Dynamic Business Law The Essentials 4th Edition Kubasek Test Bank

Dynamic Business Law The Essentials
4th Edition Kubasek Test Bank

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Dynamic Business Law The Essentials 4th Edition Kubasek Test Bank
Dynamic Business Law: The Essentials, 4e (Kubasek)

Chapter 2 Business Ethics and Social Responsibility
1) Ethics is the study and practice of decisions that meet, but do not exceed, minimum standards of
behavior prescribed by law.
Answer: FALSE
Explanation: Ethics is the study and practice of decisions about what is good or right.
Difficulty: 2 Medium
Topic: Business Ethics and Social Responsibility
Learning Objective: 02-01 What are business ethics and the social responsibility of business?
Bloom's: Understand
AACSB: Ethics
Accessibility: Keyboard Navigation
2) Business ethics refers to standards of business conduct, not a set of correct decisions.
Answer: TRUE
Explanation: The definition of business ethics refers to standards of business conduct. It does not
result in a set of correct decisions.
Bloom's: Understand
AACSB: Ethics
3) An ethical dilemma is a problem about what a firm should do for which no clear, right decision
is available.
Answer: TRUE
Explanation: An ethical dilemma is a problem about what a firm should do for which no clear,
right decision is available.
Bloom's: Understand
AACSB: Ethics
1
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4) Reasonable people can expect to disagree about optimal solutions to ethical dilemmas.
Answer: TRUE
right decision is available. Reasonable people can expect to disagree about optimal solutions to
ethical dilemmas.
Bloom's: Understand
AACSB: Ethics
5) A business decision cannot be legal but unethical.
Answer: FALSE
Explanation: A business decision can be legal but unethical.
Topic: Business Law and Business Ethics
Learning Objective: 02-02 How are business law and business ethics related?
Bloom's: Understand
AACSB: Ethics
6) Ethical standards are uniform globally.
Answer: FALSE
Explanation: Different countries have different ethical standards. Thus, ethical conceptions
shape business law and business relationships uniquely in each country.
Difficulty: 1 Easy
Bloom's: Remember
AACSB: Ethics
2
7) The stakeholders of a business are limited to those who have an ownership interest in the
business.
Answer: FALSE
Explanation: The stakeholders of a business consist of many different groups of people who are
affected by the business's decisions. They include owners or shareholders, employees, customers,
management, the general community where the firm operates, and future generations.
Difficulty: 1 Easy
Topic: The WH Framework for Business Ethics
Learning Objective: 02-05 How can we use the WH framework to make ethical business
decisions?
Bloom's: Remember
AACSB: Ethics
8) Business managers should make sure they consider all relevant stakeholders when they engage
in ethical reasoning.
Answer: TRUE
Explanation: Business managers should consider all relevant stakeholders when they engage in
ethical reasoning, since any given managerial decision affects, in varying degrees, owners or
shareholders, employees, customers, management, the general community where the firm
operates, and future generations.
decisions?
Bloom's: Understand
AACSB: Ethics
9) Employees are not stakeholders of a business.
Answer: FALSE
Explanation: The stakeholders of a firm are the many groups of people affected by the firm's
decision, including its employees.
Difficulty: 1 Easy
decisions?
Bloom's: Remember
AACSB: Ethics
3
10) The social responsibility of business consists of the expectations the community imposes on
firms doing business within its borders.
Answer: TRUE
Explanation: The social responsibility of business consists of the expectations the community
imposes on firms doing business within its borders. These expectations must be honored to a
certain extent, even when a firm wishes to ignore them, because firms are always subject to the
implicit threat that legislation will impose social obligations on them.
Topic: Introduction
Bloom's: Understand
AACSB: Ethics
11) We derive our ethics from the interplay of values.
Answer: TRUE
Explanation: Values are positive abstractions that capture one's sense of what is good and
desirable. They are ideas that underlie conversations about business ethics. We derive our ethics
from the interplay of values.
Topic: What Are Values?
Learning Objective: 02-03 What are values?
Bloom's: Understand
AACSB: Ethics
12) The Golden Rule is the idea that we should interact with other people in a manner consistent
with the way we would like them to interact with us.
Answer: TRUE
Explanation: The Golden Rule is the idea that we should interact with other people in a manner
consistent with the way we would like them to interact with us. This guideline urges us to be aware
that other people, including their rights and needs, matter.
Difficulty: 1 Easy
decisions?
Bloom's: Remember
AACSB: Ethics
4
13) An ethical ________ is a problem about what a firm should do for which no clear, right
decision is available.
A) construct
B) postulate
C) standard
D) dilemma
E) hypothesis
Answer: D
right decision is available. Reasonable people can expect to disagree about optimal solutions to
ethical dilemmas.
Bloom's: Understand
AACSB: Ethics
14) The social responsibility of business consists of the expectations ________ impose(s) on
firms.
A) the community
B) future generations
C) management
D) employees
E) shareholders
Answer: A
Explanation: The expectations that a community places on the actions of a business is referred to
as the social responsibility of business. If the community expects businesses to obey certain
standards of fairness, even when the standards interfere with profit maximization, firms that
choose to ignore this expectation do so at their peril.
Difficulty: 1 Easy
Bloom's: Remember
AACSB: Ethics
5
15) Which of the following is an incorrect statement regarding values?
A) Values are positive abstractions.
B) Values capture our sense of what is good or desirable.
C) Values come from the interplay of ethics.
D) Values are ideas that underlie conversations about business ethics.
E) Values represent our understanding of the purposes we will fulfill by making particular
decisions.
Answer: C
Explanation: Values are positive abstractions that capture our sense of what is good or desirable.
They are ideas that underlie conversations about business ethics. We derive our ethics from the
interplay of values. Values represent our understanding of the purposes we will fulfill by making
particular decisions.
Bloom's: Understand
AACSB: Ethics
16) Which of the following is an example of the primary value of freedom?

A) To be safe from those wishing to interfere with your property rights
B) To possess the capacity or resources to act as one wishes
C) To provide resources in proportion to need
D) To maximize the amount of wealth in society
E) To get the most from a particular output
Answer: B
Explanation: The primary value of freedom includes possessing the capacity or resources to act
as one wishes, acting without restriction from rules imposed by others, and escaping the cares and
demands of this world entirely.
Topic: How do Values Provide a Starting Point for Thinking about Business Ethics?
Learning Objective: 02-04 How do values provide a starting point for thinking about business
ethics?
Bloom's: Understand
AACSB: Ethics
6
17) In 2007, Dole was sued by a group of its employees for:
A) Low wages
B) Age Discrimination
C) Bribery
D) Sex discrimination
E) Ignoring safety recommendations in their use of pesticides
Answer: E
Explanation: In 2007, Dole was sued by a group of its employees for ignoring safety
recommendations in its use of pesticides.
Difficulty: 1 Easy
Topic: How do Values Provide a Starting Point for Thinking about Business Ethics?
Learning Objective: 02-04 How do values provide a starting point for thinking about business
ethics?
Bloom's: Remember
AACSB: Ethics
18) The "W" in the WH process of ethical decision making stands for:
A) Why
B) When
C) Where
D) Wherewithal
E) Who
Answer: E
Explanation: The "W" in the WH process of ethical decision making stands for "Who"; namely,
the stakeholders who are affected by the decisions a firm makes. Those stakeholders include
customers, owners or investors, management, employees, the community, and future generations.
Difficulty: 1 Easy
decisions?
Bloom's: Remember
AACSB: Ethics
7
19) Positive abstractions that capture our sense of what is good or desirable are ________.
A) ethical ideations
B) values
C) subconscious demands
D) ethical standards
E) action-oriented goals
Answer: B
Explanation: Values are positive abstractions that capture our sense of what is good or desirable.
They are ideas that underlie conversations about business ethics.
Bloom's: Understand
AACSB: Ethics
20) The idea that we should interact with other people in a manner consistent with the manner in
which we would like for them to interact with us is called the ________.
A) Purpose-Driven Life Rule
B) Ethical Self-Actualization Rule
C) Eighth Commandment of the Ten Commandments
D) Golden Rule
E) Ninth Commandment of the Ten Commandments
Answer: D
Explanation: The Golden Rule is the idea that we should interact with other people in a manner
consistent with the way we would like for them to interact with us.
decisions?
Bloom's: Understand
AACSB: Ethics
8
21) The "public disclosure" test is also known as the ________.
A) television test
B) universalization test
C) Golden Rule
D) Biden Rule
E) means test
Answer: A
Explanation: The public disclosure test is sometimes called the "television test," for it requires us
to imagine that our actions are being broadcast on national television.
decisions?
Bloom's: Understand
AACSB: Ethics
22) If we consider what the world would be like if a decision is copied by everyone else, we would
be using which of the following ethical guidelines?
A) The Golden Rule
B) The universalization test
C) The public disclosure test
D) The television test
E) The ethical plagiarism standard
Answer: B
Explanation: Before we act, the universalization test asks us to consider what the world would be
like were our decision copied by everyone else. Applying the universalization test causes us to
wonder aloud: "Is what I am about to do the kind of action that, if others followed my example,
makes the world a better place for me and those I love?"
decisions?
Bloom's: Understand
AACSB: Ethics
9
23) Environmental Concerns. Connie, the president of a company that makes paper, has a new
interest in the environment. She recently went to a seminar on environmental dangers and has
decided to take steps to clean things up. She started at home and was also committed to change
things at work. Connie had to face the fact that her company has been cheating and is not in
compliance with applicable environmental regulations due to dumping in a nearby river. Her
company has never been cited, however, because it employs a very large number of people in the
community, including the mayor's wife and the chief-of-police's brother. On her mission to clean
things up, Connie has decided to go even further than the law requires and install the very latest
environmental protections. When she announced her plan, the chair of the company's board of
directors, Brooke, had a meeting with Connie. Brooke told Connie to analyze the situation
carefully because the cost of the additional equipment would mean no dividend to shareholders
and no raise for employees. Furthermore, Brooke told Connie that installing all the new equipment
would result in higher prices for the company's paper products and could bankrupt the company
because of foreign competition. Brooke hinted that Connie could be fired if she persisted. Brooke
suggested that Connie just be concerned with a minimal standard of ethics. Which of the following
is the minimal standard that a business must meet in a consideration of business ethics?
A) Decisions must be legal.
B) Decisions must meet the criteria of a follower of the WPH Framework for Business Ethics.
C) Decisions must meet the requirements of the most important stakeholders.
D) Decisions must receive a majority vote of acceptance by employees.
E) Both that decisions must be legal and that decisions receive a majority vote of acceptance by
employees.
Answer: A
Explanation: The legality of a decision is the minimal standard that must be met in a
consideration of business ethics. The existence of that minimum standard is essential for the
development of business ethics. Think of the law as the most recent consensus about the lower
level of business ethics. Law and business ethics serve as an interactive system—informing and
assessing each other.
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Ethics
10
suggested that Connie just be concerned with a minimal standard of ethics. Which of the following
would be a stakeholder in the company?
A) The community only
B) The shareholders only
C) Future generations only
D) The community and shareholders only
E) The community, shareholders, and future generations
Answer: E
Explanation: Stakeholders of a firm are the many groups of people affected by the firm's
decisions. They include owners or shareholders, employees, customers, management, the general
community where the firm operates, and future generations.
decisions?
Bloom's: Apply
AACSB: Ethics
11
suggested that Connie just be concerned with a minimal standard of ethics. Connie, however,
decides to go forward with her plan to clean things up under the theory that she wants to treat
others in the same manner that she wants to be treated. Under Connie's theory, if she did not
understand the importance of the environmental improvements, she would want them to be thrust
upon her. Connie's idea is best referred to as the ________.
A) Golden Rule
B) public disclosure test
C) universalization test
D) Sarbanes-Oxley Rule
E) television test
Answer: A
Explanation: The Golden Rule represents the idea that we should interact with other people in a
manner consistent with the way we would like them to interact with us. This guideline urges us to
be aware that other people, including their rights and needs, matter.
decisions?
Bloom's: Apply
AACSB: Ethics
12
Dynamic Business Law The Essentials 4th Edition Kubasek Test Bank
26) Explain the WH process of ethical decision-making.
Answer: With regard to the WH framework, students should reference who is involved, meaning
stakeholders; the reason decisions are made, referencing values; and how decisions are made,
referencing ethical guidelines such as the Golden Rule.
decisions?
Bloom's: Understand
AACSB: Ethics
13
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Dynamic Business Law The Essentials

4th Edition Kubasek Test Bank

Dynamic Business Law: The Essentials, 4e (Kubasek)

Visit TestBankDeal.com to get complete for all chapters

5) A business decision cannot be legal but unethical.

6) Ethical standards are uniform globally.

9) Employees are not stakeholders of a business.

11) We derive our ethics from the interplay of values.

16) Which of the following is an example of the primary value of freedom?

26) Explain the WH process of ethical decision-making.

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