MGMT 1005 Exam 2

In the video posted on Canvas, Carlson school graduate Steele Lorenz developed mobile banking for the rural poor in Kenya, an example of product development within the constraints of the innovation sandbox.

False

In the video we watched about Enbridge and the Line 3 project, we learn about Enbridge's plan to build a new pipeline in collaboration with the Leech Lake and White Earth bands, who welcome a safer pipeline so that their wild rice harvest rights can be protected.

False

Which author wrote the following quote: "This great increase in the quantity of work, which, in consequence of the division of labour, the same number of people are capable of performing, is owing to three different circumstances; first, to the increase of dexterity in every particular workman; secondly, to the saving of the time which is commonly lost in passing from one species of work to another; and, lastly, to the invention of a great number of machines which facilitate and abridge labour, and enable one man to do the work of many....."?

Adam Smith

Which Enron executive had the most direct responsibility for creating and managing the Special Purpose Entities?

Andy Fastow

Which of the following are among the "Four As" described by Prahalad?

Availability - the product must have an uninterrupted supply Access - products must be able to be distributed in rural areas Affordable - products must be within the cost constraints of the average person in the BOP

In which way are Kant's and Rawls' theories similar?

Both affirm that all stakeholders are deserving of basic human rights.

Which author wrote the following quote: "However, these four billion people who make up the BOP are not a monolith. They represent multiple cultures, ethnicity, literacy, capabilities, and needs. They can be segmented in multiple ways....."?

CK Prahalad

Modern economies contain elements of three economic systems - traditions, commands, and markets. Which economic system did the regulation of the accounting industry and public companies by the Sarbanes-Oxley act emphasize? Correct answer:

Commands

What stage of Kohlberg's theory of moral development would be demonstrated by Jeff Skilling if he decided to aggressively use mark-to-market accounting at Enron, simply because he saw that other companies were also aggressively using mark-to-market accounting?

Conventional Interpersonal-Concordance stage

What stage of Kohlberg's theory of moral development would be demonstrated by Jeff Skilling if he decided to use mark-to-market accounting in the energy industry, simply because the Securities Exchange Commission agreed that it was legal to do so?

Conventional Law & Order stage

Which author wrote the following quote: "If Portugal had no commercial connexion with other countries, instead of employing a great part of her capital and industry in the production of wines, with which she purchases for her own use the cloth and hardware of other countries, she would be obliged to devote a part of that capital to the manufacture of those commodities, which she would thus obtain probably inferior in quality as well as quantity..."?

David Ricardo

In the Adam Smith excerpt that we read from Wealth of Nations, what concept does he describe that allows individual workers to be more productive, and to benefit from this excess production in the marketplace?

Division of labor and specialization

An Enron shareholder who purchased stock based upon fraudulent information provided by Enron management could ACCURATELY describe the ethical violation using which statement below? (multiple answers)

Enron violated Rawls' principles of distributive justice because it did not adhere to rules designed to protect basic rights of shareholders and did not ensure equal opportunity for all affected stakeholders to review material information. Enron violated Kant's categorical imperative because the deceptive financial statements took away the negative freedom from deception from shareholders, intentionally using them as a means to an end. Enron violated Bentham and Mill's theory of utility by deceiving investors because, after the fraud became public and the company filed for bankruptcy, the overall outcome did not create greatest societal utility for the greatest number.

In White's article about Gilligan's ethic of care, the separated self is contrasted with the connected self. Which of the following examples from our course readings and discussions are representative of the "separated self"?

Enron's "Performance Review Council" rating system for employees The Tuba Group's financial decision to send the Walmart order to the Tazreen Factory regardless of the consequences

Which of the following statements is most accurate about Thomas Friedman's conclusion at the end of the article about globalization we read for class?

Every individual is going to have to run a little faster if he or she wants to advance his or her standard of living.

A "classical liberal standard" for establishing wage and safety standards in a developing country is characterized by strong government regulation, with rules and laws setting minimum wage levels.

False

A "home country" standard for wages in developing countries is established by the free employment choices of informed workers in those countries.

False

In the video we watched about the oil drilling in the Niger Delta, a village elder of the Ogoni people described how the villagers worked together closely with Royal Dutch Shell to ensure that important agricultural and fishing areas would be preserved, ensuring that the benefits and burdens provided by Royal Dutch Shell's oil drilling would be fairly distributed.

False

Ken Lay earned an MBA from Harvard University, which assisted him as he developed Enron's energy trading business.

False

One of the reasons why fire safety was so difficult to achieve in Bangladesh is that the Bangladesh government had no laws nor regulations in place for factory fire safety.

False

The Triangle Shirtwaist Factory Fire and the Tazreen Factory Fire were similar in many ways, including the fact that many young women died, that many of the fire exit doors at the times of the fires were inadequate, and that the immediate response to both fires included new laws, vigorously enforced by the national governments, to protect all factory workers.

False

When Adam Smith described his theory of division of labor and specialization, he chose to illustrate his theory with a description of workers in an automobile factory.

False

What element of perfectly free competition did cell phones MOST DIRECTLY improve for the Kerala fishermen?

Full and perfect knowledge of what other buyers and sellers are doing

A teenager in Ukraine decided to use his laptop connected to the Internet to "hack" credit card numbers from Target, Inc.'s servers in 2013. Within which of Friedman's three stages of globalization would this crime be categorized?

Globalization 3.0

Based upon the information contained in the Exhibits in the Enron case, which of the following statements is/are correct?

In her letter to Ken Lay, Sherron Watkins said that she was "incredibly nervous that we will implode in a wave of accounting scandals." Enron's Code of Ethics had a conflict of interest policy with a general rule against full-time officers and employees owning an interest in another entity that does business with or is a competitor of Enron. Reported revenues from Domestic Trading in 1999 to 2000 were significantly higher than the reported revenues from from Domestic Pipelines and International Operations. Incorrect answer: Enron's Board of Directors in 2000 included Enron executives Ken Lay, Jeff Skilling and Rebecca Mark.

Which Enron executive had the most direct responsibility for initiating and building Enron's energy trading business?

Jeff Skilling

Which author wrote the following quote: "...yet every man has a property in his own person: this no body has any right to but himself. The labour of his body, and the work of his hands, we may say, are properly his. Whatsoever then he removes out of the state that nature hath provided, and left it in, he hath mixed his labour with, and joined to it something that is his own, and thereby makes it his property. "

John Locke

Which Enron executive had the most direct responsibility for leading the political efforts and lobbying to de-regulate the natural gas industry in Texas?

Ken Lay

Which author wrote the following words: "At the last two stages, then, choice is based on the principles that supersede convention, just as previously the claims of society or convention were seen as the grounds for adjudicating differences between individuals..."?

Kohlberg

Enron's intentional and aggressive use of "mark to market" accounting, which gave the appearance in financial reports that Enron's current earnings were higher than their actual earnings, is most accurately described by which statement below? Correct answer:

Mark-to-market accounting was unethical according to the theory of rights (and the categorical imperative) because Enron's intended deception used shareholders as a means to an end.

Modern economies contain elements of three economic systems - traditions, commands, and markets. Which economic system does the de-regulation of natural gas markets seek to emphasize?

Markets

What element of perfectly free competition did Enron improve by convincing the government to de-regulate the price of natural gas?

No government interference in pricing in the marketplace

What element of perfectly free competition did M-Pesa mobile banking improve by putting the power and capacity of mobile phone banking in the hands of millions of new consumers who could now use their mobile phones to buy goods in the marketplace?

Numerous buyers and sellers in the marketplace

Which of the following concepts is/are features of a perfectly competitive free market?

Numerous buyers/sellers, none dominate the market Goods so similar no one prefers buyers or sellers

Which of the following concepts is/are NOT a feature of a perfectly competitive free market?

Only sophisticated buyers/sellers, some dominate the market Lack of transparency, with intentional deception regarding quality, quantity and price

What stage of Kohlberg's theory of moral development would be demonstrated by Sherron Watkins if she were to decide to "blow the whistle" on Enron's accounting fraud, realizing that she might endure an unpleasant individual outcome but that the greater good would be best served by her actions?

Post-conventional Social Contract stage

What stage of Kohlberg's theory of moral development was demonstrated by the Enron employees who "ranked" each other via the PRC, seeking to benefit themselves individually without regard to the negative impact their actions might have on other employees?

Pre-conventional Instrumental-Relativist stage

What stage of Kohlberg's theory of moral development would be demonstrated by Andy Fastow if he decided to deceptively and illegally use special purpose entities, simply because he thought he could get away with it and not be subject to fines and imprisonment?

Pre-conventional Punishment-Obedience stage

Which Enron executive had the most direct responsibility for Enron's international market segment?

Rebecca Mark

Based upon the information contained in the Exhibits in the Enron case, which of the following statements is/are NOT correct? Incorrect answer:

Reported revenues from International Operations in 1999 to 2000 was significantly higher than the reported revenues from from Domestic Trading but lower than that of Domestic Pipelines.

Which Enron executive had the most direct responsibility for leading Enron's Risk Assessment & Control?

Rick Buy

In the John Locke excerpt that we read, entitled "Of Property," what is it that allows a person to claim private ownership in a natural resource?

She added value by her labor, and therefore she owns it

Which Enron executive is best remembered as the "whistleblower" who alerted Ken Lay in a letter that warned she was "incredibly nervous that we will implode in a wave of accounting scandals"?

Sherron Watkins

In White's article about Gilligan's ethic of care, the separated self is contrasted with the connected self. Which of the following examples from our course readings and discussions are representative of the "connected self"?

Steele Lorenz (BSB '10) working closely with small-plot farmers in rural India The decision of Western retailers to work together collaboratively on the issue of fire safety

A factory owner who chose not to follow the Bangladesh Factories Rules regarding fire safety, resulting in the preventable deaths of factory workers, could ACCURATELY be described as choosing an unethical action using which statement below? (multiple answers)

The factory owner violated Kant's categorical imperative by intentionally choosing not to follow fire safety laws in order to save expenses, using the factory employees as a means to an end by not respecting the inherent dignity of their lives. The factory owner violated Rawls' principles of distributive justice because it did not adhere to rules designed to protect basic rights of workers and did not ensure equal opportunity for all affected workers to have a safe place of employment.

In the Adam Smith excerpt that we read from Wealth of Nations, what concept does he describe that promotes public economic interests unintentionally through the rational self-interest of individuals?

The invisible hand of the marketplace

Enron's illegal and deceptive use of "special purpose entities," which were used to move toxic assets and bad debt from Enron's consolidated financial reports, is most accurately described by which statement below?

The use of special purpose entities was unethical according to the theory of of rights (and the categorical imperative) because Enron's intended deception used shareholders as a means to an end.

Which author wrote the following quote: "It is this convergence - of new players, on a new playing field, developing new processes for horizontal collaboration - that I believe is the most important force shaping global economics and policy in the early 21st century"?

Thomas Friedman

Modern economies contain elements of three economic systems - traditions, commands, and markets. Which economic system is the sustainable fishing and smoking the fish by the Ogoni people over generations primarily an example of?

Traditions

Choosing not to engage in accounting fraud simply because you want to avoid the punishment you might suffer if you get caught would be characterized as a "pre-conventional" decision, according to Kohlberg.

True

John Locke states that gold and silver derive their value as currency (money) via the "mutual consent" of those who choose to recognize their value as money.

True

M-Pesa banking in Kenya is an example of an "asset light" business strategy, using mobile phones for monetary transactions so that the "base of the pyramid" can have access to banking services.

True

Property owners who desire the outcome of increased property values near the new stations of the Southwest Light Rail project have a teleological rationale for supporting the project.

True

Thomas Friedman's explanation of globalization includes "outsourcing" as one "flattener," increasing opportunities and lowering barriers for international business transactions. Correct answer:

True

Walmart was not aware that the Tuba Group had sent Walmart's order to the Tazreen factory before the fire in November 2012.

True

Which of the following is/are the most accurate description(s) of product development as described in the lecture and Prahalad's article about the "innovation sandbox"?

When designing products for the BOP, one should remember that poor customers in developing nations willingly accept new technology. When designing products for the BOP, one must operate within certain constraints so that the products can be affordable and accessible to the customer. When designing products for the BOP, one should immerse oneself in the local culture to meet the actual needs of the customer.

Which one of the following statements about the McCormick pepper case is CORRECT both FACTUALLY (correctly matches the stakeholders and actions) and ANALYTICALLY (correctly applies the ethical theories).

When the Watkins Company sued McCormick for McCormick's actions in reducing the amount of pepper in the can, alleging that McCormick violated the Deceptive Trade Practices Act provisions related to slack-fill packaging, the argument Watkins presented was deontological, alleging that McCormick was not following the same rules that applied to all other consumer packaged goods companies, and that by violating those rules McCormick's actions could be deemed unethical through a justice and fairness analysis.

Please match the concept with the correct author.

Who described "division of labor and specialization"?- Adam Smith Who described a theory of private property based upon labor?- John Locke Who outlined the difference between the "home country standard" and the "living wage standard"?- Ian Maitland Who described the "invisible hand"?- Adam Smith Who described "comparative advantage"?- David Ricardo

Please match the concept with the correct author part 2

Who described the "Bottom of the Pyramid"?- CK Prahalad Who explained that the value of money was based upon mutual consent?- John Locke Who described the "invisible hand"?- Adam Smith Who described three eras of globalization?- Thomas Friedman

What concept does Dan Ariely describe that might make one more likely to be dishonest about stealing a pencil vs. stealing money?

psychological distance