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in Business Ethics and Corporate Social Responsibility (BECSR)

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Chapter: Unit 1
1.

Which of these are key principles of the code of ethics?

A. Objectivity
B. Familiarity
C. Professional behavior
D. A and C
Answer» D. A and C
discuss
2.

If you face an ethical dilemma, what should your first step be in resolving the issue?

A. Contact the regulators
B. Stay quiet
C. Check your facts
D. None of the above
Answer» C. Check your facts
discuss
3.

In which of these areas might you face pressures?

A. Working with colleagues from different functional areas within the organization
B. Meeting reporting deadlines
C. Allocating bonuses
D. all of the above
Answer» D. all of the above
discuss
4.

Which of these are safeguards for upholding high ethical standards?

A. Having written orders to do something
B. Companies’ internal codes, policies and education
C. Corporate governance regulations
D. b and c
Answer» D. b and c
discuss
5.

How does CIMA support its members and students?

A. Setting standards and disciplinary process
B. Making decisions for them
C. Offering helplines globally
D. a and c
Answer» D. a and c
discuss
6.

Which principles of ‘adequate procedures’ should be in place to prevent bribery according to the recent UK Bribery Act?

A. Top level commitment
B. Communication
C. Write a document
D. a and b
Answer» D. a and b
discuss
7.

The most influential theory of corporate responsibility of the past century is:

A. The moral minimum model.
B. The classical model.
C. The social contract theory.
D. The stakeholder theory.
Answer» B. The classical model.
discuss
8.

The ethical roots of the classical model of corporate social responsibility are found in which statement:

A. The idea that the interests of stakeholders are as important as the interests of a corporation's stockholders.
B. The free market theory which holds that managers are ethically obliged to take as much money as possible for their stockholders because to do otherwise would undermine the very foundations of our free society.
C. The ethical imperative to cause no harm.
D. The ethical imperative to prevent harm.
Answer» B. The free market theory which holds that managers are ethically obliged to take as much money as possible for their stockholders because to do otherwise would undermine the very foundations of our free society.
discuss
9.

Which of the following reasons might a free market economic theorist use to justify the hostile takeover of a company?

A. The takeover target company's stock is undervalued. That is evidence that the resources are being inefficiently used.
B. The organization seeking to take over the target company will maximize profits for the stockholders and will be serving the public's interests because it is only by satisfying consumer (public) demand that a business can make profits.
C. If the takeover target's managers are using their stockholders' money to serve interests other than those of the stockholders, they are stealing from them.
D. All of the above.
Answer» D. All of the above.
discuss
10.

Which of the following statements does not represent a market failure, i.e., a situation in which the pursuit of profit will not result in a net increase in consumer satisfaction?

A. The costs of pollution, groundwater contamination and depletion, soil erosion and nuclear waste disposal are borne by parties external to the economic exchange between buyer and seller.
B. Where there is no mechanism for pricing, for setting a value on, public goods, there is no guarantee that the markets result in the optimal satisfaction of the public interest in regards to public goods.
C. Situations in which externalities have been internalized result in an equilibrium in the exchange price between true costs and benefits.
D. The pursuit of individual self-interest results in a worse outcome than would have occurred had the behavior of the parties involved in the economic exchange been coordinated through cooperation or regulation rather than mere competition.
Answer» C. Situations in which externalities have been internalized result in an equilibrium in the exchange price between true costs and benefits.
discuss
11.

Which statement does not support the claim that an unconditioned ethical directive such as the one the classical model of corporate social responsibility demands of business management is inappropriate for utilitarian theory?

A. Markets can work to prevent harm only by first-hand experience with harms that have to occur before they can be remedied.
B. It is claimed that once market failures are adequately addressed by the government, business just needs to obey the law that addressed them. Business, however, has the ability to inappropriately influence government policy and the law.
C. Business has the ability to influence consumers' desires by helping shape those desires through advertising.
D. A more precise formulation of a utilitarian- based principle would be to maximize profit whenever doing so produces the greatest good for the greatest number, with the proviso that managers must consider the impact a decision will have in many ways other than merely financial.
Answer» D. A more precise formulation of a utilitarian- based principle would be to maximize profit whenever doing so produces the greatest good for the greatest number, with the proviso that managers must consider the impact a decision will have in many ways other than merely financial.
discuss
12.

According to the private property defense of the classical model of corporate social responsibility, managers who use corporate funds for projects that are not directly devoted to maximizing profits are stealing from their owners. Which statement supports this view?

A. Property rights are restricted when they conflict with the basic rules of society as embodied in law and custom.
B. The connection between ownership and control that exists for personal property does not legally exist for corporate property.
C. Investors buy their stocks with the hope of maximizing return on their investment.
D. Stockholders in publicly traded corporations are better understood as investors rather than owners.
Answer» C. Investors buy their stocks with the hope of maximizing return on their investment.
discuss
13.

Which statement is true of Bowie's Kantian approach to business ethics?

A. People have a duty both to not cause harm and to prevent harm.
B. Both causing no harm and preventing harm override other ethical considerations.
C. While it is ethically good for managers to prevent harm or do some good, their duty to stockholders overrides these concerns.
D. A narrow interpretation of Bowie's "cause no harm" imperative makes the duties faced by management under the neo-classical model significantly different from the classical model.
Answer» C. While it is ethically good for managers to prevent harm or do some good, their duty to stockholders overrides these concerns.
discuss
14.

Select the reasons, historically speaking, why the modern corporation was established as a legal entity:

A. Social benefits flow from corporate institutions.
B. Corporations provide an efficient means for raising large amounts of capital needed to produce and distribute socially desired goods and services.
C. Corporations distribute risks widely over large populations, minimizing the risk to any one individual.
D. All of the above.
Answer» D. All of the above.
discuss
15.

Which statement does not challenge the notion of a hypothetical social contract between society and corporations?

A. If the social contract presupposes an amoral beginning, it seems to offer few guarantees that certain fundamental ethical rights will be protected under the contract.
B. Micro-social contracts can be developed within particular local communities that establish the specific ethical rights and responsibilities within that community as long as they fit within the general limitations of the hypernorms governing any and all social contracts.
C. It is difficult to specify exactly what responsibilities will be drawn from this hypothetical contract.
D. If the theory already begins with certain fundamental rights and responsibilities, then the social contract may be irrelevant to providing an ethical justification for business' responsibilities.
Answer» B. Micro-social contracts can be developed within particular local communities that establish the specific ethical rights and responsibilities within that community as long as they fit within the general limitations of the hypernorms governing any and all social contracts.
discuss
16.

Which statement represents a challenge to Evan's and Freedman's defense of the stockholder theory against the classical model of corporate social responsibility?

A. The law now recognizes a wide range of managerial obligations to such stakeholders as consumers, employees, competitors, the environment, the disabled.
B. Courts and legislatures have recognized that the rights and interests of various constituencies affected by corporate decisions limit managers' fiduciary responsibility.
C. Stakeholder theory cannot ANSWER the question as to how, exactly, a manager should go about balancing the diverse and competing claims of all parties.
D. There is no guarantee that when managers produce profits they will serve the interests of either stockholders or the public.
Answer» C. Stakeholder theory cannot ANSWER the question as to how, exactly, a manager should go about balancing the diverse and competing claims of all parties.
discuss
17.

Which statement correctly reflects the free market view of business social responsibility?

A. In addition to making a profit, businesses are just as responsible for seeing to the well-being of their employees and the communities in which they operate
B. No one other than the managers and owners of a business may claim to have any stake in the business decisions managers make.
C. In the process of providing goods and services to customer who need and want them and maximizing profits for its shareowners, a business fulfills its social responsibility
D. A business is responsible for maximizing profits for its shareowners, but, in special circumstances, may have to sacrifice profits in the interest of the community whose citizens depend on it for employment.
Answer» C. In the process of providing goods and services to customer who need and want them and maximizing profits for its shareowners, a business fulfills its social responsibility
discuss
18.

Which of the following statements is decisive in determining whether or not to study business ethics?

A. Business managers don’t need to study ethics in order to know how to treat employees, shareowners, and customers.
B. Business and ethics simply don’t mix. In the final analysis, self-interest represented by profit overrides the interests of employees, customers, and communities. Opinion and sentiment get in the way of efficient business decision-making.
C. Ethical concerns are as unavoidable in business as are concerns of marketing, accounting, finance, and human resources. Formal study of business ethics helps address these concerns so that decisions of right and wrong may be made deliberately. and conscientiously
D. The
Answer» C. Ethical concerns are as unavoidable in business as are concerns of marketing, accounting, finance, and human resources. Formal study of business ethics helps address these concerns so that decisions of right and wrong may be made deliberately. and conscientiously
discuss
19.

Which statement correctly describes the relationship between philosophical ethics and ethos?

A. Individuals who obey the conventions, mores, and rules of their cultures are already acting ethically. No further philosophical reflection is required.
B. Philosophical ethics distinguishes what people do value from what they should value.
C. What people do value and should value are, for all practical purposes, the same.
D. Philosophical ethics is too abstract to be useful in everyday life situations. Following the mores and customs of one’s culture is a more dependable way to make moral decisions.
Answer» B. Philosophical ethics distinguishes what people do value from what they should value.
discuss
20.

Which statement does not reflect the idea of ethical relativism:

A. All opinions are equal; no one can say what is ethically right or wrong.
B. One's culture, society, or personal feelings are the only criteria for deciding what is ethically right or wrong.
C. Determining what is ethically right or wrong is a process of arguing from an appeal to values and principles that justify and legitimize an opinion.
D. Philosophical ethics is simply a process of clarifying values, not a process of justifying them.
Answer» C. Determining what is ethically right or wrong is a process of arguing from an appeal to values and principles that justify and legitimize an opinion.
discuss
21.

Which of the following intellectual disciplines provides absolute proof of its conclusions?

A. The social, biological, meteorological, and medical sciences.
B. Ethical judgments based on well-reasoned arguments from sound moral principles.
C. The applied sides of engineering, chemistry, and physics.
D. None of the above.
Answer» D. None of the above.
discuss
22.

Which statement is a correct view of psychological egoism?

A. While our own interests are important, they make sometimes have to give way to the interests of others.
B. Psychological egoism makes claims about how people should act.
C. If psychological egoism is true, we should abandon ethics.
D. Psychological egoism does not claim to provide an accurate descriptive account of human behavior.
Answer» C. If psychological egoism is true, we should abandon ethics.
discuss
23.

Identify the statement that is consistent with utilitarian ethical theory:

A. Adhering to a set of principles may well forbid an act that would otherwise provide overall net good consequences.
B. No act is ever morally right or wrong in all cases, in every situation. It will all depend on the act's consequences.
C. Some actions like murder, theft, rape, and lying are wrong of their very nature, the kind of acts they are. No amount of net good consequences could ever justify them.
D. The end never justifies the me
Answer» A. Adhering to a set of principles may well forbid an act that would otherwise provide overall net good consequences.
discuss
24.

Which statements are legitimate challenges to utilitarian ethical theory?

A. The end may justify the means.
B. There is no consensus among utilitarians on how to measure and determine the overall good.
C. It is difficult for the utilitarian to find a balance between individual freedom and the overall goo
D. The more utilitari
Answer» A. The end may justify the means.
discuss
25.

Which of the following reasons accounts for utilitarianism's dominance among policy makers and administrators?

A. It seems obvious that policy questions should be judged by results and consequences.
B. Policy experts at all levels are focused on results and getting things done.
C. Efficiency is simply another word for maximizing happiness.
D. All of the above.
Answer» D. All of the above.
discuss
26.

Which of the following statements best describes ethics?

A. Ethics considers how someone chooses among alternative courses of action.
B. Ethics is about values and principles.
C. Ethics is concerned with how a person chooses between right and wrong.
D. Each of the above covers part of the definition.
Answer» D. Each of the above covers part of the definition.
discuss
27.

Which one of the following is not a feature of moral standard?

A. Prohibit
B. Value
C. Condemn
D. All the above
Answer» D. All the above
discuss
28.

The main purpose of business ethics is to understand

A. Ethical uncertainties
B. Principles and concepts
C. Application of practices
D. All of the above
Answer» D. All of the above
discuss
29.

Ethical universalism is defined as

A. there being no universal set of ethical standards
B. giving preference to one's own ethical values
C. a set of universally accepted and valid ethical standards
D. what is right is synonymous with what is legal
Answer» D. what is right is synonymous with what is legal
discuss
30.

The primary stakeholders are:

A. Customers.
B. Suppliers.
C. Shareholders.
D. Creditors.
Answer» C. Shareholders.
discuss
31.

The goal of corporate governance and business ethics education is to:

A. Teach students their professional accountability and to uphold their personal Integrity to society.
B. Change the way in which ethics is taught to students.
C. Create more ethics standards by which corporate professionals must operate.
D. Increase the workload for accounting students.
Answer» C. Create more ethics standards by which corporate professionals must operate.
discuss
32.

An organization’s appropriate tone at the top promoting ethical conduct is an example of:

A. Ethics sensitivity.
B. Ethics incentives.
C. Ethical behavior.
D. Consequentialist
Answer» C. Ethical behavior.
discuss
33.

An independent director is one who:

A. Did not attend a school supported by the company.
B. Does not have outside relationships with other directors.
C. Does not have any other relationships with the company other than his or her directorship.
D. All of the above.
Answer» C. Does not have any other relationships with the company other than his or her directorship.
discuss
34.

The corporate governance structure of a company reflects the individual companies’:

A. Cultural and economic system.
B. Legal and business system.
C. Social and regulatory system.
D. All of the above.
Answer» D. All of the above.
discuss
35.

Business ethics deals primarily with

A. Social responsibility.
B. the pricing of products and services.
C. moral obligation.
D. being unfair to the competition
Answer» C. moral obligation.
discuss
36.

Ethics are important because

A. suppliers prefer to deal with ethical companies.
B. customers prefer to deal with ethical companies.
C. employees prefer to deal with ethical companies.
D. all of the choices.
Answer» D. all of the choices.
discuss
37.

Benefits derived from social responsibility include;

A. enhanced organizational efficiency
B. producing better products
C. attracting people who want to work for the firm
D. both A & C
Answer» D. both A & C
discuss
38.

Unethical behavior is often triggered by

A. pressure from higher management to achieve goals.
B. an organizational atmosphere that condones such behavior.
C. both a & b
D. a system of checks and balances
Answer» C. both a & b
discuss
39.

Building a sustainable environment includes

A. developing a green supply chain
B. omitting hazardous emissions
C. both a & b
D. writing a code of ethics
Answer» C. both a & b
discuss

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