International Business Test 3
According to Milton Friedman, the social responsibility of business is to a. increase profits b. improve society c. protect workers d. monopolize an industry
A
Business ethics that either deny the value of business ethics or apply the concept in a very unsatisfactory way are termed a. straw man b. the Sullivan principles c. just distribution d. rights theories
A
Expatriate managers may experience more than the usual degree of pressure to violate their personal ethics because they: a. may be based in a culture that does not place the same value on ethical norms important in the manager's home country b. may be surrounded by local employees who have more rigorous ethical standards c. are surrounded by their ordinary social context and supporting culture d. are psychologically and geographically closer to the parent company
A
_______ are unit cost reductions associated with a large scale output a. current account surpluses b. economies of scale c. current account deficits d. factor endowments
B
The theory of comparative advantage suggests that trade is a ________ game in which all countries that participate realize economic gains a. net-sum b. negative-sum c. positive-sum d. zero-sum
C
A neo-mercantilist strategy would promote: a. boosting both imports and exports b. the equal distribution of imports and exports c. limiting both imports and exports d. boosting exports but limiting imports
D
Personal ethics are unique to the individual and have no effect on societal business ethics True or false?
False
A business's formal statement of ethical priorities.
code of ethics
Rawls's philosophy that inequalities are justified if they benefit the position of the least-advantaged person is known as the ________ principle. a. inequality b. ignorance veil c. equity d. difference
difference
Situation in which there is no ethically acceptable solution.
ethical dilemma
Ethical strategies are the accepted principles of right or wrong governing the conduct of businesspeople true or false?
false
The Foreign Corrupt Practices Act was amended to allow facilitating payments to secure contracts that would not otherwise be secured true or false
false
To establish moral intent, managers need to stand in the shoes of a stakeholder and ask how a proposed decision might impact that stakeholder true or false
false
Values and norms shared among an organization's employees.
organizational culture
States that when scientific knowledge regarding the impact of a course of action is insufficient, inclusive, or uncertain and preliminary scientific evaluationindicates that there are reasonable grounds for concern that the action may have potentially dangerous effects on the environment, human, animal, or plant health, then that action should not be pursued or postponed until our knowledge improves.
precautionary principle
Some of the arguments made by the product life-cycle theory seem ethnocentric and increasingly dated when viewed from an Asian or European perspective. true or false
true
The Sullivan principles mandated that GM could operate in South Africa as long as the company did not comply with and promoted the abolition of apartheid laws true or false
true
These hold that the moral worth of actions or practices is determined by their consequences.
utilitarianism
The principle of mercantilism views trade as a ______ game a. zero-sum b. positive-sum c. negative-sum d. equal
A
_______ enables managers to walk away from a decision that is profitable but unethical a. utilitarianism b. righteousness c. moral courage d. just distribution
C
As a trade theory, mercantilism was based on the idea that a trade surplus would lead to: a. lower levels of imports and exports overall b. an absolute advantage for all trading partners c. first mover-advantages d. accumulations of gold and silver
D
Despite the United States being abundant in capital compared to other nations, U.S. exports are less-capital intensive. This is in opposition to the Heckscher-Ohlin theory and is an example of a. economies of scale b. gains from trade c. samuelson's critique d. leontief's paradox
D
Facilitating payments are also known as: a. sliding b. grease monkeying c. pocket lining d. speed money
D
Which factor according to Porter is most likely to give a country competitive advantage over another country? a. natural resources b. climate c. demographics d. skilled labor and know how
D
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.
corporate social responsibility
Belief that ethics are culturally determined and that firms should adopt the ethics of the cultures in which they operate.
cultural relativism
Course of action that does not violate a company's business ethics.
ethical strategy
Accepted principles of right or wrong that govern the conduct of a person, the members of a profession, or the actions of an organization.
ethics
Hechscher-Ohlin theory stresses that comparative advantage arises from differences in productivity true or false
false
People who work for or own the business such as employees, directors, and stockholders.
internal stakeholders
Distribution of goods and services that is considered fair and equitable.
just distribution
One who asserts that 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.
naive immoralist
The theories of international trade claim that promoting free trade is generally in the best interests of a. all multinational corporations b. an individual firm, although it may not always be in the best interest of a country c. a country, although it may not always be in the best interest of an individual firm or consumer d. the world trade organization
C
Which factor, according to Porter, is most likely to give a country competitive advantage over another country? a. demographics b. climate c. skilled labor and know how d. natural resources
C
U.S. law regulating behavior regarding the conduct of international business in the taking of bribes and other unethical actions.
Foreign Corrupt Practices Act
Belief that people should be treated as ends and never as means to the ends of others.
Kantian ethics
Individuals or groups that have some claim on a firm such as customers, suppliers, and unions.
external stakeholders
A _______ asserts that 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 a. naive immoralist b. utilitarian ethicist c. kantian ethicist d. righteous moralist
A
A neo-mercantilist strategy would promote: a. boosting exports and limiting imports b. limiting both exports and imports c. boosting both exports and imports d. the equal distribution of imports and exports
A
Because of _______, General Motors was allowed to operate ethically in South Africa as long as the company did not obey the apartheid laws in its own South African operations a. the Sullivan principles b. cultural relativism c. the righteous moral system d. noblesse oblige
A
Grant works at a fast-food restaurant. One day he noticed a coworker giving free food to a friend. In not knowing how to handle the situation, Grant will most likely follow the example of a. his supervisor b. his family c. other employees d. government leaders
A
New trade theory suggests that nations: a. may benefit from trade even when they do not differ in resource endowments or technology b. cannot benefit from trade when they do not differ in resource endowments or technology c. adopt policies that promote strong competition within domestic markets d. increase their commitment to research and development
A
The _____ outlawed the paying of bribes to foreign government officials to gain business a. foreign corrupt practices act b. convention on international business transactions c. universal declaration of human rights d. convention on combating bribery of foreign public officials
A
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. corporate social responsibility b. ethical dilemma c. noblesse oblige d. moral relativism
A
UN Universal Declaration of Human Rights, related to employment, upholds which principle: a. protection against unemployment b. the requirement for the formation of trade unions c. a sliding pay scale based upon need d. prohibition of trade unions
A
Under the veil of ignorance, everyone is imagined to be ignorant of: a. all of their particular characteristics b. the moral worth of actions or practices c. the minimum levels of morally acceptable behavior d. fundamental rights and privileges
A
________ approaches to business ethics are raised by business ethics scholars primarily to demonstrate that they offer inappropriate ethical decision making in a multinational enterprise. a. straw man b. cultural relativism c. the naive immoralist d. the righteous moralist
A
A major disadvantage of the product life cycle theory introduced by Vernon is that the theory: a. applies only when a poor nation invents a new product b. is based on arguments which seem to be ethnocentric and dated c. cannot be used to explain the production of luxury products d. failed to explain the dominance of developed nations
B
Any person or institution that is capable of moral action such as a government or corporation is a a. straw man b. moral agent c. righteous moralist d. naive immoralist
B
David Ricardo's theory of comparative advantage explains international trade in terms of the a. number of firms that the market can support b. differences in productivity c. late-mover advantage that certain countries and firms possess d. varying proportions in the factors of production
B
Identify the correct statement about the rights theories: a. the only social responsibility of business is to increase profits so long as the company stays within the rules of law b. human beings have fundamental rights and privileges that transcend national boundaries c. people should be treated as ends never purely as means to the ends of others d. the moral worth of actions or practices is determined by their consequences
B
Porter argues that a nation's firms gain competitive advantage if a. the country has an abundant supply of unskilled workers b. their domestic consumers are sophisticated and demanding c. their domestic consumers lack technical awareness d. they function in a labor intensive market
B
The _____ obliges member states to make bribery of foreign public officials a criminal offense and excludes facilitating payments made to expedite routine government action a. universal declaration of human rights b. convention on combating bribery of foreign public officials c. convention on international business transactions d. foreign corrupt practices act
B
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. human beings have fundamental rights and privileges that transcend national cultures d. people have dignity and need to be treated as such
B
________ means standing in the shoes of a stakeholder and asking how a proposed decision might impact that stakeholder a. noblesse oblige b. moral imagination c. difference principle d. veil of ignorance
B
in the international business setting, one of the most common ethical issues involves: a. facilitating payments b. the moral obligation of multinational corporations c. outsourcing of services d. government deregulation
B
Business ethics that either deny the value of business ethics or apply the concept in a very unsatisfactory way are termed: a. the sullivan principles b. rights theories c. straw man d. just distribution
C
John Rawls would agree with which statement? a. freedom of speech and assembly is the single most important component in a justice system b. ethics is culturally determined c. each person should be permitted the maximum amount of basic liberty compatible with a similar liberty for others d. equal basic liberty is impossible to achieve in a pure market economy
C
The _______ predicts that countries will export those goods that make intensive use of factors that are locally abundant a. new trade theory b. ricardo theory c. heckscher-ohlin theory d. theory of comparative advantage
C
______ approaches to business ethics are raised by business ethics scholars primarily to demonstrate that they offer inappropriate ethical decision making in a multinational enterprise a. the naive immoralist b. cultural relativism c. straw man d. the righteous moralist
C
______ are unit cost reductions associated with a large scale output a. current account surpluses b. factor endowments c. economies of scale d. current account deficits
C
______ enables managers to walk away from a decision that is profitable but unethical a. utilitarianism b. righteousness c. moral courage d. just distribution
C
companies can strengthen the __________ of employees by committing themselves to not retaliate against employees who complain about unethical actions. a. veil of ignorance b. organizational culture c. moral courage d. cross-cultural literacy
C
OECD convention that establishes legally binding standards to criminalize bribery of foreign public officials in international business transactions and provides for a host of related measures that make this effective
Convention on Combating Bribery of Foreign Public Officials in International Business Transactions
According to the naive immoralist, a. a multinational's home country standards of ethics are the appropriate ones for companies to follow in foreign countries b. ethics are nothing more than the reflection of a culture c. the social responsibility of business is to increase profits, so long as the company stays within the rules of law d. if firms in a host nation do not follow ethical norms, then the manager of a multinational should not follow ethical norms there either
D
Facilitating payments are: a. a direct violation of the foreign corrupt practices act b. permitted so long as they are designed only to gain exclusive preferential treatment c. used to secure contracts that would otherwise not be secured d. permitted under the amended Foreign Corrupt Practices Act
D
Hechscher-Ohlin theory predicts that countries will: a. import those goods that make intensive use of factors that are locally abundant b. export those goods that make intensive use of factors that are locally scarce c. import those goods that make intensive use of factors that are available worldwide d. export those goods that make intensive use of factors that are locally abundant
D
The _____ occurs when a resource held in common by all, but owned by no one, is overused by individuals, resulting in its degradation a. noblesse oblige b. moral ignorance c. veil of ignorance d. tragedy of the commons
D
The core idea behind _____ is that an organization's actions will not exert a negative impact on the ability of future generations to meet their own economic needs and that its actions impart long-run economic and social benefits on stakeholders. a. moral imagination b. universalism c. just distribution d. sustainability
D
What is the main principle of mercantilism? a. government intervention is not required in global trade b. countries should encourage absolute free trade c. protection of domestic industries is not essential for a nation's welfare d. it is in a country's best interests to maintain a trade surplus
D
What is the term for a company's formal statement of ethical priorities it expects all of its employees to follow? a. mission statement b. difference principle c. stakeholder pledge d. code of ethics
D
Which group is an external (secondary) stakeholder? a. employees b. customers c. board of directors d. special interest groups
D
Which is a basic factor that a nation will possess by Porter? a. communication infrastructure b. technological knowledge c. skilled labor d. natural resources
D
United Nations document that lays down the basic principles of human rights that should be adhered to.
Universal Declaration of Human Rights
According to Rawls, inequalities are unjust even if the system that produces inequalities is to the advantage of everyone True or false
false
Hechscher-Ohlin theory is considered the best predictor of real world international trade patterns true or false?
false
In the simple model of free trade, resources always move easily from one economic activity to another True or false?
false
Specialized Hydraulics manufactures and sells small quantities of each of its products, but it can still benefit from economies of scale. true or false
false
There is no excuse for multinational corporations to ignore the ethical obligations placed upon them as it pertains to employment conditions, human rights, environmental pollution, and the use of power, since these obligations are well known and are always clear cut: true or false?
false
The economic benefits realized when countries specialize in the production (and export) of goods and services that they can produce most efficiently, while importing goods and services that they cannot produce so efficiently from other nations.
gains from trade
One who claims that a multinational's home-country standards of ethics are the appropriate ones for companies to follow in foreign countries.
righteous moralist
Twentieth-century theories that recognize that human beings have fundamental rights and privileges that transcend national boundaries and cultures.
rights theories
Individuals or groups who have an interest, stake, or claim in the actions and overall performance of a company.
stakeholders
Strategies that not only help the multinational firm make good profits but that do so without harming the environment, while simultaneously ensuring that the corporation acts in a socially responsible manner with regard to its multiple stakeholders.
sustainable strategies
A country has an absolute advantage in the production of a product when it is more efficient than any other country in producing it true or false
true
According to Paul Samuelson's critique, a poor country will rapidly improve its productivity if a rich country enters into a free trade agreement with it. true or false
true
Building an organizational culture that places a high value on ethical behavior requires incentive and reward systems True or false
true
Building an organizational culture that places a high value on ethical behavior requires incentive and reward systems true or false
true
Corporations can contribute to the global tragedy of the commons by pumping pollutants into the atmosphere or dumping them in oceans or rivers in locations with weak environmental standards true or false
true
Ethical dilemmas are situations in which none of the available alternatives seems ethically acceptable true or false
true
Ethics offers are hired by many businesses to make sure that all employees are trained to be ethically aware and to address employees' questions about issues that may be ethical or unethical true or false
true
Managed trade can be described as a situation in which issues related to trade—such as what can be traded and in what quantities—are determined by market forces, government mandates, and negotiated agreements. True or false?
true
New trade theorists stress the role of luck, entrepreneurship, and innovation in giving a firm first mover advantages true or false
true
The simple model of free trade assumed away transportation costs between countries true or false
true
an individual with a strong sense of personal ethics is less likely to behave in an unethical manner in a business setting true or false
true
most moral philosophers see value in utilitarian and kantian approaches to business ethics true or false
true
Accepted principles of right and wrong governing the conduct of businesspeople.
business ethics
A firm's values and norms shape its culture which, in turn, has an important influence on the ethics of the firm's business decision making. True or false?
True
Many ethical issues in international business are rooted in the fact that political systems, the law, economic development, and culture vary significantly from nation to nation True or false:
True
A key assumption in the Hechscher-Ohlin theory is that technologies are the same across all countries: true or false?
true
