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Business Ethics

answer

the principles, values, and standards that guide behavior in the world of business

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Caux Round Table

answer

a group of businesses, political leaders, and concerned interest groups that desire responsible behavior in the global community

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Consumers' Bill of Rights

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introduced in 1962, outlined four basic consumer rights: the right to safety, the right to be informed, the right to choose, and the right to be heard

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Defense Industry Initiative on Business Ethics and Conduct (DII)

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established a method for discussing best practices and working tactics to link organizational practice and policy to successful ethical compliance

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ethical culture

answer

the character or decision-making process that employees use to determine whether their responses to ethical issues are right or wrong

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Federal Sentencing Guidelines for Organizations (FSGO)

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codified into law, incentives to reward organizations for taking action to prevent misconduct

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principles

answer

specific and pervasive boundaries for behavior that are universal and absolute

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Sarbanes-Oxley Ac

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law that made securities fraud a criminal offense and stiffened penalties for corporate fraud; created an accounting oversight board that requires corporations to establish codes of ethics for financial reporting and to develop greater transparency in financial reports to investors and other interested parties

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social responsibility

answer

an organization's obligation to maximize its positive impact on stakeholders and to minimize its negative impact

question

The Foreign Corrupt Practices Act made it illegal for U.S. businesses to issue bribes to foreign government officials: true or false?

answer

true

question

The 1940s saw the rise of consumerism in the United States: true or false?

answer

false

question

The difference between an ordinary decision and an ethical one:

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lies in the point where the accepted rules do not apply, and the decision maker is faced with the responsibility for weighing values and reaching a judgment in a situation that is not quite the same as any he/she has faced before.

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Business ethics relates to rules and principles that guide individual and work group decisions, whereas social responsibility:

answer

concerns the effect of organizational decisions on society.

question

Business ethics was institutionalized through the Federal Sentencing Guidelines for Organizations during which of the following periods?

answer

The 1990s

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Using what you learned about business ethics in Chapter 1, which of the following is true?

answer

The values learned from family, religion, and school may not provide specific guidelines for complex business decisions.

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The Consumers' Bill of Rights decreed by President John F. Kennedy did NOT specify which of the following rights?

answer

The right to freedom

question

Employees' perception of their firm as having an ethical climate leads to:

answer

performance-enhancing outcomes.

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A strong organizational ethical climate usually focuses on the core value of:

answer

placing customers' interests first.

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Ralph Nader became famous for his 1965 publication that criticized the food packing industry.

answer

false

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act deontologist

answer

holds that actions are the proper basis on which to judge morality or ethicalness; requires that a person use equity, fairness, and impartiality when making and enforcing decisions

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act utilitarian

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individual who examines a specific action itself, rather than the general rules governing it, to assess whether it will result in the greatest utility

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consequentialism

answer

teleological theories that assess the moral worth of a behavior by looking at its consequences

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deontology

answer

moral philosophies that focus on the rights of individuals and on the intentions associated with a particular behavior rather than on its consequences

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descriptive relativism

answer

assumes that through observation of the different norms, customs, and values exhibited by different cultures one can arrive at a factual description of a culture

question

distributive justice

answer

justice based on the evaluation of the outcomes or results of the business relationship

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economic value orientation

answer

a theory associated with values that can be quantified by monetary means

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egoism

answer

theory that defines right or acceptable behavior in terms of its consequences for the individual

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enlightened egoism

answer

theory that allows for the well being of others although the self-interest of the individual remains paramount

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goodness theory

answer

focuses on the end result of actions and the goodness or happiness created by them

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hedonism

answer

concept that defines right or acceptable behavior as that which maximizes personal pleasure

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idealism

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a moral philosophy that places special value on ideas and ideals as products of the mind, in comparison with the world's view

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instrumentalist

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rejects the idea that (1) ends can be separated from the means that produce them and (2) ends, purposes, or outcomes are intrinsically good in and of themselves

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interactional justice

answer

justice based on evaluating the communication processes used in the business relationship

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justice

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as applied in business ethics, involves evaluations of fairness or the disposition to deal with perceived injustices of others

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Kohlberg's model of cognitive moral development

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theory stating that people make different decisions in similar ethical situations because they are in different stages of six cognitive moral development stages

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metaethical relativist

answer

holds that one culture's moral philosophy cannot logically be preferred to another because there exists no meaningful basis for comparison

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monist

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individual who believes that only one thing is intrinsically good

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moral philosophy

answer

the specific principles or rules that people use to decide what is right or wrong

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nonconsequentialist

answer

ethics based on respect for persons

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normative relativism

answer

assumes that one person's opinion is as good as another's

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obligation theory

answer

emphasizes the means and motives by which actions are justified.

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pluralist

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takes the position that no one thing is intrinsically good

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procedural justice

answer

justice based on the processes and activities that produce the outcome or results

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qualitative hedonist

answer

those who believe that it is possible to get too much of a good thing (such as pleasure)

question

quantitative hedonist

answer

those who believe that more pleasure is better

question

realism

answer

the view that an external world exists independent of our perception of it

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relativist perspective

answer

holds that definitions of ethical behavior are derived subjectively from the experiences of individuals and groups

question

rule deontologist

answer

believes that conformity to general moral principles determines ethicalness; use reason and logic to formulate rules for behavior

question

rule utilitarian

answer

individual who determines behavior on the basis of principles, or rules, designed to promote the greatest utility rather than on an examination of each particular situation

question

teleology

answer

moral philosophies in which an act is considered morally right or acceptable if it produces some desired result such as pleasure, knowledge, career growth, the realization of self-interest, utility, wealth, or even fame

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utilitarianism

answer

theory that seeks the greatest good for the greatest number of people by making decisions that result in the greatest total utility and that achieve the greatest benefit for all those affected

question

virtue ethics

answer

posits that what is moral in a given situation is not only what conventional morality or moral rules (current societal definitions) require but also what the mature person with a "good" moral character would deem appropriate

question

white-collar crime

answer

an individual or group committing an illegal act in relation to his/her employment, who is highly educated (college), in a position of power, trust, respectability and responsibility, within a profit/nonprofit business or government organization and who abuses the trust and authority normally associated with the position for personal and/or organizational gains

question

Distributive justice is based on the evaluation of outcomes or results of the business relationship: true or false?

answer

true

question

People who face ethical issues often base their decisions on their own values and principles of right and wrong: true or false?

answer

true

question

Teleology is a philosophy that states that:

answer

an act is morally right or acceptable if it produces a desired result.

question

The types of moral philosophy discussed in the text include:

answer

teleology, deontology, relativist perspective, virtue ethics, and justice.

question

Deontology refers to moral philosophies that focus on:

answer

the preservation of individual rights and the intentions associated with a particular behavior.

question

Which statement is NOT correct?

answer

Utilitarianism defines right or acceptable actions as those that maximize total utility, or the greatest good for the most powerful people.

question

Deontologists believe that individuals have certain absolute rights, including

answer

freedom of conscience, freedom of consent, freedom of privacy, freedom of speech, and due process.

question

According to Kohlberg's model of cognitive moral development, different individuals make different decisions in similar ethical situations because:

answer

they are in different stages of cognitive moral development.

question

Types of justice include:

answer

distributive, procedural, and interactional.

question

Which statement is correct?

answer

A moral virtue represents an acquired disposition that is valued as a part of an individual's character.

question

Adam Smith

answer

Eighteenth-century British professor whose writings formed the basis of modern economics; observed and wrote about supply and demand, contractual efficiency, and division of labor; published The Theory of Moral Sentiments and the Inquiry into the Nature and Causes of the Wealth of Nations

question

amakudari

answer

Japanese for "descent from heaven"the practice of hiring retired bureaucrats to become auditors, directors, executives, and presidents

question

behavioral economics

answer

assumes that humans may not act rationally because of genetics, learned behavior, and heuristics or rules of thumb

question

bimodal wealth distribution

answer

occurs when the middle class shrinks, resulting in highly concentrated wealth amongst the rich and large numbers of poor people with very few resources

question

Business for Social Responsibility

answer

globally based resource system that tracks emerging issues and trends, provides information on corporate leadership and best practices, conducts educational workshops and training, and assists organizations in developing practical business ethics tools

question

consumerism

answer

the belief that consumers, rather than the interests of producers, should dictate the economic structure of a society; the theory that an increasing consumption of goods is economically desirable and equates personal happiness with the purchase and consumption of material possessions

question

country common values

answer

values that are specific to groups, sects, regions, or countries that express actions, behavior, and intent

question

cultural relativism

answer

the concept that morality varies from one culture to another and that business practices are therefore differentially defined as right or wrong by particular cultures

question

culture

answer

everything in our surroundings that is made by people—both tangible items and intangible things like concepts and values; includes language, law, politics, technology, education, social organizations, general values, and ethical standards

question

dumping

answer

the practice of charging high prices for products in domestic markets while selling the same products in foreign markets at low prices, often below cost

question

framing effect

answer

concept of behavioral economics that the way something is presented to a consumer can affect choice

question

global common values

answer

values that are shared across most cultures

question

human rights

answer

the concept of an inherent dignity with equal and inalienable rights as the foundation of freedom, justice and peace in the world

question

international monetary fund

answer

organization dedicated to the concept that the primary responsibility for the regulation of monetary relationships among national economies should rest in an extra-national body

question

John Keynes

answer

economist who argued that the state could stimulate economic growth and improve stability in the private sector through such means as controlling interest rates, taxation and public projects

question

laissez fare

answer

theory that assumes the market, through its own inherent mechanisms, will keep commerce in equilibrium

question

made-to-break

answer

planned obsolescence products

question

Milton Friedman

answer

economist whose ideas were guiding principles for government policy making in the U.S., and increasingly throughout the world, starting in the second half of the 20th century; believed in deregulation and that the system could reach equilibrium without government intervention

question

multinational corporation

answer

public companies that operate on a global scale without significant ties to any one nation or region

question

rational economics

answer

based upon the assumption that people are predictable and will maximize the utility of their choices relative to their needs and wants

question

risk compartmentalization

answer

situation where various profit centers within corporations become unaware of the overall consequences of their actions.

question

self-reference criterion

answer

an implied perspective of ethical superiority based on the idea that "we" differ from "them"

question

socialism

answer

economic theories advocating the creation of a society in which wealth and power are shared and distributed evenly based on the amount of work expended in production

question

sustainable development

answer

a systematic approach to achieving human development in such a way that the earth's resources are preserved for future generations

question

World Trade Organization

answer

administers trade agreements, facilitates future trade negotiations, settles trade disputes, and monitors the trade policies of member nations; addresses economic and social issues involving agriculture, textiles and clothing, banking, telecommunications, government purchases, industrial standards, food sanitation regulations, services, and intellectual property; and provides legally binding ground rules for international commerce and trade policy.

question

Culture consists of everything in our surroundings that is made by people: true or false?

answer

true

question

Based on revenues versus GDP, Walmart is larger than most of the countries in the world: true or false?

answer

true

question

According to the concept of cultural relativism, which of the following is correct?

answer

Morality varies from one culture to another.

question

The belief that consumers, rather than the interests of producers, should dictate the economic structure of a society is:

answer

consumerism

question

Who argued that governments can stimulate economic growth and improve stability in the private center?

answer

John Maynard Keynes

question

________ is based on the assumption that people are predictable and will seek to maximize the utility of their choices relative to their needs and wants.

answer

Rational economics

question

________ is the unconscious reference to one's own cultural values, experiences, and knowledge.

answer

The self-reference criterion

question

Which of the following statements is correct about dumping?

answer

When companies charge high prices for products sold in their home markets while selling the same products in foreign markets at low prices that do not cover all the costs of exporting the products, the practice is known as dumping.

question

The ________ prohibits U.S. corporations from offering or providing payments to officials of foreign governments for the purpose of obtaining or retaining business abroad.

answer

Foreign Corrupt Practices Act

question

Which organization was established in 1995 at the Uruguay round of negotiations?

answer

WTO

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