The belief that the costs of social activity are passed on as higher prices to consumers is known as which argument against a firm being socially responsible?
A) violation of profit maximization
B) costs
C) lack of skills
D) dilution of purpose

Question

Quizplus · Accepted Answer

The argument that the costs of social activity are passed on as higher prices to consumers is known as the "costs" argument against a firm being socially responsible. This argument states that if a firm spends resources on social activities, it will have to compensate for those costs by increasing its prices, which may lead to a decrease in demand and ultimately reduce profits. However, some argue that being socially responsible may actually benefit a firm in the long run by improving its reputation and customer loyalty.

The Belief That the Costs of Social Activity Are Passed