on only the minimal amount of responsibility required by law and standard business
practice.
Difficulty: 2 Page-Reference: 95
Question ID: 03-1-118 Skill: Comprehension
Objective: 3.4
119. The _________ stance to social responsibility means that a business firm goes beyond the bare
minimum expectations of the law if asked.
a. charitable
b. defensive
c. obstructionist
d. proactive
e. accommodative
Difficulty: 2 Page-Reference: 95
Question ID: 03-1-119 Skill: Knowledge
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
Objective: 3.4
120. A survey of 93 large Canadian companies found that ____ percent made a charitable
contribution of some sort, and that the median value of their contributions was $________.
a. 40; $100 000
b. 30; $20 000
c. 560; $80 000
d. 70; $200 000
e. 97; $340 000
Difficulty: 3 Page-Reference: 95
Question ID: 03-1-120 Skill: Knowledge
Objective: 3.4
121. The four basic steps in managing a social responsibility program, in order from first to last, are
a. strategic planning, social audit, appointment of a director, and top management support.
b. top management support, strategic planning, appointment of a director, and a social audit.
c. strategic planning, top management support, social audit, and appointment of a director.
d. top management support, social audit, strategic planning, and appointment of a director.
e. appointment of a director, social audit, strategic planning, and top management support.
Difficulty: 3 Page-Reference: 96–97
Question ID: 03-1-121 Skill: Knowledge
Objective: 3.4
122. Battleford Corp. is in the processes of setting up a system to manage its social responsibility
program. What should they do first?
a. A social audit must be conducted. Conduct a social audit.
b. The government must identify specific things the company is doing that need to be corrected.
c. Make sure that support is evident from top management.
d. A director of the firm’s social agenda must be appointed.
e. A committee of top managers must develop a strategic plan for social responsibility.
Difficulty: 2 Page-Reference: 96–97
Question ID: 03-1-122 Skill: Application
Objective: 3.4
123. The top management level at Brown Corp. has already publicly stated its commitment to being
socially responsible. What is the next action that Brown Corp. needs to take if it wants to follow the four–
step process for managing social responsibility programs?
a. A social audit must be conducted.
b. The government must identify specific things the company is doing that need to be corrected.
c. Make sure that support must is evident from top management.
d. A director of the firm’s social agenda must be appointed.
e. A committee of top managers must develop a strategic plan for social responsibility.
Difficulty: 2 Page-Reference: 96–97
Question ID: 03-1-123 Skill: Application
Objective: 3.4
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
124. Bendix Corp.’s Board of Directors has just received a detailed plan regarding social
responsibility activities that was developed by a committee of top managers at the company. What is the
next step Bendix Corp. should take if it wants to follow the four-step process for managing social
responsibility programs?
a. A social audit must be conducted.
b. The government must identify specific things the company is doing that need to be corrected.
c. Make sure that support must is evident from top management.
d. A director of the firm’s social agenda must be appointed.
e. A committee of top managers must develop a strategic plan for social responsibility.
Difficulty: 2 Page-Reference: 96–97
Question ID: 03-1-124 Skill: Application
Objective: 3.4
125. The fundamental goal of sustainable development is to
a. make sure that oil resources last until 2100.
b. discover more oil so that developing nations will be able to eventually attain the standard of living
that developed nations now enjoy.
c. encourage managers to focus more on social issues and less on profit issues.
d. pursue activities that meet current needs, but that will not put future generations at a disadvantage
when they attempt to meet their needs.
e. encourage businesses to publish sustainability reports each year.
Difficulty: 2 Page-Reference: 97
Question ID: 03-1-125 Skill: Comprehension
Objective: 3.4
126. What is the purpose of a social audit?
a. To conduct a systematic analysis of how a firm has used funds that are earmarked for social
programs
b. To determine the impact of a company’s social involvement on the local community
c. To determine the specific area of need for a firm’s social responsibility actions
d. To determine the anticipated costs and benefits of dealing with a social concern
e. To audit the social functions the firm puts on for employees
Difficulty: 1 Page-Reference: 97
Question ID: 03-1-126 Skill: Comprehension
Objective: 3.4
127. The final step in managing a social responsibility program is to
a. conduct a social audit.
b. survey the various causes that might be supported.
c. select an individual to run the program.
d. develop a policy statement outlining the firm’s commitment.
e. form a committee to develop a detailed plan.
Difficulty: 1 Page-Reference: 97
Question ID: 03-1-127 Skill: Knowledge
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
Objective: 3.4
128. Brantford Corp. has decided to commit to an active social responsibility program. Top
management has already developed and published a policy statement outlining the company’s
commitment. What does Brantford need to do next?
a. Conduct a social audit
b. Survey the various causes that might be supported
c. Select an individual to run the program
d. Develop a policy statement outlining the firm’s commitment
e. Form a committee of top managers to develop a detailed plan
Difficulty: 2 Page-Reference: 96–97
Question ID: 03-1-128 Skill: Application
Objective: 3.4
129. Clarion Corp. has just established a committee of top managers to develop a plan detailing the
level of support they will give to various social programs. What do they need to do next?
a. Conduct a social audit
b. Survey the various causes that might be supported
c. Give authority to one specific person to act as director of the firm’s social agenda
d. Develop a policy statement outlining the firm’s commitment
e. Form a committee of top managers to develop a detailed plan
Difficulty: 2 Page-Reference: 96–97
Question ID: 03-1-129 Skill: Application
Objective: 3.4
130. Owners of small business firms face the same type of social concerns as do larger firms, but
a. with more demands on the owner.
b. on a smaller scale.
c. with more regulation.
d. with less regulation.
e. with more complexity.
Difficulty: 1 Page-Reference: 98
Question ID: 03-1-130 Skill: Comprehension
Objective: 3.5
1. Ethical behaviour is behaviour that conforms to individual beliefs and social norms about what is
right and good.
a. True
b. False
Difficulty: 1 Page-Reference: 74
Question ID: 03-2-131 Skill: Knowledge
Objective: 3.1
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
2. Business ethics is a term often used to refer to the ethical or unethical behaviour of a manager or
employee of an organization.
a. True
b. False
Difficulty: 1 Page-Reference: 74
Question ID: 03-2-132 Skill: Knowledge
Objective: 3.1
3. Because ethics are based on both individual beliefs and social concepts, they do not vary from
person to person.
a. True
b. False
Difficulty: 2 Page-Reference: 74
Question ID: 03-2-133 Skill: Comprehension
Objective: 3.1
4. What constitutes ethical and unethical behaviour is determined partly by the individual and partly by
culture.
a. True
b. False
Difficulty: 2 Page-Reference: 74
Question ID: 03-2-134 Skill: Knowledge
Objective: 3.1
5. An individual’s peers have only limited influence on the development of ethical values.
a. True
b. False
Difficulty: 2 Page-Reference: 76
Question ID: 03-2-135 Skill: Knowledge
Objective: 3.1
6. A business firm’s influence on the ethical behaviour of its employees is very limited because their
family and friends influenced their beliefs about right and wrong long before they joined the business firm.
a. True
b. False
Difficulty: 2 Page-Reference: 76
Question ID: 03-2-136 Skill: Comprehension
Objective: 3.1
7. What distinguishes ethical behaviour from unethical behaviour is often subjective and influenced by
differences of opinion.
a. True
b. False
Difficulty: 1 Page-Reference: 76
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
Question ID: 03-2-137 Skill: Knowledge
Objective: 3.1
8. The ethical norm of utility evaluates whether the decision is consistent with cultural standards of
fairness.
a. True
b. False
Difficulty: 2 Page-Reference: 78
Question ID: 03-2-138 Skill: Knowledge
Objective: 3.1
9. The ethical norm of justice evaluates if the decision is consistent with cultural standards of fairness.
a. True
b. False
Difficulty: 2 Page-Reference: 78
Question ID: 03-2-139 Skill: Knowledge
Objective: 3.1
10. The ethical norm of caring evaluates whether the decision is consistent with people’s
responsibilities to each other.
a. True
b. False
Difficulty: 2 Page-Reference: 78
Question ID: 03-2-140 Skill: Knowledge
Objective: 3.1
11. All things considered, the utility norm is the best one to use when making decisions about ethics.
a. True
b. False
Difficulty: 1 Page-Reference: 78–79
Question ID: 03-2-141 Skill: Comprehension
Objective: 3.1
12. Applying the ethical standard of utility, it may be acceptable to allow inflated expense reports.
a. True
b. False
Difficulty: 2 Page-Reference: 79
Question ID: 03-2-142 Skill: Application
Objective: 3.1
Business, Eighth Canadian Edition Griffin, Ebert, Starke, Dracopoulos, Lang
Chapter 3—Conducting Business Ethically and Responsibly
13. A business firm can influence an individual’s ethical behaviour through development of a written
code of ethics.
a. True
b. False
Difficulty: 2 Page-Reference: 80
Question ID: 03-2-143 Skill: Comprehension
Objective: 3.1
14. In Brazil, the term “jeitinho” is used to denote strict adherence to the rules.
a. True
b. False
Difficulty: 2 Page-Reference: 75
Question ID: 03-2-144 Skill: Comprehension
Objective: 3.1
15. Business schools must take the chief responsibility for educating people about business ethics.
a. True
b. False
Difficulty: 2 Page-Reference: 81
Question ID: 03-2-145 Skill: Comprehension
Objective: 3.1
16. A conflict of interest occurs when an activity benefits an individual at the expense of the
organization.
a. True
b. False
Difficulty: 2 Page-Reference: 77
Question ID: 03-2-146 Skill: Knowledge
Objective: 3.1
17. A conflict of interest occurs when two employees disagree about what course of action is best for
the company.
a. True
b. False
Difficulty: 2 Page-Reference: 77
Question ID: 03-2-147 Skill: Comprehension
Objective: 3.1
18. The first step in the determination of whether a decision is ethical is to determine the most
appropriate moral values.
a. True
b. False
Difficulty: 2 Page-Reference: 78
Question ID: 03-2-148 Skill: Comprehension