Chapter 5 Ethics

Which of the following observations about the Foreign Corrupt Practices Act is true? a. The act outlawed the paying of bribes to foreign government officials to gain business. b. There is enough evidence that it put U.S. firms at a competitive disadvantage. c. The act originally allowed for "facilitating payments." d. The Nike case was the impetus for the 1977 passage of this act.

a. The act outlawed the paying of bribes to foreign government officials to gain business.

Cultural relativism suggests that: a. ethics are nothing more than the reflection of culture and that a firm should adopt the ethics of the culture in which it is operating. b. the only social responsibility of business is to increase profits. c. managers of a firm should not make decisions regarding social investments. d. a multinational's home-country standards of ethics are always appropriate to follow in foreign countries.

a. ethics are nothing more than the reflection of culture and that a firm should adopt the ethics of the culture in which it is operating.

Facilitating payments are: a. permitted under the amended Foreign Corrupt Practices Act. b. a direct violation of the Foreign Corrupt Practices Act. c. permitted so long as they designed only to gain exclusive preferential treatment. d. used to secure contracts that would otherwise not be secured.

a. permitted under the amended Foreign Corrupt Practices Act.

The _____ occurs when a resource is shared by all, but owned by no one, is overused by individuals, resulting in its degradation. a. tragedy of the commons b. noblesse oblige c. ethical dilemma d. Friedman system

a. tragedy of the commons

Which of the following enables managers to walk away from a decision that is profitable, but unethical? a. Noblesse oblige b. Moral courage c. The difference principle d. The Friedman doctrine

b. Moral courage

Rawls' philosophy that inequalities are justified if they benefit the position of the least-advantaged person is known as the: a. inequality principle. b. equity principle. c. difference principle. d. indifference principle.

c. difference principle.

Ethical dilemmas exist because of all of the following reasons except: a. many real-world decisions are complex and difficult to frame. b. decisions may involve first, second, and third-order consequences that are hard to quantify. c. doing the right thing, or knowing what the right thing might be, is often far too easy. d. they are situations in which none of the available alternatives seem ethically acceptable.

c. doing the right thing, or knowing what the right thing might be, is often far too easy.

The Convention on Combating Bribery of Foreign Public Officials in International Business Transactions excludes: a. speed payments to secure contracts that would otherwise not be secured. b. grease payments to gain exclusive preferential treatment. c. facilitating payments made to expedite routine government action. d. payments to government officials for special privileges.

c. facilitating payments made to expedite routine government action.

The Kantian approach to ethics suggests that: a. human beings have fundamental rights and privileges that transcend national boundaries. b. the moral worth of actions or practices is determined by their consequences. c. people should be treated as ends and never purely as means to the ends of others. d. ethics are nothing more than the reflection of culture.

c. people should be treated as ends and never purely as means to the ends of others.

The United Nations' Universal Declaration of Human Rights, related to employment, upholds all of the following except: a. just and favorable work conditions. b. equal pay for equal work. c. prohibition of trade unions. d. protection against unemployment.

c. prohibition of trade unions.

External stakeholders: a. are individuals or groups who own the business. b. include all employees, the board of directors, and stockholders. c. typically comprise customers, suppliers, lenders, etc. d. are individuals or groups who work for the business.

c. typically comprise customers, suppliers, lenders, etc.

According to the _____ approach, the best decisions are those that produce the greatest good for the greatest number of people. a. naive immoralist b. Friedman doctrine c. utilitarian d. Kantian

c. utilitarian

Which of the following, in a business setting, is taken to mean benevolent behavior that is the responsibility of successful enterprises? a. Sullivan's principles b. Ethical dilemma c. Tragedy of the commons d. Noblesse oblige

d. Noblesse oblige

The idea that businesspeople should consider the social consequences of economic actions when making business decisions and that there should be a presumption in favor of decisions that have both good economic and social consequences is known as: a. business ethics. b. noblesse oblige. c. ethical dilemma. d. social responsibility.

d. social responsibility.

According to _____, the social responsibility of business is to increase profits, so long as the company stays within the rules of law. a. the naive immoralist b. the righteous moralist c. cultural relativism d. the Friedman doctrine

d. the Friedman doctrine

The righteous moralist suggests that: a. ethics are nothing more than the reflection of culture. b. a multinational's home-country standards of ethics are the appropriate ones for companies to follow in foreign countries. c. the social responsibility of business is to increase profits, so long as the company stays within the rules of law. d. if a manager of a multinational sees that firms from other nations are not following ethical norms in a host nation, that manager should not either.

b. a multinational's home-country standards of ethics are the appropriate ones for companies to follow in foreign countries.

To guard against abuse of employment practices in other nations, multinationals should do all of the following except: a. establish minimal acceptable standards that safeguard the basic rights and dignity of employees. b. adhere to working conditions of the host country if they are clearly inferior to those in a multinational's home nation. c. audit foreign subsidiaries and subcontractors on a regular basis to make sure established standards are met. d. take action to correct unacceptable behavior.

b. adhere to working conditions of the host country if they are clearly inferior to those in a multinational's home nation.

Grease payments: a. are not the same as facilitating payments or speed money. b. are facilitating payments made to expedite routine government action. c. are payments to gain exclusive preferential treatments. d. can be used to secure contracts that would otherwise not be secured.

b. are facilitating payments made to expedite routine government action.

The utilitarian approach to business ethics suggests that: a. people should be treated as ends and never purely as means to the ends of others. b. the moral worth of actions or practices is determined by their consequences. c. people have dignity and need to be treated as such. d. human beings have fundamental rights and privileges that transcend national cultures.

b. the moral worth of actions or practices is determined by their consequences.

Expatriate managers may experience more than the usual degree of pressure to violate their personal ethics because of all of the following reasons except: a. they are away from their ordinary social context and supporting culture. b. they are psychologically and geographically closer to the parent company. c. they may be based in a culture that does not place the same value on ethical norms important in the manager's home country. d. they may be surrounded by local employees who have less rigorous ethical standards.

b. they are psychologically and geographically closer to the parent company.

Which of the following is not likely to lead to unethical behavior? a. An organizational culture that deemphasizes business ethics. b. A process that does not incorporate ethical considerations into business decision making. c. A strong personal ethical code governing the conduct of an individual. d. Pressure from the parent company to meet unrealistic performance goals.

c. A strong personal ethical code governing the conduct of an individual.

Identify the incorrect statement regarding ethical issues in international business. a. They are often rooted in the fact that political systems, law, economic development, and culture of nations vary significantly. b. Human rights and environmental regulations are some of the common ethical issues. c. Ethical practices of all nations are similar in nature. d. Managers in multinational firms need to be particularly sensitive to differences in business practices because they work across national borders.

c. Ethical practices of all nations are similar in nature

Which of the following refers to the values and norms that the employees of an organization share? Selecte a. Vision statement b. Cultural relativism c. Organization culture d. Power orientation

c. Organization culture