Econ exam 2

What are three sources of economies of scale?

1. The ability of large-volume producers to use more effective, specialized employees 2. Spreading fixed costs over a larger volume 3. The ability of large-volume producers to use more specialized equipment

The straw men theory that states that businesses should behave in a socially responsible manner, according to ethical custom and without deception and fraud is the _______.

Friedman doctrine

what are the four determinants of ethical behavior

Leadership Societal culture Personal ethics Organizational culture decision making processes unrealistic performance goals

What are two reasons diminishing returns to specialization occur?

Not all resources are of the same quality. Different goods use resources in different proportions.

What is an accurate description of developed nations with regard to the environment?

They have more substantive environmental regulations.

Some ethics experts have proposed practical guides or ethical ______ to make ethical decisions in a systematic way.

algorithms

What is the final step companies should take when assessing ethical issues?

audit the company's decisions

Many companies develop a formal statement of primary values and ethical standards for employees and managers to follow. This is called a

code of ethics

The Hofstede dimension that is focused on the degree to which people in a society are integrated into groups is

collectivism vs individualism

Class ______ is an awareness of one's social or economic rank in society.

consciousness

Hofstede studied how ______ relates to values in the workplace.

culture

The reductions in the cost of a single unit that result from large scale output of that product are called

economies of scale

______ are situations where none of the available alternatives seems morally acceptable.

ethical dimensions

The accepted principles of right and wrong that guide a person's decisions are called _____.

ethics

The Foreign Corrupt Practices Act was amended to include _____ because some U.S. businesses complained the act would put U.S. firms at a competitive disadvantage.

facilitating (grease) payments

The Hofstede dimension that looks at the relationship between gender and work roles is

femininity vs masculinity

The routine conventions of living, thinking, and acting in a group are called ______.

folkways

Which congressional act outlaws the payment of bribes to foreign government officials to gain businesses?

foreign corrupt practices act

What is the likely result for the gains from specialization according to the concept of diminishing returns?

gains are likely to be exhausted before specialization is complete

According to Hofstede, societies with stiff codes of behavior, rules, and laws score high (Blank) on the uncertainty avoidance index. (Choose high or low.)

high

Which two of Hofstede's dimensions are present in countries where ethical practices are commonly practiced?

high in individualism high in uncertainty avoidance

An organization's code of ethics may be partially based on documents such as the United Nations Universal Declaration of

human rights

New trade theory states that some countries specialize in the production and export of a particular product because _____.

in certain industries the world can only support a limited number of firms. first mover rights

What are the four dimensions originally identified by Hofstede?

individualism vs collectivism uncertainty avoidance masculinity vs feminism power distance

a (blank) distribution is one that is considered fair and equitable

just

In some cultures, people are more willing to work hard to achieve material wealth and may have to wait years before feeling they have succeeded. This is a reflection of which dimension identified by Hofstede?

long-term vs short-term orientation

In traditional British society, a school teacher would have been part of the _____ class.

lower-middle

Which theory does NOT support unrestricted free trade between countries?

mercantilism

Free trade _____ the efficient use of resources within a country.

might increase

______ join the political entity of a state to the cultural entity of a nation.

nation-states

Rights that are taken for granted in developed nations, such as freedom of association and freedom of speech are

not universally accepted

What are three examples of the "hidden curriculum" of schools?

obedience to authority, respect for others, dealing with competition

What is the focus of Hofstede's power distance dimension?

people are not equal in physical capabilities

Certain theories accept that there are rights, both positive and negative, that all humans have simply because they are human. These are called ______ theories.

rights

Which two theories provide the moral compass that is important when thinking through the ethical implications of decisions in a systematic way?

rights theories & Rawl's theory of justice

ethics officer

someone trained about matters of ethics in the workplace, particularly about resolving ethical dilemmas

True or false: Companies can use psychological tests in the hiring process to help identify people who have a strong sense of personal ethics.

true

True or false: Economic advancement and globalization may be important factors in societal change. True false question.

true

______ ethics measure actions on a cost-benefit scale.

utilitarian

In the 1980s, Western businesses questioned the ethics of operating in South Africa because the apartheid system in place there

violated basic human rights

As demonstrated by the Nike example in the text, which situation is generally MOST preferred when considering employment practices in international business?

Requiring good conditions in home and foreign operations even when this results in a smaller profit margin

As countries get richer, we often see a shift ______ traditional values (such as staying married and obeying one's parents) and ______ secular rational values (including abortion and divorce).

away from, toward

Economic studies have suggested that according to the theory of ______ advantage, countries will experience higher growth rates if they follow a more open stance toward international growth.

comparative

Which form of returns to specialization means that the units of resources required to produce one unit are assumed to remain the same no matter where a country is on the production possibilities frontier?

constant (Ricardian theory)

Ethical issues arise in international business when

environmental regulations in host nations are less stringent than those in the home country.

According to Hofstede, if the ties between people are loose, it is most likely a sign of a(n) ______ society.

individualistic

In the ______ dimension identified by Hofstede, the degree of power and wealth is not balanced within a country.

power distance

n the ______ dimension identified by Hofstede, the degree of power and wealth is not balanced within a country.

power distance

the (blank) theories recognize that there are things we CANNOT do against individuals because they have certain moral, fundamental rights.

rights

True or false: Education provides a competitive economic advantage through the creation of a pool of skilled and educated workers.

true

A person who follows the idea of _____ says that the multinational's home-country standards of ethics are the appropriate approach to follow in foreign countries.

righteous moralist