CH10 GBA490 Test3

1. (p. 317) Business ethics concerns
A. Developing a consensus among companies worldwide as to what ethical principles that
businesses should be expected to observe in the course of conducting their operations

B. What ethical behaviors should be expected of company personnel in the course of doing their
jobs

C. The application of general ethical principles and standards to the actions and decisions of
companies and the behavior of company personnel

D. Developing a special set of ethical standards for businesses to observe in conducting their
affairs

E. Picking and choosing among the consensus ethical standards of society to arrive at a set of
ethical standards that apply directly to operating a business

C

2. (p. 317) Ethical principles in business

A. Deal chiefly with the actions and behaviors required to operate companies in a socially

responsible manner

B. Deal chiefly with the rules each company's top management and board of directors make about

"what is right" and "what is wrong."

C. Are not materially different from ethical principles in general

D. Are generally less stringent than the ethical principles for society at large

E. Are generally more stringent than the ethical principles for society at large

C

3. (p. 317) Ethical principles as they apply to business conduct and business decisions

A. Deal chiefly with standards a company has (and that are elaborated in its code of ethics) about
what is right and wrong insofar as the conduct of its business is concerned and about what
behaviors are expected of company personnel

B. Deal chiefly with the behaviors that a company's board of directors expects of all company
personnel in both their conduct on-the-job and their conduct off-the-job

C. Involve the rules a company's top management and board of directors make about "what is
right" and "what is wrong."

D. Are not materially different from ethical principles in general

E. Are generally less stringent than the ethical principles for society at large because it is well
understood that businesses should not be expected to operate any differently than what the law
requires of them

D

4. (p. 318) Notions of right and wrong, fair and unfair, moral and immoral, ethical and unethical

A. Vary enormously from religion to religion and country to country across the world

B. Are present in all societies, organizations and individuals; some of the most important concepts
of what is right and what is wrong (being truthful, integrity of character, not cheating or stealing,
treating people with dignity and respect) resonate with people of most cultures and religions and
are thus universal

C. Ultimately depend on the circumstances—nothing is really black or white when it comes to
ethical standards

D. Are governed mainly by the thinking and writings of religious clerics at the School of Morally
Correct Thinking and Behavior in Geneva, Switzerland

E. Ultimately depend on a person's own values and beliefs

B

5. (p. 318) The contentions that (1) many of the same standards of what's ethical and what's unethical
resonate with peoples of most societies regardless of local traditions and cultural norms and (2) to
the extent there is common moral agreement about right and wrong actions, common ethical
standards can be used to judge the conduct of personnel at companies operating in a variety of
country markets and cultural circumstances are defining beliefs of

A. The school of ethical relativism

B. The school of ethical universalism

C. Integrated social contracts theory

D. The School of Morally Correct Thinking and Behavior in Paris, France

E. The Global Code of Ethical and Social Morality developed in 1925 at a worldwide convention
of distinguished religious clerics

B

6. (p. 319) The contention that since different societies and cultures have divergent values and
standards of right and wrong it is appropriate to judge behavior as ethical/unethical in the light of
local customs and social mores rather than according to a single set of ethical standards

A. Defines what is meant by "ethical relativism."

B. Defines what is meant by "ethical universalism."

C. Is the foundation of integrated social contracts theory

D. Is the basis for the theory of ethical variation

E. Is the guiding principle of the Global Code of Ethical and Social Morality created by the United
Nations

A

7. (p. 322) The contention that ethical standards should be governed both by (1) a limited number of
universal ethical principles that are widely recognized as putting legitimate ethical boundaries on
actions and behavior in all situations and (2) the circumstances of local cultures, traditions and
shared values that further prescribe what constitutes ethically permissible behavior and what does
not are the basic principles of

A. The school of ethical relativism

B. The school of ethical universalism

C. Integrated social contracts theory

D. The School of Morally Correct Thinking and Behavior based in Rome, Italy

E. The Global Code of Ethical and Social Morality developed by the United Nations

C

8. (p. 318) The school of ethical universalism holds that

A. Concepts of right and wrong are absolute and leave no room for deviation from country to
country or circumstance to circumstance

B. Concepts of right and wrong are universal within countries but not across countries and cultures

C. Concepts of right and wrong are governed by the Global Code of Ethical and Social Morality

D. Some concepts of what is right and what is wrong resonate with peoples of most societies
regardless of local traditions and cultural norms—hence common ethical standards can be used to
judge the conduct of personnel at companies operating in a variety of country markets and cultural
circumstances

E. All societies and countries apply essentially the very same set of universally-defined ethical
principles of right and wrong in judging individual behavior

D

9. (p. 318) According to the school of ethical universalism,

A. Concepts of what constitutes ethical behavior and unethical behavior are dictated by
subjectively-provable moral principles but not by objectively-provable moral principles

B. Concepts of right and wrong are universal within countries/societies but not across countries or
cultures

C. Concepts of what is ethical and what is unethical are universal and absolute, leaving no room
for deviation from country to country or circumstance to circumstance

D. To the extent there is common moral agreement about right and wrong actions and behaviors
across multiple cultures and countries, there exists a set of universal ethical standards to which all
societies, all companies and all individuals can be held accountable

E. All societies and countries are obligated to apply universally-defined ethical principles of right
and wrong as set forth in the Global Code of Ethical Behavior adopted by 150 nations of the world

D

10. (p. 318) According to the school of ethical universalism,

A. Universal ethical principles or norms put limits on what actions and behaviors fall inside the
boundaries of what is right and which ones fall outside—such universal norms include honesty or
trustworthiness, respecting the rights of others, practicing the Golden Rule, avoiding unnecessary
harm to workers or to the users of the company's product or service and respect for the
environment

B. All societies and countries are obligated to apply universally-defined ethical principles of right

and wrong as set forth in the Global Code of Ethical and Social Morality (which is subscribed to
by 150 nations of the world)

C. All societies and countries apply essentially the very same set of universally-defined ethical
principles of right and wrong in judging the ethical correctness of business behavior

D. It is only fair that the standards of what's ethical and what's unethical be applied universally to
all businesses in all countries irrespective of local business traditions and local business norms

E. The standards of what constitutes ethical and unethical behavior in business situations are partly
universal, but in the main are governed by local business norms

A

11. (p. 318) If one concurs with the school of ethical universalism, then one believes that

A. Many basic moral standards travel well across cultures and countries and really do not vary
significantly according to local cultural beliefs, social mores, religious convictions and/or the
circumstances of the situation

B. Since ethical standards are subjectively-determined rather than objectively-determined, each

company has a window within which it can define and implement its own ethical principles of
right and wrong

C. What is deemed right or wrong, fair or unfair, moral or immoral, ethical or unethical in business
situations should be judged in light of local customs and social mores and can legitimately vary
from one culture or nation to another

D. Each country should have some degree of latitude in setting its own ethical standards for
judging the ethical correctness of business actions/behaviors within its borders

E. Concepts of right and wrong as they apply to business behavior are always varying shades of
gray, never absolute (i.e. black or white)

A

12. (p. 318) The strength of the beliefs underlying ethical universalism is that

A. Ethical universalism recognizes the obvious—basic moral standards vary significantly

according to local cultural beliefs, local religious beliefs and social mores

B. Ethical standards are objectively-determined by religious and moral experts

C. What is deemed right or wrong, fair or unfair, moral or immoral, ethical or unethical is (or
should be) grounded in religious doctrine and applied strictly to all business situations

D. It draws upon the collective views of multiple societies and cultures to put some clear
boundaries on what constitutes ethical business behavior and what constitutes unethical business
behavior no matter what country market or culture a company or its personnel are operating in

E. It leaves no room for thinking that concepts of right and wrong can be varying shades of gray—
they are always absolute and unambiguous

D

13. (p. 319) The school of ethical relativism holds that

A. What constitutes ethical or unethical conduct varies according to the religious convictions of
each society or each culture within a country

B. When there are cross-country or cross-cultural differences in what is deemed fair or unfair, what
constitutes proper regard for human rights and what is considered ethical or unethical in business
situations, it is appropriate for local moral standards to take precedence over what the ethical
standards may be elsewhere

C. Concepts of right and wrong are always governed by business norms in each country, culture or
society

D. Concepts of right and wrong are always a function of each individual's own set of values,
beliefs and ethical convictions

E. Concepts of right and wrong as they apply to business behavior are always varying shades of
gray, never absolute (i.e. black or white)

B

14. (p. 319) According to the school of ethical relativism,

A. Concepts of ethically right and ethically wrong are relative across countries and cultures but are
universal within countries or cultures

B. Individuals and businesses have a basic right to "moral free space" and that it is inappropriate to
specify ethically permissible and ethically impermissible actions and behaviors

C. There are important occasions when local cultural norms and the circumstances of the situation
determine whether certain behaviors are right or wrong

D. Concepts of right and wrong as applied to business situations are always a function of each
company's own set of values, beliefs and ethical convictions (as stated in the company's code of
ethical conduct)

E. Standards of what is ethically right and ethically wrong as applied to business behavior are
determined solely by whatever business norms prevail in a particular country/culture/society and
these business norms are certain to vary across countries/cultures/societies

C

15. (p. 319) According to the advocates of ethical relativism,

A. If the use of underage labor and/or the payment of bribes/kickbacks are acceptable in a
particular culture/society/country, then a case can be made that it is morally correct and ethical for
a company to use underage labor or pay bribes/kickbacks in conducting its business activities in
that culture/society/country

B. Each company should have the flexibility to set its own standards for deciding whether the use
of underage labor and/or the payment of bribes/kickbacks are ethically acceptable or not

C. If the use of underage labor and/or the payment of bribes/kickbacks are legal in a particular
country, then it is morally correct and ethical for a company to use underage labor in conducting
its business activities in that country, no matter what the legality of using underage labor or paying
bribes/kickbacks happens to be in other countries

D. Each industry should have the flexibility to set its own standards for deciding whether the use
of underage labor and/or the payment of bribes/kickbacks are ethically acceptable or not

E. It is very clear that the use of underage labor or the payment of bribes and kickbacks are
ethically impermissible—local customs, behavioral norms and traditions absolutely cannot be
taken into account

A

16. (p. 319) A belief in ethical relativism leads to the conclusion that

A. Since ethical standards are subjective, it is perfectly appropriate for each company to define and
implement its own ethical principles of right and wrong as concerns the use of underage labor and
the payment of bribes and kickbacks

B. Ethical standards are determined objectively (rather than subjectively)

C. Whether the use of underage labor and the payment of bribes/kickbacks should be deemed
ethical or unethical depends on the moral standards, values, beliefs, convictions and business
norms that prevail in particular cultures, societies, countries or circumstances

D. Ethical standards are objective and universal—thus whether the use of underage labor and the
payment of bribes and kickbacks should be deemed ethical or unethical definitely is not dependent
on the moral standards, values, beliefs, convictions and business norms that prevail in particular
cultures, societies, countries or circumstances

E. Standards of right and wrong are governed by what is legal in a given country—thus whether
the use of underage labor and the payment of bribes and kickbacks is ethical or unethical is
governed by local law

C

17. (p. 319 - 321) If one accepts the tenets of the school of ethical relativism, then it follows that

A. There are multiple sets of ethical standards rather than a single universal set

B. At least some ethical standards are governed by local norms, religious doctrines and social
customs rather than by absolute standards of right and wrong

C. What constitutes ethical or unethical behavior on the part of businesses must in some cases be
judged in the light of local customs and social mores

D. It is inappropriate to hold businesses accountable for observing a universal set of ethical
standards

E. All of the above

E

18. (p. 321) Companies that adopt the principle of ethical relativism in providing ethical guidance to
company personnel

A. Base their standards of what is ethical and what is unethical on the Global Code of Ethical
Conduct first developed in 1935 and since subscribed to by the governments of 180 countries

B. Quickly find themselves on a slippery slope with no higher order moral compass if they operate

in countries where ethical standards vary considerably from country to country

C. Have no fair way to judge the ethical correctness of the conduct of company personnel

D. Have a one-size-fits-all set of ethical standards

E. End up allowing each company employee to determine what set of ethical standards to observe

B

19. (p. 319) According to the ethical relativism school of thinking,

A. There can be no one-size-fits-all set of authentic ethical norms against which to gauge the
conduct of company personnel

B. A company should have a different set of ethical standards for each country in which it operates

C. Only respected religious experts can provide companies with a higher order moral compass

D. The best source of ethical standards in each country where the company operates is that
country's adopted Code of Required Ethical Conduct

E. Since there can be no one-size-fits-all set of authentic ethical norms it is appropriate for each
company to hold company personnel to observing the company's code of ethical conduct

A

20. (p. 319) Paying bribes and kickbacks to grease business transactions

A. Violates ethical principles of right and wrong in all countries

B. Is ethically acceptable according to the principle of ethical universalism and ethically
unacceptable according to the principle of ethical relativism

C. Is acceptable to immoral managers but not to amoral managers

D. Is one of the thorniest ethical problems that multinational companies face because paying bribes
is normal and customary in some countries and ethically or legally forbidden in others

E. Is more acceptable in dealing with a company's suppliers than in dealing with a company's
customers

D

21. (p. 319 - 320) Multinational companies that forbid the payment of bribes and kickbacks in their
codes of ethical conduct and that are serious about enforcing this prohibition

A. Are generally advocates of the ethical relativism school of thought

B. Are misguided in their efforts because bribes and kickbacks are really no different from tipping
for service at restaurants—whether you tip for service at dinner or make payments to government
officials to get goods through customs or give kickbacks to customers to retain their business, you
pay for a service rendered

C. Still have considerable difficulty in preventing the payments of bribes and kickbacks when such
payments are entrenched as normal and customary in locations where they do business

D. Are out-of-step with business reality given that the preponderance of company managers are
immoral

E. Are in a distinct minority compared to companies that view the payment of bribes and
kickbacks as a legitimate or permissible practice

C

22. (p. 319 - 322) Which one of the following statements about the ethical relativism school of thinking
is false?

A. In a multinational company, application of ethical relativism equates to multiple sets of ethical
standards

B. There are few absolutes when it comes to business ethics and thus few ethical absolutes for
consistently judging a company's conduct in various countries and markets

C. The best and fairest way for a multinational company to approach the enforcement of ethical
standards companywide is to reject ethical universalism and pursue ethical relativism

D. A company that adopts the principle of ethical relativism and holds company personnel to local
ethical standards necessarily assumes that what prevails as local morality is an adequate guide to
ethical behavior—this assumption is ethically dangerous

E. According to the ethical relativism school of thinking, a "one-size-fits-all" template for judging
the ethical appropriateness of business actions and the behaviors of company personnel does not
exist

C

23. (p. 322) According to integrated social contracts theory, the ethical standards a company should
try to uphold

A. Are governed by the school of ethical universalism

B. Are governed both by (1) a limited number of universal ethical principles that are widely
recognized as putting legitimate ethical boundaries on actions and behavior in all situations and (2)
the circumstances of local cultures, traditions and shared values that further prescribe what
constitutes ethically permissible behavior and what does not—but universal norms always take
precedence over local ethical norms

C. Are governed by each country's Code of Required Ethical Conduct—which sets forth that each
individual/group/business/organization has a "social contract" to observe the ethical and moral
standards that the country has adopted

D. Should be determined by the company's moral managers

E. Should never be absolute but rather always provide some wiggle room according to the
circumstances of the situation

B

24. (p. 322 - 323) According to integrated social contracts theory,

A. Universal ethical principles apply in those situations where most all societies—endowed with
rationality and moral knowledge—have common moral agreement on what is wrong and thereby
put limits on what actions and behaviors fall inside the boundaries of what is right and which ones
fall outside

B. Commonly held views about what is morally right and wrong form a "social contract" (or
"contract with society") that is binding on all individuals, groups, organizations and businesses in
terms of establishing right and wrong and in drawing the line between ethical and unethical
behaviors

C. Universal ethical principles or norms leave some "moral free space" for the people in a
particular country (or local culture or even a company) to make specific interpretations of what
other actions may or may not be permissible within the bounds defined by universal ethical
principles
D. Universal ethical norms always take precedence over local ethical norms

E. All of the above

E

25. (p. 322 - 323) Which one of the following is not a key element of integrated social contracts
theory?

A. Universal ethical principles apply in those situations where most all societies—endowed with
rationality and moral knowledge—have common moral agreement on what is wrong and thereby
put limits on what actions and behaviors fall inside the boundaries of what is right and which ones
fall outside

B. Commonly held views about what is morally right and wrong form a "social contract" (contract
with society) that is binding on all individuals, groups, organizations and businesses in terms of
establishing right and wrong and in drawing the line between ethical and unethical behaviors

C. Universal ethical principles or norms leave some "moral free space" for the people in a
particular country (or local culture or even a company) to make specific interpretations of what
other actions may or may not be permissible within the bounds defined by universal ethical
principles

D. Universal ethical norms always take precedence over local ethical norms

E. Integrated social contracts theory rejects the slippery slope of ethical relativism and embraces
ethical universalism

E

26. (p. 322) Integrated social contracts theory maintains that

A. There is no such thing as "moral free space"—all ethical standards are determined by societal
norms and individuals have an implied social contract to live up to these standards

B. Few nations or cultures have common moral agreement on what is ethically right and wrong

C. There should be no absolute limits put on what actions and behaviors fall inside the boundaries
of what is ethically or morally right and which actions/behaviors fall outside

D. Universal ethical norms always take precedence over local ethical norms

E. Each country/culture/society has commonly held views about what constitutes ethically
appropriate actions/behaviors; these common standards of what is ethical and what is not combine
to form a "social contract" that all individuals in that country/culture/society are obligated to
observe

D

27. (p. 322) The strength of integrated social contracts theory is that it

A. Correctly recognizes all soundly-reasoned ethical standards are universal

B. Accommodates the best parts of ethical universalism and ethical relativism

C. Puts no absolute limits on what actions and behaviors fall inside the boundaries of what is
ethically or morally right and which actions/behaviors fall outside

D. Recognizes the importance of allowing local ethical norms to always take precedence over
universal ethical norms

E. Recognizes that individuals and businesses have a basic right to "moral free space" and that it is
inappropriate to specify ethically permissible and ethically impermissible actions and behaviors

B

28. (p. 323 - 324) The three categories of managers that stand out with regard to the beliefs and

commitments they have to ethical and moral principles in business affairs are:

A. Ethical managers, socially responsible managers and crooked managers

B. Mostly ethical managers, somewhat unethical managers and ethically corrupt managers

C. Ethically-principled managers, ethically-unprincipled managers and ethically-neutral managers

D. Moral managers, amoral managers and immoral managers

E. Ethically responsible managers, ethically irresponsible managers and ethically unconcerned
managers

D

29. (p. 323 - 324) The categories of managerial morality include:

A. Honorable managers, dishonorable managers and totally corrupt managers

B. Mostly ethical managers, somewhat ethical managers and totally unethical managers

C. Ethically-principled managers, ethically-unprincipled managers and if-it-is-legal-then-it-is-
ethical managers ( the latter type of manager believes that ethics don't really apply to business—
their view is that anything that is legal is also ethical)

D. Managers with lots of integrity, managers with some integrity and managers with no integrity

E. Moral managers, immoral managers and amoral managers

E

30. (p. 323) Moral managers

A. Are ethically principled

B. See themselves as stewards of ethical behavior and believe it is important to exercise ethical
leadership

C. Pursue success within the letter and spirit of what is considered ethical and legal

D. View what is legal as the ethical minimum and have a habit of operating at well above what the
law requires

E. All of the above

E

32. (p. 324) An immoral manager is one who

A. Is ethically-principled most of the time but who might stoop to unethical behavior if there's low
risk of discovery and the action or decision has a sizable positive effect on company profitability

B. Has no regard for so-called ethical standards in business and pays no attention to ethical
principles in making decisions and conducting the company's business—an immoral manager is
driven by greed and self-gain and won't hesitate to violate ethical principles if it is in his/her best
interest to do so

C. Is ethically unprincipled but nonetheless usually observes ethical standards for fear of get
caught and fired

D. Believes that ethical standards violate the principle of moral free space and therefore are
illegitimate

E. Strongly believes that it is ethical to do whatever is legal

B

33. (p. 324) An intentionally amoral manager is one who

A. Is ethically-principled most of the time but who knowingly and willingly stoops to unethical
behavior if there's low risk of discovery and the action or decision has a sizable positive effect on
company profitability

B. Deliberately and maliciously violates ethical principles on a regular basis

C. Believes business and ethics are not to be mixed because different rules apply in business as
compared to other realms of life

D. Views the observance of high ethical standards (doing more than what is required by law) as
too Sunday-schoolish for the tough competitive world of business, even though observing some
higher ethical considerations may be appropriate in life outside of business

E. Strongly believes that whatever is legal is also ethical

D

34. (p. 324) An unintentionally amoral manager is one who

A. Is ethically-principled most of the time but who is also prone to being unethical when there's
low risk of being discovered and/or it is in their best interests

B. Holds firmly to the view that anything goes, so long as actions and behaviors are not clearly
ruled out by prevailing legal and regulatory requirements

C. Strongly believes in the integrated social contract theory approach to ethics in business

D. Strongly believes in ethical relativism

E. Strongly believes in ethical universalism

B

35. (p. 325) The best available evidence indicates that the average manager in the whole population of
managers is

A. Ethically corrupt

B. Ethically amoral most of the time but may slip into a moral or immoral mode based on a variety
of impinging factors and circumstances

C. Mostly ethical

D. Ethically moral and is fairly steadfast in taking ethically correct positions

E. Ethically immoral and unprincipled, especially when the chances of being discovered are slim;
however, in public, the average manager is prone to give every appearance of being ethically
principled and to profess support for ethically correct behavior

B

36. (p. 324 - 325) By some accounts, the population of managers is said to be

A. Distributed among moral, immoral and amoral managers in a bell-shaped curve, with immoral
managers and moral managers occupying the two tails of the curve and amoral managers,
especially the intentionally amoral managers, occupying the broad middle ground

B. Composed of mostly ethically moral managers but perhaps a third of all managers slip into an
immoral or unethical mode in certain circumstances

C. About 15% highly ethical, 50% mostly ethical and 35% ethically corrupt

D. About 20% highly ethical, 60% mostly ethical and 20% mostly unethical

E. About one-third highly ethical, one-third mostly ethical and one-third mostly unethical

A

37. (p. 325) Based on data from the Global Corruption Report sponsored by Transparency
International,

A. Corruption in emerging country markets is relatively low compared to the rest of the world

B. Business managers are more corrupt on average than government officials

C. Corruption among public officials and in business transactions is widespread across the world

D. Bribery occurs most often in the automotive industry, the drug and pharmaceutical industry and
in the apparel industry

E. The ethically "cleanest" industries are public works contracts and construction, the arms and
defense industry and the oil and gas industry

C

38. (p. 328) The consequences of pursuing a strategy which has unethical or shady components
include

A. Sharp drops in the stock prices of companies found to be engaging in unethical behavior

B. Frequently devastating hits to the company's reputation

C. Incurring potentially large fines for companies found to have engaged in unethical behavior

D. A potential of criminal indictments and jail sentences for company executives

E. All of the above

E

39. (p. 328) One of the biggest reasons for company managers to craft ethical strategies is

A. The importance of not embarrassing company shareholders

B. The scandals, fines, hits to a company's reputation and consequences for executives that come
from C. Being put in the public limelight for unethical behavior

C. The imperative of having a strategy that fully complies with the company's code of ethics

D. The requirement for every company's strategy to pass the moral scrutiny of the company's board
of directors

E. So that they can escape the anguish of feeling guilty should their company be called on the
carpet for engaging in actions/behaviors that some parts of society believe are "out of bounds."

B

40. (p. 328) The major drivers of unethical managerial behavior include

A. Greed, atheism, pervasive managerial immorality and a general lack of scruples on the part of
top executives regarding how customers and suppliers should be treated

B. Ethically corrupt corporate cultures and overzealous or obsessive pursuit of wealth
accumulation, power, status and other selfish interests

C. Widespread managerial belief in the ethical relativism school of thinking

D. An aversion to ethical correctness on the part of top executives and a belief that unethical
behavior is unimportant and probably won't be discovered

E. Intense competitive pressures

B

41. (p. 328) Unethical managerial behavior tends to be driven by such factors as

A. The pervasiveness of immoral and amoral businesspeople

B. Overzealous pursuit of personal gain, wealth and other selfish interests

C. A company culture that puts the profitability and good business performance ahead of ethical
behavior

D. Heavy pressures on company managers to meet or beat earnings targets

E. All of these

E

42. (p. 328) Which one of the following is not one of the major drivers of unethical managerial
behavior?

A. Intense competitive pressures

B. Overzealous pursuit of personal gain, wealth and other selfish interests

C. A company culture that puts the profitability and good business performance ahead of ethical
behavior

D. Heavy pressures on company managers to meet or beat earnings targets

E. The pervasiveness of immoral and amoral businesspeople

A

43. (p. 333) The stance a company takes in dealing with or managing ethical conduct at any given
point in time can take such basic forms as

A. The unconcerned or non-issue approach, the damage control approach, the compliance
approach and the ethical culture approach

B. The amoral approach, the immoral approach and the ethically-principled approach

C. The ethically incorrect approach, the ethically correct approach and the socially responsible
approach

D. The noncompliance approach, the compliance approach, the public interest approach and the
cultural norm approach

E. The empowered employee approach, the cultural values approach and the authoritarian
approach

A

44. (p. 333) Which of the following is not a stance a company can take in dealing with or managing
ethical conduct at any given point in time?

A. The unconcerned or non-issue approach

B. The damage control approach

C. The socially responsible approach

D. The ethical culture approach

E. The compliance approach

C

45. (p. 334 - 336) The unconcerned or non-issue approach to dealing with or managing ethical conduct

A. Is prevalent at companies whose executives ascribe to the view that trying to enforce ethical
standards above and beyond what is legally required is a non-issue because businesses are entitled
to conduct their affairs in whatever manner they wish so long as they comply with the letter of
what is legally required

B. Is perfectly suited for ethically-principled companies where company personnel are highly
accustomed to behaving in an ethical fashion (because at such companies, ethical behavior is
mostly a non-issue)

C. Is favored at companies whose managers fear scandal and are desirous of containing any
adverse fallout from claims of unethical actions by company personnel

D. Is favored at companies whose managers are moral and have ethically upstanding reputations

E. Is appropriate for companies who have a deeply-planted ethical culture

A

46. (p. 336) The damage control approach to dealing with or managing ethical conduct

A. Is prevalent at companies whose executives are moral and want to put on a public face of being
ethically-principled

B. Is perfectly suited for ethically-principled companies where company personnel are highly
accustomed to behaving in an ethical fashion (because at such companies any ethical lapses are
easily subject to damage control)

C. Is favored at companies whose managers are wary of scandal and adverse public relations
fallout that could cost them their jobs or tarnish their careers

D. Is appropriate for companies whose managers are highly concerned about having ethically
upstanding reputations

E. Is well-suited for companies with no history of ethical problems

C

47. (p. 336) Which of the following is not accurate as concerns the damage control approach to
dealing with or managing ethical conduct?

A. The damage control approach is well-suited for companies with no history of ethical problems

B. Pany executives that practice the damage control approach are prone to look the other way
when ady or borderline behavior occurs—adopting a kind of "See no evil, hear no evil, speak no
evil" stance (except when exposure of the company's actions put executives under great pressure to
redress any wrongs that have been done)

C. Damage control approach is favored at companies whose managers are wary of scandal and
adverse public relations fallout that could cost them their jobs or tarnish their careers

D. Panies that practice the damage control approach often have a code of ethics that exists mainly
as nice words on paper, but company personnel do not operate within a strong ethical context—
there's a notable gap between talking ethics and walking ethics

E. Executives at companies that practice the damage control approach are prone to making token
gestures to police compliance with codes of ethics; they also rely heavily on all sort of "spin" to
help extricate the company or themselves from claims that the company's strategy has unethical
components or that company personnel have engaged in unethical practices

A

48. (p. 336 - 337) The compliance approach to dealing with or managing ethical conduct

A. Is perfectly suited for ethically-unprincipled companies where company personnel must be
spurred into complying with the company's ethical standards

B. Is favored at companies whose managers (1) lean toward being somewhat amoral but recognize
the value of having ethically upstanding reputations or (2) are moral and see strong compliance
methods as the best way to impose and enforce ethical rules and high ethical standards

C. Is favored at companies whose managers fear scandal and want to put on a public face of being
ethical; they like having some compliance methods in place so they can give the appearance of
trying to be ethical (although they are deliberately lax in pushing compliance and punishing
unethical conduct)

D. Is favored at companies whose managers are immoral but who see having cosmetic compliance
methods in place as a safeguard against scandal

E. Is perfectly suited for companies that have had a code of ethics for 10 years or more and that
want to spend little top management time exhorting company personnel to be ethical in the actions
and behavior

B

49. (p. 337) The ethical culture approach to dealing with or managing ethical conduct

A. Is favored at companies where top managers are very concerned about gaining employee buy-in
to the company's ethical standards, business principles and corporate values and see the company's
code of ethics and/or its statement of corporate values as integral to the company's identity and
ways of operating

B. Works well in companies desirous of pursuing light ethics compliance

C. Is favored at companies whose managers want to maintain the appearance of an ethical culture
to help shield the company from scandal, adverse publicity and possible unethical conduct on the
part of company personnel

D. Is favored at companies whose managers are amoral yet highly concerned about maintaining the
appearance of being ethically upstanding

E. Is perfectly suited for companies that have had a code of ethics for 10 years or more and that
want to spend little top management time exhorting company personnel to be ethical in the actions
and behavior

A

50. (p. 337) Which one of the following is not a key trait of the ethical culture approach to dealing
with or managing ethical conduct?

A. The ethical culture approach is favored at companies where top managers are very concerned
about gaining employee buy-in to the company's ethical standards, business principles and
corporate values and see the company's code of ethics and/or its statement of corporate values as
integral to the company's identity and ways of operating

B. The ethical culture approach makes little use of either a code of ethics or ethics compliance
procedures

C. There are strong peer pressures from coworkers to observe ethical norms

D. Compliance procedures need to be an integral part of the ethical culture approach to help send
the message that management takes the observance of ethical norms seriously and that behavior
that fall outside ethical boundaries will have negative consequences

E. The integrity of the ethical culture approach depends heavily on the ethical integrity of the
executives who create and nurture the culture

B

51. (p. 334 - 337) Which of the following statements is false as concerns the various approaches
company managers can take in dealing with or managing ethical conduct?

A. Companies that adopt a compliance mode usually do such things as making the company's code
of ethics a visible and regular part of communications with employees, having ethics training
programs, appointing a chief ethics officer or ethics ombudsperson, giving guidance to employees
on ethics matters, instituting formal procedures for investigating alleged ethics violations,
conducting ethics audits to measure and document compliance and giving ethics awards to
employees for outstanding efforts to create an ethical climate and improve ethical performance

B. Companies using the damage control approach usually make some concession to window-
dressing ethics, going so far as to adopt a code of ethics (so their executives can point to it as
evidence of their ethical commitment should any ethical lapses on the company's part be exposed)

C. One of the weaknesses of the compliance approach is that moral control resides in the
company's code of ethics and in the ethics compliance system rather than in an individual's own
moral responsibility for ethical behavior and in strong peer pressures for ethical behavior

D. The main objective of the compliance approach is to protect against adverse publicity and any
damaging consequences brought on by headlines in the media, outside investigation, threats of
litigation, punitive government action or angry or vocal shareholders

E. Companies using the unconcerned or non-issue approach ascribe to the view that ethics has no
place in the conduct of business and that companies should not be morally accountable for their
actions

D

52. (p. 336) One of the big difficulties and challenges that a company encounters in using the
"damage control" approach to dealing with or managing ethics-related issues and ethics conduct is

A. Writing a code of ethics that looks strong but is really pretty weak in terms of ethical principles

B. Credibility problems with stakeholders and susceptibility to ethical scandal

C. A proliferation of ethical rules and guidelines to avoid public scandal

D. That the locus of moral control is shifted to individual employees

E. How to discreetly signal employees that the company's code of ethics will be lightly enforced if
at all

B

53. (p. 336 - 337) One of the big difficulties and challenges that a company encounters in using the
"compliance" approach to dealing with or managing ethics-related issues and ethics conduct is

A. Writing compliance procedures that look strong but really are pretty weak in terms of pushing
people to observe the espoused ethical standards

B. Inability to deter inherently immoral company personnel from breaking the rules

C. A proliferation of ethical rules and guidelines and an environment where employees come to
rely on the existing rules for moral guidance—a condition that fosters a mentality of what is not
forbidden is allowed

D. That the locus of moral control is shifted to individual employees and away from top
management

E. Being clever in signaling employees that the company's code of ethics is mere window-dressing
and that employees should not expect that top executives will "walk the talk" and actually practice
what they preach

C

54. (p. 337) One of the big difficulties or challenges that a company encounters in using the "ethical
culture" approach to dealing with or managing ethics-related issues and ethics conduct is

A. Relying too heavily on peer pressures and cultural norms to enforce the espoused ethical
standards and underutilizing compliance enforcement procedures

B. The lack of strong compliance procedures to deter morally corrupt company personnel from
deliberately flaunting cultural norms and engaging in unethical behavior

C. Overemphasizing the creation of a work climate where everyone is an ethics watchdog and
whistle-blowing is required

D. That the locus of moral control is the company's code of ethics

E. Greater susceptibility to ethical scandal

A

55. (p. 338) A company that is concerned about the recent raft of corporate scandals and aggressive
enforcement of anticorruption legislation (such as the Sarbanes-Oxley Act of 2002) might well be
inclined to shift it's a approach to dealing with or managing ethics-related issues and ethics
conduct

A. From an "ethical culture" approach to a "damage control" approach

B. From an "unconcerned/nonissue" approach to a "damage control" approach

C. From an "compliance" approach to a "damage control" approach

D. From a "damage control" or an "unconcerned/nonissue" approach to a "compliance" approach

E. From an "damage control" approach to a "ethical culture" approach

D

56. (p. 338) A company's strategy needs to be ethical because

A. Of the dangers that top management will get embarrassed if the company's unethical behavior is
publicly exposed

B. A strategy that is unethical in whole or in part is morally wrong and reflects badly on the
character of the company personnel involved

C. Everyone is an ethics watchdog and somebody is sure to blow the whistle on the company's
unethical behavior

D. Of the risks of getting caught and prosecuted by governmental authorities if an unethical
strategy is used

E. Unethical strategies are inconsistent with or else weaken the corporate culture

B

57. (p. 338) Which of the following represents a justifiable reason for why a company's strategy
should be ethical?

A. .An unethical strategy reflects badly on the character of the company personnel involved

B. A strategy that is unethical in whole or in part is morally wrong

C. Pursuing an unethical strategy damages a company's reputation and can have costly
consequences

D. An ethical strategy is good business and is in the best interest of shareholders

E. All of these

E

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1. (p. 317) Business ethics concerns
A. Developing a consensus among companies worldwide as to what ethical principles that
businesses should be expected to observe in the course of conducting their operations

B. What ethical behaviors should be expected of company personnel in the course of doing their
jobs

C. The application of general ethical principles and standards to the actions and decisions of
companies and the behavior of company personnel

D. Developing a special set of ethical standards for businesses to observe in conducting their
affairs

E. Picking and choosing among the consensus ethical standards of society to arrive at a set of
ethical standards that apply directly to operating a business

C

2. (p. 317) Ethical principles in business

A. Deal chiefly with the actions and behaviors required to operate companies in a socially

responsible manner

B. Deal chiefly with the rules each company’s top management and board of directors make about

"what is right" and "what is wrong."

C. Are not materially different from ethical principles in general

D. Are generally less stringent than the ethical principles for society at large

E. Are generally more stringent than the ethical principles for society at large

C

3. (p. 317) Ethical principles as they apply to business conduct and business decisions

A. Deal chiefly with standards a company has (and that are elaborated in its code of ethics) about
what is right and wrong insofar as the conduct of its business is concerned and about what
behaviors are expected of company personnel

B. Deal chiefly with the behaviors that a company’s board of directors expects of all company
personnel in both their conduct on-the-job and their conduct off-the-job

C. Involve the rules a company’s top management and board of directors make about "what is
right" and "what is wrong."

D. Are not materially different from ethical principles in general

E. Are generally less stringent than the ethical principles for society at large because it is well
understood that businesses should not be expected to operate any differently than what the law
requires of them

D

4. (p. 318) Notions of right and wrong, fair and unfair, moral and immoral, ethical and unethical

A. Vary enormously from religion to religion and country to country across the world

B. Are present in all societies, organizations and individuals; some of the most important concepts
of what is right and what is wrong (being truthful, integrity of character, not cheating or stealing,
treating people with dignity and respect) resonate with people of most cultures and religions and
are thus universal

C. Ultimately depend on the circumstances—nothing is really black or white when it comes to
ethical standards

D. Are governed mainly by the thinking and writings of religious clerics at the School of Morally
Correct Thinking and Behavior in Geneva, Switzerland

E. Ultimately depend on a person’s own values and beliefs

B

5. (p. 318) The contentions that (1) many of the same standards of what’s ethical and what’s unethical
resonate with peoples of most societies regardless of local traditions and cultural norms and (2) to
the extent there is common moral agreement about right and wrong actions, common ethical
standards can be used to judge the conduct of personnel at companies operating in a variety of
country markets and cultural circumstances are defining beliefs of

A. The school of ethical relativism

B. The school of ethical universalism

C. Integrated social contracts theory

D. The School of Morally Correct Thinking and Behavior in Paris, France

E. The Global Code of Ethical and Social Morality developed in 1925 at a worldwide convention
of distinguished religious clerics

B

6. (p. 319) The contention that since different societies and cultures have divergent values and
standards of right and wrong it is appropriate to judge behavior as ethical/unethical in the light of
local customs and social mores rather than according to a single set of ethical standards

A. Defines what is meant by "ethical relativism."

B. Defines what is meant by "ethical universalism."

C. Is the foundation of integrated social contracts theory

D. Is the basis for the theory of ethical variation

E. Is the guiding principle of the Global Code of Ethical and Social Morality created by the United
Nations

A

7. (p. 322) The contention that ethical standards should be governed both by (1) a limited number of
universal ethical principles that are widely recognized as putting legitimate ethical boundaries on
actions and behavior in all situations and (2) the circumstances of local cultures, traditions and
shared values that further prescribe what constitutes ethically permissible behavior and what does
not are the basic principles of

A. The school of ethical relativism

B. The school of ethical universalism

C. Integrated social contracts theory

D. The School of Morally Correct Thinking and Behavior based in Rome, Italy

E. The Global Code of Ethical and Social Morality developed by the United Nations

C

8. (p. 318) The school of ethical universalism holds that

A. Concepts of right and wrong are absolute and leave no room for deviation from country to
country or circumstance to circumstance

B. Concepts of right and wrong are universal within countries but not across countries and cultures

C. Concepts of right and wrong are governed by the Global Code of Ethical and Social Morality

D. Some concepts of what is right and what is wrong resonate with peoples of most societies
regardless of local traditions and cultural norms—hence common ethical standards can be used to
judge the conduct of personnel at companies operating in a variety of country markets and cultural
circumstances

E. All societies and countries apply essentially the very same set of universally-defined ethical
principles of right and wrong in judging individual behavior

D

9. (p. 318) According to the school of ethical universalism,

A. Concepts of what constitutes ethical behavior and unethical behavior are dictated by
subjectively-provable moral principles but not by objectively-provable moral principles

B. Concepts of right and wrong are universal within countries/societies but not across countries or
cultures

C. Concepts of what is ethical and what is unethical are universal and absolute, leaving no room
for deviation from country to country or circumstance to circumstance

D. To the extent there is common moral agreement about right and wrong actions and behaviors
across multiple cultures and countries, there exists a set of universal ethical standards to which all
societies, all companies and all individuals can be held accountable

E. All societies and countries are obligated to apply universally-defined ethical principles of right
and wrong as set forth in the Global Code of Ethical Behavior adopted by 150 nations of the world

D

10. (p. 318) According to the school of ethical universalism,

A. Universal ethical principles or norms put limits on what actions and behaviors fall inside the
boundaries of what is right and which ones fall outside—such universal norms include honesty or
trustworthiness, respecting the rights of others, practicing the Golden Rule, avoiding unnecessary
harm to workers or to the users of the company’s product or service and respect for the
environment

B. All societies and countries are obligated to apply universally-defined ethical principles of right

and wrong as set forth in the Global Code of Ethical and Social Morality (which is subscribed to
by 150 nations of the world)

C. All societies and countries apply essentially the very same set of universally-defined ethical
principles of right and wrong in judging the ethical correctness of business behavior

D. It is only fair that the standards of what’s ethical and what’s unethical be applied universally to
all businesses in all countries irrespective of local business traditions and local business norms

E. The standards of what constitutes ethical and unethical behavior in business situations are partly
universal, but in the main are governed by local business norms

A

11. (p. 318) If one concurs with the school of ethical universalism, then one believes that

A. Many basic moral standards travel well across cultures and countries and really do not vary
significantly according to local cultural beliefs, social mores, religious convictions and/or the
circumstances of the situation

B. Since ethical standards are subjectively-determined rather than objectively-determined, each

company has a window within which it can define and implement its own ethical principles of
right and wrong

C. What is deemed right or wrong, fair or unfair, moral or immoral, ethical or unethical in business
situations should be judged in light of local customs and social mores and can legitimately vary
from one culture or nation to another

D. Each country should have some degree of latitude in setting its own ethical standards for
judging the ethical correctness of business actions/behaviors within its borders

E. Concepts of right and wrong as they apply to business behavior are always varying shades of
gray, never absolute (i.e. black or white)

A

12. (p. 318) The strength of the beliefs underlying ethical universalism is that

A. Ethical universalism recognizes the obvious—basic moral standards vary significantly

according to local cultural beliefs, local religious beliefs and social mores

B. Ethical standards are objectively-determined by religious and moral experts

C. What is deemed right or wrong, fair or unfair, moral or immoral, ethical or unethical is (or
should be) grounded in religious doctrine and applied strictly to all business situations

D. It draws upon the collective views of multiple societies and cultures to put some clear
boundaries on what constitutes ethical business behavior and what constitutes unethical business
behavior no matter what country market or culture a company or its personnel are operating in

E. It leaves no room for thinking that concepts of right and wrong can be varying shades of gray—
they are always absolute and unambiguous

D

13. (p. 319) The school of ethical relativism holds that

A. What constitutes ethical or unethical conduct varies according to the religious convictions of
each society or each culture within a country

B. When there are cross-country or cross-cultural differences in what is deemed fair or unfair, what
constitutes proper regard for human rights and what is considered ethical or unethical in business
situations, it is appropriate for local moral standards to take precedence over what the ethical
standards may be elsewhere

C. Concepts of right and wrong are always governed by business norms in each country, culture or
society

D. Concepts of right and wrong are always a function of each individual’s own set of values,
beliefs and ethical convictions

E. Concepts of right and wrong as they apply to business behavior are always varying shades of
gray, never absolute (i.e. black or white)

B

14. (p. 319) According to the school of ethical relativism,

A. Concepts of ethically right and ethically wrong are relative across countries and cultures but are
universal within countries or cultures

B. Individuals and businesses have a basic right to "moral free space" and that it is inappropriate to
specify ethically permissible and ethically impermissible actions and behaviors

C. There are important occasions when local cultural norms and the circumstances of the situation
determine whether certain behaviors are right or wrong

D. Concepts of right and wrong as applied to business situations are always a function of each
company’s own set of values, beliefs and ethical convictions (as stated in the company’s code of
ethical conduct)

E. Standards of what is ethically right and ethically wrong as applied to business behavior are
determined solely by whatever business norms prevail in a particular country/culture/society and
these business norms are certain to vary across countries/cultures/societies

C

15. (p. 319) According to the advocates of ethical relativism,

A. If the use of underage labor and/or the payment of bribes/kickbacks are acceptable in a
particular culture/society/country, then a case can be made that it is morally correct and ethical for
a company to use underage labor or pay bribes/kickbacks in conducting its business activities in
that culture/society/country

B. Each company should have the flexibility to set its own standards for deciding whether the use
of underage labor and/or the payment of bribes/kickbacks are ethically acceptable or not

C. If the use of underage labor and/or the payment of bribes/kickbacks are legal in a particular
country, then it is morally correct and ethical for a company to use underage labor in conducting
its business activities in that country, no matter what the legality of using underage labor or paying
bribes/kickbacks happens to be in other countries

D. Each industry should have the flexibility to set its own standards for deciding whether the use
of underage labor and/or the payment of bribes/kickbacks are ethically acceptable or not

E. It is very clear that the use of underage labor or the payment of bribes and kickbacks are
ethically impermissible—local customs, behavioral norms and traditions absolutely cannot be
taken into account

A

16. (p. 319) A belief in ethical relativism leads to the conclusion that

A. Since ethical standards are subjective, it is perfectly appropriate for each company to define and
implement its own ethical principles of right and wrong as concerns the use of underage labor and
the payment of bribes and kickbacks

B. Ethical standards are determined objectively (rather than subjectively)

C. Whether the use of underage labor and the payment of bribes/kickbacks should be deemed
ethical or unethical depends on the moral standards, values, beliefs, convictions and business
norms that prevail in particular cultures, societies, countries or circumstances

D. Ethical standards are objective and universal—thus whether the use of underage labor and the
payment of bribes and kickbacks should be deemed ethical or unethical definitely is not dependent
on the moral standards, values, beliefs, convictions and business norms that prevail in particular
cultures, societies, countries or circumstances

E. Standards of right and wrong are governed by what is legal in a given country—thus whether
the use of underage labor and the payment of bribes and kickbacks is ethical or unethical is
governed by local law

C

17. (p. 319 – 321) If one accepts the tenets of the school of ethical relativism, then it follows that

A. There are multiple sets of ethical standards rather than a single universal set

B. At least some ethical standards are governed by local norms, religious doctrines and social
customs rather than by absolute standards of right and wrong

C. What constitutes ethical or unethical behavior on the part of businesses must in some cases be
judged in the light of local customs and social mores

D. It is inappropriate to hold businesses accountable for observing a universal set of ethical
standards

E. All of the above

E

18. (p. 321) Companies that adopt the principle of ethical relativism in providing ethical guidance to
company personnel

A. Base their standards of what is ethical and what is unethical on the Global Code of Ethical
Conduct first developed in 1935 and since subscribed to by the governments of 180 countries

B. Quickly find themselves on a slippery slope with no higher order moral compass if they operate

in countries where ethical standards vary considerably from country to country

C. Have no fair way to judge the ethical correctness of the conduct of company personnel

D. Have a one-size-fits-all set of ethical standards

E. End up allowing each company employee to determine what set of ethical standards to observe

B

19. (p. 319) According to the ethical relativism school of thinking,

A. There can be no one-size-fits-all set of authentic ethical norms against which to gauge the
conduct of company personnel

B. A company should have a different set of ethical standards for each country in which it operates

C. Only respected religious experts can provide companies with a higher order moral compass

D. The best source of ethical standards in each country where the company operates is that
country’s adopted Code of Required Ethical Conduct

E. Since there can be no one-size-fits-all set of authentic ethical norms it is appropriate for each
company to hold company personnel to observing the company’s code of ethical conduct

A

20. (p. 319) Paying bribes and kickbacks to grease business transactions

A. Violates ethical principles of right and wrong in all countries

B. Is ethically acceptable according to the principle of ethical universalism and ethically
unacceptable according to the principle of ethical relativism

C. Is acceptable to immoral managers but not to amoral managers

D. Is one of the thorniest ethical problems that multinational companies face because paying bribes
is normal and customary in some countries and ethically or legally forbidden in others

E. Is more acceptable in dealing with a company’s suppliers than in dealing with a company’s
customers

D

21. (p. 319 – 320) Multinational companies that forbid the payment of bribes and kickbacks in their
codes of ethical conduct and that are serious about enforcing this prohibition

A. Are generally advocates of the ethical relativism school of thought

B. Are misguided in their efforts because bribes and kickbacks are really no different from tipping
for service at restaurants—whether you tip for service at dinner or make payments to government
officials to get goods through customs or give kickbacks to customers to retain their business, you
pay for a service rendered

C. Still have considerable difficulty in preventing the payments of bribes and kickbacks when such
payments are entrenched as normal and customary in locations where they do business

D. Are out-of-step with business reality given that the preponderance of company managers are
immoral

E. Are in a distinct minority compared to companies that view the payment of bribes and
kickbacks as a legitimate or permissible practice

C

22. (p. 319 – 322) Which one of the following statements about the ethical relativism school of thinking
is false?

A. In a multinational company, application of ethical relativism equates to multiple sets of ethical
standards

B. There are few absolutes when it comes to business ethics and thus few ethical absolutes for
consistently judging a company’s conduct in various countries and markets

C. The best and fairest way for a multinational company to approach the enforcement of ethical
standards companywide is to reject ethical universalism and pursue ethical relativism

D. A company that adopts the principle of ethical relativism and holds company personnel to local
ethical standards necessarily assumes that what prevails as local morality is an adequate guide to
ethical behavior—this assumption is ethically dangerous

E. According to the ethical relativism school of thinking, a "one-size-fits-all" template for judging
the ethical appropriateness of business actions and the behaviors of company personnel does not
exist

C

23. (p. 322) According to integrated social contracts theory, the ethical standards a company should
try to uphold

A. Are governed by the school of ethical universalism

B. Are governed both by (1) a limited number of universal ethical principles that are widely
recognized as putting legitimate ethical boundaries on actions and behavior in all situations and (2)
the circumstances of local cultures, traditions and shared values that further prescribe what
constitutes ethically permissible behavior and what does not—but universal norms always take
precedence over local ethical norms

C. Are governed by each country’s Code of Required Ethical Conduct—which sets forth that each
individual/group/business/organization has a "social contract" to observe the ethical and moral
standards that the country has adopted

D. Should be determined by the company’s moral managers

E. Should never be absolute but rather always provide some wiggle room according to the
circumstances of the situation

B

24. (p. 322 – 323) According to integrated social contracts theory,

A. Universal ethical principles apply in those situations where most all societies—endowed with
rationality and moral knowledge—have common moral agreement on what is wrong and thereby
put limits on what actions and behaviors fall inside the boundaries of what is right and which ones
fall outside

B. Commonly held views about what is morally right and wrong form a "social contract" (or
"contract with society") that is binding on all individuals, groups, organizations and businesses in
terms of establishing right and wrong and in drawing the line between ethical and unethical
behaviors

C. Universal ethical principles or norms leave some "moral free space" for the people in a
particular country (or local culture or even a company) to make specific interpretations of what
other actions may or may not be permissible within the bounds defined by universal ethical
principles
D. Universal ethical norms always take precedence over local ethical norms

E. All of the above

E

25. (p. 322 – 323) Which one of the following is not a key element of integrated social contracts
theory?

A. Universal ethical principles apply in those situations where most all societies—endowed with
rationality and moral knowledge—have common moral agreement on what is wrong and thereby
put limits on what actions and behaviors fall inside the boundaries of what is right and which ones
fall outside

B. Commonly held views about what is morally right and wrong form a "social contract" (contract
with society) that is binding on all individuals, groups, organizations and businesses in terms of
establishing right and wrong and in drawing the line between ethical and unethical behaviors

C. Universal ethical principles or norms leave some "moral free space" for the people in a
particular country (or local culture or even a company) to make specific interpretations of what
other actions may or may not be permissible within the bounds defined by universal ethical
principles

D. Universal ethical norms always take precedence over local ethical norms

E. Integrated social contracts theory rejects the slippery slope of ethical relativism and embraces
ethical universalism

E

26. (p. 322) Integrated social contracts theory maintains that

A. There is no such thing as "moral free space"—all ethical standards are determined by societal
norms and individuals have an implied social contract to live up to these standards

B. Few nations or cultures have common moral agreement on what is ethically right and wrong

C. There should be no absolute limits put on what actions and behaviors fall inside the boundaries
of what is ethically or morally right and which actions/behaviors fall outside

D. Universal ethical norms always take precedence over local ethical norms

E. Each country/culture/society has commonly held views about what constitutes ethically
appropriate actions/behaviors; these common standards of what is ethical and what is not combine
to form a "social contract" that all individuals in that country/culture/society are obligated to
observe

D

27. (p. 322) The strength of integrated social contracts theory is that it

A. Correctly recognizes all soundly-reasoned ethical standards are universal

B. Accommodates the best parts of ethical universalism and ethical relativism

C. Puts no absolute limits on what actions and behaviors fall inside the boundaries of what is
ethically or morally right and which actions/behaviors fall outside

D. Recognizes the importance of allowing local ethical norms to always take precedence over
universal ethical norms

E. Recognizes that individuals and businesses have a basic right to "moral free space" and that it is
inappropriate to specify ethically permissible and ethically impermissible actions and behaviors

B

28. (p. 323 – 324) The three categories of managers that stand out with regard to the beliefs and

commitments they have to ethical and moral principles in business affairs are:

A. Ethical managers, socially responsible managers and crooked managers

B. Mostly ethical managers, somewhat unethical managers and ethically corrupt managers

C. Ethically-principled managers, ethically-unprincipled managers and ethically-neutral managers

D. Moral managers, amoral managers and immoral managers

E. Ethically responsible managers, ethically irresponsible managers and ethically unconcerned
managers

D

29. (p. 323 – 324) The categories of managerial morality include:

A. Honorable managers, dishonorable managers and totally corrupt managers

B. Mostly ethical managers, somewhat ethical managers and totally unethical managers

C. Ethically-principled managers, ethically-unprincipled managers and if-it-is-legal-then-it-is-
ethical managers ( the latter type of manager believes that ethics don’t really apply to business—
their view is that anything that is legal is also ethical)

D. Managers with lots of integrity, managers with some integrity and managers with no integrity

E. Moral managers, immoral managers and amoral managers

E

30. (p. 323) Moral managers

A. Are ethically principled

B. See themselves as stewards of ethical behavior and believe it is important to exercise ethical
leadership

C. Pursue success within the letter and spirit of what is considered ethical and legal

D. View what is legal as the ethical minimum and have a habit of operating at well above what the
law requires

E. All of the above

E

32. (p. 324) An immoral manager is one who

A. Is ethically-principled most of the time but who might stoop to unethical behavior if there’s low
risk of discovery and the action or decision has a sizable positive effect on company profitability

B. Has no regard for so-called ethical standards in business and pays no attention to ethical
principles in making decisions and conducting the company’s business—an immoral manager is
driven by greed and self-gain and won’t hesitate to violate ethical principles if it is in his/her best
interest to do so

C. Is ethically unprincipled but nonetheless usually observes ethical standards for fear of get
caught and fired

D. Believes that ethical standards violate the principle of moral free space and therefore are
illegitimate

E. Strongly believes that it is ethical to do whatever is legal

B

33. (p. 324) An intentionally amoral manager is one who

A. Is ethically-principled most of the time but who knowingly and willingly stoops to unethical
behavior if there’s low risk of discovery and the action or decision has a sizable positive effect on
company profitability

B. Deliberately and maliciously violates ethical principles on a regular basis

C. Believes business and ethics are not to be mixed because different rules apply in business as
compared to other realms of life

D. Views the observance of high ethical standards (doing more than what is required by law) as
too Sunday-schoolish for the tough competitive world of business, even though observing some
higher ethical considerations may be appropriate in life outside of business

E. Strongly believes that whatever is legal is also ethical

D

34. (p. 324) An unintentionally amoral manager is one who

A. Is ethically-principled most of the time but who is also prone to being unethical when there’s
low risk of being discovered and/or it is in their best interests

B. Holds firmly to the view that anything goes, so long as actions and behaviors are not clearly
ruled out by prevailing legal and regulatory requirements

C. Strongly believes in the integrated social contract theory approach to ethics in business

D. Strongly believes in ethical relativism

E. Strongly believes in ethical universalism

B

35. (p. 325) The best available evidence indicates that the average manager in the whole population of
managers is

A. Ethically corrupt

B. Ethically amoral most of the time but may slip into a moral or immoral mode based on a variety
of impinging factors and circumstances

C. Mostly ethical

D. Ethically moral and is fairly steadfast in taking ethically correct positions

E. Ethically immoral and unprincipled, especially when the chances of being discovered are slim;
however, in public, the average manager is prone to give every appearance of being ethically
principled and to profess support for ethically correct behavior

B

36. (p. 324 – 325) By some accounts, the population of managers is said to be

A. Distributed among moral, immoral and amoral managers in a bell-shaped curve, with immoral
managers and moral managers occupying the two tails of the curve and amoral managers,
especially the intentionally amoral managers, occupying the broad middle ground

B. Composed of mostly ethically moral managers but perhaps a third of all managers slip into an
immoral or unethical mode in certain circumstances

C. About 15% highly ethical, 50% mostly ethical and 35% ethically corrupt

D. About 20% highly ethical, 60% mostly ethical and 20% mostly unethical

E. About one-third highly ethical, one-third mostly ethical and one-third mostly unethical

A

37. (p. 325) Based on data from the Global Corruption Report sponsored by Transparency
International,

A. Corruption in emerging country markets is relatively low compared to the rest of the world

B. Business managers are more corrupt on average than government officials

C. Corruption among public officials and in business transactions is widespread across the world

D. Bribery occurs most often in the automotive industry, the drug and pharmaceutical industry and
in the apparel industry

E. The ethically "cleanest" industries are public works contracts and construction, the arms and
defense industry and the oil and gas industry

C

38. (p. 328) The consequences of pursuing a strategy which has unethical or shady components
include

A. Sharp drops in the stock prices of companies found to be engaging in unethical behavior

B. Frequently devastating hits to the company’s reputation

C. Incurring potentially large fines for companies found to have engaged in unethical behavior

D. A potential of criminal indictments and jail sentences for company executives

E. All of the above

E

39. (p. 328) One of the biggest reasons for company managers to craft ethical strategies is

A. The importance of not embarrassing company shareholders

B. The scandals, fines, hits to a company’s reputation and consequences for executives that come
from C. Being put in the public limelight for unethical behavior

C. The imperative of having a strategy that fully complies with the company’s code of ethics

D. The requirement for every company’s strategy to pass the moral scrutiny of the company’s board
of directors

E. So that they can escape the anguish of feeling guilty should their company be called on the
carpet for engaging in actions/behaviors that some parts of society believe are "out of bounds."

B

40. (p. 328) The major drivers of unethical managerial behavior include

A. Greed, atheism, pervasive managerial immorality and a general lack of scruples on the part of
top executives regarding how customers and suppliers should be treated

B. Ethically corrupt corporate cultures and overzealous or obsessive pursuit of wealth
accumulation, power, status and other selfish interests

C. Widespread managerial belief in the ethical relativism school of thinking

D. An aversion to ethical correctness on the part of top executives and a belief that unethical
behavior is unimportant and probably won’t be discovered

E. Intense competitive pressures

B

41. (p. 328) Unethical managerial behavior tends to be driven by such factors as

A. The pervasiveness of immoral and amoral businesspeople

B. Overzealous pursuit of personal gain, wealth and other selfish interests

C. A company culture that puts the profitability and good business performance ahead of ethical
behavior

D. Heavy pressures on company managers to meet or beat earnings targets

E. All of these

E

42. (p. 328) Which one of the following is not one of the major drivers of unethical managerial
behavior?

A. Intense competitive pressures

B. Overzealous pursuit of personal gain, wealth and other selfish interests

C. A company culture that puts the profitability and good business performance ahead of ethical
behavior

D. Heavy pressures on company managers to meet or beat earnings targets

E. The pervasiveness of immoral and amoral businesspeople

A

43. (p. 333) The stance a company takes in dealing with or managing ethical conduct at any given
point in time can take such basic forms as

A. The unconcerned or non-issue approach, the damage control approach, the compliance
approach and the ethical culture approach

B. The amoral approach, the immoral approach and the ethically-principled approach

C. The ethically incorrect approach, the ethically correct approach and the socially responsible
approach

D. The noncompliance approach, the compliance approach, the public interest approach and the
cultural norm approach

E. The empowered employee approach, the cultural values approach and the authoritarian
approach

A

44. (p. 333) Which of the following is not a stance a company can take in dealing with or managing
ethical conduct at any given point in time?

A. The unconcerned or non-issue approach

B. The damage control approach

C. The socially responsible approach

D. The ethical culture approach

E. The compliance approach

C

45. (p. 334 – 336) The unconcerned or non-issue approach to dealing with or managing ethical conduct

A. Is prevalent at companies whose executives ascribe to the view that trying to enforce ethical
standards above and beyond what is legally required is a non-issue because businesses are entitled
to conduct their affairs in whatever manner they wish so long as they comply with the letter of
what is legally required

B. Is perfectly suited for ethically-principled companies where company personnel are highly
accustomed to behaving in an ethical fashion (because at such companies, ethical behavior is
mostly a non-issue)

C. Is favored at companies whose managers fear scandal and are desirous of containing any
adverse fallout from claims of unethical actions by company personnel

D. Is favored at companies whose managers are moral and have ethically upstanding reputations

E. Is appropriate for companies who have a deeply-planted ethical culture

A

46. (p. 336) The damage control approach to dealing with or managing ethical conduct

A. Is prevalent at companies whose executives are moral and want to put on a public face of being
ethically-principled

B. Is perfectly suited for ethically-principled companies where company personnel are highly
accustomed to behaving in an ethical fashion (because at such companies any ethical lapses are
easily subject to damage control)

C. Is favored at companies whose managers are wary of scandal and adverse public relations
fallout that could cost them their jobs or tarnish their careers

D. Is appropriate for companies whose managers are highly concerned about having ethically
upstanding reputations

E. Is well-suited for companies with no history of ethical problems

C

47. (p. 336) Which of the following is not accurate as concerns the damage control approach to
dealing with or managing ethical conduct?

A. The damage control approach is well-suited for companies with no history of ethical problems

B. Pany executives that practice the damage control approach are prone to look the other way
when ady or borderline behavior occurs—adopting a kind of "See no evil, hear no evil, speak no
evil" stance (except when exposure of the company’s actions put executives under great pressure to
redress any wrongs that have been done)

C. Damage control approach is favored at companies whose managers are wary of scandal and
adverse public relations fallout that could cost them their jobs or tarnish their careers

D. Panies that practice the damage control approach often have a code of ethics that exists mainly
as nice words on paper, but company personnel do not operate within a strong ethical context—
there’s a notable gap between talking ethics and walking ethics

E. Executives at companies that practice the damage control approach are prone to making token
gestures to police compliance with codes of ethics; they also rely heavily on all sort of "spin" to
help extricate the company or themselves from claims that the company’s strategy has unethical
components or that company personnel have engaged in unethical practices

A

48. (p. 336 – 337) The compliance approach to dealing with or managing ethical conduct

A. Is perfectly suited for ethically-unprincipled companies where company personnel must be
spurred into complying with the company’s ethical standards

B. Is favored at companies whose managers (1) lean toward being somewhat amoral but recognize
the value of having ethically upstanding reputations or (2) are moral and see strong compliance
methods as the best way to impose and enforce ethical rules and high ethical standards

C. Is favored at companies whose managers fear scandal and want to put on a public face of being
ethical; they like having some compliance methods in place so they can give the appearance of
trying to be ethical (although they are deliberately lax in pushing compliance and punishing
unethical conduct)

D. Is favored at companies whose managers are immoral but who see having cosmetic compliance
methods in place as a safeguard against scandal

E. Is perfectly suited for companies that have had a code of ethics for 10 years or more and that
want to spend little top management time exhorting company personnel to be ethical in the actions
and behavior

B

49. (p. 337) The ethical culture approach to dealing with or managing ethical conduct

A. Is favored at companies where top managers are very concerned about gaining employee buy-in
to the company’s ethical standards, business principles and corporate values and see the company’s
code of ethics and/or its statement of corporate values as integral to the company’s identity and
ways of operating

B. Works well in companies desirous of pursuing light ethics compliance

C. Is favored at companies whose managers want to maintain the appearance of an ethical culture
to help shield the company from scandal, adverse publicity and possible unethical conduct on the
part of company personnel

D. Is favored at companies whose managers are amoral yet highly concerned about maintaining the
appearance of being ethically upstanding

E. Is perfectly suited for companies that have had a code of ethics for 10 years or more and that
want to spend little top management time exhorting company personnel to be ethical in the actions
and behavior

A

50. (p. 337) Which one of the following is not a key trait of the ethical culture approach to dealing
with or managing ethical conduct?

A. The ethical culture approach is favored at companies where top managers are very concerned
about gaining employee buy-in to the company’s ethical standards, business principles and
corporate values and see the company’s code of ethics and/or its statement of corporate values as
integral to the company’s identity and ways of operating

B. The ethical culture approach makes little use of either a code of ethics or ethics compliance
procedures

C. There are strong peer pressures from coworkers to observe ethical norms

D. Compliance procedures need to be an integral part of the ethical culture approach to help send
the message that management takes the observance of ethical norms seriously and that behavior
that fall outside ethical boundaries will have negative consequences

E. The integrity of the ethical culture approach depends heavily on the ethical integrity of the
executives who create and nurture the culture

B

51. (p. 334 – 337) Which of the following statements is false as concerns the various approaches
company managers can take in dealing with or managing ethical conduct?

A. Companies that adopt a compliance mode usually do such things as making the company’s code
of ethics a visible and regular part of communications with employees, having ethics training
programs, appointing a chief ethics officer or ethics ombudsperson, giving guidance to employees
on ethics matters, instituting formal procedures for investigating alleged ethics violations,
conducting ethics audits to measure and document compliance and giving ethics awards to
employees for outstanding efforts to create an ethical climate and improve ethical performance

B. Companies using the damage control approach usually make some concession to window-
dressing ethics, going so far as to adopt a code of ethics (so their executives can point to it as
evidence of their ethical commitment should any ethical lapses on the company’s part be exposed)

C. One of the weaknesses of the compliance approach is that moral control resides in the
company’s code of ethics and in the ethics compliance system rather than in an individual’s own
moral responsibility for ethical behavior and in strong peer pressures for ethical behavior

D. The main objective of the compliance approach is to protect against adverse publicity and any
damaging consequences brought on by headlines in the media, outside investigation, threats of
litigation, punitive government action or angry or vocal shareholders

E. Companies using the unconcerned or non-issue approach ascribe to the view that ethics has no
place in the conduct of business and that companies should not be morally accountable for their
actions

D

52. (p. 336) One of the big difficulties and challenges that a company encounters in using the
"damage control" approach to dealing with or managing ethics-related issues and ethics conduct is

A. Writing a code of ethics that looks strong but is really pretty weak in terms of ethical principles

B. Credibility problems with stakeholders and susceptibility to ethical scandal

C. A proliferation of ethical rules and guidelines to avoid public scandal

D. That the locus of moral control is shifted to individual employees

E. How to discreetly signal employees that the company’s code of ethics will be lightly enforced if
at all

B

53. (p. 336 – 337) One of the big difficulties and challenges that a company encounters in using the
"compliance" approach to dealing with or managing ethics-related issues and ethics conduct is

A. Writing compliance procedures that look strong but really are pretty weak in terms of pushing
people to observe the espoused ethical standards

B. Inability to deter inherently immoral company personnel from breaking the rules

C. A proliferation of ethical rules and guidelines and an environment where employees come to
rely on the existing rules for moral guidance—a condition that fosters a mentality of what is not
forbidden is allowed

D. That the locus of moral control is shifted to individual employees and away from top
management

E. Being clever in signaling employees that the company’s code of ethics is mere window-dressing
and that employees should not expect that top executives will "walk the talk" and actually practice
what they preach

C

54. (p. 337) One of the big difficulties or challenges that a company encounters in using the "ethical
culture" approach to dealing with or managing ethics-related issues and ethics conduct is

A. Relying too heavily on peer pressures and cultural norms to enforce the espoused ethical
standards and underutilizing compliance enforcement procedures

B. The lack of strong compliance procedures to deter morally corrupt company personnel from
deliberately flaunting cultural norms and engaging in unethical behavior

C. Overemphasizing the creation of a work climate where everyone is an ethics watchdog and
whistle-blowing is required

D. That the locus of moral control is the company’s code of ethics

E. Greater susceptibility to ethical scandal

A

55. (p. 338) A company that is concerned about the recent raft of corporate scandals and aggressive
enforcement of anticorruption legislation (such as the Sarbanes-Oxley Act of 2002) might well be
inclined to shift it’s a approach to dealing with or managing ethics-related issues and ethics
conduct

A. From an "ethical culture" approach to a "damage control" approach

B. From an "unconcerned/nonissue" approach to a "damage control" approach

C. From an "compliance" approach to a "damage control" approach

D. From a "damage control" or an "unconcerned/nonissue" approach to a "compliance" approach

E. From an "damage control" approach to a "ethical culture" approach

D

56. (p. 338) A company’s strategy needs to be ethical because

A. Of the dangers that top management will get embarrassed if the company’s unethical behavior is
publicly exposed

B. A strategy that is unethical in whole or in part is morally wrong and reflects badly on the
character of the company personnel involved

C. Everyone is an ethics watchdog and somebody is sure to blow the whistle on the company’s
unethical behavior

D. Of the risks of getting caught and prosecuted by governmental authorities if an unethical
strategy is used

E. Unethical strategies are inconsistent with or else weaken the corporate culture

B

57. (p. 338) Which of the following represents a justifiable reason for why a company’s strategy
should be ethical?

A. .An unethical strategy reflects badly on the character of the company personnel involved

B. A strategy that is unethical in whole or in part is morally wrong

C. Pursuing an unethical strategy damages a company’s reputation and can have costly
consequences

D. An ethical strategy is good business and is in the best interest of shareholders

E. All of these

E

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