Chapter 5—Ethical Decision Making and Ethical Leadership

MULTIPLE CHOICE

1. Which of the following is the first step in the ethical decision-making process?
a. Being socialized into the firm's corporate culture
b. Applying a personal moral philosophy
c. Recognizing that an issue requires an individual or work group to make a choice that
ultimately will be judged by stakeholders as right or wrong
d. Soliciting the opinions of others in the work group and overall business
e. Enforcing the firm's ethical standards with rewards and punishment
ANS: C PTS: 1

2. Which of the following is not one of the six "spheres of influence" to which individuals are subject
when confronted with an ethical issue?
a. Educational attainment
b. Workplace
c. Family
d. Legal system
e. Community
ANS: A PTS: 1

3. The ____ leader demands instantaneous obedience and focuses on achievement, initiative, and self-
control.
a. democratic
b. coaching
c. affiliative
d. coercive
e. pacesetting
ANS: D PTS: 1

4. The perceived relevance or importance of an ethical issue to the individual, work group, or
organization is
a. organizational culture.
b. immediate job context.
c. ethical issue intensity.
d. ethical issue morality.
e. ethical issue cognitive state.
ANS: C PTS: 1
5. According to the text, ____ seem to be more sensitive to ethical issues and less tolerant of unethical
actions.
a. men
b. the elderly
c. chief executives
d. women
e. children
ANS: D PTS: 1
1
© 2011 Cengage Learning. All Rights Reserved. This edition is intended for use outside of the U.S. only, with content that may be different
from the U.S. Edition. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.
 6. According to the ethical decision-making framework, the absence of punishment provides a(n) ____
for unethical behavior.
a. reason
b. significant other
c. individual factor
d. opportunity
e. ethical issue intensity
ANS: D PTS: 1
7. ____ is an aspect of the influence significant others can exercise over our ethical decision making
process.
a. Moral philosophy
b. Cognitive moral development
c. Individual variables
d. Opportunity
e. Obedience to authority
ANS: E PTS: 1

8. Bob inspires his employees to follow a vision, facilitates change, and creates a strongly positive
climate. Bob is a(n) ____ leader.
a. authoritative
b. persuasive
c. coercive
d. pacesetting
e. affiliative
ANS: A PTS: 1

9. People generally learn their values and principles through

a. family.
b. social groups.
c. religion.
d. formal education.
e. All of these are ways people learn values.
ANS: E PTS: 1

10. A coaching leader builds a positive climate by

a. valuing people, their emotions, and their needs.
b. focusing on communication.
c. inspiring employees to facilitate change.
d. focusing on achievement, initiative, and self-control.
e. developing skills to foster long-term success, delegating responsibility, and issuing
challenging assignments.
ANS: E PTS: 1

11. If management fails to identify and educate employees about ethical problem areas, ethical issues may
not reach the critical
a. awareness level.
b. aptitude level.
2
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from the U.S. Edition. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.
 c. ethical level.
d. organizational level.
e. individual level.
ANS: A PTS: 1

12. The ____ of a corporation can be defined as a set of values, beliefs, goals, norms, and ways to solve
problems shared by members of an organization.
a. culture
b. intentions
c. awareness
d. determination
e. individual variables
ANS: A PTS: 1
13. Which of the following is not a negative reinforcement of employee behavior?
a. Demotions
b. Firings
c. Ignoring the behavior
d. Reprimands
e. Pay penalties
ANS: C PTS: 1

14. The key components of the ethical decision-making framework include

a. individual factors.
b. perceived ethical issue intensity.
c. corporate culture.
d. none of these choices.
e. all of these choices.
ANS: E PTS: 1

15. Which of the following types of leaders attempts to create employee satisfaction through bartering or
negotiating for desired behaviors or level of performance?
a. Pacesetting leaders
b. Coercive leaders
c. Transactional leaders
d. Transformational leaders
e. Transmogrified leaders
ANS: C PTS: 1

16. Following the ethical directives of a superior relates to

a. obedience to an internal locus of control.
b. obedience to authority.
c. obedience to field dependence.
d. high field dependence.
e. opportunistic behavior.
ANS: B PTS: 1

17. Which of the following is not a habit of ethical leaders?

3
© 2011 Cengage Learning. All Rights Reserved. This edition is intended for use outside of the U.S. only, with content that may be different
from the U.S. Edition. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.
 a. They are primarily concerned with themselves.
b. They are proactive.
c. They have a passion to do right.
d. They are concerned with stakeholders' interests.
e. They are role models for organizational values.
ANS: A PTS: 1
18. Which of the following leadership type has a strong influence on coworker support and building an
ethical culture?
a. Transformational leaders
b. Transactional leaders
c. Coercive leaders
d. Pacesetting leaders
e. Authoritative leaders
ANS: A PTS: 1

19. What is the value of the ethical decision making framework presented in your book?
a. It tells you what is right and wrong.
b. It teaches you values.
c. It prepares you to make informed ethical decisions.
d. It indicates whether a decision is ethical or unethical.
e. It helps you determine the type of leader you boss is.
ANS: C PTS: 1

20. Numerous studies have shown that ____ within the organization have more impact on a worker's
decisions on a daily basis than any other factor.
a. significant others
b. religion
c. education
d. chief executive officers
e. ethical issues
ANS: A PTS: 1

21. External and internal rewards relate to which part of the ethical decision-making framework?
a. Individual factors
b. Significant others
c. Cognitive moral development
d. Intentions
e. Opportunity
ANS: E PTS: 1

22. The immediate job context is

a. where one works.
b. carrots and sticks that superiors use to influence behavior.
c. with whom one works.
d. is related to opportunity.
e. all of these choices.
ANS: E PTS: 1
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© 2011 Cengage Learning. All Rights Reserved. This edition is intended for use outside of the U.S. only, with content that may be different
from the U.S. Edition. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.
23. When intentions and behavior are inconsistent with ethical judgments, the individual may feel
a. good.
b. rewarded.
c. joy.
d. guilt.
e. excitement.
ANS: D PTS: 1

24. ____ is the first sign that an unethical decision has occurred.
a. Guilt
b. Reward
c. Punishment
d. Cognitive dissonance
e. Happiness
ANS: A PTS: 1

25. People who believe in external ____, go with the flow because they feel the events in their lives are
uncontrollable.
a. ethical decision making
b. leadership
c. ethical culture
d. locus of control
e. significant others.
ANS: D PTS: 1

26. Which of the following is not an individual factor than affects business ethics?
a. Nationality
b. Age
c. Religion
d. Significant others
e. Education
ANS: D PTS: 1

27. ____ is an organizational factor that is often thought of as like a living organism with a mind and will
of its own?
a. Oversight
b. Significant others
c. Organizational culture
d. The ethical climate
e. The legal climate
ANS: C PTS: 1

28. Which leadership type values people, their emotions, and their needs and relies on friendship and trust
to promote flexibility, innovation, and risk taking?
a. Authoritative leadership
b. Coaching leadership
c. Pacesetting leadership
d. Coercive leadership
5
© 2011 Cengage Learning. All Rights Reserved. This edition is intended for use outside of the U.S. only, with content that may be different
from the U.S. Edition. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.
 e. Affiliative leadership
ANS: E PTS: 1

29. The framework for understanding ethical decision making presented in your text does not include ____
as a major determinant of ethical or unethical behavior.
a. ethical issue intensity
b. individual factors
c. corporate culture
d. evaluations and intentions
e. ethics training
ANS: E PTS: 1

30. Those who have influence in a work group are referred to as significant others and include
a. peers, managers, coworkers, and subordinates.
b. family members, peers, and coworkers.
c. spouses and friends.
d. employees in similar job situations.
e. employees who hold the same job.
ANS: A PTS: 1
31. Sherry's leadership style tends to create a negative climate because of the high standards she sets.
Sherry is most likely a(n) ____ leader.
a. autocratic
b. democratic
c. pacesetting
d. empathetic
e. coercive
ANS: C PTS: 1
32. A coaching leader builds a positive climate by
a. valuing people, their emotions, and their needs.
b. focusing on communication.
c. inspiring employees to facilitate change.
d. focusing on achievement, initiative, and self-control.
e. developing skills to foster long-term success, delegating responsibility, and issuing
challenging assignments.
ANS: E PTS: 1

33. The newest research done on gender and ethical decision making shows
a. men are generally more ethical than women.
b. in many aspects there are significant differences between men and women.
c. women are generally more sensitive to ethical scenarios and less tolerant of unethical
actions.
d. women are generally less sensitive to ethical scenarios and less tolerant of unethical
actions.
e. women are generally less sensitive to ethical scenarios and less tolerant of unethical
actions
ANS: C PTS: 1

6
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from the U.S. Edition. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.
34. The research between years of education attained and ethical decision making
a. is not significant.
b. reflects experience.
c. education type has a significant effect on ethical decision making
d. reveals that students are more ethical than businesspeople.
e. is a significant factor.
ANS: E PTS: 1

35. Research concerning nationality and the ability to make ethical decisions
a. show no relationship between the two.
b. is hard to interpret in an business context.
c. suggests that organizations should be very concerned about an employee's nationality.
d. suggests that corporations are very concerned with such research.
e. suggests that the influence of nationality is growing on corporate culture.
ANS: B PTS: 1

36. Business ethics and age

a. are negatively correlated
b. is a simple relationship.
c. suggest that employees with more experience have a greater knowledge to deal with
complex industry-specific ethical issues.
d. suggest that employees with less experience have a greater ability to deal with complex
industry-specific ethical issues.
e. do not have a statistically significant correlation.
ANS: C PTS: 1

37. Employees from different countries that see themselves as going with the flow because that's all they
can do refers to
a. external locus of control.
b. internal locus of control.
c. cultural locus of control.
d. external cultural locus of control.
e. internal cultural locus of control.
ANS: A PTS: 1
38. Current research suggests that
a. there is a significant relationship between external locus of control and ethical decision
making.
b. there is a significant relationship between internal locus of control and ethical decision
making.
c. we cannot be sure how significant locus of control is in terms of ethical decision making.
d. there is a relationship between the central locus of control and ethical decision making.
e. those who have an internal locus of control tend to be most ethical
ANS: C PTS: 1

39. For people who begin the value shift that leads to unethical decisions, which of the following is not a
usual justification to reduce and finally eliminate guilt?
a. I need a paycheck and can't afford to quit right now.
b. Those around me are doing it so why shouldn't I?
7
© 2011 Cengage Learning. All Rights Reserved. This edition is intended for use outside of the U.S. only, with content that may be different
from the U.S. Edition. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.
 c. If I don't do this, I might not be able to get a good reference from my boss when I leave.
d. If I don't do this, I might not be able to get a good reference from my company when I
leave.
e. All of these statements are justifications.
ANS: E PTS: 1

40. The book suggests that ethical leadership should be based

a. on holistic thinking that embraces the complex issues facing firms every day.
b. on those who have weak personal character.
c. on those who have a weak passion to do right.
d. on myopic thinking that embraces the complex issues facing firms every day.
e. on people such as Madoff, Koslowski, and Ponzi.
ANS: A PTS: 1

41. A solution to a fundamental problem in traditional personal character development, as suggested in the
text,
a. is that specific values and virtues ought to be taught to develop a set of basic beliefs.
b. is that specific values and virtues ought to be taught to develop a set of basic moral
philosophies.
c. is that specific values and virtues ought to be taught to develop a set of basic moral
philosophies across environments.
d. is to teach individuals who want to do the right thing about corporate values, codes, and
other skills to address the complexities of business.
e. is to teach individuals who want to do the right thing about the major philosophers both
from both western and eastern religions.
ANS: D PTS: 1

42. One habit of a strong leader is having a passion

a. to do the right thing.
b. to be proactive
c. to consider stakeholder interests
d. to be role models for the organization and its employees.
e. all of these choices.
ANS: E PTS: 1
43. Leaders whose decisions and actions are contrary to the firm's values send a signal
a. that the firm's values are trivial irrelevant.
b. that he/she is providing a good example of what not to do.
c. that the firm's values are important.
d. he/she is working to improve the ethical culture of the firm.
e. that he/she cares about the environment.
ANS: A PTS: 1

44. Which attribute of ethical leaders will not be effective unless the leader is personally involved in the
key decisions that have ethical ramifications?
a. Caring about stakeholders
b. Being proactive
c. Transparency
d. Deontological
8
© 2011 Cengage Learning. All Rights Reserved. This edition is intended for use outside of the U.S. only, with content that may be different
from the U.S. Edition. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.
 e. Teleological
ANS: C PTS: 1

45. Which type of leader is relies on participation and teamwork to reach collaborative decisions?
a. Transformational
b. Coercive
c. Democratic
d. Coaching
e. Pacesetting
ANS: C PTS: 1

46. What do strong ethical leaders need in order to make good decisions?
a. Complete information
b. Courage
c. Experience making the right decisions
d. Knowledge
e. Strong ethical leaders need all of these.
ANS: E PTS: 1
ESSAY

47. The ethical decision-making framework includes the concepts of ethical issue intensity, corporate
culture, and individual factors. Discuss how these concepts influence the ethical decision-making
process.

ANS:
Pages 233-234
PTS: 1

48.Trace the ethical decision-making process as described in this chapter. You may find it helpful to apply the
model to a real business situation or to a hypothetical ethical issue you develop yourself.

ANS:
Pages 232-234
PTS: 1

49. Based on your own decision-making experiences and the material you have read in previous chapters,
attempt to develop your own model, or framework, to describe the ethical decision-making process.
Or, if you prefer, analyze and evaluate the synthesis model of ethical decision making.

ANS:
Students may draw from the entire chapter to answer this question.
PTS: 1

50.Discuss the differences between and the relationship between the organizational and individual factors that
influence ethical decision making in business.

ANS:
Pages 234-237
PTS: 1
9
© 2011 Cengage Learning. All Rights Reserved. This edition is intended for use outside of the U.S. only, with content that may be different
from the U.S. Edition. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.