Business Ethics Exam 1 – Flashcards
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Ethics
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The principles of conduct governing an individual or a group
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Accounting Ethics
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The code that guides the professional conduct of accountants
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Morality
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Standards that an individual or a group has about what is right/wrong and good/evil
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Moral Standards
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Norms about the kind of actions believed to be morally right or wrong as well as the values placed on what we believe to be morally good and morally bad
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Moral Norm
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Expressed as general rules about our actions ("Tell the truth")
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Moral Values
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Expressed with statements about objects or features of objects that have worth ("Honesty is good")
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Conventional Standards
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Standards by which we judge good/bad and right/wrong in a nonmoral way
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Normative Study
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Investigation that attempts to reach conclusions about what things are good/bad or what actions are right/wrong ("Is bribery wrong?")
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Descriptive Study
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Investigation that attempts to describe or explain the world without reaching any conclusions about whether the world is as it should be ("Does america believe bribery is wrong?")
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Right View
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Corporations, like people, act intentionally and have moral rights and obligations and are morally responsible
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Left View
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It makes no sense to attribute ethical qualities to corporations since they are not like people but more like a machine; only humans have ethical qualities
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Middle View
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Humans carry out the corporation's actions so they are morally responsible for what they do and ethical qualities apply in a primary sense to them
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Law of Agency
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A law that specifies the duties of persons who agree to act on behalf of another party and who are authorized by an agreement to do so
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Euphemistic Labeling
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Change/veil the way we see a situation ("Firing" vs "Downsizing")
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Diminishing Comparison
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Seeing a situation in the context of another larger evil to diminish the magnitude of own wrongdoing that makes it seem inconsequential
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Displacement of Responsibility
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Removing ourselves from the chain of actors responsible for the harm
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Diffusion of Responsibility
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Obscure involvement in activities that harm someone by seeing myself as playing a small role in a large group that is responsible for the harm
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Ethic of Virtue
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An ethic based on evaluations of the moral character of persons or groups
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Utilitarianism
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A general term for any view that holds that actions and policies should be evaluated on the basis of the benefits and the costs they will impose on society
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Utility
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The inclusive term used to refer to any net benefit produced by an action
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Cost Benefit Analysis
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A type of analysis used to determine the desirability of investing in a project by calculating whether its present and future economic benefits outweigh its present and future costs
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Flaws
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Utilitarianism is unable to deal with two kinds of moral issues concerning rights (trading a life for another) and justice (subsistence wages for migrant workers but society benefits)
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Justice
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Distributing benefits and burdens fairly among people
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Rights
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Individual entitlements to freedom of choice and well-being
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Rule Utilitarianism
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A form of utilitarianism that limits utilitarian analysis to evaluations of moral rules
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Negative Rights
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Duties others have to not interfere in certain activities of the person who holds the right
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Positive Rights
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Duties of other agents to provide the holder of the right whatever he needs to freely pursue his interests
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Categorical Imperative
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In Kant, a moral principle that obligate everyone regardless of their desires and is based on the idea that everyone should be treated as a free and equal person in comparison to everyone else
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First Formulation
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We must act on reasons we would be willing to have anyone in a similar situation act on
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Second Formulation
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Never use people as a means to your ends, but always treat them as they freely and rationally consent to be treated and help them choose their rationally and freely chosen ends
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Libertarian Philosophy
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Believe freedom from human constraint is necessarily good and that all constraints imposed by others are necessarily evil except when needed to further prevent the imposition of greater human constraints
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Robert Nozick
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Claimed the only moral right is the negative right to freedom which implies that restrictions of freedom are unjustified except to prevent greater restrictions on society. Since restrictions of freedom are considered unjustified, freedom itself is considered unjust, according to Nozick
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Socialism
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Work burdens should be distributed according to people's abilities and benefits should be distributed according to people's needs
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Libertarianism
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From each according to what he chooses to do, to each according to what he makes for himself (perhaps with the contracted aid of others) and what others chooses to do for him and choose to give him of what they've been given previously (under this maxim) and haven't yet expected or Transferred
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Principle of Equal Liberty
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The claim that each citizen's liberties must be protected from invasion by others and must be equal to those of others
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Difference Principle
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The claim that a productive society will incorporate inequalities but takes steps to improve the position of the neediest members of society
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Principle of Fair Equality of Opportunity
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The claim that everyone should be given an equal opportunity to qualify for the more privileged positions in society's institutions
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Rawls Theory of Justice
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Each person has an equal right to the most extensive basic liberties compatible with similar liberties for all. Social and economic inequalities are arranged so they both are to the greatest benefit of the least advantaged persons.
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Virtue Theory
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The theory that the aim of moral life is to develop those general dispositions called "moral virtues"
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Natural Rights
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Liberty and private property and if there were no governments, humans would find themselves in a "state of nature"
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Lockean Rights
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Life, liberty and property
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Invisible Hand
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The market competition that drives self-interested individuals to act in a way that serve society
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Say's Law
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In an economy, all available resources are used and demand always expands to absorb the supply of commodities made from them
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Keynesian Economics
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Theory that free markets are not the most efficient means of coordinating the use of society's resources
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Social Darwinism
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Belief that economic competition produces human progress
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Historical Materialism
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The Marxist view of history as determined by changes in the economic methods by which humanity produces the materials by which it must live
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Immiseration of Workers
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The combined effects of increased concentration, cyclic crisis, rising unemployment, and declining relative compensation
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Perfect Competition
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A free market in which no buyer or seller has the power to significantly affect the prices at which goods are being exchanged
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Oligopoly
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A market shared by a relatively small number of large firms that together can exercise some influence on prices
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Equilibrium Point
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In a market, the point at which the quantity buyers want and sellers want to sell, and at which the highest price buyers are willing to pay equals the lowest price sellers are willing to take
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Demand Curve
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A line on a graph indicating the quantity of a product buyers would purchase at each price at which it might sell
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Supply Curve
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Shows the highest price buyers would be willing to pay for a given amount of a product
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Perfectly Competitive Free Markets
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The basis for a free market is that natural occurring events such as a high demand or a high supply correct itself over time through achieving equilibrium.
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The Fraud Triangle
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Pressures or incentives to do wrong; such as organizational pressure. The opportunity to commit a wrongdoing or have low risk of detection when doing so.
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Trust
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An alliance of previously competitive oligopolists formed to take advantage of a monopoly power
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Deontology
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Judges an action based off whether it adheres to a rule. Rule based ethics.
