global business in society ch 4, 5, 6 test

T/F: The American Institute of Certified Public Accountants Code directs accountants to be responsible to their clients and their profession, but not to the public.

False

Which statement characterizes the moral reasoning typically found in a child? A. "When in Rome, do as the Romans do." B. "I'll let you play with my toy if I play with yours." C. "Seek the greatest good for the greatest number." D. "Respect the rights of others."

B. I'll let you play with my toy if i play with yours

The primary goal of a "vulture fund" is to: A. Provide countries with debt-relief. B. Pay back loans in default. C. Increase global financial stability. D. Make a profit.

D. Make a profitt

T/F: The majority of large U.S. corporations do not have codes of ethics.

False

T/F: Honesty, integrity and accuracy are absolute requirements of the accounting function.

True

T/F: According to utilitarian reasoning, an action is ethically preferred when its benefits outweigh its costs.

True

A firm that has global operations has: A. All of their manufacturing and service operations abroad. B. Some or all of their manufacturing or service operations abroad. C. Manufacturing but not service operations abroad. D. Service but not manufacturing operations abroad.

B. Some or all of their manufacturing or service operations abroad

A bottom-line mentality in business is reflected in which statement? A. "I want it." B. "We have to beat the others at all costs." C. "Help yourself and those closest to you." D. "Foreigners have a funny notion of what's right and wrong."

B. We have to beat the others at all costs

What U.S. company is the best example of using globalization to reduce the price of its products? A. K-Mart. B. Toys R Us. C. Walmart. D. Macy's.

C. Walmart

A society where economic power is concentrated in the hands of government officials and political authorities is called: A. A central state control system. B. A social democracy. C. A political control system. D. A military dictatorship.

A. A central control system

Which of the following is not true about justice reasoning? A. The reasoner is interested in the net value of benefits. B. The reasoner considers who pays the costs and who receives the benefits C. The reasoner seeks a fair distribution to all affected. D. The reasoner relies upon some accepted rule or standard.

A. The reasoner is interested in the net value of benefits

Global market channels involve a firm producing goods in: A. Their home country and exporting them to other countries. B. Their home country to sell at home. C. A foreign country to sell at home. D. A foreign country to sell abroad.

A. Their home country to sell at home

Under the U.S. Corporate Sentencing Guidelines, if a firm has developed a strong ethics program, corporate executives found guilty of criminal activity may have their sentence: A. Increased. B. Reduced. C. Unaffected. D. Decided by the company.

B. Reduced

By law, the financial records of publicly held companies are required to be: A. Managed by an accounting department of at least five CPAs. B. Summarized in the employee manual for new hires. C. Reviewed quarterly by the IRS. D. Audited by a certified professional accounting firm.

D. Audited by a certified professional accounting firm

Mature adults typically base their ethical reasoning on broad principles and relationships such as: A. Human rights and constitutional guarantees of human dignity. B. Universal principles of justice. C. Customs and traditions show by their peers. D. Both A and B, but not C

D. Both A and B, but not C

Which of the following is not an example of an ethical criterion? A. Egoism. B. Concern for others. C. Principle. D. Corporate driven.

D. Corporate driven

If a manager approaches ethical issues with a self-centered approach, emphasis will be on: A. Integrity. B. Social relationship. C. Economic efficiency. D. Laws.

D. Economic efficiency

Ethisphere Magazine recognizes and rewards ethical leadership and business practices worldwide according to their: A. Regulatory Percentage Track (RPT). B. Ethics and Leadership Radar (ELR). C. Quality Measurement (QM). D. Ethical Quotient (EQ).

D. Ethical Quotient (E.Q.)

T/F: Only in the last few years have scholars found a positive relationship between an organization's economic performance and attention to spiritual values.

False

If a manger approaches ethics with benevolence in mind, he or she would stress what? A. Friendly relations with an employee. B. Company rules and procedures. C. Laws and professional codes. D. Economic efficiency

A. Friendly relations with an employee

Under the Sarbanes-Oxley Act, corporations are required to: A. Have executives vouch for the accuracy of a firm's financial reports. B. Have their audit committee comprised of only executives employed by the firm. C. Collect reimbursements from the U.S. government if financial restatements occur. D. All of the above.

A. Have an executive vouch for the accuracy of a firm's financial reports

A company that channels employee behavior in a lawful direction by emphasizing the threat of detection and punishment is: A. Operating under the compliance-based approach. B. Practicing "tone at the top." C. Operating under the integrity-based approach. D. Operating under the instrumental policy approach.

A. Operating under the compliance based approach

The theory of comparative advantage states that: A. Productivity rises more quickly when countries produce goods and services for which they have a natural talent. B. Productivity decreases when countries produce goods and services based on their natural resources. C. All countries start out on an equal playing field. D. Countries that operate under a policy of isolationism have a comparative advantage

A. Productivity rises more quickly when countries produce goods and services for which they have natural talent

When the benefits of an action outweigh its costs, the action is considered ethically preferred according to: A. Utilitarian reasoning. B. Virtue ethics. C. Theological reasoning. D. Plato and Aristotle.

A. Utilitarian reasoning

According to the United Nations, how many transnational corporations operate in the global economy? A. 49,000. B. 104,000. C. 290,000. D. 900,000

B. 104,000

Under the World Trade Organization's most-favored nation rule: A. All import restrictions imposed by other nations on their goods are illegal unless a cultural waiver is issued. B. All import restrictions are illegal unless proven scientifically. C. Most-favored nations can impose heavy tariffs on other nations. D. Most-favored nations can oppose the dumping of goods by any nation in their home market

B. All import restrictions are illegal unless proven scientifically

All of the following values are present in most ethical decisions except: A. Be fair and just. B. Be kind. C. Act responsibly. D. Be honest.

B. Be kind

As an additional employee benefit to promote spirituality, companies have begun to provide employees with the services of: A. Philosophers. B. Chaplains. C. Financial advisors. D. Ombudspersons

B. Chaplains

Integrity-based ethics programs: A. Seeks to avoid legal sanctions. B. Combines concern for the law with an emphasis on employee responsibility. C. Threatens employees with punishment for non-compliance with the ethics program. D. Are predominately implemented within the European Union.

B. Combines concern for the law with an emphasis on employee responsibility

The purpose of the World Trade Organization is to: A. Impose barriers to free trade among nations. B. Eliminate barriers to free trade among nations. C. Develop trading partnerships between rich and poor nations. D. Decrease globalization and free trade

B. Eliminate barriers to free trade among nations

Recipients of the corporate ethics awards show that: A. Awards are based on economic power, not ethical performance. B. Firms can be financially successful and ethically focused. C. Being legally compliant results in receiving an ethics award. D. Improving ethical performance is very costly, but bolsters a firm's reputation

B. Firms can be financially successful and ethically focused

The term "race to the bottom" refers to: A. Seeking to mine valuable minerals from the bottom of the ocean. B. Moving production jobs to the country with the lowest labor cost. C. Efforts to deconstruct the assembly process in manufacturing industries. D. An old concept of globalization that is no longer relevant.

B. Moving productions jobs to the country with the lowest labor cost

Most ethics or compliance officers are generally entrusted to: A. Act as a liaison between the company and the Securities and Exchange Commission. B. Reduce the risks to the company of employee misconduct. C. Annually distribute copies of the company's code of ethics to all interested stakeholders. D. Arrange for ethics training for employees at a nearby university.

B. Reduce the risk to the company of employee misconduct

At the core of rights reasoning is the belief that: A. The company's right to a profit must be protected. B. Respecting others is the essence of human rights. C. The right to join a union is no longer universally accepted. D. Economic and political powers determine who is right.

B. Respecting others is the essence of human rights

A conception of right and wrong is: A. Impossible to know. B. The definition of ethics. C. Determined by power. D. Based on stakeholder dialogue.

B. The definition of ethics

Single-party rule by communist parties still remains in: A. Lithuania. B. Vietnam. C. Thailand. D. Russia.

B. Vietnam

A just or fair ethical decision occurs when: A. The rights of all affected are considered. B. The greatest good for those with power is achieved. C. Benefits and burdens are distributed equally. D. All of the above

C. Benefits and burdens are distributed equally

Cross-cultural contradictions arise due to: A. The emergence of a developing country's economic power. B. Religious differences practiced by business executives. C. Differences between home and host countries' ethical standards. D. All of the above.

C. Differences between home and host countries ethical standards

All of the following are commitments of the Principles of the Code of Professional Conduct of the American Institute of Certified Public Accountants except: A. The Public Interest. B. Objectivity and Independence. C. Due Process. D. Due Care.

C. Due Process

Business managers need a set of ethical guidelines to help them: A. Understand the changing customs throughout the world. B. Justify the resolution which best helps themselves. C. Identify and analyze the nature of ethical problem. D. None of the above.

C. Identify and analyze the nature of ethical problem

The SEC filed civil false-certification charges against which U.S. financial institution? A. Wells Fargo. B. Countrywide. C. J.P. Morgan Chase. D. Bear Stearns

C. J.P. Morgan Chase

Aristotle argued: A. Self-control is the most virtuous of values. B. Faith is a road to charity and modesty. C. Moral virtue is a mean between two virtues. D. High-mindedness delivers human integrity.

C. Moral virtue is a mean between two virtues

A firm that would like to develop a global supply chain would: A. Manufacture components or supplies in other countries. B. Sell raw materials, components or supplies produced at home abroad. C. Purchase raw materials, components, or supplies from sellers in other countries. D. Check products that were manufactured abroad for defects in their home country.

C. Purchase raw materials, components, or supplies from sellers in other countries

The three strategies of globalization can be summarized using what three words? A. Channels, operations, and chains. B. Export, locate, and purchase. C. Sell, make, and buy. D. Ethics, import, and sell.

C. Sell, make, and buy

An example of a Global Action Network, or GAN, is: A. The World Trade Organization. B. Nongovernmental organizations. C. The Kimberley Process. D. The Heritage Foundation.

C. The Kimberly Process

The most important agreement which codifies human rights is the: A. The American Civil Liberties Act. B. The Versailles Treaty. C. The Universal Declaration of Human Rights. D. The U.S. Declaration of Independence.

C. The Universal Declaration of Human Rights

A critic of globalization might argue that companies decide to manufacture in China mainly because of China's: A. Strict law enforcement. B. High environmental standards. C. Weak health and safety regulations. D. Strong worker unions

C. Weak heath and safety regulations

Assets that a person accumulates and owns at a certain point in time are called: A. Income. B. Equity. C. Wealth. D. Microfinance.

C. Wealth

The percentage of global wealth concentrated at the Bottom of the Pyramid is: A. 8 percent. B. 22 percent. C. 60 percent. D. 70 percent.

D. 70 percent

According to the United Nations, a feature of democracy is: A. Fair elections. B. An independent media. C. A government with power balanced among executive, legislative, and judicial branches. D. All of the above.

D. All of the above

An individual who is a supporter of globalization would argue that it helps the developing world by: A. Giving entrepreneurs access to foreign investment funds to support economic development. B. Allowing new ideas and technological innovations to spread quickly. C. Providing people in developing countries with more jobs. D. All of the above.

D. All of the above

Businesses are expected to be ethical in their relationships with: A. Stockholders. B. Customers. C. Competitors. D. All of the above.

D. All of the above

Government has distinctive resources and competencies including: A. Knowledge of public policy. B. Ability to enforce the rules. C. Revenue from taxation. D. All of the above.

D. All of the above

Which statement(s) below are true about global income? A. Income is how much one earns in a day or a year. B. Income at the bottom of the pyramid varies from place to place. C. Around 400 billion people globally sit at the bottom of the pyramid. D. Both A and B, but not C.

D. Both A and B, but not C

Business executives are finding that a trusting, ethical relationship with a business partner is: A. Best left to not-for-profit companies. B. Too costly to maintain. C. Likely to cause legal problems. D. Often essential in conducting business.

D. Often essential in conducting business

T/F: Globalization is accepted worldwide and creates little controversy.

FALSE

T/F: All ethics issues in business are the same.

False

T/F: An ethical egoist acts for the benefit of others and sacrifices self-interest.

False

T/F: Ethics are primarily based on religious beliefs.

False

T/F: In most companies, a moral atmosphere cannot be detected.

False

T/F: It is impossible for multiple ethical climates to exist within one organization

False

T/F: Globalization directly and indirectly influences the politics, environment, geopolitics, and economics of virtually every country in the world.

TRUE

T/F: The term sector refers to broad divisions of a whole.

TRUE

T/F: Ethical ideas are present in all societies, all organizations, and all individual persons.

True

T/F: For managers who reason at stages 2 and 3, their personal rewards, recognition from others, or compliance with the company's rules become their main ethical compass.

True

T/F: If all people relied on ethical relativism, there would be no universal ethical standards on which people around the globe could agree.

True

T/F: In a benevolence ethical climate, the interests of the company's employees and external stakeholders most likely would be given high priority.

True

T/F: Managers, as major decision-makers, are one of the keys to whether a company will act ethically or unethically.

True

T/F: Personal values and moral character play key roles in improving a company's ethical performance.

True

T/F: The Sarbanes-Oxley Act requires that firms maintain good financial practices, apart from high ethical standards, in how they conduct and monitor business operations.

True

A purchasing agent directing her company's orders to a firm which she received a valuable gift, is an example of: A. Conflict of interest. B. Ethical relativism. C. Moral development. D. Egotism.

a. Conflict of interest

As business becomes increasingly global: A. It must turn to national laws for guidance. B. Ethical issues become issues of free trade. C. A global code of conduct will emerge for businesses. D. Cross-cultural contradictions will increase.

d. Cross -cultural contradictions will increase

The unspoken understanding among employees of what is and is not acceptable behavior is called: A. Ethical climate. B. Efficiency. C. Success. D. Rites and rituals

A. Ethical climate

Which of the following examples best illustrate an ethics issue based on cross-cultural contradictions? A. Legally marketing a pesticide abroad that has been banned in the U.S. B. Circumventing government regulations to ensure company profits. C. Hiring child workers in violation of civil law. D. False and misleading advertising claims.

A. Legally marketing a pesticide abroad that has been banned in the U.S.

Microfinance refers to: A. Banks lending money to a very small number of businesses. B. Banks lending money to low-income businesses. C. Banks lending very small amounts of money to wealthy businesses. D. Banks charging low fees for all business loans.

B. Banks lending money to low income businesses

Ethics policies typically cover all of the following issues except: A. Developing guidelines for accepting or refusing gifts from suppliers. B. Encouraging discriminatory personnel practices. C. Avoiding conflict of interest. D. Maintaining the security of proprietary information.

B. Encouraging discriminatory personnel practices

Scholars found that spirituality: A. Negatively affects employee and organizational performance. B. Positively affects employee and organizational performance. C. Has no affect on employee and organizational performance. D. Only affects the employee performance of not for profit organizations.

B. Positively affects employee and organizational performance

People everywhere depend on ethical systems to tell them whether their actions are: A. Legal or illegal. B. Right or wrong. C. Financially attainable or not. D. Logical and reasonable judgment

B. Right or wrong

Business managers need a set of ethical guidelines to help them: A. Understand the changing customs throughout the world. B. Justify the resolution which best helps them. C. Identify and analyze the nature of the ethical problem. D. None of the above

C. Identify and analyze the nature of the ethical problem

People's ethical beliefs come from: A. Legislative action and judicial decisions. B. Reading the company's profit and loss statements. C. Their religious background, family, and education. D. The organization's code of ethics

C. Their religious background, family, and education

Building ethical safeguards into a company's everyday routines is called: A. Change management. B. Justifying ethics. C. Institutionalizing ethics. D. Ethical awareness.

C. institutionalizing ethics

The reason(s) behind the uncertainty of an ethical or unethical decision is (are) that different people and groups: A. May honestly and genuinely use different sources of information. B. May rank various rights in different ways. C. May not share the same meaning of justice. D. All of the above.

D. All of the above

Why should business be ethical? A. Most people want to act in ways that are consistent with their own sense of right and wrong. B. Ethical behavior protects business firms from abuse by unethical employees and competitors. C. Society's stakeholders expect it from businesses. D. All of the above.

D. All of the above

T/F: The World Bank makes currency exchange easier for member countries so that they can participate in global trade.

FALSE

T/F: The World Trade Organization conducts negotiations, called "cycles," on various topics, rotating its meetings among different cities

FALSE

T/F: The main purpose of inversion is to reduce corporate income tax obligations

FALSE

T/F: Business cannot expect to be profitable while adhering to ethical principles of conduct.

False

T/F: Business must develop its own definition of what is right and wrong, apart from ethics.

False

T/F: In the United States, most ethics policies are primarily based on the company's mission and vision.

False

T/F: Managers in the same company are likely to be at the same stages of moral reasoning at any given time.

False

T/F: Although many firms conduct business across national boundaries, most global commerce is carried out by a small number of powerful firms.

TRUE

T/F: According to a recent Transparency International survey, Denmark and New Zealand are two countries that are least likely to be subjected to bribery.

True

T/F: Being ethical includes developing a sense of trust, which promotes positive alliances among business partners.

True

T/F: Business managers should use all four methods of ethical reasoning - virtues, utility, rights and justice - to better understand ethical issues at work.

True

T/F: The U.S. Corporate Sentencing Guidelines provide a strong incentive for businesses to promote their

True

An example of an international financial and trade institution is: A. World Bank. B. International Monetary Fund. C. World Trade Organization. D. All of the above

D. All of the above

T/F: The importing of foreign goods by U.S. firms is called foreign direct investment.

TRUE

Which ethical criterion is described by the idea that a company should strive for efficiency? A. Egoism. B. Benevolence. C. Principle. D. Business-centered

A. Egoism

The primary purpose of the International Monetary Fund is to: A. Lend foreign currency to member countries. B. Exchange one currency for another. C. Consolidate the debt facing third world nations. D. Collect the interest on loans made by the World Bank to third-world nations.

A. Lend foreign currency to member countries

Representation on the World Bank's board of directors is based on: A. The size of the member nation's population. B. The size of the member nation's economy. C. The size of the member nation's land mass. D. Equal representation of all member nations.

B. The size of the member nation's economy

Experts attribute the growth of nongovernmental organizations to: A. The creation of global stock exchanges and enhanced currency transactions. B. The globalization of marketing and converging consumer preferences. C. Greater openness in many societies. D. All of the above.

C. Greater openness in many societies

The Heritage Foundation scored which nation of the world among the most repressed in 2012? A. Hong Kong. B. Australia. C. North Korea. D. Singapore

C. North Korea

A giant step is taken toward improving ethical performance throughout the company when: A. The firm hires a university ethics professor to lecture employees on moral philosophy. B. The Justice Department launches an investigation of the firm's pricing practices. C. Senior-level managers signal to employees that they believe ethics is a high priority. D. A consumer hot line is created and staffed 24 hours a day

C. Senior-level managers signal to employees that they believe ethics is a high priority

Which of the following statements accurately describe the practice of tax inversion? A. A company shifts their headquarters to a foreign country. B. A company decreases cash holdings in a foreign country. C. A company increases debt in their home country. D. Both A and C, but not B.

D. Both A and C, but not B

Which U.S. Act prohibits executives representing U.S.-based companies from paying bribes to foreign government officials, political parties, or political candidates? A. The USA Patriot Act. B. The U.K. Bribery Act. C. The Corruption of Foreign Officials Act. D. The U.S. Foreign Corrupt Practices Act.

D. The U.S. Foreign- Corrupt Practices Act

T/F: Critics of globalization support the spread of American ideals and culture throughout the rest of the world.

FALSE

T/F: Most nations in the world share similar political, social and economic beliefs.

FALSE

T/F: Only manufacturing jobs are being lost through globalization.

FALSE

A free enterprise system refers to: A. Economic assets that are privately owned and exchanged in an open market. B. Property ownership by a centralized government. C. A mix of privately owned and government controlled economic assets. D. An index of economic freedom

A. economic asset that are privately owned and exchanged in an open market

T/F: At the beginning of the 20th century, no country in the world had universal suffrage.

TRUE

T/F: Even small local businesses often compete with global companies from around the world.

TRUE

T/F: Productivity rises more quickly when countries produce goods and services for which they have a natural talent

TRUE

T/F: Under the World Trade Organization's most favored nation rule, member countries may not discriminate against foreign products for any reason.

TRUE