Chap004 Test Bank

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Chap004 - Test bank
Principle of Management (‫نداعملا و لورتبلل دهف كلملا ةعماج‬‎)
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Chapter 04 - Ethics and Social Responsibility
Chapter 04
Ethics and Social Responsibility
TEST PLANNING TABLE FOR CHAPTER 4
Learning Goal Easy Moderate Hard
1. Explain the relationship between ethics 1, 2, 3, 35, 36 4, 34, 37, 94 93, 95

and the law.
2. Differentiate between the claims of the 5, 6, 11, 38, 7, 9, 10, 12, 8, 96, 97, 98
different stakeholder groups that are 40, 41 13, 39, 42,
affected by managers and their 43, 44
companies’ actions.
3. Describe four rules that can be used to 15, 17, 20, 14, 16, 18, 99, 101
help companies and their managers act in 24, 45, 46, 19, 21, 22,
ethical ways. 47, 48, 49, 23, 25, 51,
50, 52, 55 53, 54, 56,
100
4. Discuss why it is important to behavior 57, 58, 59 26, 27, 60,

ethically. 61, 102
5. Identify the four main sources of 29, 30, 31, 28, 64, 66, 104
managerial ethics. 32, 62, 63, 68, 70, 103
65, 67, 69, 71
6. Distinguish between the four main 72, 73, 74, 33, 75, 83, 76, 79, 81,
approaches toward social responsibility 77, 78, 80, 84, 86, 87, 106
that the company can take. 82, 85, 89, 90 88, 91, 92,
105, 107
Total number of test items: 107
True/false questions are in plain text.

Multiple choice questions are in bold text.
Short answer questions are in bold underlined text.
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True / False Questions
1. Moral principles, values, or beliefs about what is "right" or "wrong" are known as ethics.
True False
2. "Moral scruples" are thoughts and feelings that tell a person what is right and wrong.
True False
3. Ethics change over time.

True False
4. Ethics and "the law" are the same thing.

True False
5. The people and groups affected by the way a company and its managers behave are called
its stockholders.
True False
6. Stakeholders supply a company with its productive resources.

True False
7. The job of balancing the demands of various stakeholders of an organization is done

primarily by shareholders.
True False
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8. Customers are stakeholders of an organization, but managers are not.

True False
9. Employees are stakeholders of a company.

True False
10. Employees have a right to expect a good return or reward from their employer.
True False
11. Suppliers have no rights to expect anything from an organization they are doing business
with.
True False
12. Customers are often regarded as the most important stakeholder group.
True False
13. The local communities in which an organization operates are generally not considered to
be true stakeholders of the organization.
True False
14. Ethical companies are more likely to grow and expand.

True False
15. In order for an organization to survive and prosper, it needs to satisfy its stakeholders.
True False
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16. All stakeholders benefit in the long run from companies making the right choices.
True False
17. Under the utilitarian rule, an ethical decision is that which creates the greatest good from
the greatest number of people.
True False
18. Typically, in the U.S., the interests of employees are placed above the interests of
shareholders.
True False
19. Managers should apply only the moral rights rule to all business decisions.
True False
20. Under the moral rights rule, an ethical decision is the one that distributes benefits and
harms among people and groups in a fair, equitable, and impartial way.
True False
21. From a moral rights perspective, managers should compare alternative courses of action
on the basis of how each will affect the rights of each stakeholder group.
True False
22. Decisions that protect the rights of some stakeholders often hurt the rights of others.
True False
23. Under the justice rule, managers should determine fair rules and procedures from
distributing outcomes to stakeholders.
True False
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24. "An ethical decision is one that a typical person in a society would think is acceptable" is
a statement that reflects the justice rule.
True False
25. The "practical rule" ensures that managers are taking into account the interests of all
stakeholders.
True False
26. The pursuit of self-interest is the most important foundation upon which a society can
operate.
True False
27. In the "Tragedy of the Commons", farmers collectively decided to manage the land's use
effectively.
True False
28. A society's ethics are derived solely from the written values and norms of the society that
address how people should interact with one another.
True False
29. The code of ethics is the same among different societies.

True False
30. The standards that govern how members of a profession should conduct themselves are
called organizational ethics.
True False
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31. An organization's code of ethics is shaped by the ethics of the top managers of the
organization.
True False
32. The way a company's managers view their duty to make decisions that enhance the well
being of stakeholders is called organizational ethics.
True False
33. The top managers at Enron acted in a defensive approach when they prevented employees
from selling Enron stock.
True False
Multiple Choice Questions
34. An ethical dilemma is a situation in which a person has to decide is she should act in a
way that ________, even though doing so may ________.
A. Fosters her own self-interest; favor another's self-interest
B. Is the "right" thing to do; go against her own self-interest
C. Is the "wrong" thing to do; go against her own self-interest
D. May help another person; favor her own self-interest
E. Go against her own self-interests; is the "wrong" thing to do
35. The moral principles and beliefs about what is "right" and "wrong" are known as:
A. Reputation
B. Laws and regulations
C. Ethics
D. Terminal values
E. Instrumental values
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36. ___________ are thoughts and feelings that tell people what is right or wrong.
A. Moral scruples
B. Ethical dilemmas
C. Ethics
D. Norms
E. Emotions
37. Which of the following statements is most true?

A. Both ethics and laws are fixed principles.
B. Ethics are fixed, but laws are flexible.
C. Ethics are flexible, but laws are fixed.
D. Neither ethics nor laws are fixed principles.
38. People or groups that supply a company with its productive resources are called:
A. Suppliers
B. Top management
C. Shareholders
D. Stockholders
E. Stakeholders
39. Stockholders are interested in the way a company operates because they:
A. Use the company's products
B. Believe in being ethical
C. Want to maximize ROI
D. Want to avoid all risks
E. Like to be in control
40. Which of the following is a stakeholder for an organization?

A. Customers
B. Employees
C. Suppliers
D. The local community
E. All of the above
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41. Which of the following is NOT normally a stakeholder of an organization?

A. Managers
B. Employees
C. Customers
D. Government
E. All of the above are stakeholders
42. The stakeholder group with the most responsibility for deciding the goals of the
organization is:
A. Stockholders
B. Customers
C. Managers
D. working-level employees
E. Consultants
43. ___________ are often regarded as the most critical stakeholder group.
A. Stockholders
B. Managers
C. Employees
D. Customers
E. Suppliers
44. A community is a stakeholder of an organization because it provides:

A. Homes for workers
B. Colleges for workers' families
C. Tax revenue into the organization
D. All of the above
E. All but C
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45. Which of the following is NOT one of the rules for ethical decision-making discussed in
the textbook?
A. Justice
B. Moral Rights
C. Utilitarian
D. Practical
E. Existential
46. The ____________ rule is that an ethical decision is one that produces the greatest good
for the greatest number of people.
A. Justice
B. Moral Rights
C. Utilitarian
D. Practical
E. None of the above
47. The utilitarian rule states that an ethical decision:

A. Best protects the rights of people affected
B. Produces the greatest good for the greatest number of people
C. Distributes benefits and harms in a fair way
D. Is one that can be communicated with no reluctance
E. Increases the financial effectiveness of the organization
48. Under the ____________ rule, an ethical decision is the one that best maintains people's
fundamental privileges.
A. Justice
B. Moral Rights
C. Utilitarian
D. Practical
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49. The _____________ rule is that an ethical decision is one that distributes rewards and
harm in a fair way.
A. Justice
B. Moral Rights
C. Utilitarian
D. Practical
E. Existential
50. The justice rule states that an ethical decision:

C. Is one that can be communicated with no reluctance
D. Increases financial effectiveness of the organization
51. Under the practical rule, a manager would not be reluctant to communicate a decision to
people outside the company when:
A. He/she could announce the decision anonymously
B. A typical person would consider the decision acceptable
C. A typical person wouldn't care about the decision
D. A typical person wouldn't know about the decision
E. He/she could blame top management of the firm
52. The practical rule states that an ethical decision:

E. is relevant to financial effectiveness of the organization
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53. The Moral Rights model of ethics:

A. Seeks to protect the privileges of people affected
B. Maximizes the greatest good for the greatest number of people
C. Distributes benefits in fair ways, but ignores harm
D. Distributes both benefits and harms in a fair way
E. Randomly distributes harms and benefits
54. One managerial implication of the justice model is that managers should base their
decisions on:
A. The effects on stakeholders' rights
B. What provides the maximum benefit to most stakeholders
C. Whatever promotes a fair distribution of outcomes
D. Arbitrary factors
E. The organization's culture
55. According to the practical rule, a managerial decision that the manager has no hesitation
or reluctance about communicating to people outside the company is called a(n):
A. Unethical decision
B. Popular decision
C. Socially responsible decision
D. Social audit
E. Ethical decision
56. Under the practical rule, which of the following is NOT a question a manager should ask
himself in regards to a business decision?
A. Would my family members and friends approve of this decision?
B. Will anyone find out I made the decision?
C. Am I willing to see the decision communicated to all people and groups affected by it?
D. Does the decision fall within the accepted values and standards that typically apply in
business today?
E. All of the above are questions a manager should ask.
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57. The idea that the pursuit of self-interest with no consideration for societal interests leads
to disaster is called the:
A. Tragedy of the commons
B. Tragedy of errors
C. Tragedy of the sheep
D. Consequences of selfishness
E. Curse of unethical behavior
58. A person's confidence and faith in another person's goodwill is called:

A. Trust
B. Reputation
C. Responsibility
D. Moral standing
E. Emotional value
59. The esteem or high repute that individuals or organizations gain when they behave
ethically is called:
A. Trust
B. Reputation
C. Social responsibility
D. Moral standing
E. Emotional value
60. Ethical behavior does NOT:

A. Increase a company's efficiency
B. Increase a company's effectiveness
C. Reduce a company's performance
D. Increase the national standard of living
E. Ethical behavior does all of these
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61. Unethical behavior:

A. Increases a company's efficiency
B. Increases a company's effectiveness
C. Reduces a company's performance
D. Increases the national standard of living
E. Increases well-being and prosperity
62. Which of the following is NOT a main determinant of differences in ethics between
people, companies, and countries?
A. Societal ethics
B. Occupational ethics
C. Individual ethics
D. Organizational ethics
E. Governmental ethics
63. Standards that govern how members of a society should deal with one another in matters
involving issues such as fairness, justice, poverty, and individual rights are called:
A. Societal ethics
64. The text names several countries that are considered to be among the most ethical in the
world. Which of the following is NOT named on this list?
A. Germany
B. Japan
C. Sweden
D. Switzerland
E. United States
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65. The standards that govern how members of a profession, trade, or craft should conduct
themselves when performing work-related activities are called:
A. Societal ethics
66. An example of a group of people performing similar work that one would expect to hold
to occupational norms is:
A. Typists
B. Doctors
C. Laborers
D. Lawyers
E. Both B and D
67. Standards that determine how people view their responsibilities to others and how they
should act in situations when their own self-interest is at stake are called:
A. Societal ethics
68. Which of the following is least likely to be a source of individual ethics?

A. Family
B. Friends
C. Peers
D. Teachers
E. Bosses
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69. The guiding practices and beliefs through which a particular firm and its managers view
their responsibilities to stakeholders are called:
A. Societal ethics
70. An important source of organizational ethics is:

A. Employees
B. Customers
C. Top managers
D. Founders
E. Both top managers and founders
71. Another name for a company's code of ethics is its:

A. Mission
B. Vision
C. Strategy
D. Credo
E. Goals
72. The way a company's managers view their duty to make decisions that promote the
welfare of stakeholders and society as a whole is called:
A. Societal ethics
B. Organizational ethics
D. Organizational responsibility
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73. The approach to social responsibility in which companies chose not to behave in a socially
responsible way is called:
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Illegal
74. Which of the approaches to social responsibility is the least socially responsible?
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Obligatory
75. Which of the following is NOT an example of socially responsible behavior?

A. Keeping company operations in the U.S. to protect jobs
B. Investing in countries with poor human rights records
C. Investing money to reduce pollution
D. Providing severance pay to laid-off workers
E. Providing educational opportunities for employees
76. Managers at ABC Company know their major product has a defect that could cause
injuries to some users, but they decide not to let the public know about this immediately. They
are engaging in ____________ behavior.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
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77. Which of the following is NOT an approach to social responsibility discussed in the text?
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Reactive
78. Which of the approaches to social responsibility is the most socially responsible?
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Both accommodative and proactive are equally most responsible
79. When Beechnut discovered that their apple juice contained corn syrup and cane sugar,
they reacted with a(n) __________ approach.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
80. A company that expects its managers to behave ethically to the degree that they stay
within the law is acting with a _______________ approach.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
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81. When WorldCom gave managers stock options and bonuses even when company
performance was declining, and managers sold stock in advance of other stockholders, they
were acting with a ____________ approach.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
82. With a(n) _____________ approach, companies and their managers behave legally and
ethically and try to balance the interests of different stakeholders as the need arises.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
83. Companies that try to curb attempts by subordinates to act unethically are likely to be
those that are __________ than their peers.
A. Older
B. More disreputable
C. Less profitable
D. More entrepreneurial
E. Younger
84. The approach most likely to be taken by the typical large U.S. company is the
__________ approach.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
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85. Companies that go out of their way to learn about the needs of different stakeholders and
use organizational resources to promote their interests are using the ____________ approach.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
86. Which of the following is NOT mentioned in the textbook as a firm that adopts the
proactive approach to social responsibility?
A. McDonald's
B. Ben and Jerry's
C. Target
D. Wal-Mart
E. Green Mountain Coffee
87. A company that pursues the minimization or elimination of the use of animals in drug or
cosmetics testing is likely to be pursuing a ___________ approach.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
88. A manager who actively embraces the need to behave in socially responsible ways is
using which approach to social responsibility?
A. Proactive
B. Accommodative
C. Obstructionist
D. Defensive
E. Assertive
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89. To help create and maintain an ethical organization, managers should:

A. Model ethical behavior
B. Facilitate a strong culture with appropriate values
C. Create an "ethics ombudsman" position
D. Create a written code of ethics
E. All of the above
90. A person responsible for communicating and teaching ethical standards is called a(n):
A. Ethics manager
B. Ethics ombudsman
C. Ethics monitor
D. Social responsibility coordinator
91. Which of the following is NOT normally a job responsibility of an ethics ombudsman?
A. Monitoring organizational practices
B. Communicating ethical standards to employees
C. Establishing an ethical culture
D. Teaching managers about how to respond to ethical dilemmas
E. Listening to organizational members who wish to communicate about unethical behavior
92. The company that is so well known for its ethical culture that it has had the best corporate
reputation for the last two years is:
A. Ben and Jerry's
B. Johnson and Johnson
C. K-mart
D. Target
E. McDonald's
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Essay Questions
93. Describe the relationships between ethics, law, and business.
94. Why are managers a critically important group of stakeholders?
95. Discuss the idea that ethics may change over time. Give an example of an ethical value
that may be changing in the culture in which you presently live; explain.
96. Using an example of your college or university, give specific examples of stakeholders of
each major type.
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97. The textbook discusses how much salary and stock options some top managers have
received in recent years. Is it ethical for managers to receive these amounts? Argue both sides
of this question.
98. What are "stakeholders"? Choose a specific example from your own experience, and name
examples of each type. Why is understanding stakeholders important to organizational
managers?
99. Suppose during a test in a class in which you are enrolled, you observe a fellow student
cheating. Explain how the four ethical rules discussed in the text would be applied to this
situation, and what each rule would tell you to do.
100. Describe the four rules of ethics and discuss their managerial implications.
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101. Describe the questions that a manager should ask to decide if a business decision is
acceptable on ethical grounds, under the practical rule. Give an example of how this rule
would be applied to an ethical decision a student such as you might have to make.
102. Why should managers behave ethically?
103. Identify and describe the sources of differences in ethics between people, companies, and
nations.
104. Give at least two examples from your own experience of situations you have observed
where an individual's ethics conflicting with societal, occupational, or organizational ethics.
Explain.
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105. Give three examples of socially responsible behavior.
106. Identify and describe the approaches to social responsibility, in the order of least to most
ethical. Give an example of a real company to illustrate each.
107. Discuss two advantages that can result to an organization when managers act in a
socially responsible way.
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Chapter 04 Ethics and Social Responsibility Answer Key
True / False Questions
1. (p. 112) Moral principles, values, or beliefs about what is "right" or "wrong" are known as
ethics.
TRUE
AACSB: Ethical understanding/reasoning abilities (2)

Bloom's: Knowledge
Difficulty: Easy
Learning Objective: 1
2. (p. 112) "Moral scruples" are thoughts and feelings that tell a person what is right and wrong.
TRUE

Bloom's: Knowledge
Difficulty: Easy
3. (p. 112) Ethics change over time.

TRUE

Bloom's: Comprehension
Difficulty: Easy
4. (p. 114) Ethics and "the law" are the same thing.
FALSE

Bloom's: Knowledge
Difficulty: Moderate
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5. (p. 114) The people and groups affected by the way a company and its managers behave are
called its stockholders.
FALSE
AACSB: Domestic and global economic environments of organizations (13)

Bloom's: Knowledge
Difficulty: Easy
6. (p. 114) Stakeholders supply a company with its productive resources.

TRUE

Difficulty: Easy
7. (p. 115) The job of balancing the demands of various stakeholders of an organization is done
primarily by shareholders.
FALSE

8. (p. 115) Customers are stakeholders of an organization, but managers are not.
FALSE

Difficulty: Hard
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9. (p. 115) Employees are stakeholders of a company.

TRUE
AACSB: Domestic and global economic environments of organizations (13), ethical understanding/reasoning abilities (2) and ethical/legal
responsibilities in organizations and society (7)
10. (p. 118) Employees have a right to expect a good return or reward from their employer.
TRUE
AACSB: Domestic and global economic environments of organizations (13) and ethical/legal responsibilities in organizations and society (7)
11. (p. 119) Suppliers have no rights to expect anything from an organization they are doing
business with.
FALSE
Difficulty: Easy
12. (p. 120) Customers are often regarded as the most important stakeholder group.
TRUE
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13. (p. 122) The local communities in which an organization operates are generally not
considered to be true stakeholders of the organization.
FALSE
14. (p. 123) Ethical companies are more likely to grow and expand.
TRUE

Bloom's: Knowledge
15. (p. 123) In order for an organization to survive and prosper, it needs to satisfy its
stakeholders.
TRUE

Difficulty: Easy
16. (p. 123) All stakeholders benefit in the long run from companies making the right choices.
TRUE

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17. (p. 123) Under the utilitarian rule, an ethical decision is that which creates the greatest good
from the greatest number of people.
TRUE

Bloom's: Knowledge
Difficulty: Easy
18. (p. 123) Typically, in the U.S., the interests of employees are placed above the interests of
shareholders.
FALSE

Bloom's: Knowledge
19. (p. 123) Managers should apply only the moral rights rule to all business decisions.
FALSE
AACSB: Ethical understanding/reasoning abilities (2) and ethical/legal responsibilities in organizations and society (7)
Bloom's: Knowledge
20. (p. 124) Under the moral rights rule, an ethical decision is the one that distributes benefits
and harms among people and groups in a fair, equitable, and impartial way.
FALSE
Bloom's: Knowledge
Difficulty: Easy
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21. (p. 124) From a moral rights perspective, managers should compare alternative courses of
action on the basis of how each will affect the rights of each stakeholder group.
TRUE
Bloom's: Knowledge
22. (p. 124) Decisions that protect the rights of some stakeholders often hurt the rights of others.
TRUE
Bloom's: Knowledge
23. (p. 124) Under the justice rule, managers should determine fair rules and procedures from
distributing outcomes to stakeholders.
TRUE
Bloom's: Knowledge
24. (p. 124) "An ethical decision is one that a typical person in a society would think is
acceptable" is a statement that reflects the justice rule.
FALSE
Bloom's: Knowledge
Difficulty: Easy
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25. (p. 125) The "practical rule" ensures that managers are taking into account the interests of all
stakeholders.
TRUE
Bloom's: Knowledge
26. (p. 126) The pursuit of self-interest is the most important foundation upon which a society
can operate.
FALSE
27. (p. 127) In the "Tragedy of the Commons", farmers collectively decided to manage the land's
use effectively.
FALSE
Bloom's: Knowledge
28. (p. 129) A society's ethics are derived solely from the written values and norms of the society
that address how people should interact with one another.
FALSE
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29. (p. 129) The code of ethics is the same among different societies.
FALSE
Difficulty: Easy
30. (p. 131) The standards that govern how members of a profession should conduct themselves
are called organizational ethics.
FALSE
Bloom's: Knowledge
Difficulty: Easy
31. (p. 133) An organization's code of ethics is shaped by the ethics of the top managers of the
organization.
TRUE
Difficulty: Easy
32. (p. 133) The way a company's managers view their duty to make decisions that enhance the
well being of stakeholders is called organizational ethics.
FALSE
Bloom's: Knowledge
Difficulty: Easy
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33. (p. 136) The top managers at Enron acted in a defensive approach when they prevented
employees from selling Enron stock.
FALSE
Bloom's: Application
Multiple Choice Questions
34. (p. 111) An ethical dilemma is a situation in which a person has to decide is she should act in
a way that ________, even though doing so may ________.
A. Fosters her own self-interest; favor another's self-interest
B. Is the "right" thing to do; go against her own self-interest
C. Is the "wrong" thing to do; go against her own self-interest
D. May help another person; favor her own self-interest
E. Go against her own self-interests; is the "wrong" thing to do

Bloom's: Knowledge
35. (p. 112) The moral principles and beliefs about what is "right" and "wrong" are known as:
A. Reputation
B. Laws and regulations
C. Ethics
D. Terminal values
E. Instrumental values

Bloom's: Knowledge
Difficulty: Easy
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36. (p. 112) ___________ are thoughts and feelings that tell people what is right or wrong.
A. Moral scruples
B. Ethical dilemmas
C. Ethics
D. Norms
E. Emotions

Bloom's: Knowledge
Difficulty: Easy
37. (p. 112) Which of the following statements is most true?

A. Both ethics and laws are fixed principles.
B. Ethics are fixed, but laws are flexible.
C. Ethics are flexible, but laws are fixed.
D. Neither ethics nor laws are fixed principles.

38. (p. 114) People or groups that supply a company with its productive resources are called:
A. Suppliers
B. Top management
C. Shareholders
D. Stockholders
E. Stakeholders

Bloom's: Knowledge
Difficulty: Easy
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39. (p. 114) Stockholders are interested in the way a company operates because they:
A. Use the company's products
B. Believe in being ethical
C. Want to maximize ROI
D. Want to avoid all risks
E. Like to be in control

Bloom's: Knowledge
40. (p. 115) Which of the following is a stakeholder for an organization?

A. Customers
B. Employees
C. Suppliers
D. The local community
E. All of the above
AACSB: Domestic and global economic environment (13)

Bloom's: Knowledge
Difficulty: Easy
41. (p. 115) Which of the following is NOT normally a stakeholder of an organization?
A. Managers
B. Employees
C. Customers
D. Government
E. All of the above are stakeholders

Bloom's: Knowledge
Difficulty: Easy
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42. (p. 115) The stakeholder group with the most responsibility for deciding the goals of the
organization is:
A. Stockholders
B. Customers
C. Managers
D. working-level employees
E. Consultants

43. (p. 120) ___________ are often regarded as the most critical stakeholder group.
A. Stockholders
B. Managers
C. Employees
D. Customers
E. Suppliers

44. (p. 122) A community is a stakeholder of an organization because it provides:

A. Homes for workers
B. Colleges for workers' families
C. Tax revenue into the organization
D. All of the above
E. All but C

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45. (p. 123) Which of the following is NOT one of the rules for ethical decision-making
discussed in the textbook?
A. Justice
B. Moral Rights
C. Utilitarian
D. Practical
E. Existential

Bloom's: Knowledge
Difficulty: Easy
46. (p. 123) The ____________ rule is that an ethical decision is one that produces the greatest
good for the greatest number of people.
A. Justice
B. Moral Rights
C. Utilitarian
D. Practical
Bloom's: Knowledge
Difficulty: Easy
47. (p. 123) The utilitarian rule states that an ethical decision:
E. Increases the financial effectiveness of the organization
Bloom's: Knowledge
Difficulty: Easy
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48. (p. 124) Under the ____________ rule, an ethical decision is the one that best maintains
people's fundamental privileges.
A. Justice
B. Moral Rights
C. Utilitarian
D. Practical
Bloom's: Knowledge
Difficulty: Easy
49. (p. 124) The _____________ rule is that an ethical decision is one that distributes rewards
and harm in a fair way.
A. Justice
B. Moral Rights
C. Utilitarian
D. Practical
E. Existential
Bloom's: Knowledge
Difficulty: Easy
50. (p. 124) The justice rule states that an ethical decision:
C. Is one that can be communicated with no reluctance
D. Increases financial effectiveness of the organization
Bloom's: Knowledge
Difficulty: Easy
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51. (p. 124) Under the practical rule, a manager would not be reluctant to communicate a
decision to people outside the company when:
A. He/she could announce the decision anonymously
B. A typical person would consider the decision acceptable
C. A typical person wouldn't care about the decision
D. A typical person wouldn't know about the decision
E. He/she could blame top management of the firm
Bloom's: Knowledge
52. (p. 124) The practical rule states that an ethical decision:
E. is relevant to financial effectiveness of the organization
Bloom's: Knowledge
Difficulty: Easy
53. (p. 124) The Moral Rights model of ethics:

A. Seeks to protect the privileges of people affected
B. Maximizes the greatest good for the greatest number of people
C. Distributes benefits in fair ways, but ignores harm
D. Distributes both benefits and harms in a fair way
E. Randomly distributes harms and benefits
AACSB: Ethical understanding/reasoning abilities (2) and domestic and global economic environments of organizations (13)
Bloom's: Knowledge
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54. (p. 124) One managerial implication of the justice model is that managers should base their
decisions on:
A. The effects on stakeholders' rights
B. What provides the maximum benefit to most stakeholders
C. Whatever promotes a fair distribution of outcomes
D. Arbitrary factors
E. The organization's culture
AACSB: Ethical understanding/reasoning abilities (2); ethical/legal responsibilities in organizations and society (7); and domestic and
global economic environments of organizations (13)
55. (p. 124) According to the practical rule, a managerial decision that the manager has no
hesitation or reluctance about communicating to people outside the company is called a(n):
A. Unethical decision
B. Popular decision
C. Socially responsible decision
D. Social audit
E. Ethical decision
Bloom's: Knowledge
Difficulty: Easy
56. (p. 125) Under the practical rule, which of the following is NOT a question a manager should
ask himself in regards to a business decision?
A. Would my family members and friends approve of this decision?
B. Will anyone find out I made the decision?
C. Am I willing to see the decision communicated to all people and groups affected by it?
D. Does the decision fall within the accepted values and standards that typically apply in
business today?
E. All of the above are questions a manager should ask.
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57. (p. 127) The idea that the pursuit of self-interest with no consideration for societal interests
leads to disaster is called the:
A. Tragedy of the commons
B. Tragedy of errors
C. Tragedy of the sheep
D. Consequences of selfishness
E. Curse of unethical behavior
Bloom's: Knowledge
Difficulty: Easy
58. (p. 127) A person's confidence and faith in another person's goodwill is called:
A. Trust
B. Reputation
C. Responsibility
D. Moral standing
E. Emotional value
Bloom's: Knowledge
Difficulty: Easy
59. (p. 127) The esteem or high repute that individuals or organizations gain when they behave
ethically is called:
A. Trust
B. Reputation
D. Moral standing
E. Emotional value
Bloom's: Knowledge
Difficulty: Easy
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60. (p. 128) Ethical behavior does NOT:

A. Increase a company's efficiency
B. Increase a company's effectiveness
C. Reduce a company's performance
D. Increase the national standard of living
E. Ethical behavior does all of these
Bloom's: Knowledge
61. (p. 128) Unethical behavior:

A. Increases a company's efficiency
B. Increases a company's effectiveness
C. Reduces a company's performance
D. Increases the national standard of living
E. Increases well-being and prosperity
62. (p. 129) Which of the following is NOT a main determinant of differences in ethics between
people, companies, and countries?
A. Societal ethics
Difficulty: Easy
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63. (p. 129) Standards that govern how members of a society should deal with one another in
matters involving issues such as fairness, justice, poverty, and individual rights are called:
A. Societal ethics
Difficulty: Easy
64. (p. 129) The text names several countries that are considered to be among the most ethical in
the world. Which of the following is NOT named on this list?
A. Germany
B. Japan
C. Sweden
D. Switzerland
E. United States
Bloom's: Knowledge
65. (p. 131) The standards that govern how members of a profession, trade, or craft should
conduct themselves when performing work-related activities are called:
A. Societal ethics
Bloom's: Knowledge
Difficulty: Easy
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66. (p. 131) An example of a group of people performing similar work that one would expect to
hold to occupational norms is:
A. Typists
B. Doctors
C. Laborers
D. Lawyers
E. Both B and D

67. (p. 132) Standards that determine how people view their responsibilities to others and how
they should act in situations when their own self-interest is at stake are called:
A. Societal ethics
Bloom's: Knowledge
Difficulty: Easy
68. (p. 132-133) Which of the following is least likely to be a source of individual ethics?
A. Family
B. Friends
C. Peers
D. Teachers
E. Bosses
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69. (p. 133) The guiding practices and beliefs through which a particular firm and its managers
view their responsibilities to stakeholders are called:
A. Societal ethics
Bloom's: Knowledge
Difficulty: Easy
70. (p. 133) An important source of organizational ethics is:

A. Employees
B. Customers
C. Top managers
D. Founders
E. Both top managers and founders
71. (p. 133) Another name for a company's code of ethics is its:
A. Mission
B. Vision
C. Strategy
D. Credo
E. Goals
Bloom's: Knowledge
Difficulty: Easy
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72. (p. 135) The way a company's managers view their duty to make decisions that promote the
welfare of stakeholders and society as a whole is called:
A. Societal ethics
B. Organizational ethics
D. Organizational responsibility
Bloom's: Knowledge
Difficulty: Easy
73. (p. 135) The approach to social responsibility in which companies chose not to behave in a
socially responsible way is called:
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Illegal
Bloom's: Knowledge
Difficulty: Easy
74. (p. 135) Which of the approaches to social responsibility is the least socially responsible?
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Obligatory
Difficulty: Easy
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75. (p. 136) Which of the following is NOT an example of socially responsible behavior?
A. Keeping company operations in the U.S. to protect jobs
B. Investing in countries with poor human rights records
C. Investing money to reduce pollution
D. Providing severance pay to laid-off workers
E. Providing educational opportunities for employees
76. (p. 136) Managers at ABC Company know their major product has a defect that could cause
injuries to some users, but they decide not to let the public know about this immediately. They
are engaging in ____________ behavior.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
In an obstructionist approach, companies choose not to behave in a socially responsible way.
Difficulty: Hard
77. (p. 136) Which of the following is NOT an approach to social responsibility discussed in the
text?
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Reactive
Bloom's: Knowledge
Difficulty: Easy
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78. (p. 136) Which of the approaches to social responsibility is the most socially responsible?
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Both accommodative and proactive are equally most responsible
Difficulty: Easy
79. (p. 136-137) When Beechnut discovered that their apple juice contained corn syrup and cane
sugar, they reacted with a(n) __________ approach.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
The situation is described in the text.
Bloom's: Knowledge
Difficulty: Hard
80. (p. 137) A company that expects its managers to behave ethically to the degree that they stay
within the law is acting with a _______________ approach.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
Bloom's: Knowledge
Difficulty: Easy
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81. (p. 137) When WorldCom gave managers stock options and bonuses even when company
performance was declining, and managers sold stock in advance of other stockholders, they
were acting with a ____________ approach.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
In a defensive approach, companies behave ethically to the degree that they stay within the
law and abide strictly with legal requirements.
Difficulty: Hard
82. (p. 137) With a(n) _____________ approach, companies and their managers behave legally
and ethically and try to balance the interests of different stakeholders as the need arises.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
Bloom's: Knowledge
Difficulty: Easy
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83. (p. 137) Companies that try to curb attempts by subordinates to act unethically are likely to
be those that are __________ than their peers.
A. Older
B. More disreputable
C. Less profitable
D. More entrepreneurial
E. Younger
84. (p. 137) The approach most likely to be taken by the typical large U.S. company is the
__________ approach.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
85. (p. 138) Companies that go out of their way to learn about the needs of different stakeholders
and use organizational resources to promote their interests are using the ____________
approach.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
Difficulty: Easy
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86. (p. 138) Which of the following is NOT mentioned in the textbook as a firm that adopts the
proactive approach to social responsibility?
A. McDonald's
B. Ben and Jerry's
C. Target
D. Wal-Mart
E. Green Mountain Coffee
Bloom's: Knowledge
87. (p. 138) A company that pursues the minimization or elimination of the use of animals in
drug or cosmetics testing is likely to be pursuing a ___________ approach.
A. Accommodative
B. Proactive
C. Defensive
D. Obstructionist
E. Offensive
88. (p. 138) A manager who actively embraces the need to behave in socially responsible ways is
using which approach to social responsibility?
A. Proactive
B. Accommodative
C. Obstructionist
D. Defensive
E. Assertive
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89. (p. 139-140) To help create and maintain an ethical organization, managers should:
A. Model ethical behavior
B. Facilitate a strong culture with appropriate values
C. Create an "ethics ombudsman" position
D. Create a written code of ethics
E. All of the above
Difficulty: Easy
90. (p. 140) A person responsible for communicating and teaching ethical standards is called
a(n):
A. Ethics manager
B. Ethics ombudsman
C. Ethics monitor
D. Social responsibility coordinator
Bloom's: Knowledge
Difficulty: Easy
91. (p. 140) Which of the following is NOT normally a job responsibility of an ethics
ombudsman?
A. Monitoring organizational practices
B. Communicating ethical standards to employees
C. Establishing an ethical culture
D. Teaching managers about how to respond to ethical dilemmas
E. Listening to organizational members who wish to communicate about unethical behavior
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92. (p. 140) The company that is so well known for its ethical culture that it has had the best
corporate reputation for the last two years is:
A. Ben and Jerry's
B. Johnson and Johnson
C. K-mart
D. Target
E. McDonald's
Bloom's: Knowledge
Essay Questions
93. (p. 112-113) Describe the relationships between ethics, law, and business.
A society passes laws based on which group within that society can summon the most support
for its ethical interests and beliefs. Neither is a fixed principle - they change over time and
vary between societies. Business must operate within societies, and must obey laws or risk
consequences.
Bloom's: Analysis
Difficulty: Hard
94. (p. 112-113) Why are managers a critically important group of stakeholders?
Managers are the stakeholder group with the most responsibility for deciding which goals an
organization should pursue to most benefit stakeholders and how to use the organization's
resources to achieve those goals.
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95. (p. 113-114) Discuss the idea that ethics may change over time. Give an example of an ethical
value that may be changing in the culture in which you presently live; explain.
Ethical beliefs change because ethics are relative, that is, no absolute or unvarying standards
exist to determine how we should behave.
Difficulty: Hard
96. (p. 114-122) Using an example of your college or university, give specific examples of
stakeholders of each major type.
The major types are employees, suppliers (high schools and/or junior colleges), stockholders
(or the equivalent), managers (deans, provosts), customers (students, potential employers),
community (local town).
Difficulty: Hard
97. (p. 117) The textbook discusses how much salary and stock options some top managers have
received in recent years. Is it ethical for managers to receive these amounts? Argue both sides
of this question.
Some people feel these large amounts are warranted, based on the important role these
managers play in building a company's capital and wealth. Others feel that the money these
executives receive is excessive and detracts from money that might have gone to other
stakeholders in the form of dividends to stockholders, increased wages and benefits to
employees, or lower prices to customers.
Bloom's: Synthesis and Evaluation
Difficulty: Hard
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98. (p. 114-122) What are "stakeholders"? Choose a specific example from your own experience,
and name examples of each type. Why is understanding stakeholders important to
organizational managers?
Stakeholders are those individuals or organizations that have an interest in the organization.
Stakeholders include employees, customers, suppliers, shareholders, suppliers, and the local
community. Stakeholders control the inputs and outputs of the organization through their
abilities to supply inputs (such as capital, legal standing, and work) and outputs (purchasing
of the organization's goods or services). Since the organization is an open system, restriction
of these inputs or outputs can harm the organization.
Difficulty: Hard
99. (p. 122-126) Suppose during a test in a class in which you are enrolled, you observe a fellow
student cheating. Explain how the four ethical rules discussed in the text would be applied to
this situation, and what each rule would tell you to do.
The four rules are the utilitarian, justice, moral rights, and practical. Their application is
discussed on the pages indicated.
Difficulty: Hard
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100. (p. 123-125) Describe the four rules of ethics and discuss their managerial implications.
The three models are the utilitarian, the moral rights, the justice, and the practical models. The
utilitarian model proposes that decisions should favor the greatest good for the greatest
number of people. Under this model, a manager should contrast alternative courses of action,
comparing the benefits and costs they bring for various stakeholder groups. The moral rights
model proposes that decisions should protect the basic rights and privileges of people affected
by the decision. In this model, the manager would compare alternatives based on their effects
on stakeholders' rights. The justice model focuses on decisions that distribute outcomes fairly.
Under this philosophy, managers should compare courses of action based on the fairness of
distribution of outcomes. The practical model suggests that an ethical decision is one that a
manager has no hesitation about communicating to people outside the company.
101. (p. 124-125) Describe the questions that a manager should ask to decide if a business
decision is acceptable on ethical grounds, under the practical rule. Give an example of how
this rule would be applied to an ethical decision a student such as you might have to make.
(1.) Does my decision fall within the accepted values or standards that typically apply in
business activity today?
(2.) Am I willing to see the decision communicated to all people and groups affected by it?
(3.) Would the people with whom I have a significant personal relationship approve of the
decision?
Difficulty: Hard
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102. (p. 126-128) Why should managers behave ethically?
(1) Relentless pursuit of self-interest can lead to a "tragedy of the commons" if everyone
behaves unethically.
(2) Without ethical behavior, trust cannot exist; without trust, efficiency and effectiveness of
inter-business relationships will be reduced.
Bloom's: Analysis
103. (p. 129-134) Identify and describe the sources of differences in ethics between people,
companies, and nations.
(1) Societal ethics are standards of how members of a society should treat one another in
matters involving issues such as fairness, justice, and individual rights. They derive from a
society's laws, customs, practices, norms and values.
(2) Occupational ethics govern how members of a profession, trade, or craft should conduct
themselves when performing work-related activities. They derive from professional training
and socialization.
(3) Individual ethics are personal standards and values that determine how they should act
when self-interest is a stake. They derive from family, peers, upbringing and experience.
(4) Organizational ethics are guiding practices and beliefs of a particular company as to how it
views its responsibility toward its stakeholders. They often arise from founders and are
maintained through culture or through devices such as codes of ethics.
104. (p. 129-135) Give at least two examples from your own experience of situations you have
observed where an individual's ethics conflicting with societal, occupational, or organizational
ethics. Explain.
Possible conflicts of ethics are described in the pages given.
Difficulty: Hard
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105. (p. 136) Give three examples of socially responsible behavior.
Examples could include: providing severance pay for laid-off workers; providing job training
to help employees avoid obsolescence; contributing to charities; keeping operations open
when closure would devastate a local community.
106. (p. 135-138) Identify and describe the approaches to social responsibility, in the order of least
to most ethical. Give an example of a real company to illustrate each.
(1) Obstructionist, in which companies choose not to behave in socially responsible ways and
behave unethically and illegally.
(2) Defensive, in which companies behave ethically to the degree that they stay within the
law.
(3) Accommodative, in which companies behave legally and ethically and try to balance the
interests of different stakeholders as the need arises.
(4) Proactive, in which companies actively embrace socially responsible behavior, going out
of their way to learn about the needs of stakeholders and using organizational resources to
promote their interests.
Difficulty: Hard
107. (p. 138) Discuss two advantages that can result to an organization when managers act in a
socially responsible way.
When managers act in socially responsible ways, the organization bears some of the cost of
helping people, and this reduces the financial burden on government. Also, the quality of life
of some people will improve, thus making the society a better place to live for everyone to
live.
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Chap004 - Test bank

Principle of Management (‫نداعملا و لورتبلل دهف كلملا ةعماج‬‎)

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Chapter 04 - Ethics and Social Responsibility

TEST PLANNING TABLE FOR CHAPTER 4

Learning Goal Easy Moderate Hard

1. Explain the relationship between ethics 1, 2, 3, 35, 36 4, 34, 37, 94 93, 95

4. Discuss why it is important to behavior 57, 58, 59 26, 27, 60,

Total number of test items: 107

True/false questions are in plain text.

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Chapter 04 - Ethics and Social Responsibility

True / False Questions

3. Ethics change over time.

4. Ethics and "the law" are the same thing.

6. Stakeholders supply a company with its productive resources.

7. The job of balancing the demands of various stakeholders of an organization is done

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Chapter 04 - Ethics and Social Responsibility

8. Customers are stakeholders of an organization, but managers are not.

9. Employees are stakeholders of a company.

14. Ethical companies are more likely to grow and expand.

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Chapter 04 - Ethics and Social Responsibility

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Chapter 04 - Ethics and Social Responsibility

29. The code of ethics is the same among different societies.

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Chapter 04 - Ethics and Social Responsibility

Multiple Choice Questions

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Chapter 04 - Ethics and Social Responsibility

37. Which of the following statements is most true?

40. Which of the following is a stakeholder for an organization?

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Chapter 04 - Ethics and Social Responsibility

41. Which of the following is NOT normally a stakeholder of an organization?

44. A community is a stakeholder of an organization because it provides:

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Chapter 04 - Ethics and Social Responsibility

47. The utilitarian rule states that an ethical decision:

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Chapter 04 - Ethics and Social Responsibility

50. The justice rule states that an ethical decision:

52. The practical rule states that an ethical decision:

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Chapter 04 - Ethics and Social Responsibility

53. The Moral Rights model of ethics:

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Chapter 04 - Ethics and Social Responsibility

58. A person's confidence and faith in another person's goodwill is called:

60. Ethical behavior does NOT:

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Chapter 04 - Ethics and Social Responsibility

61. Unethical behavior:

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Chapter 04 - Ethics and Social Responsibility

68. Which of the following is least likely to be a source of individual ethics?

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Chapter 04 - Ethics and Social Responsibility

70. An important source of organizational ethics is:

71. Another name for a company's code of ethics is its: