Which of the following statements best describes the legal standards concerning
advertising communication?
a. There is no tolerance for any type of exaggeration.
b. Companies are free to make claims about their products because consumers are
expected to have common sense to distinguish between truth and fantasy.
c. Scientific evidence is not helpful for substantiating claims that manufacturers make
about their products.
d. Companies can make false claims about products without fear of legal action because
the FTC rarely takes action against companies in this situation.
e. Although some exaggeration is tolerated, deceptive claims or claims that cannot be
substantiated are likely to result in legal action.
A person who is skilled at recognizing how one individual or group is influenced by
national, professional, and organizational cultures demonstrates which of the following?
a. High responsible competitiveness
b. Low Global Reporting Initiative (GRI) compliance
c. High Global Reporting Initiative (GRI) compliance
d. Low cultural intelligence
e. High cultural intelligence
An ethical issue is a problem, situation, or opportunity
a. that harms consumers.
b. that harms the environment.
c. that requires society to choose among several actions that must be evaluated as right
or wrong.
d. that requires an individual or organization to choose among several actions that must
be evaluated as right or wrong, ethical or unethical.
e. that requires an individual or organization to choose between harming consumers or
the environment and earning more profits.
In 2007 and 2008, what happened for only the second time in U.S. history?
a. Executive compensation became a controversial topic.
b. CEOs were required to disclose their salary histories.
c. CEOs were paid only five times more than average workers.
d. Legislation that set rules for executive compensation passed.
e. Overall, CEOs took paycuts for two years in a row.
What does the “engage” step of the process for planning and implementing strategic
philanthropy consist of?
a. Gaining the interest and support of management early on so as to ease the approval
process in the future
b. Deciding what resources and dollars should be spent on certain strategic philanthropy
efforts
c. Creating interest in all the company’s stakeholders in order to increase their support
of the strategic philanthropy process
d. Collecting information covering the internal organization and programs that might
intersect with the competencies of the company
e. Classifying funding opportunities according to the level of need and alignment with
organizational competencies
Which type of investor causes the most problems for CEOs when developing strategic
plans?
a. Shareholders seeking short-term gains
b. Institutional investors
c. Shareholders willing to sacrifice short-term gains for long-term income
d. Employees who own stock
e. Global investors who do not understand the business
Which of the following situations may constitute quid pro quo sexual harassment?
a. Many male employees of a company make repeated remarks about how men are
more intelligent than women, which makes the environment difficult for female
employees.
b. A male coworker makes unwelcomed sexual advances toward a female coworker,
which causes her to feel that her job is threatened.
c. A female employee asks one of her subordinates out to dinner over and over again
even though he always tells her no, and he is beginning to feel uncomfortable around
her.
d. A male manager suggests to one of his female employees that she will receive a raise
if she wears shorter skirts and works “overtime” once a week.
e. A male employee often disseminates e-mails of a sexual nature to his coworkers that
creates an awkward atmosphere for a couple of his female coworkers.
Which of the following best describes the rationale of the stakeholder interaction
model?
a. The customer receives most of the value because investors, suppliers, and employees
are compensated at a reasonable level.
b. This model involves a two-way relationship with the firm’s stakeholders.
c. A company basically produces at a level equal to the amount of input received from
investors, suppliers, and employees.
d. Open communication between employees and management creates the input-output
flow in an organization.
e. In order to create final products or output, an organization must have several different
inputs.
Why was there little reason to focus on corporate governance in the late 1800s and early
1900s?
a. In most companies, the owner made the strategic decisions about the business, so
little governance was needed.
b. The stakeholders in organizations had the same views about decision making, so
there was little need for governance mechanisms.
c. There were no social, safety, or environmental problems at this time, so governance
mechanisms were unnecessary.
d. The government tightly controlled industries during this time period, thereby making
a company’s attempt at governance futile.
e. Companies followed all laws, so there was little need for governance mechanisms.
When Benetton used convicted felons awaiting death sentences in a new advertising
campaign,
a. dialogue about high rates of violence increased nationwide.
b. sales increased because people responded favorably to a company strong enough to
address this controversial issue.
c. Benetton received an award for its creative and socially aware ad campaign.
d. there was very little impact on Benetton, its customers, or society in general.
e. people were outraged and some companies responded by no longer carrying Benetton
products.
The extent to which a stakeholder can gain access to coercive, utilitarian, or symbolic
means to impose or communicate its views to an organization is known as
a. power.
b. legitimacy.
c. control.
d. urgency.
e. force.
To prevent the problems that led to the 2008-2009 financial crisis from leading to future
financial crises, the Obama administration proposes legislation that would include all of
the following except
a. removing some of the Federal Trace Commission’s powers and creating a Consumer
Financial Protection Agency
b. giving the Federal Reserve less power over the financial industry
c. creating a Financial Services Oversight Council to identify and address key risks to
the financial industry
d. establishing a new National Bank Supervisor to oversee federally chartered lenders
e. new powers for the Securities and Exchange Commission to monitor credit rating
industries for objectivity
Under the historical and traditional views of business, who was considered to be a
stakeholder?
a. Owners
b. Owners and customers
c. Owners, customers, employees, and business partners
d. Owners, customers, employees, business partners, the community, the government,
and special-interest groups
e. Society in general
What holds organizations together and allows them to focus on efficiency, productivity,
and profits?
a. Respect
b. Diversity
c. Trust
d. Competence
e. Reliable source of funds
Which division of the Federal Trade Commission works to protect consumers against
unfair, deceptive, and fraudulent practices?
a. Bureau of Consumer Protection
b. Consumer Product Safety Commission
c. Consumer Information Bureau
d. Deceptive Trade Practices Commission
e. Privacy Protection Agency
Which of the following is not a recommended step for changing the ethical culture of an
organization?
a. Avoid the perception of hidden agendas.
b. Implement communications and education strategies.
c. State your position, philosophy, or belief.
d. Avoid the use of informal systems to communicate expectations.
e. Reinforce the policy through measurements and rewards.
Which of the following provides the best description of the community stakeholder for
an organization?
a. The community to be concerned with is the immediate neighborhood where most of
the organization’s patrons live and work.
b. The entire city in which the organization operates will be affected by the
organization, and therefore this defines the community stakeholder.
c. The entire county in which the organization is located is the community stakeholder
because the impact of the organization reaches beyond the city to the entire county.
d. The community aspect of the stakeholder model includes the entire region in which
the company operates.
e. The community includes those members of society who are aware of, concerned by,
or in some way affected by the operations and outputs of the organization.
The Home Ownership and Equity Protection Act requires home equity lenders to
a. verbally disclose the interest rates associated with the mortgage loan.
b. use a practice called “red lining,” to determine those customers with the lowest risk
of defaulting on the loan.
c. employ loan officers who mirror the demographics of the majority of home buyers in
the region.
d. give consumers the right to dispute and correct inaccurate information on their credit
reports.
e. disclose, in writing, the borrower’s rights, payment amounts, and the consequences of
defaulting on the loan.
According to Mercer’s survey, all of the following are global drivers for employee
engagement except
a. the work itself, including opportunities for development.
b. a high level of autonomy.
c. confidence and trust in leadership.
d. recognition and rewards.
e. organizational communication.
If employees believe that salary decisions are fair and consistent for all job categories,
what type of justice exists?
a. Interactional
b. Procedural
c. Utilitary
d. Distributive
e. Ethical
How could regulation on businesses result in a “hidden tax” to consumers?
a. Businesses could pass regulatory costs on to their consumers in the form of higher
prices.
b. States could raise their sales taxes to compensate for higher regulatory costs.
c. Consumers may have to pay for recycling products that have been used or disposed.
d. Consumers may be required to pay large fees to have their garbage carried off to a
landfill.
e. Purchasing in larger quantities may actually become more expensive per unit than
smaller purchases.
As fiduciaries, members of a company’s board of directors are fundamentally expected
to
a. address conflicts about merging different corporate cultures.
b. resolve issues before they become reputation or legal risks.
c. reconcile differences in quality standards.
d. ensure that daily issues are addressed properly by management.
e. exercise both due diligence and due loyalty.
Toll-free hotlines that companies set up to give employees a place to report misconduct
are associated with which aspect of ethics programs?
a. Continuously improving the program
b. Consistently enforcing standards, codes, and punishments
c. Communicating standards and procedures via ethics training programs
d. Establishing systems to monitor and enforce ethical standards
e. Establishing codes of conduct that are reasonably capable of detecting and preventing
misconduct
Which of the following is not an example of a cause-related marketing effort?
a. Avon sells beauty products through its “pink ribbon” campaign and donates a
percentage of the proceeds to fund breast cancer research.
b. American Express donates a percentage of its credit card charges to the Statue of
Liberty and Ellis Island Restoration Fund.
c. Regis Hair Salons offers $10 haircuts for its “Clip for the Cure” campaign for which
the proceeds went to cancer research.
d. Bankers Trust Private Bank develops and introduces a “Wealth of Responsibility”
program to assist wealthy families in planning for philanthropy.
e. Sales from New Covent Garden’s pea and ham soup were donated to help renovate a
homeless shelter’s charity kitchens.
Which of the following is least likely to be considered destructive or unfair
competition?
a. Collaborating with a competitor to establish prices so that each firm can ensure a
certain level of profit
b. Obtaining information through ethical competitive intelligence practices
c. Using a “bait and switch” method for selling products to customers
d. Lowering prices significantly in an effort to drive competitors out of a market, and
then raising prices afterwards
e. Stealing competitors’ trade secrets
According to reports published in Business Week and other sources, the best boards of
directors
a. are not compensated.
b. rarely own stock in the company.
c. are generally more independent and more active than other boards.
d. rate high on independence but low on innovation.
e. are found in Japanese and European countries.
To whom should consumers turn first when exercising their right to seek redress?
a. Federal Trade Commission
b. Local Better Business Bureau
c. Seller of the product/service
d. Their attorney
e. Consumer Protection Agency
Which of the following statements is true about codes of conduct?
a. Codes are mostly standardized throughout all industries.
b. Codes are informal ideals about organizational expectations.
c. Few organizations have written ethical guidelines.
d. Codes are designed to resolve every ethical dilemma a company may face.
e. Codes are formal statements describing organizational expectations.
Which of the following is not one of the keys to successful ethics training addressed in
Chapter 6?
a. Give employees a means to address ethical issues.
b. Make employees aware that their actions can define the company’s ethical posture.
c. Help employees understand the ambiguity inherent in ethical situations.
d. Eliminate the belief that unethical behavior is ever justified.
e. Provide specific evidence of punishment for an employee who committed an ethical
infraction.
Up until the twentieth century, how did people generally think of the environment?
a. As a beautiful natural resource that needed to be protected from actions that harmed
its beauty
b. As nature, including wildlife, trees, oceans, rivers, and mountains
c. In terms of how natural resources could be harnessed to meet the need for food,
shelter, and recreation
d. As resources that should be used in unlimited quantities to satisfy the need for shelter,
food, and transportation
e. As a resource that dictates how people should live their lives
Which of the following makes the Global Reporting Initiative (GRI) particularly
valuable?
a. The GRI makes comparisons possible because it uses a globally applicable and
well-vetted framework.
b. The GRI allows firms to formally assess and document social responsibility
outcomes.
c. The GRI allows firms to include social responsibility reporting in annual reports or
sustainability reports.
d. The GRI makes assessment possible because its framework includes social
responsibility indicators.
e. The GRI allows firms to communicate its social responsibility outcomes to
stakeholders.
One of the most effective methods of ethics training is
a. getting employees involved in resolving ethical dilemmas that relate to actual
situations in the workplace.
b. providing a video of the ethics officer.
c. testing employees on the code of conduct.
d. discussing cognitive moral development.
e. providing a CD-ROM of material for employees to view on their own.
On what basic precept is the shareholder model of corporate governance founded?
a. The problem created when ownership and control are not separated
b. Supply and demand found in the marketplace
c. Everyone should contribute to social welfare
d. The maximization of wealth for investors and owners
e. The customer is always right
____ expose an employer’s wrongdoing to outsiders, such as the media or government
regulatory agencies.
a. Private investigators
b. Whistleblowers
c. Secret shoppers
d. Malcontents
e. Fraud-finders
Five bases of power, including ____, coercive, legitimate, referent, and expert power,
can be used to motivate individuals either ethically or unethically in the workplace.
a. executive
b. peer
c. reward
d. formal
e. diverse
How can an individual employee potentially mitigate the onset and effects of
downsizing?
Answer:
Answers will vary.
Why have some endangered species been purposely harmed by landowners?
Answer:
Answers will vary.
How does a training and communication plan assist in the implementation of an ethics
program? What are some unique ways that organizations could train and communicate
about ethics?
Answer:
Answers will vary.
What are the negative effects caused by air pollution?
Answer:
Answers will vary.
What is urban sprawl, and what negative environmental impacts have resulted because
of it?
Answer:
Answers will vary.
How successful have privacy policies been in ensuring consumers that websites are
safe?
Answer:
Answers will vary.
List and describe the six steps involved in implementing a stakeholder perspective into
a company’s social responsibility strategy.
Answer:
Answers will vary.
What can a company do to become a neighbor of choice?
Answer:
Answers will vary.
What additional legal issues must a company contend with when it engages in
commerce beyond its own borders?
Answer:
Answers will vary.
What impact do corruption and underdeveloped social institutions tend to have on a
country’s economy?
Answer:
Answers will vary.
How is quid pro quo sexual harassment different from hostile work environment
harassment?
Answer:
Answers will vary.
What can a company do to influence its employees’ opportunity for unethical behavior?
Answer:
Answers will vary.
What is the future outlook for biotechnology?
Answer:
Answers will vary.
According to results from the National Business Ethics Survey, what are the types of
misconduct commonly found in the workplace?
Answer:
Answers will vary.
Describe the function of the Caux Round Table. List and describe three of the Caux
Round Table Principles for Business.
Answer:
Answers will vary.
Describe the purpose of the stakeholder interaction model. Sketch a diagram of the
model and briefly explain the types and direction of those relationships that exist.
Answer:
Answers will vary.
How has the need for corporate governance around the world been affected by
increased globalization in business?
Answer:
Answers will vary.
What concerns about the right to privacy has the Internet raised?
Answer:
Answers will vary.
What is crisis management? Describe the four stages of the crisis management process
and possible conditions, strategies, and tactics that an organization may experience or
consider at each stage.
Answer:
Answers will vary.