Chapter 2: Ethics and Social Responsibility in Business

Recent court cases involving ________ have helped to make business ethics a matter of public concern.

unethical behavior

Which document provides the information the firm needs to evaluate and revise its social responsibility program?

A social audit

What is the name for a plan designed to increase the number of minority employees at all levels within an organization?

Affirmative action program

Which Act established a national air-quality standard for ozone?

Clean Air Act Amendment (1987)

Programs to reduce sexual harassment and abusive behavior in the workplace have been on the rise in recent years. Which of the following is true of workplace bullying?

Bullying in the workplace is repeated work sabotage; verbal abuse; and/or abusive conduct that is threatening, humiliating, or intimidating.

______________ is the application of moral standards to business situations.

Business Ethics

Ethics is the study of right and wrong and of morality of the choices individuals make. Which of the following most correctly explains the definition of "business ethics"?

Business ethics is the application of moral standards to business situations.

Which of the following is an argument for increased social responsibility?

By helping resolve social issues, businesses can create a more stable environment for long-term profitability

The activities that independent individuals, groups, and organizations undertake to protect their rights as consumers are called:

Consumerism

Which of the following statements is most correct regarding ethical issues concerning satisfying stakeholders' interests in a business?

Customers expect a firm's products to be safe, reliable, and reasonably priced.

Who should prepare a social audit for the firm?

Director of the social responsibility program

Caveat emptor is a Latin phrase that means "let the buyer beware." It was used to express the doctrine used by businesses during the 1900s that meant "what you see is what you get." Which of the following statements about this doctrine and its application is false?

During the 1900s government became involved in day-to-day business activities regularly to limit the free-market system.

_____________ is the study of right or wrong and of the morality of the choices individuals make.

Ethics

Green marketers must ensure that their claims are backed by evidence that shows a significant environmental benefit and does not mislead consumers. If they don't, which of the following groups would likely investigate them?

Federal Trade Commission

Most firms begin the process of reducing their impact on the environment by

Identifying and eliminating inefficiencies in production and operations.

Three of the primary factors influencing the standards of behavior in an organization include _____, social factors, and opportunities.

Individual factors

Ethical problems can have an extremely detrimental effect on relationships among co-workers. Which of the following would NOT be an ethical problem created by employee relationships?

Investors expecting a return on their investment regardless of the cost.

Which of the following is correct regarding an effective code of ethics?

It helps create an environment where employees recognize the importance of code compliance

Whistle-blowers can be helped by protecting them from:

Management retaliation

Which of the following is an individual factor that influences the level of ethical behavior in an organization?

Personal Values

The contamination of water, air, or land through the actions of people in an industrialized society is known as:

Pollution

Pollution has become a significant environmental issue for governments, society, and business; which of the following is NOT true about pollution.

One of the driving forces behind the production of waste is unreasonable expectations by consumers that all products, including fruits and vegetables, must be perfect to be consumed.

_______ refers to the amount of freedom an organization gives an employee to behave unethically if he or she makes that choice.

Opportunity

Which Act (passed in 2002) provided sweeping new legal protection for employees who report corporate misconduct?

Sarbanes-Oxley Act

Which of the following statements is true regarding sexual harassment and other abusive behavior in the workplace?

Sexual harassment can result in poor morale, high turnover, and expensive lawsuits.

Which Act was passed to prevent businesses from restraining trade and monopolizing markets, and condemns "every contract, combination, or conspiracy in restraint of trade"?

Sherman Antitrust Act

Consumer-oriented legislation passed during the last 55 years is primarily based on _____ rights.

Six

Which of the following statements is true about whistle-blowing?

Those who "blow whistles" may face retaliation and sometimes even lose their jobs.

Which of the following is an argument against increasing social responsibility?

Social problems affect society in general, so individual businesses should not be expected to solve these problems

Companies that contribute resources, knowledge, and products as well as money to help neighbors and others during times of crisis are demonstrating __________________.

Social responsibility

Which model of social responsibility places emphasis not only on profits, but also on the impact of decisions in society?

Socioeconomic model of social responsibility

Which of the following are significant steps necessary for a business to implement a program of social responsibility?

The firm must develop and implement a program to reach its goal.

Which of the following statements is true regarding encouraging ethical behavior?

The government can encourage ethical behavior in business by enacting more stringent regulations such as the Sarbanes-Oxley Act of 2002.

Which of the following was not asserted as a basic right by President Kennedy's Consumer Bill of Rights?

The right to fair prices

Consumerism has been defined as "all activities undertaken to protect the rights of consumers." Which of the following are rights protected as basic consumer rights?

The right to safety, to be informed, and to choose.

Why did Congress create the Equal Employment Opportunity Commission (EEOC)?

To investigate complaints of employment discrimination and sue firms that practice it

Which statement is true regarding ethical issues that arise out of a business relationship?

When ethical misconduct occurs in a business, investors also suffer

Joe Whinney and Theo Chocolate's view of social responsibility is one of:

a socioeconomic model.

According to the consumer bill of rights, the right to _______ assures consumers' interests will receive full consideration and appropriate action will be taken when customers complain.

be heard

False and misleading advertising is an example of where _______ issues can present ethical questions.

communications

A (an)______ arises when a businessperson takes advantage of a situation for his or her own personal interest rather than for the employer's interest

conflict of interest

The major forces in consumerism are individual consumer advocates and organizations, consumer education programs, and

consumer laws

Joe Whinney, the founder of Theo Chocolate, says everyone in the supply chain should be better off as a result of this delicious food. Theo Chocolate's creators believe that they have an obligation to adopt a strategic approach to fulfilling economic, ethical, environmental, and social responsibilities, which is best described as _____.

corporate citizenship

The notion of ______ is one that encourages adopting a strategic approach to fulfilling economic, ethical, environmental, and social responsibilities.

corporate citizenship

Which of the following is NOT an individual factor affecting ethics?

cultural norms

The purpose of the Environmental Protection Agency (EPA), a federal agency, is to _________ the laws designed to protect the environment.

enforce

During the Great Depression, factory production fell by almost half and about 25 percent of the nation's workforce was unemployed. Because of these conditions, President Franklin D. Roosevelt instituted programs to restore the economy and improve social conditions. Laws were passed to correct abuses by big business and to provide social services for individuals. As________, awareness of social responsibility has increased.

government involvement increased

An issue related to fairness and honesty that involves knowingly taking the words, ideas, or original material of others without acknowledging the sources is known as ____________________.

plagiarism

Ethical misconduct can take on many forms within the business environment, including all of the following, except:

prohibiting employees from taking gratuities from customers.

The general sets of factors that influence standards of ethical behavior in an organization are individual factors, opportunities, and ___________________.

social factors