Business 111 Chapters 4 and 5

Purposefully understating your firm's income to avoid paying higher taxes is an example of:

• an accepted business practice.

• tax accountants doing their job.

• illegal behavior.

• a firm's responsibility to its owners.

The purpose of sobriety checkpoints that are set up by community and state police is to deter drunk driving and ultimately save lives. While not mandated, the makers of Blackberry have complied with the public request of several legislators and have obediently removed apps that permit smartphone users to navigate around the checkpoints. Google and Apple have elected not to honor such requests. After studying about ethics and social responsibility, which of the following statements applies to this situation?

• Laws represent the minimum guidelines that companies must follow whereas a firm’s ethical stance may venture beyond the minimum level of compliance.

• Google and Apple are showing corporate social responsibility because they demonstrate concern for their investors, which is exactly where their focus should be.

• Blackberry is acting philanthropically toward government.

• Google and Apple are showing their distrust for big government, and their avoidance of contributing toward philanthropic causes.

When WorldCom used intentional accounting irregularities to make the company look more profitable than it actually was, it:

• provided its stockholders profit through a tax loophole.

• acted in an acceptable business manner.

• engaged in illegal behavior.

• executed its responsibility to its owners.

Cigarette producers refused to voluntarily place health warnings on their packages. In response, the federal government passed laws requiring health warnings on all cigarette packages. With respect to ethical behavior, this sequence of events is:

• the intended approach.

• the desired approach.

• not the desired approach.

• not really a concern.

When Angela graduated with a degree in computer science and started her software company, she posted a sign that read, "This company will always operate within the legal limits of the law." Posted where all employees could clearly see it each day, this demonstrated:

• her commitment to high ethical standards of behavior.

• her commitment to respect the law.

• her expectation that all employees follow the laws that apply to the business.

• her aversion to cheating, stealing, and dishonesty.

After a few years of being in business, employees who worked for a start-up software company noticed that the owner overlooked certain questionable actions of high billing associates, versus other employees who worked hard but only brought in an average number of new clients each month. With respect to what you learned in this chapter about the ethical behavior of many Americans, which of the following statements applies here?

• This story indicates that moral absolutes are very prevalent today in business settings.

• The owner will continue to operate this way until someone blows the whistle.

• We cannot expect people in the U.S. to all follow similar ethical patterns because there are too many cultures to deal with. Businesses are no different.

• As is often the case today, some leaders will look at each situation individually when making value judgments.

A U.S. government official has indicated that for a generous contribution to his reelection fund, he would ignore your firm's apparent violation of several anti-pollution laws. Which of the following "ethics check questions" would you consider first?

• Is it legal?

• Is it fair and balanced?

• How will it make me feel about myself?

• Is it a generous amount?

A friend offers to share with you a term paper previously prepared for her Introduction to Business class last semester. When you tell her that it wouldn't be fair, she reminds you of your habit of reading an entire Harry Potter book at the local bookstore without paying for the book. Which ethics-based question would be most helpful in evaluating these situations?

• Is it legal?

• Is it balanced?

• Who wins and who loses?

• Will I get caught?

A high-level manager gathers his team of supervisors together to create a new office policy that will affect all employees at the company. After receiving a verbal okay from the supervisors, he then proceeds to pass around a written form of the new policy and asks all members of the team to initial it. He explains to the supervisors that the new policy will be posted in the break rooms on each floor of corporate headquarters. If you were a part of this work team, which question would you ultimately ask yourself before initialing your approval of this policy?

• Is it legal?

• Is it balanced?

• How will it make me feel about myself?

• Is it a lose-lose situation?

Joe Jackson operates a sole proprietorship, but he is in poor health and may be unable to continue running the business. If Joe becomes incapacitated, his business:

• automatically continues under new management as a sole proprietorship.

• automatically converts into a public corporation with stock sold to interested investors.

• ceases to exist unless sold or taken over by Joe's heirs.

• becomes the property of the most senior employee who wishes to continue operating the firm.