Chapter 3 Corporate Social Responsibility

35. The costs of corporate social responsibility may ultimately be passed on to the: A) Employees through fewer health benefits. B) Consumer through high prices. C) Investor through lower dividends. D) All of the above.

All of the above.

28. Which phrase of corporate responsibility occurred in the 1950-1960s? A) Corporate Social Stewardship. B) Corporate Social Responsiveness. C) Corporate/Business Ethics. D) A, B and C are all false.

Corporate Social Stewardship.

24. According to a modern day expression of the stewardship principle: A) Corporate managers should acknowledge business and society interdependence. B) Corporate managers should balance the interests and needs of many diverse groups in society. C) Voluntary actions should be taken to promote the social good. D) Both A. and B., but not C.

Corporate managers should balance the interests and needs of many diverse groups in society.

4. Walmart had more profits in 2009 than any other company A) True B) False

False

5. The charity principle is a relatively new notion. A) True B) False

False

6. According to the stewardship principle, professional managers are supposed to, but are not obliged to, see that everyone benefits from the company's action. A) True B) False

False

22. The iron law of responsibility says that: A) In the long run, those who do not use power responsibly will lose it. B) In the short run, sacrifice social goals for economic goals. C) Law is most important, more than social or economic responsibility. D) In the long run, economic responsibility leads to social responsibility.

In the long run, those who do not use power responsibly will lose it.

26. Which of the following is not an example of the charity principle? A) Endowing public libraries. B) Supporting settlement houses for the poor. C) Supporting a governmental protection agency. D) Donating money to a family-counseling center.

Supporting a governmental protection agency.

23. A modern day expression of the charity principle does not include: A) Balancing the interests and needs of many diverse groups in society. B) Expressions of corporate philanthropy. C) Voluntary actions to promote the social good. D) Taking a paternalistic approach to community affairs.

Taking a paternalistic approach to community affairs.

38. Johnson and Johnson's response to the Tylenol incident in the 1980s is an example of: A) Maximizing short term profits. B) Taking a short term loss for a long run benefit. C) Poor uses of charitable resources. D) Poor crisis management.

Taking a short term loss for a long run benefit.

27. Which of the following was not a reason for the wealthy to be philanthropic in the early 20th century: A) Good publicity. B) Serving as "my brother's keepers". C) Tax provision. D) Well publicized contest between the super wealthy.

Tax provision

18. The revenues of Toyota Motors in 2009 was roughly equal to the entire economic output of: A) Venezuela B) Peru C) Spain D) Colorado

Venezuela

20. Corporations have a role in establishing their community's: A) Tax base. B) Safety. C) Economic growth. D) All of the above.

economic growth

34. Which of the following are arguments against corporate social responsibility? A) Lowers economic efficiency and profits. B) Imposes unequal costs among competitors. C) Requires social skills business may lack. D) All of the above are arguments against corporate social responsibility.

All of the above are arguments against corporate social responsibility.

19. According to a Harris Interactive poll of people think business has too much power. A) 55% B) 65% C) 75%. D) 85%

85%

29. HP Brazil, a subsidiary of Hewlett-Packard, developed the Digital Garage project to: A) Promote the sale of PCs and notebook computers in the Brazilian consumer market. B) Assist with natural resource conservation and recycling programs in their plant. C) Empower less privileged Brazilian youth with leadership, teamwork, IT and other skills to participate in the growing technological society. D) All of the above.

Empower less privileged Brazilian youth with leadership, teamwork, IT and other skills to participate in the growing technological society.

42. What company installed a wind turbine in the Dominican Republic? A) LaPlata. B) Timberland. C) Microsoft. D) Constellation Energy.

Timberland.

39. What company took responsibility to dredge the New York Harbor in 2002? A) General Electric. B) Merck. C) Pfizer. D) New York Power.

General Electric.

37. Which company was not recognized as a best corporate citizen in every year since 2009. A) Starbucks. B) Whole Foods. C) Intel. D) Cisco Systems.

Whole Foods

41. What was Fortune Magazine's 2009 America's Most Admired company? A) Whole Foods. B) Pfizer. C) Apple. D) Sun Microsystems.

Apple

32. Positive reputation can be valued as an intangible corporate: A) Asset. B) Liability. C) Charity. D) Expense.

Asset.

25. Examples of modern day stewardship do not include: A) A stakeholder approach to strategic corporate planning. B) An attitude of enlightened self-interest. C) Developing social partnerships with needy groups. D) Both A. and B., but not C.

Both A. and B., but not C.

16. According to David Korten: A) Business has become most powerful entity on the planet. B) Businesses should need to secure stockholder approval to engage in philanthropic practices. C) The iron law of responsibility is not valid. D) Coca-cola has failed to protect the environment of Brazil.

Business has become most powerful entity on the planet.

36. Proponents against corporate social responsibility feel that public officials, not business people, should solve societal problems because: A) Business people do not have the skill-set to solve societal problems. B) The private sector is not mandated to solve these issues. C) Both A. and B. D) None of the above.

Business people do not have the skill-set to solve societal problems.

13. Laws and regulations help create an unleveled playing field for businesses that compete against one another. A) True B) False

False

33. Which of the following is not an argument in favor of corporate social responsibility? A) Imposes unequal costs among competitors. B) Responds to changing stakeholders' demands. C) Corrects social problems caused by business. D) Discourages government regulation.

Imposes unequal costs among competitors.

40. Odwalla began pasteurizing juices in order to: A) Prevent the need for governmental regulation B) Build good will through advertising C) Comply with disputed United Nations mandates D) Prevent Minute Maid for consolidating an important issue

Prevent the need for governmental regulation

30. Which of the following is not an argument in favor of corporate social responsibility? A) Discourages governmental regulation. B) It balances businesses' power with their responsibility to act. C) Improves Business value. D) Promotes short-term profitability for businesses.

Promotes short-term profitability for businesses.

31. According to Barlow v. A.P. Smith Manufacturing: A) The law prohibited charitable contributions, at that time. B) Socially responsible actions are an investment in the future, thus an allowable expense. C) Socially responsible actions must be approved by a majority of the firm's stockholders. D) Charitable contributions were bad corporate investments for the short term.

Socially responsible actions are an investment in the future, thus an allowable expense.

21. Modern corporations should be socially responsible because: A) They are responsible to the stockholders of the company. B) They create jobs, influencing the lives of employees. C) They are highly profitable. D) All of the above.

They create jobs, influencing the lives of employees.

17. Which of the following is true of General Motors in 2009. A) They were not a top 10 company with regard to revenue. B) They were a top 10 in profits. C) They were a top 10 company in revenue even though they lost money. D) None of the above

They were a top 10 company in revenue even though they lost money.

1. Corporate social responsibility implies that harm to people and society should be acknowledged and corrected if possible. A) True B) False

True

10. One reason for a corporation to behave responsible is to discourage government regulation. A) True B) False

True

11. Enlightened self-interest means that companies are socially aware without giving up their own economic self-interest. A) True B) False

True

12. Accompanying a firm's economic responsibility to its stakeholders are its legal obligations. A) True B) False

True

14. Putting all the emphasis on short-run maximum profits for stockholders can lead to policies that overlook the interests and needs of other stakeholders. A) True B) False

True

15. The Center for Corporate Responsibility is based at Boston College A) True B) False

True

2. Pfizer pledged approximately $1.4 million for earthquake relief in China. A) True B) False

True

3. Through the Microsoft Unlimited Potential Program, people living in developing countries can receive a stripped down version of Windows for free. A) True B) False

True

7. According to the stewardship principle, businesses act as trustees and should consider the interests of all who are affected by business decisions and policies. A) True B) False

True

8. A positive reputation allows a firm to attract a loyal customer base. A) True B) False

True

9. A primary benefit of enlightened self interest is an enhanced reputation. A) True B) False

True