Hartman Business Ethics 3e

8/10/2019 Hartman Business Ethics 3e

http://slidepdf.com/reader/full/hartman-business-ethics-3e 1/27

Chapter 01 - Ethics and Business

Chapter 01Ethics and Business

True/False Questions

1. Ethical decision making in business is limited to major corporate decisions with dramatic

social consequences.

Answer: alse!i""icult#: Eas#

$earning %bjecti&e: 01-01

'opic: (ntroduction: )aking the Case "or Business EthicsBloom*s 'a+onom#: ,emember

AACB: Ethics

age: /

eedback: Ethical decision making in business is not at all limited to the t#pe o" major

corporate decisions with dramatic social consequences. At some point e&er# worker andcertainl# e&er#one in a management role will be "aced with an issue that will require ethical

decision making.

. (n business e&er# decision can be co&ered b# economic legal or compan# rules and

regulations.Answer: alse

!i""icult#: Eas#

$earning %bjecti&e: 01-01'opic: (ntroduction: )aking the Case "or Business Ethics

Bloom*s 'a+onom#: ,emember

AACB: Ethicsage: /eedback: At some point e&er# worker and certainl# e&er#one in a managerial role will be

"aced with an issue that will require ethical decision making. 2ot e&er# decision can be

co&ered b# economic legal or compan# rules and regulations.

3. 'he direct costs o" unethical business practice are more &isible toda# than the# ha&e e&er

been be"ore.Answer: 'rue

!i""icult#: Eas#



AACB: Ethics

age: 4eedback: 'he direct costs o" unethical business practice are more &isible toda# than perhaps

the# ha&e e&er been be"ore. 'he "irst decade o" the new millennium has been riddled with

highl# publici5ed corporate scandals the e""ects o" which did not escape people o" an# socialor income class.

1-1




/. (n a general sense a business stakeholder is one who has made substantial "inancial

in&estments in the business.

Answer: alse!i""icult#: )edium


'opic: (ntroduction: )aking the Case "or Business EthicsBloom*s 'a+onom#: 6nderstand

AACB: Ethics

age: 7eedback: (n a general sense a business stakeholder will be an#one who a""ects or is a""ected

b# decisions made within the "irm "or better or worse.

4. A "irm*s ethical reputation can pro&ide a competiti&e ad&antage in the marketplace withcustomers suppliers and emplo#ees.

Answer: 'rue

!i""icult#: Eas#


Bloom*s 'a+onom#: ,emember AACB: Ethics

age: 8

eedback: A "irm*s ethical reputation can pro&ide a competiti&e edge in the marketplace withcustomers suppliers and emplo#ees.

9. 'he ra#son-;imes a# "or er"ormance Act was passed to amend the e+ecuti&e

compensation pro&isions o" the Emergenc# Economic tabili5ation Act o" 008.Answer: 'rue

!i""icult#: Eas#



AACB: Ethicsage: 10

eedback: 'he ra#son-;imes a# "or er"ormance Act was passed <to amend the e+ecuti&e

compensation pro&isions o" the Emergenc# Economic tabili5ation Act o" 008 to prohibit

unreasonable and e+cessi&e compensation and compensation not based on per"ormancestandards.=

7. Ethics re"ers to how human beings should properl# li&e their li&es.Answer: 'rue

!i""icult#: Eas#

$earning %bjecti&e: 01-0'opic: Business Ethics as Ethical !ecision )aking


AACB: Ethics

age: 11

1-




eedback: Ethics re"ers not onl# to an academic discipline but to that arena o" human li"e

studied b# this academic discipline namel# how human beings should properl# li&e their

li&es.

8. Ethical business leadership is the skill to create circumstances in which bad people are

taught to do good.Answer: alse

!i""icult#: Eas#

$earning %bjecti&e: 01-03'opic: Business Ethics as ersonal (ntegrit# and ocial ,esponsibilit#


AACB: Ethics

age: 1eedback: Ethical business leadership is the skill to create the circumstances in which good

people are able to do good and bad people are pre&ented "rom doing bad.

>. 2orms appeal to certain &alues that would be promoted or attained b# acting in a certainwa#.

Answer: 'rue!i""icult#: )edium

$earning %bjecti&e: 01-0/

'opic: Business Ethics as ersonal (ntegrit# and ocial ,esponsibilit#Bloom*s 'a+onom#: 6nderstand

AACB: Anal#tic

age: 17

eedback: 2orms establish the guidelines or standards "or determining what we should dohow we should act what t#pe o" person we should be. Another wa# o" e+pressing this point is

to sa# that norms appeal to certain &alues that would be promoted or attained b# acting in a

certain wa#.

10. 'echnicall# speaking &alues are not necessaril# positi&e or ethical in nature.

Answer: 'rue!i""icult#: )edium


'opic: Business Ethics as ersonal (ntegrit# and ocial ,esponsibilit#

Bloom*s 'a+onom#: 6nderstandAACB: Ethics

age: 18

eedback: (n general &alues are those belie"s that incline us to act or to choose one wa#rather than another. %ne important implication o" this guidance o" course is that an

indi&idual*s or a corporation*s set o" &alues ma# lead to either ethical or unethical result.

11. Ethical &alues are personal codes o" ethics that ensure that indi&iduall# a person meets his

or her standards o" well-being.

Answer: alse

!i""icult#: )edium

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age: 18

eedback: (t is important to know two elements o" ethical &alues. irst ethical &alues ser&ethe ends o" human well-being. econd the well-being promoted b# ethical &alues is not a

personal and sel"ish well-being. 'hus ethical &alues are those belie"s and principles that

impartiall# promote human well-being.

1. 'he well-being promoted b# ethical &alues is not a personal and sel"ish well-being.

Answer: 'rue

!i""icult#: Eas#$earning %bjecti&e: 01-0/



AACB: Ethics? Anal#ticage: 18

eedback: (t is important to know two elements o" ethical &alues. irst ethical &alues ser&ethe ends o" human well-being. econd the well-being promoted b# ethical &alues is not a

personal and sel"ish well-being. 'hus ethical &alues are those belie"s and principles that

impartiall# promote human well-being.

13. ocieties that &alue indi&idual "reedom will be reluctant to legall# require acts o" charit#

personal integrit# and common decenc#.

Answer: 'rue!i""icult#: Eas#


'opic: Ethics and the $awBloom*s 'a+onom#: ,emember

AACB: Ethics

age: 1eedback: ocieties that &alue indi&idual "reedom will be reluctant to legall# require more

than just an ethical minimum. uch liberal societies will seek legall# to prohibit the most

serious ethical harms but the# will not legall# require acts o" charit# common decenc# and

personal integrit# that ma# otherwise comprise the social "abric o" a de&eloped culture.

1/. (n ci&il law there is no room "or ambiguit# in appl#ing the law because much o" the law is

established b# past precedent.Answer: alse

!i""icult#: Eas#

$earning %bjecti&e: 01-09'opic: Ethics and the $aw


AACB: Ethics

age: 3

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eedback: (n ci&il law @as opposed to criminal law where much o" the law is established b#

past precedent there is alwa#s room "or ambiguit# in appl#ing the law.

14. Ethical theories are patterns o" thinking or methodologies to help us decide what to do.

Answer: 'rue

!i""icult#: Eas#$earning %bjecti&e: 01-07

'opic: Ethics as ractical ,eason


age: 9

eedback: Ethical theories are patterns o" thinking or methodologies to help us decide what

to do.

Multiple Choice Questions

19. hich o" the "ollowing statements is true about ethical decision making in business

a. Ethical decision making is not limited to the t#pe o" major corporate decisions withdramatic social consequences.

b. E&er# emplo#ee does not "ace an issue that requires ethical decision making.

c. All ethical decisions can be co&ered b# economic legal or compan# rules and regulations.d. Ethical decision making should not rel# on the personal &alues and principles o" the

indi&iduals in&ol&ed.

Answer: a

!i""icult#: )edium$earning %bjecti&e: 01-01

'opic: (ntroduction: )aking the Case "or Business Ethics


age: /

eedback: Ethical decision making in business is not at all limited to the t#pe o" majorcorporate decisions with dramatic social consequences.

17. hich o" the "ollowing statements is true about ethical decision making in business

a. Ethical decision making is limited to the t#pe o" major corporate decisions with socialconsequences.

b. At some point e&er# worker will be "aced with an issue that will require ethical decision

making.c. All ethical decisions can be co&ered b# economic legal or compan# rules and regulations.

d. Ethical decision making should not rel# on the personal &alues and principles o" the

indi&iduals in&ol&ed.Answer: b

!i""icult#: )edium



1-4








Bloom*s 'a+onom#: ,emember AACB: Anal#tic

age: 7

eedback: (n a general sense a business stakeholder will be an#one who a""ects or is a""ected b# decisions made within the "irm "or better or worse.

1. (denti"# the bill that was passed in April 00> to amend the e+ecuti&e compensation pro&isions o" the Emergenc# Economic tabili5ation Act o" 008 to prohibit unreasonable and

e+cessi&e compensation and compensation not based on per"ormance standards.

a. ramm,udman;ollings er"ormance and ,esults Act

b. Emplo#ee a# Comparabilit# Actc. ra#son-;imes a# "or er"ormance Act

d. tatutor# a#-As-Fou-o Act

Answer: c



AACB: Anal#tic

age: 10eedback: 'he ra#son-;imes a# "or er"ormance Act was passed in April 00> <to amend

the e+ecuti&e compensation pro&isions o" the Emergenc# Economic tabili5ation Act o" 008

to prohibit unreasonable and e+cessi&e compensation and compensation not based on

per"ormance standards.= 'his bill would ban "uture <unreasonable and e+cessi&e=compensation at companies recei&ing "ederal bailout mone#.

. hich o" the "ollowing is the objecti&e o" the ra#son-;imes a# "or er"ormance Acta. 'o ban "uture <unreasonable and e+cessi&e= compensation at companies recei&ing "ederal

bailout mone#

b. 'o set up the ublic Compan# Accounting %&ersight Board in the wake o" accountingscandals that rocked the pri&ate sector

c. 'o outlaw the practice o" backdating o" stock options awarded to senior management

d. 'o set upper limits on e+ecuti&e pa# based on a&erage emplo#ee salar# in all pri&ate sector

organi5ationsAnswer: a

!i""icult#: Eas#



AACB: Anal#ticage: 10

eedback: 'he ra#son-;imes a# "or er"ormance Act was passed in April 00> <to amend

the e+ecuti&e compensation pro&isions o" the Emergenc# Economic tabili5ation Act o" 008

to prohibit unreasonable and e+cessi&e compensation and compensation not based on

1-7




per"ormance standards.= 'his bill would ban "uture <unreasonable and e+cessi&e=

compensation at companies recei&ing "ederal bailout mone#.

3. hich o" the "ollowing best describes ethics

a. An academic discipline which originated in the earl# 1>00s

b. A descripti&e approach that pro&ides an account o" how and wh# people do act the wa#the# do

c. 'he stud# o" how human beings should properl# li&e their li&es

d. A descripti&e approach such as ps#cholog# and sociolog#Answer: c

!i""icult#: Eas#


'opic: Business Ethics as Ethical !ecision makingBloom*s 'a+onom#: ,emember

AACB: Anal#tic

age: 11

eedback: Ethics re"ers not onl# to an academic discipline but to that arena o" human li"estudied b# this academic discipline namel# how human beings should properl# li&e their

li&es.

/. hich o" the "ollowing is an approach ad&ocated while teaching ethics

a. 'eachers should teach ethical dogma to a passi&e audience. b. 'eachers should consider acceptance o" customar# norms as an adequate ethical

perspecti&e.

c. 'eachers should understand that their role is onl# to tell the right answers to their students.

d. 'eachers should challenge students to think "or themsel&es.Answer: d

!i""icult#: )edium

$earning %bjecti&e: 01-0'opic: Business Ethics as Ethical !ecision making


AACB: Ethicsage: 1

eedback: 'he teacher*s role should not be to preach ethical dogma to a passi&e audience but

instead to treat students as acti&e learners and to engage them in an acti&e process o" thinking

questioning and deliberating. 'eaching ethics must challenge students to think "orthemsel&es.

4. hilosophers o"ten emphasi5e that ethics is DDDDD which means that it deals with a person*s reasoning about how he or she should act.

a. normati&e

b. descripti&ec. stipulati&e

d. persuasi&e

Answer: a

!i""icult#: Eas#

1-8






Bloom*s 'a+onom#: ,emember AACB: Ethics? Anal#tic

age: 1/

eedback: hilosophers o"ten emphasi5e that ethics is normati&e which means that it dealswith our reasoning about how we should act.

9. hich o" the "ollowing obser&ations is true o" ethicsa. (t is descripti&e in nature.

b. (t deals with our reasoning about how we should act.

c. (t pro&ides an account o" how and wh# people act the wa# the# do.

d. (t is equi&alent to law-abiding beha&ior.Answer: b

!i""icult#: Eas#


'opic: Business Ethics as ersonal (ntegrit# and ocial ,esponsibilit#Bloom*s 'a+onom#: ,emember

AACB: Ethics? Anal#ticage: 1/

eedback: hilosophers o"ten emphasi5e that ethics is normati&e which means that it deals

with our reasoning about how we should act. As a normati&e discipline ethics seeks anaccount o" how and wh# people should act a certain wa# rather than how the# do act.

7. $ike ethics social sciences such as ps#cholog# and sociolog# also e+amine human

decision making and actions. ;owe&er these "ields di""er "rom ethics because the# are DDDDD.a. normati&e in nature

b. descripti&e in nature

c. persuasi&e in natured. stipulati&e in nature

Answer: b





eedback: ocial sciences such as ps#cholog# and sociolog# also e+amine human decision

making and actions? but these sciences are descripti&e rather than normati&e.

8. Ethics seeks an account o" how and wh# people should act a certain wa# rather than how

the# do act. 'his nature o" ethics makes it a@n DDDDD discipline.a. descripti&e

b. supererogator#

c. normati&e

d. stipulati&e

1->




Answer: c

!i""icult#: )edium


Bloom*s 'a+onom#: 6nderstand


eedback: As a normati&e discipline ethics seeks an account o" how and wh# people should

act a certain wa# rather than how the# do act.

>. As a DDDDD discipline ethics seeks an account o" how and wh# people should act a certain

wa#.

a. descripti&e b. supererogator#

c. normati&e

d. stipulati&e

Answer: c!i""icult#: )edium




eedback: As a normati&e discipline ethics seeks an account o" how and wh# people should

act a certain wa# rather than how the# do act.

30. 'he DDDDD discipline pro&ides an account o" how and wh# people do act the wa# the# do.

a. descripti&e

b. supererogator#c. normati&e

d. stipulati&e

Answer: a!i""icult#: )edium



Bloom*s 'a+onom#: ,ememberAACB: Ethics? Anal#tic

age: 1/

eedback: ocial sciences such as ps#cholog# and sociolog# also e+amine human decisionmaking and actions? but these sciences are descripti&e rather than normati&e. hen we sa#

that the# are descripti&e we re"er to the "act that the# pro&ide an account o" how and wh#

people do act the wa# the# doGthe# describe.

31. (ndi&idual codes o" conduct based on one*s &alue structures regarding how one should

li&e how one should act what one should do what kind o" a person should one be etc. is

sometimes re"erred to as DDDDD.

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AACB: Anal#tic

age: 17eedback: 2orms establish the guidelines or standards "or determining what we should do

how we should act what t#pe o" person we should be.

37. 2orms:

a. are the underl#ing belie"s that cause people to act or to decide one wa# rather than another.

b. are standards o" appropriate and proper beha&ior.c. are re"erred to b# the phrase <personal integrit#.=

d. do not presuppose an# underl#ing &alues.

Answer: b





eedback: 'o sa# that ethics is a normati&e discipline is to sa# that it deals with norms: thosestandards o" appropriate and proper @or <normal= beha&ior. 2orms establish the guidelines or

standards "or determining what we should do how we should act what t#pe o" person we

should be.

38. 'he cru+ o" normati&e ethics is that these disciplines:

a. presuppose some underl#ing &alues.

b. describe what people do.c. should alwa#s in&ol&e the stud# or discipline o" ethics.

d. branch awa# "rom social ethics to personal ethics.

Answer: a!i""icult#: )edium



AACB: Anal#tic

age: 17

eedback: 2ormati&e disciplines presuppose some underl#ing &alues.

3>. hich o" the "ollowing are underl#ing belie"s that cause us to act or to decide one wa#

rather than anothera. atterns

b. Codes

c. etsd. Halues

Answer: d

!i""icult#: Eas#


1-13







eedback: e can think o" &alues as the underl#ing belie"s that cause us to act or to decide

one wa# rather than another.

/0. hich o" the "ollowing is true about &alues

a. Halues are the highest standards o" appropriate and proper beha&ior. b. Corporate scandals pro&e the "act that indi&iduals ha&e personal &alues but institutions lack

&alues.

c. Halues cannot lead to unethical results.

d. Halues are underl#ing belie"s that cause us to act or to decide in a certain wa#.Answer: d

!i""icult#: )edium




eedback: e can think o" &alues as the underl#ing belie"s that cause us to act or to decide

one wa# rather than another.

/1. hich o" the "ollowing are belie"s and principles that pro&ide the ultimate guide to a

compan#*s decision making

a. )ission statement b. Core &alues

c. ;istorical milestones

d. Hision statementAnswer: b

!i""icult#: Eas#

$earning %bjecti&e: 01-0/'opic: Business Ethics as ersonal (ntegrit# and ocial ,esponsibilit#


AACB: Ethics? Anal#tic

age: 18eedback: A compan#*s core &alues are those belie"s and principles that pro&ide the ultimate

guide to its decision making.

/. hich o" the "ollowing best describe the norms that guide emplo#ees implicitl# more

o"ten than not to beha&e in wa#s that the "irm &alues and "inds worth#

a. %rgani5ational culture b. o&ernment*s "inancial regulations

c. (ndustrial norms

d. $egal statutes

Answer: a

1-1/




!i""icult#: Eas#




age: 18eedback: 'alk o" a corporation*s <culture= is a wa# o" sa#ing that a corporation has a set o"

identi"iable &alues that establish the e+pectations "or what is <normal= within that "irm. 'hese

norms guide emplo#ees implicitl# more o"ten than not to beha&e in wa#s that the "irm &aluesand "inds worth#.

/3. Ethics requires that the promotion o" human wel"are be done:

a. based on the personal opinions o" the decision maker. b. based on the le&el o" need o" the bene"iciaries.

c. understanding the religious belie"s o" the bene"iciar#.

d. in a manner that is acceptable and reasonable "rom all rele&ant points o" &iew.

Answer: d!i""icult#: Eas#




eedback: rom the perspecti&e o" ethics no one person*s wel"are is more worth# than an#

other*s. Ethical acts and choices should be acceptable and reasonable "rom all rele&ant points

o" &iew.

//. !ramatic e+amples "rom histor# including 2a5i erman# and apartheid in outh A"rica

demonstrate that:a. societies &aluing "reedom welcome laws that require more than the ethical minimum.

b. ethical responsibilities gi&e rise to more and more regulations.

c. obedience to law is su""icient to "ul"ill one*s ethical duties.d. one*s ethical responsibilit# ma# run counter to the law.

Answer: d

!i""icult#: )edium



AACB: Ethicsage: 1>

eedback: ;olding that obedience to the law is su""icient to "ul"ill one*s ethical duties begs

the question o" whether the law itsel" is ethical. !ramatic e+amples "rom histor# including 2a5i erman# and apartheid in outh A"rica demonstrate that one*s ethical responsibilit#

ma# run counter to the law.

/4. 'elling organi5ations that their ethical responsibilities end with obedience to the law:

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a. is just in&iting more legal regulation.

b. is enough to maintain an ethical business en&ironment.

c. reduces the "requenc# o" corporate scandals.d. eliminates ambiguit# while making personal ethics-related decisions.

Answer: a

!i""icult#: ;ard$earning %bjecti&e: 01-04

'opic: Ethics and the $aw

Bloom*s 'a+onom#: 6nderstandAACB: Ethics? Anal#tic

age: 1

eedback: 'elling business that its ethical responsibilities end with obedience to the law is just

in&iting more legal regulation.

/9. 'he "ailure o" personal ethics among companies like Enron and orldCom led to the

creation o" the:

a. Brooks Act. b. ramm-$each-Blile# Act.

c. ClingerCohen Act.d. arbanes%+le# Act.

Answer: d




AACB: Ethicsage: 1

eedback: (t was the "ailure o" personal ethics among companies such as Enron and

orldCom that led to the creation o" the arbanes-%+le# Act and man# other legal re"orms.

/7. hich o" the "ollowing obser&ations is true

a. %bedience to the law is su""icient to "ul"ill one*s ethical duties. b. 'he law is &er# e""ecti&e at promoting <goods.=

c. 'he law cannot anticipate e&er# new dilemma that businesses might "ace.

d. An indi&idual*s ethical responsibilit# can ne&er run counter to the law.

Answer: c!i""icult#: )edium


'opic: Ethics and the $awBloom*s 'a+onom#: 6nderstand


age: 1eedback: 'he law cannot possibl# anticipate e&er# new dilemma that businesses might

"ace? so o"ten there ma# not be a regulation "or the particular dilemma that con"ronts a

business leader.

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/8. hich o" the "ollowing helps identi"# potential e&ents that ma# a""ect the entit# and

manage risk to be within its risk appetite to pro&ide reasonable assurance regarding the

achie&ement o" entit# objecti&esa. ,isk a&ersion

b. ,isk benchmarking

c. ,isk assessmentd. ,isk minimi5ation

Answer: c




AACB: Ethicsage: 3

eedback: ,isk assessment is de"ined as <a process . . . to identi"# potential e&ents that ma#

a""ect the entit# and manage risk to be within its risk appetite to pro&ide reasonable

assurance regarding the achie&ement o" entit# objecti&es.=

/>. ractical reasoning is reasoning about:a. what we should think.

b. what we should do.

c. what we should belie&e.d. what we should share.

Answer: b

!i""icult#: Eas#

$earning %bjecti&e: 01-07'opic: Ethics as ractical ,eason


AACB: Ethicsage: /

eedback: ractical reasoning is reasoning about what we should do.

40. DDDDD reasoning is reasoning about what we should do.

a. ractical

b. !escripti&e

c. 'heoreticald. 2otional

Answer: a




age: /

eedback: ractical reasoning is reasoning about what we should do.

1-17




41. 'heoretical reasoning is reasoning about:

a. what we actuall# do.

b. what we should do.c. what we should belie&e.

d. what we should implement.

Answer: c!i""icult#: Eas#


'opic: Ethics as ractical ,easonBloom*s 'a+onom#: ,emember

AACB: Ethics

age: /

eedback: 'heoretical reasoning is reasoning about what we should belie&e.

4. DDDDD reasoning is reasoning about what we should belie&e.

a. ractical

b. Abstractc. 'heoretical

d. !escripti&eAnswer: c

!i""icult#: Eas#



AACB: Ethics

age: /eedback: 'heoretical reasoning is reasoning about what we should belie&e.

43. hich o" the "ollowing re"ers to the pursuit o" truth and the highest standard "or what weshould belie&e

a. 'heoretical reason

b. Critical reasonc. hilanthropic reason

d. ractical reason

Answer: a




age: /

eedback: 'heoretical reason is the pursuit o" truth which is the highest standard "or what weshould belie&e.

4/. According to the tradition o" theoretical reason DDDDD is the great arbiter o" truth.

a. religion

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b. perception

c. science

d. ethicsAnswer: c

!i""icult#: Eas#



AACB: Ethics? Anal#ticage: / 9

eedback: 'heoretical reason is the pursuit o" truth which is the highest standard "or what we

should belie&e. According to this tradition science is the great arbiter o" truth.

44. hich o" the "ollowing can be thought o" as the answer to the "undamental questions o"

theoretical reason

a. 'he scienti"ic method

b. 'he practical approachc. 'he contingenc# approach

d. 'he normati&e modelAnswer: a

!i""icult#: )edium




age: 9eedback: 'heoretical reason is the pursuit o" truth which is the highest standard "or what we

should belie&e. According to this tradition science is the great arbiter o" truth. 'hus the

scienti"ic method can be thought o" as the answer to the "undamental questions o" theoreticalreason: hat should we belie&e

Fill in the Blank Questions

49. A@n DDDDD is an#one a""ected "or better or "or worse b# the decisions made within a

particular "irm.Answer: stakeholder

!i""icult#: Eas#



AACB: Ethicsage: 7

eedback: (n a general sense a business stakeholder will be an#one who a""ects or is a""ected

b# decisions made within the "irm "or better or worse.

1-1>




47. (n an organi5ational conte+t DDDDD is the skill o" creating a circumstance in which good

people are able to do good and bad people are pre&ented "rom doing bad.

Answer: ethical business leadership!i""icult#: Eas#



AACB: Ethics

age: 1eedback: Ethical business leadership is the skill to create the circumstances within which

good people are able to do good and bad people are pre&ented "rom doing bad.

48. DDDDD is the aspect o" ethics that is re"erred to b# the phrase <personal integrit#.=Answer: )oralit#

!i""icult#: Eas#



AACB: Ethicsage: 1/

eedback: )oralit# is the aspect o" ethics that we re"er to b# the phrase <personal integrit#.=

4>. DDDDD ethics asks us to simpl# step back "rom implicit e&er#da# decisions to e+amine and

e&aluate them.

Answer: hilosophical




age: 14

eedback: hilosophical ethics merel# asks us to step back "rom implicit e&er#da# decisionsto e+amine and e&aluate them.

90. 'o sa# that ethics is a DDDDD discipline is to sa# that it deals with standards o" appropriate

and proper beha&ior.Answer: normati&e

!i""icult#: Eas#



AACB: Ethicsage: 17

eedback: 'o sa# that ethics is a normati&e discipline is to sa# that it deals with norms: those

standards o" appropriate and proper @or <normal= beha&ior.

1-0




91. 2ormati&e disciplines presuppose some underl#ing DDDDD.

Answer: &alues




age: 17

eedback: 2ormati&e disciplines presuppose some underl#ing &alues.

9. DDDDD ser&e the ends o" human well-being.

Answer: Ethical &alues




AACB: Ethicsage: 18

eedback: Ethical &alues ser&e the ends o" human well-being. Acts and decisions that seek to promote human wel"are are acts and decisions based on ethical &alues.

93. %ne wa# to distinguish the &arious t#pes o" &alues is in terms o" the ends the# ser&e. DDDDD &alues ser&e the end o" beaut#.

Answer: Aesthetic

!i""icult#: Eas#



AACB: Ethicsage: 18

eedback: %ne wa# to distinguish &arious t#pes o" &alues is in terms o" the ends the# ser&e.

inancial &alues ser&e monetar# ends? religious &alues ser&e spiritual ends? aesthetic &aluesser&e the end o" beaut#? legal &alues ser&e law order and justice and so "orth.

9/. 'he DDDDD requires emplo#ers to make reasonable accommodations "or emplo#ees with

disabilities.Answer: Americans with !isabilities Act

!i""icult#: Eas#




eedback: 'he Americans with !isabilities Act @A!A requires emplo#ers to make

reasonable accommodations "or emplo#ees with disabilities.

1-1




94. According to DDDDD science is the great arbiter o" truth.

Answer: theoretical reason

!i""icult#: )edium$earning %bjecti&e: 01-07



age: /? 9

eedback: 'heoretical reason is the pursuit o" truth which is the highest standard "or what weshould belie&e. According to this tradition science is the great arbiter o" truth.

Essay Questions

99. E+plain how ethical decisions are required to be made b# e&er#bod# and how the# ha&e

the capacit# to in"luence more than just the decision maker.

Answer: Ethical decision making in business is not limited to the t#pe o" major corporatedecisions with dramatic social consequences known in the "orm o" Enron I)organ and

orldCom etc. At some point e&er# worker and certainl# e&er#one in a management rolewill be "aced with an issue that will require ethical decision making. 2ot e&er# decision can

be co&ered b# economic legal or compan# rules and regulations. )ore o"ten than not

responsible decision making must rel# on the personal &alues and principles o" the indi&idualsin&ol&ed. (ndi&iduals will ha&e to decide "or themsel&es what t#pe o" person the# want to be.

At other times decisions will in&ol&e signi"icant general polic# issues that a""ect entire

organi5ations as happened in all the well-known corporate scandals. 'he managerial role

especiall# in&ol&es decision making that establishes organi5ational precedents and hasorgani5ational and social consequences.

!i""icult#: )edium



AACB: Ethicsage: /

97. E+plain how the stud# o" ethics was &iewed until recentl# and what kind o" shi"t in "ocus

has occurred post the scandals.Answer: As recentl# as the mid-1>>0s articles in such major publications as 'he all treet

Iournal the ;ar&ard Business ,e&iew and 6.. 2ews and orld ,eport questioned the

legitimac# and &alue o" teaching classes in business ethics. ew disciplines "ace the t#pe o"skepticism that commonl# con"ronted courses in business ethics. )an# students belie&ed that

<business ethics= was an o+#moron. )an# also &iewed ethics as a mi+ture o" sentimentalit#

and personal opinion that would inter"ere with the e""icient "unctioning o" business.$eaders reali5e that the# can no longer a""ord this approach in contemporar# business. 'he

questions toda# are less about wh# or should ethics be a part o" business than the# are about

which &alues and principles should guide business decisions and how ethics should be

integrated within business. tudents un"amiliar with the basic concepts and categories o"

1-




ethics will "ind themsel&es as unprepared "or careers in business as students who are

un"amiliar with accounting and "inance. (ndeed it is "air to sa# that students will not be "ull#

prepared e&en within "ields such as accounting "inance human resource managementmarketing and management unless the# are "amiliar with the ethical issues that arise within

those speci"ic "ields.

!i""icult#: ;ard$earning %bjecti&e: 01-01



age: 4-9

98. !escribe the ad&antages associated with ethical decision-making.Answer: 6nethical beha&ior not onl# creates legal risks "or a business it creates "inancial and

marketing risks as well. )anaging these risks requires managers and e+ecuti&es to remain

&igilant about their compan#*s ethics. (t is &er# clear now that a compan# can lose in the

marketplace it can go out o" business and its emplo#ees can go to jail i" no one is pa#ingattention to the ethical standards o" the "irm.

A "irm*s ethical reputation can pro&ide a competiti&e ad&antage in the marketplace and withcustomers suppliers and emplo#ees. )anaging ethicall# can also pa# signi"icant di&idends in

organi5ational structure and e""icienc#. 'rust lo#alt# commitment creati&it# and initiati&e

are just some o" the organi5ational bene"its that are more likel# to "lourish within ethicall#stable and credible organi5ations.

!i""icult#: Eas#


'opic: (ntroduction: )aking the Case "or Business EthicsBloom*s 'a+onom#: 6nderstand


age: 7-8

9>. !iscuss the hesitation @that ma# be justi"ied associated with teaching ethics. E+plain

brie"l# how the authors o" this te+t belie&e that ethics can be taught constructi&el# in a class.Answer: art o" the hesitation about teaching ethics in&ol&es the potential "or abuse?

e+pecting teachers to in"luence beha&ior ma# be &iewed as permission "or teachers to impose

their own &iews on students. )an# belie&e that teachers should remain &alue-neutral in the

classroom and respect a student*s own &iews. Another part o" this concern is that the line between moti&ating students and manipulating students is a narrow one. 'here are man# wa#s

to in"luence someone*s beha&ior including threats guilt pressure bull#ing and intimidation.

But not all "orms o" in"luencing beha&ior raise such concerns. 'here is a major di""erence between manipulating someone and persuading someone between threatening and reasoning.

'he authors o" this te+t belie&e that the tension between knowledge and beha&ior can be

resol&ed b# emphasi5ing ethical judgment ethical deliberation and ethical decision making.'he onl# academicall# and ethicall# legitimate wa# to do this is through care"ul and reasoned

decision making. 'he "undamental assumption is that a process o" rational decision making a

process that in&ol&es care"ul thought and deliberation can and will result in beha&ior that is

more reasonable accountable and ethical.

1-3




!i""icult#: )edium


'opic: Business Ethics as Ethical !ecision makingBloom*s 'a+onom#: 6nderstand

AACB: Ethics

age: 11

70. !e"ine ethics. ;ow is it di""erent "rom social sciences such as ps#cholog# and sociolog#

Answer: Ethics re"ers not onl# to an academic discipline but to that arena o" human li"estudied b# this academic discipline namel# how human beings should properl# li&e their

li&es.

hilosophers o"ten emphasi5e that ethics is normati&e in that it deals with our reasoning

about how we should act. ocial sciences such as ps#cholog# and sociolog# also e+aminehuman decision-making and actions but these sciences are descripti&e rather than normati&e.

'he# pro&ide an account o" how and wh# people do act the wa# the# do? as a normati&e

discipline ethics seeks an account o" how and wh# people should act a certain wa# rather

than how the# do act.!i""icult#: Eas#

$earning %bjecti&e: 01-03? 01-0'opic: Business Ethics as Ethical !ecision )aking? Business Ethics as ersonal (ntegrit# and

ocial ,esponsibilit#


age: 11 1/

71. !i""erentiate the concepts o" moralit# and social ethics.Answer: 'he "undamental question o" ethics <;ow should we li&e= can be interpreted in two

wa#s.

<e= can mean each one o" us indi&iduall# or it might mean all o" us collecti&el#. (n the "irstsense this is a question about how ( should li&e m# li"e how ( should act what ( should do

and what kind o" person ( should be. 'his meaning o" ethics is sometimes re"erred to as

moralit# and it is the aspect o" ethics that we re"er to b# the phrase <personal integrit#.= 'herewill be man# times within a business setting where an indi&idual will need to step back and

ask: <hat should ( do ;ow should ( act=

(n the second sense <;ow should we li&e= re"ers to how we li&e together in a communit#.

'his is a question about how a societ# and social institutions such as corporations ought to bestructured and about how we ought to li&e together. 'his area is sometimes re"erred to as

social ethics and it raises questions o" justice public polic# law ci&ic &irtues organi5ational

structure and political philosoph#. (n this sense business ethics is concerned with how business institutions ought to be structured about corporate social responsibilit# and about

making decisions that will impact man# people other than the indi&idual decision maker. 'his

aspect o" business ethics asks us to e+amine business institutions "rom a social rather than anindi&idual perspecti&e. 'his broader social aspect o" ethics is re"erred to as decision making

"or social responsibilit#.

!i""icult#: Eas#


1-/






AACB: Ethics? Anal#ticage: 1/-14

7. h# is Jethics* considered a normati&e disciplineAnswer: 'o sa# that ethics is a normati&e discipline is to sa# that it deals with norms those

standards o" appropriate and proper @or <normal= beha&ior. 2orms establish the guidelines or

standards "or determining what we should do how we should act what t#pe o" person weshould be.

!i""icult#: Eas#



AACB: Ethics

age: 17

73. !e"ine &alues and discuss the element o" corporate culture in detail.

Answer: (n general &alues can be thought o" as those belie"s that incline us to act or to chooseone wa# rather than another.

A compan#*s core &alues "or e+ample are those belie"s and principles that pro&ide the

ultimate guide in its decision making. (ndi&iduals can ha&e their own personal &alues andimportantl# institutions also ha&e &alues. A corporation*s <culture= is a wa# o" sa#ing that a

corporation has a set o" identi"iable &alues that establish the e+pectations "or what is <normal=

within that "irm. 'hese norms guide emplo#ees implicitl# more o"ten than not to beha&e in

wa#s that the "irm &alues and "inds worth#. %ne important implication o" this is that anindi&idual or a corporation*s set o" &alues ma# lead to either ethical or unethical result. 'he

corporate culture at Enron "or e+ample seems to ha&e been committed to pushing the

en&elope o" legalit# as "ar as possible in order to get awa# with as much as possible in pursuito" as much mone# as possible.

!i""icult#: Eas#



AACB: Ethics

age: 18

7/. !escribe the two elements o" ethical &alues.

Answer: irst ethical &alues ser&e the ends o" human well-being. Acts and choices that aim to promote human wel"are are acts and choices based on ethical &alues.

econd the well-being promoted b# ethical &alues is not a personal and sel"ish well-being.

Ethical &alues are those belie"s and principles that impartiall# promote human well-being.!i""icult#: Eas#




1-4




AACB: Ethics

age: 18

74. !iscuss the impact o" maintaining that holding to the law is su""icient to "ul"ill one*s

ethical duties and what it sa#s about the law itsel".

Answer: ;olding that obedience to the law is su""icient to "ul"ill one*s ethical duties begs thequestion o" whether or not the law itsel" is ethical. E+amples "rom histor# 2a5i erman# and

apartheid in outh A"rica being the most ob&ious demonstrate that one*s ethical responsibilit#

ma# run counter to the law.%n a more practical le&el this question can ha&e signi"icant implications in a global econom#

in which businesses operate in countries with legal s#stems di""erent "rom those o" their home

countr#. ome countries make child labor or se+ual discrimination legal but businesses that

choose to adopt such practices do not escape ethical responsibilit# "or doing so. rom the perspecti&e o" ethics a business does not "orgo its ethical responsibilities based on obedience

to the law.

!i""icult#: )edium



age: 1>

79. E+plain the di""iculties associated with telling businesses that its ethical responsibilities

end with obedience to the law.

Answer: 'elling business that its ethical responsibilities end with obedience to the law is just

in&iting more legal regulation. 'he di""icult# o" tr#ing to create laws to co&er each and e&er# possible business challenge would be enormous. 'he task would require such speci"icit# that

the number o" regulated areas would become unmanageable.

Additionall# it was the "ailure o" personal ethics among such companies as Enron andorldCom a"ter all that led to the creation o" the arbanes-%+le# Act and man# other legal

re"orms. (" business restricts its ethical responsibilities to obedience to the law it should not

be surprising to "ind a new wa&e o" go&ernment regulations that require what were "ormerl#&oluntar# actions.

!i""icult#: Eas#


'opic: Ethics and the $awBloom*s 'a+onom#: 6nderstand


age: 1

77. !iscuss the importance o" precedents "or most laws concerning business.

Answer: )ost o" the laws that concern business are based on past cases that establish legal precedents. Each precedent applies general rules to the speci"ic circumstances o" an indi&idual

case. (n most business situations asking <(s this legal= is reall# asking <Are these

circumstances similar enough to past cases that the conclusions reached in those cases will

also appl# here= ince there will alwa#s be some di""erences between cases the question

1-9




will alwa#s remain somewhat open.

!i""icult#: Eas#



AACB: Ethicsage: -3

78. !e"ine risk assessment.Answer: ,isk assessment is de"ined as a process to identi"# potential e&ents that ma# a""ect

the entit# and manage risk to be within its risk appetite to pro&ide reasonable assurance

regarding the achie&ement o" entit# objecti&es.





7>. hile using the risk assessment model what might the decision makers include in their

assessment be"ore taking action

Answer: 6sing the risk assessment model decision makers might include in their assessment be"ore taking action:

K the likelihood o" being challenged in court

K the likelihood o" losing the case

K the likelihood o" settling "or "inancial damagesK a comparison o" those costs

K the "inancial bene"its o" taking the action

K the ethical implication o" the options a&ailable!i""icult#: Eas#


'opic: Ethics and the $awBloom*s 'a+onom#: ,emember

AACB: Ethics

age: 3-/

80. !i""erentiate between practical reason and theoretical reason.

Answer: ractical reason is described as reasoning about what we should do whereas

theoretical reason in&ol&es reasoning about what we should belie&e.!i""icult#: Eas#


'opic: Ethics as ractical ,easonBloom*s 'a+onom#: ,emember

AACB: Ethics

age: /

Hartman Business Ethics 3e

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