84. What are some of the common price-related ethical issues?
a.
Misleading advertising and predatory pricing
b.
Additional discounts and price fixing
c.
Not disclosing the full price and value-pricing
d.
Predatory pricing and price fixing
e.
Loss leaders and deceptive pricing
85. Pharmaceutical companies have at times been accused of acting unethically by taking advantage of
customers in the area of
a.
promotion.
b.
pricing.
c.
distribution.
d.
product.
e.
manufacturing.
86. After a hurricane strikes the U.S. Gulf Coast, a tremendous demand for gas-powered generators
occurs. Many of the local hardware and home supply stores have limited supplies of these items.
However, Ace Hardware has a large inventory of these items. Traditionally, Ace has lower prices than
the other competitors. What major ethical decisions is Ace likely to face with regard to the current
issue?
a.
product-related and pricing-related
b.
advertising-related and distribution-related
c.
distribution-related and product-related
d.
publicity-related and advertising-related
e.
pricing-related and promotion-related
87. Distribution-related ethical issues arise when marketers
a.
do not provide intermediaries with enough information about how a product is priced.
b.
force channel intermediaries to behave in a specific manner.
c.
bribe salespeople to push one product over another.
d.
fail to disclose information to consumers about the risks associated with using a product.
e.
distribute a product that is very similar to a competing product.
88. At times, large retailers such as Walmart may be accused of coercion in dealing with intermediaries
because of the amount of power and control these large companies have over many of their suppliers.
This is most potentially a ____ related ethical issue.
a.
promotion
b.
pricing
c.
culture
d.
product
e.
distribution
89. According to the text, which of the following is not one of the factors that influence the ethical
decision-making processes in a marketing organization?
a.
Organizational culture
b.
Attitudes toward religion
c.
Opportunity
d.
Individual factors
e.
Organizational pressure
90. All of the following are factors that influence the ethical decision-making process except
a.
opportunity.
b.
individual factors.
c.
organizational culture.
d.
organizational pressure.
e.
salary or wages.
91. Three factors that influence the ethical decision-making process in marketing include
a.
individual factors, organizational culture, and peer influence.
b.
opportunity, personal moral philosophies, and situational variables.
c.
individual factors, organizational factors, and opportunity.
d.
social forces, laws, and organizational factors.
e.
peer influences, personal moral philosophies, and opportunity.
92. Since most ethical choices pertaining to marketing decisions are jointly made, an organization must
ensure the ____ reflects the organization’s values, beliefs and norms.
a.
code of ethics
b.
code of conduct
c.
enforcement of ethical standards and screening techniques
d.
employee self-regulation and screening procedures
e.
organizational or corporate culture
93. Ethical choices in business situations are most often made
a.
by top managers.
b.
by front-line employees.
c.
jointly in work groups and committees.
d.
in consultation with family, friends, and coworkers.
e.
individually.
94. At his new job, Carlos notices that everyone places high values on their families and each others’
families, birthdays are always celebrated, and flexible schedules are permitted to facilitate family
involvement as long as the work is still getting done. Everyone is very relaxed and friendly. Carlos has
made several observations about the
a.
organizational structure.
b.
ethical climate.
c.
morale and performance programs.
d.
codes of conduct.
e.
corporate culture.
95. Tasha recently changed employers within the same industry. At her old company, employees routinely
took home company pens, pencils, paperclips, and note pads, and they frequently made personal long–
distance calls on company phones. Tasha observes that employees do not engage in such practices at
her new company. What Tasha sees is best described as a difference in
a.
significant others.
b.
profit objectives.
c.
corporate culture.
d.
legal climate.
e.
corporate goals.
96. Amanda believes that the corporate culture at her company is best conveyed in informal ways. What
are some informal ways that corporate culture is most likely to be expressed?
a.
Codes of conduct and ethics officers
b.
Memos and cultural manuals
c.
Work habits and dress codes
d.
Extracurricular activities and work habits
e.
Ceremonies and anecdotes
97. Which of the following employees is most responsible for setting the ethical tone for the entire
marketing organization?
a.
Marketing manager
b.
Marketing employee
c.
Product manager
d.
Chief executive officer
e.
Vice president of marketing research
98. A set of values, beliefs, goals, norms, and rituals shared by members of an organization is called
a.
organizational factors.
b.
corporate culture.
c.
codes of conduct.
d.
ethical environment.
e.
company ethos.
99. The effect that coworkers have on the ethical decision-making process depends on a person’s exposure
to ethical and unethical behavior. Which of the following statements about ethical decision making is
true?
a.
The more a person is exposed to ethical activity in the organization, the more likely he or
she will behave unethically.
b.
The more a person is exposed to unethical activity in the organization, the more likely he
or she will behave unethically.
c.
The more a person is exposed to unethical activity in the organization, the less likely he or
she will pay attention to that activity.
d.
The more a person is exposed to ethical activity in the organization, the less likely he or
she will pay attention to that activity.
e.
Exposure to ethical and unethical activity has no effect on a person’s decision-making
process.
100. Opportunity provides a pressure that may determine ethical decisions in marketing. Opportunity is best
thought of as
a.
unethical behavior found in top management.
b.
a favorable set of conditions that limit barriers or provide rewards.
c.
the principles or rules that individuals use to determine the way to behave.
d.
a person’s relationship with others in the organization.
e.
a problem or situation requiring an individual to choose a course of action.
101. Justin believes that certain conditions at his company are very conducive to engaging in unethical
behavior because these conditions provide rewards such as faster promotions and better salaries for
those who bend the rules. Justin’s company seems to allow ____ for unethical behavior.
a.
peer pressure
b.
individuality
c.
corporate culture
d.
exposure
e.
opportunity
102. In response to organizational pressure to perform, Barry used a deceptive sales tactic to obtain a major
sales contract. He was surprised that he wasn’t punished for his behavior and even received a
substantial bonus for securing the contract. Given the same opportunity in the future, Barry will most
likely
a.
blow the whistle on his employer to a government agency.
b.
report his employer to the industry’s trade association.
c.
express his discomfort with the situation to his supervisor.
d.
not use similar sales tactic again.
e.
use similar sales tactic again.
103. Carrie, a new salesperson for Brenham Foods, calls in an order for twice the amount of merchandise
that Corner Market requested because she knows that it will increase her sales and will not be noticed
by Corner Market. This is an example of how ____ influences ethical decision making.
a.
opportunity
b.
exposure
c.
a significant other
d.
a peer
e.
an external reward
104. As a media buyer for the Angelo Agency, Philip knows that no one ever checks to see if his phone
calls are business related or personal. With regard to ethical behavior, this situation relates most
closely to
a.
exposure.
b.
individual factors.
c.
desire.
d.
opportunity.
e.
organizational factors.
105. Which of the following statements best summarizes the perspective that most marketing managers
have on unethical behavior?
a.
Most do not believe that unethical conduct will lead to success and refrain from taking
unethical opportunities.
b.
They believe that unethical behavior is useful in the short run but detrimental in the long
run.
c.
They feel that codes of conduct will eliminate any unethical behavior from occurring in
their organizations.
d.
They believe that unethical behavior will be harmful in the short run but have little impact
in the long run.
e.
Most do not see ethical or unethical behavior as a concern to their organization because
the opportunities do not exist.
106. ____ is (are) most likely to improve ethical behavior in a marketing organization.
a.
Hiring goal-directed employees
b.
Allowing employees to follow their own ethical standards
c.
Encouraging employees to identify ethical issues and to decide what is right
d.
Obeying the law and accepting all other behavior
e.
Eliminating unethical individuals and improving the organization’s ethical standards
107. Which of the following would be consistent with Johnson Chemicals’ understanding of the “bad apple”
concept of improving the ethical conduct of salespeople?
a.
Publishing ethical guidelines for salespeople
b.
Firing unethical salespeople
c.
Retraining unethical salespeople
d.
Using customers to review ethical guidelines
e.
Scrutinizing top management’s conduct
108. It is possible to improve ethical behavior in an organization by
a.
changing the employees’ individual moral philosophies.
b.
increasing legislation aimed at unethical practices.
c.
decentralizing authority and responsibilities in the firm.
d.
offering ethics awareness training for managers and professionals in the organization.
e.
improving the organization’s ethical standards and eliminating unethical persons.
109. ____ are formalized rules and standards that describe what a company expects of its employees in
terms of ethical behavior.
a.
Job descriptions
b.
Ethics clauses
c.
Behavior contracts
d.
Codes of conduct
e.
Ethics contracts
110. Codes of conduct are also frequently known as
a.
ethics mandates.
b.
codes of ethics.
c.
corporate culture.
d.
ethics compliance programs.
e.
moral codes.
111. Which of the following statements about codes of conduct is true?
a.
All publicly-traded companies have formal codes of conduct.
b.
Most large corporations have formal codes of conduct.
c.
Codes of conduct are unnecessary for small- and medium-sized companies.
d.
Approximately half of large companies have formal codes of conduct.
e.
Very few companies have formal codes of conduct, but most have informal codes.
112. Which one of the following statements about codes of conduct (ethics) is false?
a.
They are formalized rules and standards that describe what a company expects of its
employees.
b.
They must be detailed enough to take into account many possible situations.
c.
They encourage ethical behavior by eliminating opportunities for unethical behavior
because employees know what is expected of them.
d.
They help marketers deal with marketing issues by prescribing and limiting certain
activities.
e.
Top management must provide leadership in implementing codes of ethics.
113. Who is typically responsible for creating, distributing, and enforcing a formal code of conduct?
a.
Chief executive officer
b.
Vice president of marketing
c.
Morale manager
d.
Ethics officer
e.
Managers and supervisors
114. Within the scope of her job, Sue Hanson gives ethics advice, disseminates a code of ethics, reviews the
code of ethics, and takes action on ethics violations. Sue is the ____ in her company.
a.
attorney
b.
marketing manager
c.
ethics officer
d.
owner
e.
consumer activist
115. Priya knows that her company has a formal code of conduct, but she does not see this code being
equally and consistently applied to all employees. Priya believes that this sporadic enforcement of the
formal code only enhances the ____ for committing unethical acts.
a.
opportunity
b.
culture
c.
individual factors
d.
compliance
e.
punishment
116. Which of the following is not usually a responsibility of an ethics officer?
a.
Drafting, disseminating, and updating a mission statement
b.
Drafting, disseminating, and updating a code of conduct
c.
Training employees to deal with ethical issues
d.
Creating and maintaining a confidential system to answer questions about ethical issues
e.
Taking action on possible violations of the code of conduct
117. Because laws are often difficult to interpret and understand, company codes of conduct and
compliance programs should
a.
avoid involving any issues deemed to be of a legal nature.
b.
focus on those issues most likely to be of legal, rather than strictly ethical, consequence.
c.
incorporate both legal and ethical concerns that the company deems most appropriate.
d.
try to fully cover the laws guiding ethical decision making that is most applicable.
e.
offer very general ethical principles without providing any level of specificity.
118. Which of the following statements about implementing an ethics and legal compliance program is
false?
a.
It requires open communication.
b.
It requires consistent enforcement of standards from the code of conduct.
c.
It rarely needs to be revised.
d.
It requires taking reasonable steps in response to violations of standards.
e.
It helps create a buffer zone on issues that could trigger serious legal complications for the
company.
119. What is the major difference between social responsibility and marketing ethics?
a.
Marketing ethics varies by industry whereas social responsibility involves universal rules
of conduct.
b.
There is legislation that deals with marketing ethics, but none for socially responsible
practices.
c.
Marketing ethics is concerned with organizational practices, and social responsibility is
concerned with individual behavior.
d.
There is no difference; they are synonymous terms.
e.
Social responsibility deals with the total effect of marketing decisions on society, whereas
marketing ethics relates to individual and group evaluations in marketing situations.
120. Which of the following statements is false?
a.
If an ethical or social responsibility issue can withstand open discussion that results in
agreement or limited debate, an acceptable solution may exist.
b.
A company that supports both socially responsible decisions and adheres to a code of
conduct is likely to have a positive impact on society.
c.
If other persons in the organization approve of an activity and it is legal and customary
within the industry, chances are that the activity is acceptable from both an ethical and
social responsibility perspective.
d.
Social responsibility and marketing ethics are interrelated.
e.
Social responsibility and marketing ethics are the same thing and can be used
interchangeably.
121. In a meeting with key personnel, Watson Corporation’s president speaks to the firm’s managers about
social responsibility in business today. He suggests that the key to being socially responsible is to
a.
watch profit impacts very carefully.
b.
maintain an updated code of ethics.
c.
monitor changes and trends in society’s values.
d.
carefully interpret all new legislation.
e.
stay with present programs over the long run.
122. In a classroom discussion, Jacob agrees with Marcie that consumers generally want biodegradable
beverage cups. However, he says that businesses in that industry must evaluate whether
a.
they can be produced.
b.
consumers are willing to pay higher prices for them.
c.
the competition will ever make them.
d.
stores will stock them.
e.
they can be effectively promoted.
123. Companies that incorporate ethics and social responsibility into their strategic plans are likely to
experience
a.
improved marketing performance.
b.
increased lawsuits.
c.
negative publicity.
d.
reduced costs.
e.
disappointed shareholders.
Scenario 4.1
Use the following to answer the questions.
Hershey Foods was founded in the nineteenth century by Milton Hershey, who had a strong ethical
value system⎯always show integrity, be honest, and respect others. Hershey felt it was important to
provide high-quality goods and services of real value at competitive prices that provide an adequate
return on investment. He also founded the Milton Hershey School, operating today as a cost-free,
private home and school dedicated to helping children with social needs and limited resources. The
company also focuses on environmental issues, such as reducing waste by 360,000 pounds annually by
redesigning Hershey’s Syrup caps. Hershey Foods has an ethics compliance program that includes a
code of ethics and training, guidelines for handling legal and ethical issues, an 800 number for
assistance with ethical issues, and support from supervisors and human resource managers in dealing
with ethical issues. However, in the last few years, Hershey has been criticized by several advocacy
groups concerning the sourcing of its chocolate from West Africa where many of the companies use
child labor. While Hershey is the largest chocolate candy producer in America, it lags behind other
major chocolate producers with regard to certifying its chocolate as child labor-free.
124. Refer to Scenario 4.1. Milton Hershey contributed resources to the community to improve the overall
quality of life for consumers, employees, and the community in general. This reflected his ____
responsibility.
a.
philanthropic
b.
ethical
c.
legal
d.
economic
e.
shareholder
125. Refer to Scenario 4.1. The fact that the Hershey company has recently reduced its waste by 360,000
pounds through a packaging redesign is evidence of its focus on
a.
a philanthropic culture.
b.
an ethical culture.
c.
social responsibility.
d.
the legal climate.
e.
the economic environment.
126. Refer to Scenario 4.1. The criticism of Hershey’s sourcing for chocolate is an example of ____, while
the potential use of child labor to produce Hershey products impacts its level of commitment to
______.
a.
consumerism; organizational culture
b.
ethics; social responsibility
c.
shareholder orientation; social responsibility
d.
ethical climate; ethics
e.
consumerism; sustainability practices
127. Refer to Scenario 4.1. Hershey and its employees benefit in many ways from its strong ethics
compliance program. Which of the following is not one of the benefits of such a program?
a.
Enforcement and discipline of ethical infractions
b.
Better employee understanding of ethical issues
c.
Free-flowing communication within the firm regarding ethical issues
d.
Costly programs to develop and maintain
e.
High level of organizational guidance for employees
Scenario 4.2
Use the following to answer the questions.
WhiteWave Foods, producer of brands such as Silk Soymilk, specializes in manufacturing innovative
and nutritious food products. Silk Soymilk was first launched in 1996, and is committed to the health
of its customers, as well as the health of the planet. At Silk, they have offset all of their energy
consumption with wind power, preventing over 16,000 tons of greenhouse gasses from entering the
atmosphere each year. Silk Soymilk is made from a mixture of organic and natural, non-genetically
modified soy beans, reducing the amount of pesticides in the air, soil, and water. Since 2002 they have
been sponsoring the FarmAid concert, whose mission is to is to keep family farmers on their land and
ensure a safe, healthy food supply for all Americans.
128. Refer to Scenario 4.2. Silk Soymilk’s sponsorship of the FarmAid concert is best thought of as an
example of its
a.
cause-related marketing effort.
b.
ethical responsibility.
c.
green marketing strategy.
d.
philanthropic activities.
e.
environmental strategy.
129. Refer to Scenario 4.2. Silk Soymilk’s use of organic, non-genetically modified soybeans in its product
is an example of
a.
green marketing.
b.
social consciousness.
c.
ethical responsibility.
d.
cause-related marketing.
e.
corporate benevolence.
130. Refer to Scenario 4.2. The use of wind power to offset energy consumption by Silk Soymilk’s parent
company demonstrates its commitment to
a.
consumerism.
b.
ethical marketing.
c.
social responsibility.
d.
philanthropic strategy.
e.
environmental marketing.
131. Refer to Scenario 4.2. Silk Soymilk’s parent company, WhiteWave Foods, is currently operating at the
____ level of the social responsibility pyramid.
a.
economic
b.
philanthropic
c.
ethical
d.
legal
e.
cause-related
TRUE/FALSE
132. An organization’s obligation to maximize its positive impact and minimize its negative impact on
society is known as social accountability.
133. Social responsibility is an organization’s obligation to maximize its positive impact and minimize its
negative impact on society.
134. Marketing citizenship refers to an organization’s obligation to maximize its positive impact and
minimize its negative impact on society.
135. Four dimensions of social responsibility are economic, legal, ethical, and philanthropic.
136. At the most basic level of marketing citizenship, marketers have an obligation to contribute funds to
philanthropic causes.
137. Marketing ethics refers to principles and standards that define acceptable conduct in marketing.
138. Cause-related marketing refers to the specific development, pricing, promotion, and distribution of
products that do not harm the natural environment.
139. Strategic philanthropy involves linking a firm’s products to a particular social cause on a sort-term
basis.
140. Green marketing refers to the packaging of products in green containers that blend in with the
environment.
141. Under President Kennedy’s consumer bill of rights, consumers must have access and opportunity to
review all relevant information about a product before buying it.
142. The right to be informed means that consumers should be treated fairly when they complain to
marketers about their products.
143. Marketers’ contributions of resources to community causes such as education, recreation, and others
illustrate social responsibility on a community-relations level.
144. When marketing activities deviate from accepted standards, the exchange process can break down,
resulting in customer dissatisfaction, lack of trust, and lawsuits.
145. According to research, only a small percentage of consumers have a more positive opinion of an
organization when it supports causes they care about.
146. It is easy to distinguish between legal and ethical issues.
147. Marketing ethics goes beyond legal issues, although ethical disputes must sometimes be resolved in
court.
148. An ethical issue is an identifiable problem, situation, or opportunity requiring an individual to choose
from among several actions that must be evaluated as right or wrong.
149. Any time an activity causes managers or consumers to feel manipulated or cheated, a marketing ethics
issue exists, regardless of the legality of that activity.
150. A marketer’s failure to inform customers about changes in the quality of its products does not
constitute an ethical issue.
151. Pressures to substitute inferior materials to reduce costs may result in product-related issues.
152. A bribe offered to benefit an organization is generally considered acceptable.
153. Bribery is a pricing-related ethical issue.
154. Price fixing, predatory pricing, and failure to disclose the full price associated with a purchase are
pricing activities that do not result in ethical issues.
155. Manipulating a product’s availability for purposes of exploitation and forcing intermediaries to behave
in a specific manner are ethical issues in distribution.
156. Three important factors that influence ethical decisions in marketing are individual factors,
organizational factors, and opportunity.
157. People learn values and principles through socialization by family members, social groups, religion,
and formal education.
158. Employees, coworkers, or superiors do not influence the ethical decision-making process.
159. Top management sets the ethical tone for the entire organization.
160. The more a person is exposed to unethical activity in the organizational environment, the more likely it
is that he or she will behave unethically.
161. Opportunity is a favorable set of conditions that limit barriers or provide rewards.
162. If a person is rewarded for developing a deceptive advertisement, he or she probably will not engage in
such behavior in the future.
163. It is possible to improve ethical behavior in an organization by eliminating unethical persons and
improving the organization’s ethical standards.
164. An organization can rid itself of “bad apples” through screening techniques and enforcement of its
code of conduct.
165. Codes of conduct (ethics) are formalized rules and standards that describe what the company expects
of its employees in terms of ethical behavior.
166. Codes of conduct (ethics) must be detailed enough to take every situation into account.
167. A marketing compliance program must have oversight by a high-ranking person who is known to
respect legal and ethical standards.
168. Employees can easily determine what behavior is acceptable even in organizations that do not have
ethics compliance programs and policies on conduct.
169. Companies should promote individuals prone to misconduct to management positions.
170. Open communication and coaching on ethical issues are essential to nurturing ethical conduct in
marketing.
171. It is not important to consistently enforce standards and impose penalties or punishment on those who
violate codes of conduct.
172. Marketing ethics and social responsibility mean the same thing.
173. Marketing ethics concerns the impact of an organization’s decisions on society, whereas social
responsibility relates to individual decisions.
174. Marketing ethics relates to individual and group evaluations about what is right or wrong in a
particular marketing decision-making situation; social responsibility deals with the total impact of
marketing decisions on society.
175. If other persons within an organization approve of an activity and the activity is legal but not
customary in the industry, the activity is probably both ethical and socially responsible.
176. To resolve a social responsibility issue, it is helpful to check with concerned consumer groups and
industry or specific company policy regarding the activity.
177. Although openness is not the solution to ethics issues, it does create trust and facilitates learning
relationships.
178. If an ethical (or social responsibility) issue can withstand open discussion and result in agreements or
limited debate, it is not really an ethical (or social responsibility) issue.
179. Being socially responsible and ethical is easy.
180. There are few costs associated with being socially responsible and satisfying society’s demands.
181. There is no evidence that being socially responsible and ethical is worthwhile.