Question 1

Brain Wing Inc. has won the bid to build airplanes for a host country government. However, the execution of the contract has been delayed due to certain unproductive, bureaucratic procedures in the less developed nation. In order to legally overcome this problem, Brain Wing Inc. could resort to the payment of:

Accepted Answer

Sometimes known as speed money or grease payments, facilitating payments are made to expedite routine government action.

Question 2

Which of the following is most likely to lead to unethical behavior in a business setting?

Accepted Answer

Home-country managers working abroad in multinational firms (expatriate managers) may experience more than the usual degree of pressure to violate their personal ethics.

Question 3

Which of the following statements is true of facilitating payments?

Accepted Answer

The demand for speed money creates a genuine ethical dilemma. The argument that corruption feeds on itself strengthens the ethical case for never engaging in corruption, no matter how compelling the benefits might seem. Many multinationals have accepted this argument. The large oil multinational BP, for example, has a zero-tolerance approach toward facilitating payments.

Question 4

Which of the following best exemplifies noblesse oblige?

Accepted Answer

Noblesse oblige is a French term that refers to honorable and benevolent behavior considered the responsibility of people of high (noble) birth. In a business setting, it is taken to mean benevolent behavior that is the responsibility of successful enterprises.

Question 5

The Convention on Combating Bribery of Foreign Public Officials in International Business Transactions:

Accepted Answer

The Convention on Combating Bribery of Foreign Public Officials in International Business Transactions obliges member-states and other signatories to make the bribery of foreign public officials a criminal offense, but excludes facilitating payments made to expedite routine government action from the convention.

Question 6

Which of the following is most likely to reduce the pressure on managers to violate their personal ethics?

Accepted Answer

Home-country managers working abroad in multinational firms (expatriate managers) may experience more than the usual degree of pressure to violate their personal ethics. They are away from their ordinary social context and supporting culture, and they are psychologically and geographically distant from the parent company.

Question 7

Which of the following best exemplifies an ethical dilemma?

Accepted Answer

An ethical dilemma is a situation in which there is no ethically acceptable solution.

Question 8

In a business setting, managers sometimes do not realize they are behaving unethically, primarily because they:

Accepted Answer

Several studies of unethical behavior in a business setting have concluded that businesspeople sometimes do not realize they are behaving unethically, primarily because they simply fail to ask, "Is this decision or action ethical?" Instead, they apply a straightforward business calculus to what they perceive to be a business decision, forgetting that the decision may also have an important ethical dimension.

Question 9

Which of the following explicitly rejects the idea that businesses should undertake social expenditures beyond those mandated by the law and required for the efficient running of a business?

Accepted Answer

Friedman's basic position is that the only social responsibility of business is to increase profits, so long as the company stays within the rules of law. He explicitly rejects the idea that businesses should undertake social expenditures beyond those mandated by the law and required for the efficient running of a business.

Question 10

In a business setting, the term noblesse oblige refers to:

Accepted Answer

Noblesse oblige is a French term that refers to honorable and benevolent behavior considered the responsibility of people of high (noble) birth. In a business setting, it is taken to mean benevolent behavior that is the responsibility of successful enterprises.

Question 11

The CEO of Gold Chip Software engages in corruption and uses his power in the company to enrich himself and his family members. Consequently, his employees also engage in the same behavior. In this case, the roots of unethical behavior can be traced to:

Accepted Answer

Leaders help to establish the culture of an organization, and they set the example that others follow. Other employees in a business often take their cue from business leaders, and if those leaders do not behave in an ethical manner, they might not either.

Question 12

In order to build large production units and expedite certain routine government actions related to this, Scorpius Inc. made legal payments to the government officials of a host nation. Such payments are typically referred to as:

Accepted Answer

Sometimes known as speed money or grease payments, facilitating payments are made to expedite routine government action.

Question 13

Davis is the manager of a pharmaceutical manufacturing facility in a developing country. The manufacturing unit does not meet the acceptable standards of the manufacturing facility in the home nation. He knows that demanding a better manufacturing unit will raise the cost of the drugs mainly exported to other less developed countries, and hence its price. But he also realizes that by not demanding a better unit, the employees are prone to serious health issues. Davis is facing:

Accepted Answer

Ethical dilemmas are situations in which none of the available alternatives seems ethically acceptable. Doing the right thing, or even knowing what the right thing might be, is often far from easy.

Question 14

The practice of "gift giving" between the parties to a business negotiation is considered right and proper behavior in many Asian cultures. However, some Westerners view the practice as a form of bribery, and therefore unethical, particularly if the gifts are substantial. This reflects that:

Accepted Answer

The ethical obligations of a multinational corporation toward employment conditions, human rights, corruption, environmental pollution, and the use of power are not always clear-cut. There may be no agreement about accepted ethical principles. From an international business viewpoint, some argue that what is ethical depends upon one's cultural perspective.

Question 15

Which of the following refers to the idea that businesspeople should consider the social consequences of economic actions when making business decisions, and that there should be a presumption in favor of decisions that have both good economic and social consequences?

Accepted Answer

The concept of social responsibility refers to the idea that businesspeople should consider the social consequences of economic actions when making business decisions, and that there should be a presumption in favor of decisions that have both good economic and social consequences.

Question 16

The Foreign Corrupt Practices Act was subsequently amended to allow for speed money or grease payments, which are payments made to:

Accepted Answer

The Foreign Corrupt Practices Act was subsequently amended to allow for "facilitating payments." Sometimes known as speed money or grease payments, facilitating payments are not payments to secure contracts that would not otherwise be secured and nor are they payments to obtain exclusive preferential treatment. Rather they are payments to ensure receiving the standard treatment that a business ought to receive from a foreign government, but might not due to the obstruction of a foreign official.

Question 17

Which of the following is a straw man approach to business ethics?

Accepted Answer

Straw men approaches to business ethics are raised by business ethics scholars primarily to demonstrate that they offer inappropriate guidelines for ethical decision making in a multinational enterprise. Four such approaches to business ethics are commonly discussed in the literature. These approaches can be characterized as the Friedman doctrine, cultural relativism, the righteous moralist, and the naive immoralist.

Question 18

Which of the following is detrimental to an ethical business setting?

Accepted Answer

Using Hofstede's dimensions of social culture, it was found that enterprises headquartered in cultures where individualism and uncertainty avoidance are strong were more likely to emphasize the importance of behaving ethically than firms headquartered in cultures where masculinity and power distance are important cultural attributes.

Question 19

The CEO of United Synergy Inc., a company in its embryonic stage, believes that unethical behavior will result in premature decline of the company. In order to ensure that the company starts operating in the most ethical manner, the CEO should:

Accepted Answer

An individual with a strong sense of personal ethics is less likely to behave in an unethical manner in a business setting. It follows that the first step to establishing a strong sense of business ethics is for a society to emphasize strong personal ethics.

Question 20

Unipeg Corporation has uniform high sales targets for its employees all across the globe, regardless of the environmental constraints in each market. Employees are penalized for any shortfall. This has caused many employees to falsify the values of their sales. In this context, the roots of unethical behavior can be traced to:

Accepted Answer

One of the causes of unethical behavior is pressure from the parent company to meet unrealistic performance goals that can be attained only by cutting corners or acting in an unethical manner.

Quiz 5: Ethics, Corporate Social Responsibility, and Sustainability