Question 1

Leah has just handed in a major required report to her professor, and after careful scrutiny the professor finds numerous instances of plagiarism. If the school policy and the professor's personal perspective follow a principles-based approach, Leah should be charged and suffer whatever penalty is prescribed by school policy.

Accepted Answer

The principles-based approach holds that everyone should be subject to and follow similar rules.

Question 2

Immanuel Kant is credited with developing the utilitarian stream of moral reasoning.

Accepted Answer

Immanuel Kant is credited with developing theories of duty ethics.

Question 3

A comprehensive values management program may be used in managing a corporation's diversity program.

Accepted Answer

A comprehensive values management program may be effective in considering different values and perspectives among various stakeholders.

Question 4

Honoring ethical values and respecting communities and the environment while recognizing the interests of shareholders are elements of corporate citizenship.

Accepted Answer

Each of the values named is a component of corporate citizenship.

Question 5

As of today, the Enron bankruptcy remains the largest corporate bankruptcy in America's history.

Accepted Answer

The 2008 Lehman Brothers bankruptcy eclipsed the Enron bankruptcy as the largest in America's history.

Question 6

In the early part of the 2000s, Wall Street analysts rated Enron's stock risk as "staggeringly low."

Accepted Answer

In the early part of the 2000s, Wall Street analysts rated Enron's stock risk as "staggeringly low" due to enormous revenue increases.

Question 7

Corporations, as business entities, cannot be charged with a crime; only the individuals who make up the company's officers and board can be charged.

Accepted Answer

Arthur Andersen, for example, was convicted of obstruction of justice, fined, and banned from performing audits for a number of years.

Question 8

AIG caused a major political firestorm when, after receiving taxpayer bailout money, it distributed $165 million in performance bonuses to executive employees.

Accepted Answer

After receiving $173 billion in taxpayer money to keep the company running, AIG then distributed $165 million in performance bonuses to executive employees.

Question 9

The final result of the AIG bonusgate scandal was that no new laws or taxes were enacted, nor were there any additional official actions taken by Congress or the president.

Accepted Answer

Despite threats, no action was taken by Congress or the president following the AIG bonusgate fiasco.

Question 10

One of the major reasons that Enron failed was that it did not have an articulated code of ethics to guide the company.

Accepted Answer

Enron had an elaborate and well-written code of ethics that it simply violated.

Question 11

Tom's company has a code of ethics and a separate code of conduct. If he would like to find out about the company's expectations or requirements regarding community service, he would reference the code of ethics.

Accepted Answer

A company's expectations or requirements regarding community service are a topic found in a code of ethics.

Question 12

Arthur Andersen, as a result of its conviction following the Enron scandal, is now completely out of business.

Accepted Answer

Primarily because of its ban from performing audits, customers and employees left the company and the company ceased most operations although a small portion of the original organization continues in operation.

Question 13

Grimshaw v. Ford Motor Company is often cited as a failing of the management's hand approach to corporate social responsibility.

Accepted Answer

Grimshaw v. Ford Motor Company is often cited as a failing of the invisible hand and government's hand approaches to corporate social responsibility.

Question 14

Enron profits showed that first-quarter revenues rose from $12 billion in 2000 to $84 billion in 2001.

Accepted Answer

Enron's profits indeed rose 600 percent once deregulation of the industry began.

Question 15

The fundamental underlying concept of corporate social responsibility is that conscience resides in individuals but not in a corporation itself.

Accepted Answer

The fundamental underlying concept of corporate social responsibility is that conscience resides not just in individuals but also in a corporation itself.

Question 16

Social responsibility is at its highest when the moderate view, or government's hand theory, of corporate social responsibility is utilized.

Accepted Answer

Social responsibility is at its highest when the broad view, or management's hand theory, of corporate social responsibility is utilized.

Question 17

Advocates of the invisible hand theory do not trust corporate leaders with stewardship over noneconomic values.

Accepted Answer

Advocates of the invisible hand theory do not believe that corporate leaders are capable of managing noneconomic values.

Question 18

Linda's company has a code of ethics and a separate code of conduct. If she wants to be sure that she complies with the company dress code, she would reference the code of ethics.

Accepted Answer

A company dress code is a topic found in a code of conduct.

Question 19

Kenneth Lay, Enron's CEO, is currently serving a prison sentence as a result of his fraudulent dealings that led to the Enron scandal.

Accepted Answer

Although convicted, Kenneth Lay died before he was sentenced.

Question 20

Codes of ethics are insufficient and do not serve their proper purpose if they are intended only to ensure that company policies are legal.

Accepted Answer

A code of ethics should reflect values to aspire to, not simply policies to stay out of legal trouble.

Quiz 5: Business, Societal, and Ethical Contexts of Law