42) Changes in the economic, political, legal, and technological global system that may affect an
organization are ________ forces. For example, stresses within the European Union (including the
United Kingdom’s recent decision to exit the EU) may have global ramifications.
A) local
B) demographic
C) international
D) technological
E) external stakeholder
43) Bob, the owner of Orthopedic Supply, just discovered that his trusted friend Ruth, his
accountant for over 30 years, has been mishandling the company books and stealing from the
company bank account. Bob must decide whether to ignore his friend’s actions and avoid bad
publicity for Orthopedic Supply, or to have Ruth arrested for embezzlement. Bob is facing
A) a whistle-blower.
B) a moral courage decision
C) an issue of corporate governance.
D) a social audit.
E) an ethical dilemma.
44) Ethics are defined as
A) influences arising from changes in the characteristics of a population.
B) an organization’s written code of social responsibility.
C) standards of right and wrong that influence behavior.
D) a set of behaviors accepted as “right” or “good.”
E) rules to be enforced in an organization.
45) ________ are the relatively permanent and deeply held underlying beliefs and attitudes that
help determine a person’s behavior. These beliefs may include the idea that employees should be
promoted solely on the basis of merit, that no bribes will be paid to foreign officials to obtain
business licenses, and that companies should offer extended maternity leave upon the employee’s
request.
A) Morals
B) Norms
C) Ethical advantages
D) Values
E) Fairness factors
46) To increase profitability, top management of a national retailer needs to decide if it will close
several stores. Management knows that by closing the locations, it will save the company millions
of dollars and benefit many stockholder groups and individuals. The benefits of closing the stores
outweigh the benefits of keeping them open. Keeping the stores open would be advantageous for
many fewer people than closing the stores. This logic is an example of the ________ approach to
deciding ethical dilemmas.
A) individual
B) deontological
C) utilitarian
D) procedural justice
E) moral-rights
47) Consider the following situation: Local livestock farmers could allow the runoff of manure
nutrients into a stream that feeds a local lake because polluting the stream helps farmers in the
short term. However, farmers will act ethically in the short run to avoid harming others in the long
run because doing so is also in the farmer’s best long-term interests. This type of thinking reflects
the ________ approach to deciding ethical dilemmas.
A) individual
B) group
C) moral-rights
D) utilitarian
E) procedural justice
48) With recent reports of identity theft, Mr. Adams, the CEO of a construction company, is
concerned about his employees’ privacy, and because of recent accidents on the job, he is also
worried about the safety of his workers. Mr. Adams’ concerns with privacy and health and safety
are key elements in the ________ approach to deciding ethical dilemmas.
A) individual rights
B) procedural justice
C) impartial
D) utilitarian
E) moral-rights
49) ________ guides the justice approach to deciding ethical dilemmas.
A) Increasing profits and workplace diversity
B) Respect for the fundamental rights of human beings
C) Respect for impartial standards of fairness and equity
D) Respect for society and the environment
E) An individual’s moral compass
50) Josiah was unhappy with how his boss was promoting individuals on his team. He felt like was
being overlooked because of his race and the fact that he had reported an incident to management a
year before. Instead of speaking to his boss and human resources about his hunch, he posted about
it on Facebook. When confronted, he claimed he was protected as a(n) ________, even though he
posted on Facebook.
A) external stakeholder
B) special-interest group member
C) internal stakeholder
D) whistle-blower
E) insider trader
51) Charles, the president of an IT company, is friends with Levi, the CEO of Cyber Industries, a
company that develops and manufactures computer hardware. Levi tells Charles that Cyber
Industries is about to announce the creation of a revolutionary new computer processor that will
quadruple processing capacity and cause Cyber Industries’ sales and profits to skyrocket. Charles
then purchases a large number of shares of Cyber Industries company stock before the news of the
new computer processor is made public. In which illegal activity has Charles engaged?
A) A Ponzi scheme
B) Short selling
C) Issuing a call
D) Information abuse
E) Insider trading
52) The Sarbanes-Oxley Act of 2002 established requirements for ________. Noncompliance can
result in penalties of
A) proper financial record keeping for private companies; as much as 20 years in prison.
B) proper financial record keeping for government organizations; as much as 25 years in prison.
C) codes of ethics guidelines for organizations; as much as $2 million.
D) proper financial record keeping for public companies; as much as 25 years in prison.
E) all corporate financial records to be made public; as much as $5 million.
53) Mackenzie, a successful store manager, leads her employees by encouraging them and
showing that she genuinely believes in them. She also encourages group and team efforts.
Mackenzie manages at Kohlberg’s ________ level of personal moral development.
A) second
B) nonconventional
C) conventional
D) acceptable
E) first
54) Blake has managed several restaurants for over 50 years and is close to retirement. With his
maturity and business experience, his decisions are sound, based on solid, proven values. Blake
tends to be an independent thinker who focuses on empowering his employees. Blake manages at
Kohlberg’s ________ level of personal moral development.
A) first
B) nonconventional
C) second
D) acceptable
E) postconventional
55) The employees of Pi’s Pizza, a local pizza restaurant, feel that the owners and managers really
try to follow the ethical policies outlined in their company’s code of ethics. Curtis, a cook, said that
“Just today, Rob, our manager, called our supplier to let them know we received an extra case of
tomatoes that we did not pay for. And they do this type of thing almost every day.” Pi’s Pizza
maintains a(n)
A) procedurally sound atmosphere.
B) profitable climate.
C) ethical climate.
D) holier-than-thou atmosphere.
E) honest environment.
56) A(n) ________ is a formal written set of ethical standards guiding an organization’s actions.
A) moral compass
B) business plan
C) dilemma document
D) ethical plan
E) code of ethics
57) Beau said to a close friend, “I am fed up with my company’s continual disregard for the
environment. They secretly dispose of hazardous chemicals into a nearby stream constantly. I don’t
know how they get away with it! I am going to call a reporter at the local newspaper and reveal
what my company is doing.” Beau’s decision to tell somebody about his company’s actions is an
example of
A) moral courage.
B) violating a code of ethics.
C) backstabbing his manager.
D) being guided by the invisible hand.
E) whistle-blowing.
58) As the CEO of a company that produces products for schools, Amber believes that her
company needs not only to produce a profit but also to do things that benefit society. ________
guides Amber’s beliefs.
A) Individual responsibility
B) The desire for sustainability
C) Social responsibility
D) A sense of moral rights
E) Corporate lobbying
59) The company that Layton owns, the Music Box, is a family-owned company that has been in
business for more than 100 years. Layton wants to give back to the people of the community to
acknowledge their role in the store’s success. He decides to donate a significant portion of the
store’s profits to a charity every year. Layton’s decision is an example of ________ in action.
A) corporate social responsibility
B) corporate governance
C) a code of ethics
D) economic responsibility
E) legal responsibility
60) Sustainable economic development
A) meets future needs without compromising present needs.
B) always generates greater profitability.
C) is the goal of most corporations.
D) meets present needs without compromising the ability of future generations to meet their needs.
E) is an idea proposed by Frank and Lillian Gilbreth to cut costs and increase efficiency.
61) Business scholar Archie Carroll suggested that ________ is the first and primary responsibility
of an organization in the global economy.
A) to be a good global corporate citizen, as defined by the host country’s expectations,
B) to make a profit consistent with expectations for international business
C) to be ethical in all of its business practices
D) to obey the law of host countries as well as international law
E) to have a written code of ethics
62) Mr. Liang, a wealthy businessman who made his fortune in the oil industry, understands the
importance of a college education, so he has donated over $10 million over the last several years to
colleges and universities. Mr. Liang’s actions are an example of
A) philanthropy.
B) sustainability.
C) servant leadership.
D) social responsibility.
E) corporate governance.
63) Which of the following is an example of a green policy or action?
A) A local factory pollutes the atmosphere via smokestacks that belch out carbon dioxide.
B) The owner of a sole proprietorship announces that she is taking on a business partner.
C) A major publisher donates 10,000 books a year to national literacy groups.
D) 3M encourages employees to experiment with creating new products.
E) Coca-Cola has pledged to replenish (return to nature) all the water it uses to make its beverages.
64) Which of the following describes the system of corporate governance?
A) governing an industry, such as the trucking industry, to protect customers
B) protecting citizens against unethical state and national governments
C) governing a company so that the interests of corporate owners and other stakeholders are
protected
D) monitoring an industry, such as law firms, to ensure ethical practices
E) monitoring and limiting corporate political donations
65) On an organization’s board of directors, inside directors
A) are supposed to be elected from outside the organization and outside directors may be members
of the firm.
B) must work for the company and outside directors are also members of the firm.
C) may be members of the firm and outside directors are supposed to be elected from outside the
firm.
D) are always retired executives and outside directors typically are employees.
E) must work for the organization and outside directors are paid members of the organization.
66) Outside directors are supposed to be elected yet many are handpicked by the CEO, creating the
directors’ lack of
A) interest in company matters.
B) corporate social responsibility.
C) focus on profits.
D) independence from the CEO.
E) a written ethical code.
67) Katelyn, a millennial, is conducting her job search. She wants to work for a company that cares
not only about its people, but about the planet too. In reviewing different company portfolios,
where in the company would you guide her to be successful with her research?
A) its LinkedIn page
B) its financial reports
C) its social audit documents
D) reports from the Better Business Bureau
E) its retention rate of employees
68) Kendra decided to leave her job in the city and move to the country where she plans to start her
own business selling homemade preserves, soaps, lotions, and candles. Kendra’s business would
be
A) a sole proprietorship.
B) a partnership.
C) a private investment.
D) employee owned.
E) owned by stockholders.
69) The Parvizians own several oriental rug stores in and around the Washington, DC,
metropolitan area. It is expected that as each of the brothers have children they will grow up and
take part in the business too. The members of the family are considered
A) sole proprietors.
B) partners.
C) private investors.
D) employee owners.
E) stockholders.
70) When a pharmaceutical company wants to sell a newly tested drug to the public, it must first
meet the ground rules established by
A) its strategic allies.
B) the employee unions.
C) special-interest groups.
D) financial institutions.
E) government regulators.
71) Angela wants to sell her business. Sadie has expressed an interest in purchasing it, but is
worried about whether or not she will qualify a loan with the interest rates going up. Sadie is
worried about a(n)
A) economic force.
B) technological force.
C) demographic force.
D) political-legal force.
E) international force.
72) Which of the following is NOT considered a sociocultural force?
A) LGBTQ restrooms
B) Smoking marijuana laws
C) Millennials choosing Netflix over cable TV
D) Religious exemptions for vaccines
E) Multigenerational households on the rise