Essentials of Contemporary Management Gareth Jones 8th Edition- Test Bank
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Sample Test
Essentials of Contemporary Management, 8e (Jones)
Chapter 3 Managing Ethics and Diversity
1) Customers are stakeholders of an organization, but managers
are not.
Answer: FALSE
Explanation: Because stakeholders can directly benefit or
be harmed by its actions, the ethics of a company and its managers are
important to them. It is important to examine the claims of these
stakeholders—stockholders; managers; employees; suppliers and distributors;
customers; and community, society, and nation-state.
Difficulty: 1 Easy
Topic: External Stakeholders
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Remember
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
2) Under the utilitarian rule, an ethical decision is one that
best maintains and protects the fundamental rights and privileges of the people
affected by it.
Answer: FALSE
Explanation: The utilitarian rule is that an ethical
decision is a decision that produces the greatest good for the greatest number
of people.
Difficulty: 1 Easy
Topic: Utilitarian Approach
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Remember
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
3) 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.
Answer: TRUE
Explanation: From a moral rights perspective, managers
should compare and contrast different courses of business action on the basis
of how each course will affect the rights of the company’s different
stakeholders. Managers should then choose the course of action that best
protects and upholds the rights of all stakeholders.
Difficulty: 1 Easy
Topic: Code of Ethics
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Remember
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
4) The practical rule ensures that managers are taking into
account the interests of all stakeholders.
Answer: TRUE
Explanation: Applying the practical rule to analyze a
business decision helps ensure that managers are taking into account the interests
of all stakeholders.
Difficulty: 1 Easy
Topic: Code of Ethics
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Remember
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
5) The ethics of the top managers of an organization shape that
organization’s code of ethics.
Answer: TRUE
Explanation: Managers can emphasize the importance of
ethical behavior and social responsibility by ensuring that ethical values and
norms are a central component of organizational culture. An organization’s code
of ethics guides decision making when ethical questions arise, but managers can
go one step further by ensuring that important ethical values and norms are key
features of an organization’s culture.
Difficulty: 2 Medium
Topic: Code of Ethics
Learning Objective: 03-02 Explain why managers should
behave ethically and strive to create ethical organizational cultures.
Bloom’s: Understand
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
6) The term “diversity” refers to differences in gender and age,
but not to those in sexual orientation.
Answer: FALSE
Explanation: Diversity is dissimilarities among people due
to age, gender, race, ethnicity, religion, sexual orientation, socioeconomic
background, education, experience, physical appearance,
capabilities/disabilities, and any other characteristic that is used to
distinguish between people.
Difficulty: 2 Medium
Topic: Diversity
Learning Objective: 03-03 Appreciate the increasing
diversity of the workforce and of the organizational environment.
Bloom’s: Understand
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
7) According to the federal Glass Ceiling Commission Report,
African Americans have the hardest time being promoted.
Answer: TRUE
Explanation: The federal Glass Ceiling Commission Report
indicated that African Americans have the hardest time being promoted and
climbing the corporate ladder, that Asians are often stereotyped into technical
jobs, and that Hispanics are assumed to be less well educated than other
minority groups.
Difficulty: 1 Easy
Topic: Diversity
Learning Objective: 03-03 Appreciate the increasing
diversity of the workforce and of the organizational environment.
Bloom’s: Remember
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
8) The increasing racial and ethnic diversity of the workforce
and the population as a whole underscores the importance of effectively
managing diversity.
Answer: TRUE
Explanation: Statistics suggest that much needs to be done
in terms of ensuring that diverse employees have equal opportunities.
Difficulty: 2 Medium
Topic: Diversity
Learning Objective: 03-03 Appreciate the increasing
diversity of the workforce and of the organizational environment.
Bloom’s: Understand
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
9) Managers can promote the effective management of diversity through
the performance of interpersonal and decisional roles, but not through
informational roles.
Answer: FALSE
Explanation: Managers can promote the effective management
of diversity through the performance of interpersonal roles, decisional roles, and
informational roles. Refer: Table 3.2
Difficulty: 2 Medium
Topic: Diversity
Learning Objective: 03-04 Grasp the central role that
managers play in the effective management of diversity.
Bloom’s: Understand
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
10) Although a slight bias toward a particular group can seem
unimportant, it can lead to very large differences between groups over time.
Answer: TRUE
Explanation: Research suggests that slight differences in
treatment can accumulate and result in major disparities over time. Even small
differences—such as a very slightly favorable bias toward men for
promotions—can lead to major differences in the number of male and female
managers over time.
Difficulty: 2 Medium
Topic: Diversity
Learning Objective: 03-04 Grasp the central role that
managers play in the effective management of diversity.
Bloom’s: Understand
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
11) At a job interview, the interviewer asks Andrea to describe
a time when she faced an ethical dilemma. An ethical dilemma is a situation in
which a person has to decide if he/she should act in a way that
1. A)
neglects his/her own self-interest to favor another’s self-interest.
2. B) is
the right thing to do, even though doing so might go against his/her own
self-interest.
3. C)
does not go against the self-interest of anyone involved.
4. D)
may help another person and favor his/her own self-interest at the same time.
Answer: B
Explanation: An ethical dilemma is the quandary that
people find themselves in when they have to decide if they should act in a way
that might help another person or group, and is the right thing to do, even
though doing so might go against their own self-interest.
Difficulty: 2 Medium
Topic: Ethical Dilemma
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
12) Bruce is a manager seeking new employees. As he looks
through applicants’ resumes, he decides he wants to hire only women for these
positions because he believes that women are much less trouble and will do as
he tells them. But then he decides that it would be wrong to exclude people he
hasn’t even met based on his notions of how men and women behave. Bruce’s
thoughts and feelings that tell him what is right or wrong are an example of
1. A)
moral scruples.
2. B)
ethical dilemmas.
3. C)
quid pro quo.
4. D)
moral imagination.
Answer: A
Explanation: Moral scruples are thoughts and feelings that
tell a person what is right or wrong; they are a part of a person’s ethics.
Difficulty: 2 Medium
Topic: Ethical Dilemma
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Understand
AACSB: Ethics
Accessibility: Keyboard Navigation
13) Li Jun, a manager, has a problem at work. He asks his mentor
for advice, and she suggests that he think about what he believes is morally
the right thing to do. Essentially, Li Jun’s mentor is telling him to pay
attention to his
1. A)
ethics.
2. B)
opinions.
3. C)
laws.
4. D)
norms.
Answer: A
Explanation: Ethics are the inner guiding moral
principles, values, and beliefs that people use to analyze or interpret a
situation and then decide what is the right or appropriate way to behave.
Ethics also indicate what is inappropriate behavior and how a person should
behave to avoid harming another person.
Difficulty: 2 Medium
Topic: Ethical Dilemma
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Understand
AACSB: Ethics
Accessibility: Keyboard Navigation
14) Which of the following statements about ethics and law is
true?
1. A)
Both ethics and law are fixed principles.
2. B)
Ethics are fixed, but law is flexible.
3. C)
Ethics are flexible, but law is fixed.
4. D)
Neither ethics nor laws are fixed principles.
Answer: D
Explanation: In studying the relationship between ethics
and law, it is important to understand that neither laws nor ethics are fixed
principles that do not change over time. Ethical beliefs alter and change as
time passes, and as they do so, laws change to reflect the changing ethical
beliefs of a society.
Difficulty: 2 Medium
Topic: Ethical Dilemma
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Understand
AACSB: Ethics
Accessibility: Keyboard Navigation
15) It was considered ethical and legal to acquire and possess
slaves in ancient Rome and Greece. Today, however, slavery is considered both unethical
and illegal. This implies that
1. A)
ethics and laws can be fixed or flexible principles depending on the situation.
2. B)
ethics are always fixed but law is always flexible.
3. C)
neither laws nor ethics are fixed principles.
4. D)
ethics are always flexible, but law is always fixed.
Answer: C
Explanation: In studying the relationship between ethics
and law, it is important to understand that neither laws nor ethics are fixed
principles that do not change over time. Ethical beliefs alter and change as
time passes, and as they do so, laws change to reflect the changing ethical
beliefs of a society.
Difficulty: 2 Medium
Topic: Ethical Dilemma
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Understand
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
16) The people and groups that supply a company with its
productive resources, and thus have a claim on and a stake in the company, are
known as
1. A)
community members.
2. B)
individual rights holders.
3. C)
claimants.
4. D)
stakeholders.
Answer: D
Explanation: Stakeholders supply a company with its
productive resources; as a result, they have a claim on and a stake in the
company. Types of stakeholders include stockholders, managers, customers,
community, society, nation-states, suppliers and distributors, and employees.
Difficulty: 1 Easy
Topic: External Stakeholders
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
17) Stockholders are interested in the way that a company
operates because they
1. A)
supply the company’s raw materials.
2. B)
want to do what is morally right.
3. C)
want to maximize the return on their investment.
4. D)
need to minimize the company’s reputation.
Answer: C
Explanation: Stockholders are interested in the way a
company operates because they want to maximize the return on their investment.
Thus they watch the company and its managers closely to ensure that management
is working diligently to increase the company’s profitability. Stockholders
also want to ensure that managers are behaving ethically and not risking
investors’ capital by engaging in actions that could hurt the company’s
reputation.
Difficulty: 1 Easy
Topic: External Stakeholders
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Remember
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
18) The stakeholder group with the most responsibility for
deciding the goals of the organization is the
1. A)
stockholders.
2. B)
customers.
3. C)
managers.
4. D)
working-level employees.
Answer: C
Explanation: Managers are the stakeholder group that bears
the responsibility to decide which goals an organization should pursue to most
benefit stakeholders and how to make the most efficient use of resources to
achieve those goals.
Difficulty: 2 Medium
Topic: Internal Stakeholders
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Understand
AACSB: Ethics
Accessibility: Keyboard Navigation
19) Golden Lumber Inc. sees its profits drop during a recession.
To benefit stockholders and to make the company more attractive to potential
new stockholders, Golden decides to reduce costs. Which stakeholder group is
probably most adversely affected by this cost cutting?
1. A)
board of directors
2. B)
customers
3. C)
managers
4. D)
employees
Answer: D
Explanation: In economic downturns or when a company
experiences performance shortfalls, layoffs may help cut costs (thus benefiting
shareholders) at the expense of the employees laid off.
Difficulty: 2 Medium
Topic: Internal Stakeholders
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Apply
AACSB: Ethics
Accessibility: Keyboard Navigation
20) Important issues concerning product quality and safety
specifications are governed by the contracts a company signs with its
1. A) government
inspectors.
2. B)
senior supervisors.
3. C)
human resources division.
4. D)
suppliers and distributors.
Answer: D
Explanation: Important issues concerning product quality
and safety specifications are governed by the contracts a company signs with its
suppliers and distributors.
Difficulty: 1 Easy
Topic: Code of Ethics
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
21) The most critical stakeholder group is often the
1. A)
stockholders.
2. B)
managers.
3. C)
employees.
4. D)
customers.
Answer: D
Explanation: Customers are often regarded as the most
critical stakeholder group since if a company cannot attract them to buy its
products, it cannot stay in business. Thus managers and employees must work to
increase efficiency and effectiveness in order to create loyal customers and
attract new ones.
Difficulty: 1 Easy
Topic: External Stakeholders
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
22) Senior management of a restaurant chain decides to cut the
workforce by 15 percent. Which of these groups is most likely to respond
positively to this news?
1. A)
stockholders
2. B)
managers
3. C)
employees
4. D)
customers
Answer: A
Explanation: Stockholders are interested in how a company operates
because they want to maximize the return on their investment. Thus, they watch
the company and its managers closely to ensure that management is working
diligently to increase the company’s profitability. If the restaurant chain has
fewer employees, it may become more profitable. In this scenario, managers and
employees would most likely respond negatively because they would have to
divide the same amount of work among fewer people. Customers’ response would
probably be negative because there would be fewer employees to take their
orders, make their food, and clean up.
Difficulty: 3 Hard
Topic: External Stakeholders
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Apply
AACSB: Ethics
Accessibility: Keyboard Navigation
23) To help managers and employees make ethical decisions and
behave in ways that benefit their stakeholders, they can use four ethical rules
or principles to analyze the effects of their business decisions on
stakeholders, the ________ rules.
1. A)
utilitarian, moral choice, justice, and practical
2. B)
utilitarian, moral rights, justice, and existentialist
3. C)
fairness, moral choice, justice, and practical
4. D)
utilitarian, moral rights, justice, and practical
Answer: D
Explanation: To help themselves and employees make ethical
decisions and behave in ways that benefit their stakeholders, managers can use
four ethical rules or principles to analyze the effects of their business
decisions on stakeholders: the utilitarian, moral rights, justice, and
practical rules.
Difficulty: 1 Easy
Topic: Code of Ethics
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different stakeholder
groups.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
24) The utilitarian rule states that an ethical decision
1. A)
will affect those who consider utility in their business decisions.
2. B)
produces the greatest good for the greatest number of people.
3. C)
protects the most important stakeholders first.
4. D) is
one that can be made quickly and with a minimum amount of tension.
Answer: B
Explanation: The utilitarian rule is that an ethical
decision is one that produces the greatest good for the greatest number of
people.
Difficulty: 1 Easy
Topic: Utilitarian Approach
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
25) According to which of the following rules is an ethical
decision one that best maintains people’s fundamental privileges?
1. A)
religious equality
2. B)
moral rights
3. C)
financial
4. D)
fairness-based
Answer: B
Explanation: Under the moral rights rule, an ethical
decision is one that best maintains and protects the fundamental or inalienable
rights and privileges of the people affected by it.
Difficulty: 1 Easy
Topic: Code of Ethics
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
26) Which of these sayings is a reflection of the moral rights
rule?
1. A)
Act first and ask questions later.
2. B) Do
the greatest good for the greatest number of people.
3. C) Do
unto others as you would have them do unto you.
4. D) Do
nothing that would embarrass the company if news of it became public.
Answer: C
Explanation: Under the moral rights rule, an ethical
decision is one that best maintains and protects the fundamental or inalienable
rights and privileges of the people affected by it. The adage “Do unto others
as you would have them do unto you” is a moral rights principle that managers
should use to decide which rights to uphold.
Difficulty: 2 Medium
Topic: Code of Ethics
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Understand
AACSB: Ethics
Accessibility: Keyboard Navigation
27) According to which of the following rules is an ethical
decision one that distributes rewards and harms in a fair way?
1. A)
justice rule
2. B)
moral rights rule
3. C)
utilitarian rule
4. D)
practical rule
Answer: A
Explanation: The justice rule is that an ethical decision
is one that distributes benefits and harms among people and groups in a fair,
equitable, or impartial way.
Difficulty: 1 Easy
Topic: Code of Ethics
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
28) One managerial implication of the justice model is that
managers should base their decisions on
1. A)
whatever stockholders want because stockholders own the company.
2. B)
what provides the maximum benefit to the most stakeholders.
3. C)
whatever promotes a fair distribution of outcomes to stakeholders.
4. D) a
consensus of local, national, and international opinion.
Answer: C
Explanation: The ethical dilemma for managers is to
determine the fair rules and procedures for distributing outcomes to
stakeholders. The justice rule is that an ethical decision is one that
distributes benefits and harms among people and groups in a fair, equitable, or
impartial way.
Difficulty: 2 Medium
Topic: Code of Ethics
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Understand
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
29) Employees who are similar in their level of skill,
performance, or responsibility should receive similar pay; allocation of
outcomes should not be based on differences such as gender, race, or religion.
This is an example of which rule of ethical decision making?
1. A)
justice rule
2. B)
moral rights rule
3. C)
utilitarian rule
4. D)
practical rule
Answer: A
Explanation: The ethical dilemma for managers is to
determine the fair rules and procedures for distributing outcomes to
stakeholders. The justice rule is that an ethical decision is one that
distributes benefits and harms among people and groups in a fair, equitable, or
impartial way.
Difficulty: 2 Medium
Topic: Code of Ethics
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Understand
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
30) When a manager has no hesitation about communicating to
people outside the company regarding a decision made because the typical person
in a society would think it is acceptable, this logic is explained by the
________ rule.
1. A)
justice
2. B)
moral rights
3. C)
utilitarian
4. D)
practical
Answer: D
Explanation: The practical rule is that an ethical
decision is one that a manager has no hesitation or reluctance about communicating
to people outside the company because the typical person in a society would
think it is acceptable.
Difficulty: 1 Easy
Topic: Code of Ethics
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Remember
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
31) The practical rule states that an ethical decision
1. A)
considers people, property, and environment equally.
2. B)
produces the greatest good for the most stockholders.
3. C)
punishes the dishonest and praises the honest.
4. D) is
one that can be communicated with no reluctance.
Answer: D
Explanation: The practical rule is that an ethical
decision is one that a manager has no hesitation or reluctance about
communicating to people outside the company because the typical person in a
society would think it is acceptable.
Difficulty: 1 Easy
Topic: Code of Ethics
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
32) Danika, a board member for a medium-sized corporation, faces
an ethical dilemma. She is unsure whether the board should fire senior
employees who have violated rules or merely discipline those employees but keep
them on staff to avoid potentially harmful publicity. Danika asks herself,
“Would my family members and friends approve of this decision, and am I willing
to see the decision communicated to all people and groups affected?” Asking
this question is part of the ________ rule.
1. A)
justice
2. B)
moral rights
3. C)
utilitarian
4. D)
practical
Answer: D
Explanation: The practical rule is that an ethical decision
is one that a manager has no hesitation or reluctance about communicating to
people outside the company because the typical person in a society would think
it is acceptable. A business decision is probably acceptable on ethical grounds
if a manager can answer yes to each of these questions: (1) Does my decision
fall within the accepted values that typically apply in business activity
today? (2) Am I willing to see the decision communicated to all people and
groups affected by it—for example, by having it reported in newspapers or on
television? (3) Would the people with whom I have a significant personal
relationship, such as family members, friends, or even managers in other
organizations, approve of the decision?
Difficulty: 2 Medium
Topic: Code of Ethics
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Understand
AACSB: Ethics
Accessibility: Keyboard Navigation
33) A paper manufacturer is forced to make staff cutbacks
because of declining profits. It decides to cut back each employee’s hours and
pay by one-half day per week rather than laying off two people. Senior managers
believe that by allowing all their employees to keep their jobs, they are
producing the greatest good for the greatest number of people. Which rule for
ethical decision making does this example show?
1. A)
justice
2. B)
utilitarian
3. C)
moral rights
4. D)
practical
Answer: B
Explanation: The utilitarian rule is that an ethical
decision is a decision that produces the greatest good for the greatest number
of people.
Difficulty: 2 Medium
Topic: Utilitarian Approach; Code of Ethics
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Understand
AACSB: Ethics
Accessibility: Keyboard Navigation
34) Ms. Chen manages a clothing store. Her boss, the district
manager, suggests that she fire competent employees who are old or unattractive
because “they aren’t good ambassadors for our brand.” Ms. Chen tells her boss,
“I’m sorry, but I can’t do as you ask. If anyone found out that we did this, it
would damage the company’s reputation. The average shopper wouldn’t want to do
business with us.” Which ethical rule is Ms. Chen applying?
1. A)
justice
2. B)
practical
3. C)
moral rights
4. D)
utilitarian
Answer: B
Explanation: The practical rule is that an ethical
decision is one that a manager has no hesitation or reluctance about communicating
to people outside the company because the typical person in a society would
think it is acceptable. When a decision is likely to result in the average
person criticizing or shunning the company, that decision violates the
practical rule.
Difficulty: 3 Hard
Topic: Code of Ethics
Learning Objective: 03-01 Illustrate how ethics help
managers determine the right way to behave when dealing with different
stakeholder groups.
Bloom’s: Apply
AACSB: Ethics
Accessibility: Keyboard Navigation
35) Why is it so important that managers, and people in general,
should act ethically and temper their pursuit of self-interest by considering
the effects of their actions on others?
1. A)
because giving excessive importance to oneself with no consideration of societal
interests leads to disaster for each individual and for the whole society
because scarce resources are destroyed
2. B)
because ethical issues are seldom clear-cut, since the rights, self-interests,
goals, and incentives of different stakeholders often conflict
3. C)
because a manager has no reluctance about communicating an ethical decision to
people outside the company since the typical person in a society would think it
is acceptable
4. D)
because if all companies make the right choices, all stakeholders will benefit
in the long run
Answer: A
Explanation: The relentless pursuit of self-interest can
lead to a collective disaster when one or more people start to profit from
being unethical because this encourages other people to act in the same way.
The pursuit of individual self-interest with no consideration of societal
interests leads to disaster for each individual and for the whole society
because scarce resources are destroyed.
Difficulty: 2 Medium
Topic: Code of Ethics
Learning Objective: 03-02 Explain why managers should
behave ethically and strive to create ethical organizational cultures.
Bloom’s: Understand
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
36) Patricia is a supervisor at an Internet startup. One of her
employees tells her, “It’s every man for himself here. Everybody here cuts
corners and breaks rules, so I have to do that, too. So don’t tell me that I
need to follow regulations, because I can’t if I want to get ahead.” Which of
these theories refutes this employee’s belief?
1. A)
personal accountability
2. B)
moral pragmatism
3. C)
the right to equal resources
4. D)
the tragedy of the commons
Answer: D
Explanation: “The tragedy of the commons” means that the
relentless pursuit of self-interest can lead to a collective disaster when
people start to profit from being unethical. When one person acts unethically
for the sake of profit, more people follow that person’s lead, and soon
everybody is trying to manipulate the situation to serve their personal ends
with no regard for the effects of their actions on others.
Difficulty: 3 Hard
Topic: Code of Ethics
Learning Objective: 03-02 Explain why managers should
behave ethically and strive to create ethical organizational cultures.
Bloom’s: Apply
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
37) A person’s confidence and faith in another person’s goodwill
is called
1. A)
trust.
2. B)
esteem.
3. C)
ethics.
4. D)
moral scruple.
Answer: A
Explanation: Trust is the willingness of one person or
group to have faith or confidence in the goodwill of another person, even
though this puts him/her at risk (because the other might act in a deceitful
way).
Difficulty: 1 Easy
Topic: Trust
Learning Objective: 03-02 Explain why managers should
behave ethically and strive to create ethical organizational cultures.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
38) Which of the following is a likely result of loss of trust?
1. A)
Withholding information becomes the norm to keep the stakeholders’ interests
safe.
2. B)
Distrust decreases the time spent negotiating and bargaining between
stakeholders.
3. C)
More motivated stakeholders contribute to a higher standard of living and
well-being.
4. D) An
increase in company performance takes place as people try to win back trust.
Answer: A
Explanation: When trust exists, stakeholders are likely to
signal their good intentions by cooperating and providing information that
makes it easier to exchange and price goods and services. When one person acts
in a trustworthy way, this encourages others to act in the same way. In
contrast, a lack of trust causes people to be more protective of their own
interests.
Difficulty: 1 Easy
Topic: Trust
Learning Objective: 03-02 Explain why managers should
behave ethically and strive to create ethical organizational cultures.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
39) Formal standards and rules, based on beliefs about right or
wrong, that managers can use to help themselves make appropriate decisions with
regard to the interests of their stakeholders are
1. A)
honor codes.
2. B)
codes of ethics.
3. C)
moral codes.
4. D)
existentialist guidelines.
Answer: B
Explanation: Codes of ethics are formal standards and
rules, based on beliefs about right or wrong, that managers can use to help
themselves make appropriate decisions with regard to the interests of their
stakeholders.
Difficulty: 1 Easy
Topic: Code of Ethics
Learning Objective: 03-02 Explain why managers should
behave ethically and strive to create ethical organizational cultures.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
40) Which of the following emanate from a particular community’s
unwritten attitudes, values, and norms that influence how people interact with
each other?
1. A)
societal ethics
2. B)
professional ethics
3. C)
individual ethics
4. D)
organizational ethics
Answer: A
Explanation: Societal ethics are standards that govern how
members of a society deal with each other in matters involving issues such as
fairness, justice, poverty, and the rights of the individual. Societal ethics
emanate from a society’s laws, customs, and practices, and from the unwritten
attitudes, values, and norms that influence how people interact with each
other.
Difficulty: 1 Easy
Topic: Code of Ethics
Learning Objective: 03-02 Explain why managers should
behave ethically and strive to create ethical organizational cultures.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
41) Dontay is the social media manager at the corporate
headquarters of a large hotel chain. In a meeting, another manager suggests
that Dontay should tell his employees to create fake reviews of competing
hotels. “Tell them to make up fake names and say that the other hotels have
bedbugs and that the staff is rude,” the other manager says. “We need to
improve occupancy or the stock price will fall.” Why is this suggestion a bad
idea?
1. A) It
violates societal ethics.
2. B) It
may violate international law.
3. C)
Dontay’s coworkers dislike the idea.
4. D)
The plan wouldn’t affect the stock price.
Answer: A
Explanation: Spreading false claims about a competitor’s
product or service violates societal ethics. Societal ethics are standards that
govern how members of a society deal with each other in matters involving
issues such as fairness, justice, poverty, and the rights of the individual.
Societal ethics emanate from a society’s laws, customs, and practices, and from
the unwritten attitudes, values, and norms that influence how people interact
with each other.
Difficulty: 2 Medium
Topic: Code of Ethics
Learning Objective: 03-02 Explain why managers should
behave ethically and strive to create ethical organizational cultures.
Bloom’s: Apply
AACSB: Analytical Thinking; Ethics
Accessibility: Keyboard Navigation
42) An example of how societal ethics vary among societies might
be how they view
1. A)
murdering a boss.
2. B)
bombing a competitor’s factory.
3. C)
missing a meeting.
4. D)
bribing a public official.
Answer: D
Explanation: In many economically poor countries, bribery
is standard practice to get things done, such as getting a telephone installed
or a contract awarded. In the United States and many other Western countries,
bribery is considered unethical and often illegal.
Difficulty: 1 Easy
Topic: Code of Ethics
Learning Objective: 03-02 Explain why managers should
behave ethically and strive to create ethical organizational cultures.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
43) Standards that govern how members of a particular community
deal with each other in matters involving issues such as fairness, justice,
poverty, and the rights of the individual are ________ ethics.
1. A)
fundamental
2. B)
professional
3. C) individual
4. D)
societal
Answer: D
Explanation: Societal ethics are standards that govern how
members of a society deal with each other in matters involving issues such as
fairness, justice, poverty, and the rights of the individual.
Difficulty: 1 Easy
Topic: Code of Ethics
Learning Objective: 03-02 Explain why managers should
behave ethically and strive to create ethical organizational cultures.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
44) People in a particular country may automatically behave
ethically because they have internalized values and norms that specify how they
should behave in certain situations. This is an example of which code of
ethics?
1. A)
professional ethics
2. B)
individual ethics
3. C)
societal ethics
4. D)
organizational ethics
Answer: C
Explanation: Societal ethics are standards that govern how
members of a society deal with each other in matters involving issues such as
fairness, justice, poverty, and the rights of the individual.
Difficulty: 2 Medium
Topic: Code of Ethics
Learning Objective: 03-02 Explain why managers should
behave ethically and strive to create ethical organizational cultures.
Bloom’s: Apply
AACSB: Ethics
Accessibility: Keyboard Navigation
45) Standards that govern how members of an organization,
whether they are managers or workers, make decisions when the way in which they
should behave is not clear-cut are ________ ethics.
1. A)
professional
2. B)
individual
3. C)
societal
4. D)
organizational
Answer: A
Explanation: Professional ethics are standards that govern
how members of an organization, managers or workers, make decisions when the
way in which they should behave is not clear-cut.
Difficulty: 1 Easy
Topic: Code of Ethics
Learning Objective: 03-02 Explain why managers should behave
ethically and strive to create ethical organizational cultures.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
46) Which of the following are the result of differences in
personalities, values, and attitudes?
1. A) societal
ethics
2. B)
occupational ethics
3. C)
individual ethics
4. D)
organizational ethics
Answer: C
Explanation: Individual ethics are personal values (both
terminal and instrumental) and attitudes that govern how individuals interact
with other people. Many decisions or behaviors that a person finds unethical
may be acceptable to another person because of differences in their
personalities, values, and attitudes.
Difficulty: 1 Easy
Topic: Code of Ethics
Learning Objective: 03-02 Explain why managers should
behave ethically and strive to create ethical organizational cultures.
Bloom’s: Remember
AACSB: Ethics
Accessibility: Keyboard Navigation
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