Question 1

Anderson invested $1 million in a company called Ladmen Corp. He, therefore, has a personal interest in the company's profits and its new ventures. Given this information, Anderson is a _____ in Ladmen Corp.

Accepted Answer

Anderson's investment in Ladmen Corp gives him a personal interest in the company's profits and new ventures, making him a stakeholder. A lender would be someone who loans money to the company, a vendor would be a supplier of goods or services to the company, and shapeholder is not a recognized term in the context of corporate title/position.

Question 2

Crayon, a well-established beauty products company, partnered with the Lenora Birdstone Foundation, a nonprofit organization, to raise awareness about breast cancer and collect funds for setting up a cancer unit at a local hospital. The company accumulated a sum of $5 million by selling organic creams to more than 2,000 people. In this scenario, Crayon was most likely involved in _____.

Accepted Answer

Crayon was involved in cause-related marketing, as they partnered with a nonprofit organization to raise awareness and funds for breast cancer.

Question 3

Adhering to a new act passed in 2002, the CEO of Pearsil & Pearsil, a real estate company, now personally certifies the validity of the company's financial statements. Given this information, the CEO most likely follows the_____.

Accepted Answer

The Sarbanes-Oxley Act, passed in 2002, requires CEOs and CFOs to personally certify the validity of their company's financial statements. Therefore, the CEO of Pearsil & Pearsil most likely follows this act. The Blaine Act pertains to presidential succession, the Landrum-Griffin Act pertains to labor unions, and the Dawes Act pertains to Native American land rights.

Question 4

An automobile company is asked to recall 20 batches of its sports utility vehicle after it is found that a defect in the exhaust system of the car causes it to emit more smoke than the level permitted. In this scenario, the car manufacturing company is exceeding its _____ emissions.

Accepted Answer

The answer of An automobile company is asked to recall...

Question 5

Ethics refer to:

Accepted Answer

Ethics refer to sets of beliefs about right and wrong. They are not the same as legal codes or social movements, although they can influence both. While businesses may have an obligation to contribute to society, this is not the definition of ethics.

Question 6

Rudolf, a Polish manager in a company based in China, is admired by his colleagues for the way he interacts with people, his considerate nature, and his tolerance toward other cultures. In the context of universal ethical standards, Rudolf possesses the core value of _____.

Accepted Answer

Rudolf's behavior towards people with different cultural backgrounds demonstrates his respect towards them. Respect is a core value that is a part of universal ethical standards.

Question 7

Yanmei, an employee at a news agency, learns that the reason her colleague was asked not to pursue a news story further was because the editor of the newspaper was bribed by the concerned party to suppress the matter. Yanmei reveals this information to the chief editor and her colleagues and also reports it to the media. In this scenario, Yanmei is a _____.

Accepted Answer

Yanmei is a whistle-blower as she exposed the corrupt practices of the editor even though it could have resulted in negative consequences for her.

Question 8

Ethan, an employee in a corporate company, is asked to do a systematic evaluation of the company's adherence to its social and ethical standards. In this case, Ethan should first:

Accepted Answer

The first step in a systematic evaluation of the company's adherence to its social and ethical standards is to establish the ethics and social responsibility goals that the company seeks to achieve. This will provide a clear framework for the evaluation process and help determine what areas need to be assessed. Once the goals are established, the other steps such as comparing philosophies of other companies, assessing investment capacity, and quantifying involvement can be taken.

Question 9

Gander, an apparel company, is known to be a profit-hungry company. It lands in a controversy when it comes to light that the company pays almost nonliving wages to the workers in its manufacturing subsidiaries based in developing countries. In the context of business behavior, Gander's business conduct is:

Accepted Answer

While it may be legal for a company to pay low wages in developing countries where labor laws are weak or non-existent, it is still unethical to pay nonliving wages to workers who are often in dire need of a decent income. Therefore, Gander's conduct is legal but unethical.

Question 10

In the context of ethical choices, research results from the Ethics Resource Center (ERC) illustrate that:

Accepted Answer

The research by the ERC shows that there is a correlation between the perceived changes in ethical culture and employee misconduct. It suggests that when employees feel that the ethical culture of their organization has been negatively impacted, they are more likely to engage in misconduct. This highlights the importance for organizations to maintain a strong ethical culture, especially during challenging times such as economic downturns.

Question 11

Which of the following is a duty of a socially responsible organization toward its customers?

Accepted Answer

Following laws that prevent anticompetitive behavior such as predatory pricing is a duty of a socially responsible organization toward its customers. This ensures that customers are not exploited by the organization's practices and that there is fair competition in the market. Choice A is incorrect because involving consumers in financial indicators is not a direct duty toward customers. Choice B is incorrect because planned obsolescence can harm customers by encouraging them to buy new products more frequently. Choice D is incorrect because collusion and monopoly are anticompetitive practices that harm customers.

Question 12

Cornell Health Care, a renowned American hospital, regularly collaborates with other health-care centers to provide small medical clinics in low-income countries drugs and medical services at lower than normal prices. In this scenario, this practice of collusion by Cornell Health Care is _____.

Accepted Answer

The answer of Cornell Health Care, a renowned American hospital,...

Quiz 4: Business Ethics and Social Responsibility: Doing Well by Doing Good