question

what you do when you think no one is watching

answer

Ethics

question

well-established rules of right and wrong that prescribe what humans ought to do

answer

Ethics

question

how personal moral norms and choices apply to the activities and goals of commercial enterprise

answer

Business Ethics

question

consideration of the moral context, antecedents, and consequences of actions in a business context

answer

Ethical Decision Making

question

Case 1; Cannery considered replacing expensive tomatoes with cheap ones when following a recipe for a private company.

answer

Renfro Foods

question

all the people who stand to gain or lose by the policies and activities of a business

answer

Stakeholders

question

(1) telling the truth (2) keeping one's promises (3) treating others fairly (4) respecting the rights of others

answer

Clawson's Four Elements of Ethical Leadership

question

first of Clawson's four elements of ethical leadership

answer

telling the truth

question

second of Clawson's four elements of ethical leadership

answer

keeping one's promises

question

third of Clawson's four elements of ethical leadership

answer

treating others fairly

question

fourth of Clawson's four elements of ethical leadership

answer

respecting the rights of others

question

Case 2; potential new President of the company overcharges long-time customer by not offering policy discount, earning the company many thousand in "pure profit." Current manager (Neeley) not happy, risk loss of important client. Potential hire forced to apologize and pay out of his commission to give the client the correct price plus an extra discount.

answer

trailer company

question

argues that justice is more profitable, more rational, and more valuable than injustice.

answer

Velasquez, "Why Ethics Matters"

question

situations when two parties are faced with a choice between 2 options- to cooperate or to defect; if both cooperate, both benefit; if both defect, no benefits; if one cooperates while the other defects, the one who cooperatd suffers while the one who defets gets benefit.

answer

Prisoner's Dilema

question

a strategy in which the individual's first move is cooperative and thereafter the individual mimics the other person's behavior, whether cooperative or competitive

answer

Tit for Tat Strategy

question

Article that says that being good is not boring

answer

Vice, "On the Tedium of the Good"

question

Article that says that the only responsibility of busiess is to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game- engaged in open and free competition without deception or fraud

answer

Friedman, "Social Responsibility of Business"

question

main point of article: being good does not always lead to external reward

answer

Twain, "Edward Mills and George Benton"

question

deterrence theory doesn't necessarily work

answer

Smith, "Why managers fail to do the right thing"

question

we can reduce or prevent bad actions by giving punishments 3 characteristics: swift, certain, severe

answer

deterrence theory

question

3 characteristics of deterrence theory

answer

swift, certain, severe

question

The Price must start out very stern then over time exhibit mercy

answer

Machiavelli, "The Prince"

question

rewards can be high, punishment for failure can be high, flexibility in performing job, no oversight

answer

why people act unethically

question

said that "the only reason business people come together is to conspire to defraud the public"

answer

Adam Smith

question

groups of companies that get together to conspire to defraud the public

answer

trust

question

1906 act that says that businesses cannot combine to restrain trade; violations are civil and criminal

answer

Sherman Anti-Trust Act

question

act that deals with pricing; can't charge customers two different prices for products of same grade and quantity

answer

Robinson-Patman Act

question

true cost difference, transaction must be "in commerce," or if the product is obsolete or in danger of being obsolete

answer

exceptions to RP Act

question

act against tying agreements

answer

Clayton Act

question

agreement between a buyer and a seller in which the buyer is required to purchase one product to get another

answer

tying agreement

question

Written by Mary Anne Jennings; anytime a new product, technology or market is entered ethical problems are encountered that are novel to you, then the government steps in and makes laws against it.

answer

regulatory cycle

question

the set of rules for sentencing of organizations

answer

federal sentencing guidelines

question

Enron's Accounting Firm

answer

arthur anderson

question

problem with deterrence theory; by the time law is passed grievous damage can already be done; offenders have an advantage over non-offenders until loophole is fixed

answer

time lag problem

question

monetary, government sanction

answer

system of fines

question

non-monetary, government sanction; punishment to shame; named after character in the Scarlet Letter; EX: ad campaign, print apology

answer

Hester Prynne

question

non-government sanctions (monetary or non-monetary) like environmental organizations, can organize boycotts, etc.

answer

Modified Vendetta

question

example of a modified vendetta; infant formula action committee

answer

Infact

question

established public company accounting oversight board, auditor independence, corporate responsibility, and enhanced financial disclosures

answer

Sarbanes Oxley

question

Title II of Sarbanes-Oxley; an auditor or their family must not maintain a financial or business relationship with the client, cannot own stock in a company that they audit an accountant who engages in unethical or improper profession conduct may be banned from practice by the SEC

answer

auditor independence

question

part of Sarbanes Oxley; the idea that corporations can and should act ethically and be accountable to society for their actions; how do we control a company?

answer

corporate responsibility

question

A subset of a company's board of directors composed of outside members (those not involved in the day-to-day operations of the company) who can provide a buffer between the audit firm and management; SOX says they must be independent, financially sophisticated, and not already on the finance committee

answer

audit committees

question

by SOX, in order to serve on the finance committee, you must have these three characteristics:

answer

independent, financially sophisticated, not already on the finance committee

question

part of SOX that prevents loans to executives and requires senior management directors to disclose changes in securities ownership within two business days after close of calendar month

answer

enhanced financial disclosures

question

2010 law that regulates banking and financial institutions; creates new agency housed in the Fed to oversee institutions providing credit to consumers, ends "to big to fail" bailouts like AIG, created system to give early warning signals before big companies can threaten stability of the economy, etc.

answer

Dodd-Frank

question

big cable operator owned by Rigas family; Rigas family reported taking very little compensation, but actually was taking a lot through major loans with no repayment plans that were completely forgiven after 10 years. This case contributed to SOX.

answer

Adelphia

question

biggest insurance company in the world; they kept no loss reserves and needed a bailout of $180 billion after the hurricane, led to parts of Dodd-Frank

answer

AIG

question

rule of thumb

answer

Heuristic

question

this model is a flow chart by the American Institute of CPAs; sets CPAs apart from non-certified accountants

answer

AICPA model

question

this model is a simple decision heuristic

answer

Harris Methodist model

question

this model has four steps: awareness, understanding, application/decision, and post-decision consequences

answer

Traditional model

question

first step of the traditional model; recognize situations with ethical implications and identify the facts

answer

awareness

question

right or wrong?

answer

ethical decision

question

right verses right?

answer

ethical dilemma

question

second step of the traditional model; identify stakeholders and stakes involved, identify alternatives, obtain information, and evaluate the alternatives using religious, philosophical, legal, or regulatory perspectives

answer

understanding

question

third step of the traditional model; make a decision using judgment, decision aids, and decision analysis; everyone has bias in this step

answer

application/decision

question

fourth step of the traditional model; learn from decision and use the feedback in future decisions

answer

post-decision consequences

question

this model consists of an introductory phase and three subsequent phases that allow the decision-maker to consider the implications and understand the facts of the case, become aware of the contextual factors affecting the perception of the ethical issue, assess the options for action in a given situation, and evaluate the potential benefits and harms

answer

phase model

question

problem of the traditional theory that says that no one ethical principle or set of principles can possible perform such a comprehensive function as to cover every problem

answer

ethical pluralism

question

foreign corrupt practices act; made bribery illegal in the US. different cultures have different standards, reflecting ethical pluralism

answer

FCPA

question

problem of the traditional theory that the traditional model is based upon this kind of decision making, not group-decision making; EX: Asch experiment

answer

individual decision-making

question

one problem of the traditional model is that it is this; it addresses problems that already exist

answer

reactive

question

4 phases of the 3 phase model

answer

Introductory phase, principle-based evaluation, virtue-based solution, contract-based decision

question

theory that tries to balance benefits with costs

answer

utilitarian theory

question

theory that says that people have rights and we can't do anything without their consent. Kant.

answer

deontology

question

knowing misstatement of a material fact upon which the buyer depends and suffers damage as a result

answer

fraud

question

any citizen can bring this claim; get up to 30% for bringing suit

answer

false claim

question

first characteristic of dilemmas; they must be ____ questions

answer

important

question

second characteristic of a dilemma; a dilemma is a ____ between two or more alternatives

answer

tradeoff

question

third characteristic of a dilemma; no ___ involved

answer

law

question

fourth characteristic of a dilemma; there will be one or more ____ ___ ____.

answer

winners and losers

question

fifth characteristic of a dilemma; any option selected will result in these to the parties

answer

consequences

question

sixth characteristic of a dilemma; dilemmas must be this before they can be communicated and resolved

answer

understood

question

first kind of dilemma; when you find yourself in the position of having to choose between being completely honest and telling the whole truth, or not telling the whole truth out of a sense of loyalty to someone.

answer

truth vs. loyalty

question

second type of dilemma; Sometimes you have to choose between what's best for one person and what's best for a group of people

answer

individual vs. community

question

third type of ethical dilemma where we are torn between the gratification of needs now, or being willing to postpone gratification to a later date.

answer

short-term vs. long-term

question

fourth type of dilemma; Does a cop serve justice and give you a ticket, or does he be merciful and let you off with a warning?

answer

justice vs. mercy

question

fifth type of dilemma; who comes first, client or group

answer

primacy of the interests of one party over the other

question

sixth type of dilemma; in the Bible, workers in the vineyard were all paid the same amount despite differing work time

answer

distribution in one way or other

question

seventh type of dilemma; duty, custom, legal obligation

answer

obligation of one to another

question

one is unsure as to what one ought to do, but has the will and the ability to do what is right

answer

genuine dilemma

question

one knows that the moral obligations are but experiences difficulty in fulfilling them

answer

compliance problem

question

one acknowledges a general moral duty but given that there is an indefinite range or ways to fulfill this duty is unsure as to what exactly ought to be done and fails to take steps toward pursuit of the general duty

answer

moral laxity

question

one knows what the moral obligations are and has the will and the ability to fulfill them

answer

no-problem problem

Business Ethics Unit 1 – Flashcards

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