Business Law CH.2

The end result of ethical examination is what philosophers call _____. A. the good B. the categorical imperative C. a veil of ignorance D. the Protestant Ethic E. due diligence

A. the good

The dominant form of consequentialism is _____. A. utilitarianism B. hedonism C. libertinism D. narcissism E. Marxism

A. utilitarianism

Which of the following statements is true of the effect of the group on ethics in a corporate organization? A. Individuals hardly do unethical things when they are part of a group. B. Coupled with an overemphasis on profit, the group effect reduces the difficulty of achieving an ethical business corporation. C. Individuals in groups may feel a diminished sense of responsibility for actions taken, which invites ethical compromise. D. In corporate life, it is difficult to overlook the unethical behavior of a superior when many fellow employees are also overlooking it. E. Individuals feel more responsible for what happens in a group than in their individual lives.

C. Individuals in groups may feel a diminished sense of responsibility for actions taken, which invites ethical compromise.

The primary goal or end of business leaders is to produce a profit. This orientation reflects _____. A. deontology B. formalism C. consequentialism D. the Protestant ethic E. Darwinism

C. consequentialism

Stakeholder theory suggests that ethical corporate behavior __________. A. strongly relies on government interaction B. focuses primarily on whether corporate actions take the interests of all employees into account before making significant business decisions C. depends on managers who recognize and take into account the various stakeholders whose interests a corporation affects D. takes unacceptable risks only when the risk has a reasonable likelihood of enriching the stakeholders' net worth substantially E. requires interaction specifically between managers and customers to promote profit sharing

C. depends on managers who recognize and take into account the various stakeholders whose interests a corporation affects

Hannah Arendt believed that evil often comes from a kind of _____. A. apathy B. ignorance C. thoughtlessness D. boredom E. anger

C. thoughtlessness

According to the Spanish journal Boletín Círculo, which of the following is true about business ethics? A. Profits and business ethics are usually contradictory. B. Unethical behavior is hardly a business liability. C. Immoral behavior often flows from ignorance. D. Business ethics reflect business leadership. E. Ongoing reevaluations of ethics are insignificant and time-consuming.

D. Business ethics reflect business leadership.

Which of the following belongs to the category of involuntary stakeholders? A. The employees B. The top management C. The shareholders D. The suppliers E. The community

E. The community

Which of the following statements is true about the role and effect of profits on ethical corporate behavior? A. In many modern business corporations, the responsibility for profit making is decentralized. B. Making a profit usually deteriorates the common good. C. Profit earning is the least important goal in the contemporary business environment. D. A decline in the Protestant ethic reduces the emphasis on corporate profit. E. In many situations, focusing on profits hinders managers from engaging in any unethical behavior.

A. In many modern business corporations, the responsibility for profit making is decentralized.

Who developed the social contract theory? A. John Rawls B. Immanuel Kant C. John Locke D. Robert Jackall E. Plato

A. John Rawls

Which of the following refers to the collection of values that guides human behavior? A. Divinity B. Morality C. Utility D. Integrity E. Legality

B. Morality

According to the Ethical Norms and Values for Marketers from the American Marketing Association, which of the following ethical values states that a marketer should accept the consequences of the marketing decisions and strategies taken by him or her? A. Honesty B. Responsibility C. Fairness D. Openness E. Respect

B. Responsibility

The values-based management approach to business ethics illustrates consequentialism through its emphasis on __________. A. teaching ethical values that enhance the profitability of a company specifically to the top management and supervisory personnel B. teaching ethical values that enhance the profitability of a company to all employees C. teaching ethical values to management and supervisory personnel with the aim of avoiding ethical issues, whether profitability is affected or not D. teaching ethical values to all employees with the aim of avoiding ethical issues, whether profitability is affected or not E. teaching ethical values to employees to punish them for unethical conduct

B. teaching ethical values that enhance the profitability of a company to all employees

Isla fakes a headache to skip her classes. Few weeks later, when her friend, Isaac, lies to the teacher about being sick, Isla reports him to the teacher. She tells the teacher that she is not in favor of lying. According to Immanuel Kant, Isla would most likely be in violation of _____. A. utilitarianism B. the categorical imperative C. a veil of ignorance D. the Protestant Ethic E. due diligence

B. the categorical imperative

In which of the following situations is there a conflict of interest? A. A judge who occasionally shops in a store that is involved in a case before the same judge B. A real estate agent representing the buyer and seller of a house with permission from the buyer and seller C. An agent of one principal who secretly works for another whose interest competes with that of the first principal D. A bank regulator using a credit union E. A lawyer discussing a case with his or her boss

C. An agent of one principal who secretly works for another whose interest competes with that of the first principal

Which of the following statements is true of consequentialism? A. It focuses primarily on individual rights. B. It views lying as an unethical practice. C. It is found in the way in which managers use cost-benefit analysis to evaluate alternative courses of action. D. It is primarily a duty-based view of ethics. E. It asserts that individuals have rights, and that these rights should not be infringed, even at the expense of society as a whole, because they have an intrinsic moral value to them.

C. It is found in the way in which managers use cost-benefit analysis to evaluate alternative courses of action.

Stakeholder theory suggests that through its managers, an ethical corporation __________. A. considers primarily the concerns of top- and mid-level managers B. restricts stakeholders to communicate with decision makers so as to ensure smooth functioning of business C. acknowledges the potential conflict between managerial self-interest and the ethical responsibility of managers to other stakeholders D. focuses and remains within the responsibilities of corporate governance and not to focus on legal responsibilities of managers to society E. discourages open procedures that aid managers to monitor their own ethical performance

C. acknowledges the potential conflict between managerial self-interest and the ethical responsibility of managers to other stakeholders

Who among the following developed the theory of the categorical imperative? A. Socrates B. Plato C. John Rawls D. Immanuel Kant E. Robert Jackall

D. Immanuel Kant

_____ derives from society's expectations about how fair and reasonable actions are. A. Good faith B. Due care C. Utilitarianism D. Conflict of interest E. Liberty

B. Due care

Dan is a supporter of the formalist view. Which of the following is most likely to be his belief about lying? A. He is likely to support a lie that is told for personal gain. B. He is likely to condemn all forms of lying. C. He is likely to support a lie that is told for the common good. D. He is likely to disapprove of lying only in instances that hurt people. E. He is likely to support a lie that is harmless.

B. He is likely to condemn all forms of lying.

According to sociologist Robert Jackall's view of the modern bureaucratic managerial system, how has the Protestant ethic changed over time? A. The Protestant ethic has become the only viable ethical system for American corporations. B. The profiteering of the Protestant ethic became a justification for economic excess. C. The religious consequentialism of the Protestant ethic became the dominant system of formalistic morality. D. The Protestant ethic collapsed as a viable ethical system. E. The religious formalism of the Protestant ethic has become a type of utilitarian consequentialism

E. The religious formalism of the Protestant ethic has become a type of utilitarian consequentialism

For utilitarians, the __________. A. individual rights of a person are integral to analyzing the morality of actions B. common good is of the least importance C. formalist approach is the basis of every moral action D. ethical focus is on the self-worth of an individual E. end justifies the means

E. end justifies the means

In the context of ethical issues, modern economic theory reflects __________. A. formalism B. the categorical imperative C. the monopolistic approach D. consequentialism E. utilitarianism

E. utilitarianism

Which of the following statements is true of the sharing of moral values? A. It usually fails to set limits on unethical behavior. B. It is a significant means of social control. C. It creates an atmosphere of mistrust and suspicion among people. D. It disrupts social harmony. E. It stifles social cooperation as many people fail to accept others.

B. It is a significant means of social control.

According to Rawls, it is important to forget one's own age, gender, race, intelligence, strength, wealth, or social status when determining the ethical values on which a just society can be built. What purpose does this step serve? A. It permits one put oneself first before considering others. B. It keeps one from being self-interested in the ethical values he or she considers. C. It ensures that one acts for one's self-esteem and identity rather than on the perception of others. D. It makes it easier to consider the usefulness of one's actions. E. It promotes the assumption that what one personally needs or wants is morally correct.

B. It keeps one from being self-interested in the ethical values he or she considers

Which of the following is a national group of senior business leaders that has identified a general list of topics that organizational codes of business ethics should cover? A. The Corporate Deciders B. The Business Roundtable C. The National Business Ethics Survey D. The Board of Review E. The Springfield Armory

B. The Business Roundtable

Plato wrote that immoral behavior often flows from _____. A. apathy B. ignorance C. thoughtlessness D. boredom E. anger

B. ignorance

Ethical formalists maintain that __________. A. harm to an individual is acceptable as long as it serves the greater good B. values are situational and change based on circumstance C. individuals have rights that should not be infringed even at the expense of society D. the good of the many always supersedes the good of the few E. the focus should be more on the consequence than on the act of an individual

C. individuals have rights that should not be infringed even at the expense of society

Opponents of the Civil Rights Act of 1964 inserted the prohibition against _____ in employment in hopes of preventing its passage, thinking that such discrimination was acceptable and that many others agreed with them. A. age discrimination B. religious discrimination C. sex discrimination D. race discrimination E. ethnic discrimination

C. sex discrimination

Which of the following is a similarity between ethical and legal systems? A. Both systems are institutions of the state. B. In both systems, the motivation to observe moral values comes from within an individual. C. Both systems are based on utilitarian views. D. Both systems consist of rules to guide conduct and foster social cooperation. E. In both systems, ethical behavior is based on just meeting minimum legal requirements.

D. Both systems consist of rules to guide conduct and foster social cooperation.

Which of the following statements is true of formalism? A. It is primarily concerned with the consequences of a person's action rather than the action itself. B. It lays more emphasis on end results and their evaluation. C. It focuses more on common good rather than on individual rights. D. It is an approach to ethics that affirms an absolute morality. E. Its dominant form is utilitarianism.

D. It is an approach to ethics that affirms an absolute morality.

The Protestant ethic was rooted in a(n) _____. A. utilitarian approach B. consequentialist approach C. relativist approach D. formalist approach E. epistemological approach

D. formalist approach

Which of the following occurs when one attempts to serve two masters? A. A conflict of interest B. A veil of ignorance C. A writ of certiorari D. Ratio decidendi E. Voir dire

A. A conflict of interest

Which of the following statements is true about a formalist? A. A formalist places ethical focus on the worth of an individual. B. A formalist predominantly believes and works for the common good. C. A formalist attempts to achieve utilitarianism as fast as possible. D. A formalist evaluates the consequence or end result of lying and not lying itself. E. A formalist lays less emphasis on duty or moral obligation.

A. A formalist places ethical focus on the worth of an individual

_____ means "honesty in intent" and "honesty in fact." A. Acting in good faith B. Acting in due care C. Acting in conflict of interest D. Acting in confidentiality E. Acting in liberty and rights of individuals

A. Acting in good faith

The Wealth of Nations was written by _____. A. Adam Smith B. Karl Marx C. Immanuel Kant D. Euripides E. Socrates

A. Adam Smith

Which of the following statements is an example of ethical formalism? A. Openness in communications is deemed fundamental. B. There is no doubt that the standards of morality are flexible. C. The greatest happiness of the greatest number is the foundation of morals and legislation. D. The strongest argument for raising the ethics bar boils down to self-interest. E. Loss of confidence in an organization is the single greatest cost of unethical behavior.

A. Openness in communications is deemed fundamental.

Which of the following acts prohibits employment discrimination based on race, sex, color, religion, and national origin? A. The Civil Rights Act of 1964 B. The Sarbanes-Oxley Act of 2002 C. The Glass-Steagall Act D. The Foreign Corrupt Practices Act E. The Commodity Futures Modernization Act of 2000

A. The Civil Rights Act of 1964

Which of the following statements is true of the legal system? A. The state enforces legal rules through civil and criminal sanctions. B. The motivation to observe moral values in a legal system comes from within an individual. C. It sets moral standards but does not legally prosecute in instances of breach. D. It involves a broader-based commitment to proper behavior than does the ethical system. E. It sets the highest ethical standards acceptable to a society.

A. The state enforces legal rules through civil and criminal sanctions.

According to Rawls, which of the following serves as the first step in determining the ethical values on which a just society can be built? A. To assume that one is not aware of one's own age, gender, race, intelligence, strength, wealth, or social status B. To weigh the effects of one's decisions on the society and oneself and thereby choose the path that brings in maximum benefit C. To be completely self-aware of one's ambitions and goals D. To test the morality of actions done by others in a society E. To use formalism to formulate acceptable codes of conduct

A. To assume that one is not aware of one's own age, gender, race, intelligence, strength, wealth, or social status

Rawls's veil of ignorance means that to think ethically people must __________. A. lose the assumption that what they personally want or need is necessarily morally correct B. recognize that they cannot make valid ethical decisions unless they are totally unaware of the other parties involved so as to eliminate bias C. recognize that they cannot make valid ethical decisions unless they are totally unaware of the circumstances leading to the ethical dilemma so as not to be influenced by unchangeable history D. put themselves in the position of those affected by their decision and act as they would want them to act E. make every ethical decision as if they did not have any education in ethical or moral history to color their decision

A. lose the assumption that what they personally want or need is necessarily morally correct

The social contract theory concerns itself with how to construct a just society given __________. A. the many inequalities of wealth, knowledge, and social status B. the difficulty of acting toward others as people would have them act toward themselves C. the many logical fallacies contained in legal contracts D. the implicit agreement that the powerful are best suited to govern E. the inherent nature of those in a society to argue and reject consensus

A. the many inequalities of wealth, knowledge, and social status

Which of the following statements is true of the role of economic interdependence on business ethics and society? A. It reduces concerns about business ethics. B. It sometimes gives opportunities to executives who control what stockholders own to manipulate corporate actions for their own benefit. C. It reduces any transparency problems in an organization as corporate leaders are usually the real owners of corporations. D. It predominantly results in utilitarianism. E. It ensures that the decision taken by stockholders have little effect on others.

B. It sometimes gives opportunities to executives who control what stockholders own to manipulate corporate actions for their own benefit.

Which of the following statements is true of ethical systems? A. They are institutions of the state. B. They believe that the motivation to observe moral values usually comes from within an individual. C. They set a bare minimum standard acceptable to a society, and violations of the standards are punishable under the legal system. D. They are based on just meeting minimum legal requirements. E. They hold that every ethical value is enforced by the state.

B. They believe that the motivation to observe moral values usually comes from within an individual.

For the formalist thinker Immanuel Kant, to be ethical requires that people act with a good intent. To have a good intent, people have to act in ways that are ethically consistent. This emphasis on consistency Kant called the _____. A. protestant ethic B. categorical imperative C. pure reason D. practical reason E. hypothetical imperative

B. categorical imperative

In the context of ethics, the good is most likely to be defined as __________. A. a sustained way of producing high-quality goods and services B. the moral goals and objectives people choose to pursue C. the acquisition of the things necessary for having a good life D. a formal system of examining one's moral life E. a formalized, duty-based approach to achieving one's targets

B. the moral goals and objectives people choose to pursue

Which of the following is one of the ethical principles proposed by Rawls? A. People from the lower strata of a society should be given special opportunities for achievement. B. Social inequalities should be based on a person and not on his or her actions. C. Everyone is entitled to certain equal basic rights, including liberty, freedom of association, and personal security. D. The concerns of an individual are more important than the concerns of a society. E. Economic inequalities should be based on a person and not the person's actions.

C. Everyone is entitled to certain equal basic rights, including liberty, freedom of association, and personal security.

According to the Ethical Norms and Values for Marketers from the American Marketing Association, which of the following ethical values requires marketers to try to balance justly the needs of a buyer with the interests of a seller? A. Honesty B. Responsibility C. Fairness D. Openness E. Respect

C. Fairness

Which of the following statements is true of the Protestant ethic? A. It was a massive threat to capitalism. B. It was rooted in a consequentialist approach. C. It has become a type of utilitarian consequentialism. D. It has remained unaffected by rising wealth and increasing mass consumption. E. It has become an organizational ethics that discourages the modern bureaucratic managerial system.

C. It has become a type of utilitarian consequentialism.

Which of the following statements is true of the social contract theory? A. It lays minimal emphasis on individual rights and self-worth. B. It is based on duty. C. It has its origins in formalism. D. It has given rise to utilitarianism. E. It is based on agreements between people.

C. It has its origins in formalism.

Which of the following ethical principles focuses on the common good rather than on individual rights? A. Formalism B. Hedonism C. Utilitarianism D. Narcissism E. Libertinism

C. Utilitarianism

The _____, proposed by Kant, says that a person has a moral duty to act in the way he or she believes everyone should act. A. social contract theory B. deontological imperative C. categorical imperative D. consequentialist theory E. relativistic approach

C. categorical imperative

For a consequentialist, the __________. A. act of lying itself is unethical B. end results of lying are of little important C. harm done by lying is unethical D. harm done by lying makes it unethical E. act of lying is justified if it is concealed well

C. harm done by lying is unethical

Which of the following statements is true of the categorical imperative? A. It allows one to make an exception for one's own benefit. B. It propagates that there is hardly any need to act in the way one believes everyone should act. C. It holds that one can choose to be unethical if a situation demands it. D. It requires one to act with good intent to be ethical. E. It holds that one can hold contradictory opinions and act on them without having to ensure consistency with what others believe.

D. It requires one to act with good intent to be ethical.

Which of the following statements best defines ethics? A. Ethics is a legal system for evaluating who profits in a business transaction. B. Ethics is merely a different term for the laws and regulations created by a government. C. Ethics is an irrational method used specifically in examining the morality of lives. D. Ethics is a simplified term given to the momentary decisions one makes regarding which answer will lead to the most personally successful solution. E. Ethics is a formal system for deciding what is right and wrong and for justifying moral decisions.

E. Ethics is a formal system for deciding what is right and wrong and for justifying moral decisions.

Which of the following is a difference between ethical and legal systems? A. The moral values are observed from within the legal system, whereas the moral values are observed in the form of state transaction in an ethical system. B. An ethical system consists of rules to guide conduct, whereas the legal system consists only of rules to foster social cooperation. C. An ethical system primarily deals with what is wrong, whereas the legal system primarily deals with what is right. D. The legal system involves a broader-based commitment to proper behavior than an ethical system. E. The legal system is an institution of state, whereas an ethical system is not an institution of state.

E. The legal system is an institution of state, whereas an ethical system is not an institution of state.