BUS 309 Business Ethics Week 10 Quiz – Strayer
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Chapter 10—Moral Choices Facing Employees
1. Based on guidelines of employer/employee relations, which statement is true?
a. company loyalty is an outmoded, illegitimate concept that employees today reject
b. the traditional law of agency obliges employees to act loyally and in good faith and to carry out lawful instructions
c. an employee’s work contract is irrelevant to his or her moral obligations
d. no value is more important than loyalty, whether to a person or an organization
2. Conflicts of interest
a. have become less frequent today.
b. always involve personal financial gain.
c. are morally worrisome only when the employee acts to the detriment of the company.
d. occur when employees’ private interests are substantial enough to potentially interfere with their job duties.
3. According to the Supreme Court,
a. there is nothing improper about an outsider’s using information, as long as the information is not obtained from an insider who breaches a legal duty to the corporation’s shareholders.
b. anyone buying/selling stock based on nonpublic information is guilty of inside trading.
c. insider trading violates the interstate commerce clause of the Constitution.
d. it should be left up to the company, not the government, to decide whether or not to prohibit insider trading.
4. A “trade secret”
a. is legally equivalent to a patent or copyright.
b. need not be treated confidentially by the company in order to be protected.
c. can become part of an employee’s technical knowledge, experience, and skill.
d. is a narrow, precise concept that the law defines in great detail.
5. The Foreign Corrupt Practices Act (FCPA)
a. doesn’t apply to countries where bribery is common.
b. is alleged by its critics to put American companies at a disadvantage.
c. carefully distinguishes bribery from extortion payments.
d. outlaws “grease payments”.
6. In determining the morality of giving and receiving gifts in a business situation, which of the following factors is MOST relevant?
a. the purpose of the gift
b. the size of the business
c. amount of the cash
d. whether the company is privately held or publicly held
7. A whistle-blower
a. doesn’t have to be a past or present member of the organization.
b. doesn’t have to report activity that is illegal, immoral, or harmful.
c. is any employer who spreads gossip.
d. far from being disloyal, may be acting in the best interest of the organization.
8. The Sarbanes-Oxley Act
a. makes it easier to fire whistle blowers.
b. reduces the law’s protection of employees who disclose securities fraud.
c. makes it illegal for executives to retaliate against employees who report possible violations of federal law.
d. provides penalties for blowing the whistle illegitimately or maliciously.
9. According to Professor Norman Bowie, which of the following factors is relevant to determining the morality of blowing the whistle?
a. the whistle blower’s motive
b. whether internal channels have been exhausted
c. whether the whistle blowing has some chance of success
d. all of the above
10. In discussing the case of the truck stop cashier who is asked to write up phony chits or receipts, the text argues that
a. there is nothing wrong with writing up the chits.
b. she should resign immediately.
c. she may be justified in “going along,” at least temporarily.
d. morality never requires us to sacrifice our own interests.
11. In the 1997 case of U.S. v. Hagan, the Supreme Court found that Hagan
a. had been discriminated against because of whistle blowing.
b. was innocent of insider trading.
c. violated the FCPA despite never having gone overseas.
d. had misappropriated confidential information.
12. The Donald Wohlgemuth case shows that
a. trade secrets can be patented.
b. trade secrets often become an integral part of an employee’s total job skills and capabilities.
c. employees need to divest themselves of any skill acquired while handling trade secrets.
d. “noncompete” or “nondisclosure” contracts are always legally valid.
13. Some writers deny that employees have any obligation of loyalty to the company, because
a. companies are not the kind of things that are properly objects of loyalty.
b. you cannot trust anyone.
c. it’s every man for himself.
d. companies just aren’t the same any more.
14. When an employee’s interests are likely to interfere with the employee’s ability to exercise proper judgment on behalf of the organization, what exists?
a. a golden opportunity c. a balance of power
b. a conflict of interest d. a disaster
15. Insider trading is
a. the buying or selling of stocks (or other financial securities) by business “insiders” on the basis of information that has not yet been made public and is likely to affect the price of the stock.
b. a corporate merger.
c. knowing when to make the best buy.
d. giving great advice on a deal.
16. Inside traders ordinarily defend their actions by claiming that they don’t injure
a. the boss. b. their family. c. the President. d. anyone.
17. Shaw and Barry mention three arguments for legally protecting trade secrets. Which of these is one of them?
a. Trade secrets are the intellectual property of the employee who developed them.
b. Employees who disclose trade secrets
violate the confidentiality owed to their employers
c. Trade secrets are patented.
d. Trade secrets are trademarked.
18. U.S. companies have a history of paying off foreign officials for business favors. Such acts were declared illegal by
a. the U.S. Customs department.
b. the Vice President.
c. the Foreign Corrupt Practices Act (FCPA) of 1977.
d. the United Nations.
19. To resolve difficult moral dilemmas, the better we understand the exact ramifications of the
alternatives—the more likely we are
a. to make a sound moral decision. c. to be a success.
b. to drive the boss crazy. d. to go to jail.
20. Whistle-blowing involves exposing activities that are
a. sports related. c. too close to call.
b. immoral or illegal. d. boring and need some excitement.
21. Whistle-blowers are only human beings, not saints, and they sometimes have their own
a. salary. c. bandwagon.
b. self-serving agenda. d. office.
22. Which act provides sweeping new legal protection for employees who report possible securities fraud, making it unlawful for companies to “discharge, demote, suspend, threaten, harass, or in any other manner discriminate against” them?
a. Sarbanes-Oxley Act of 2002 c. Economic Espionage Act
b. Foreign Corruption Act d. U.S. vs. O’Hagan
23. Conflicts of interest may exist when employees have financial investments
a. in suppliers, customers, or distributors with whom their organizations do business.
b. in sports teams.
c. and question the wisdom of the deal.
d. that lead to office romance.
24. The use of one’s official position for what always raises moral concerns and questions?
a. power trips c. stepping stones to success
b. egos d. personal gain
25. Experimental studies suggest that when informed that the advice they’re receiving may be biased because of a conflict of interest,
a. those who disclose a conflict of interest rarely end up giving more biased advice than those who do not disclose
b. those who disclose a conflict of interest always end up giving more biased advice than those who do not disclose
c. People tend to fail to discount the advice as much as they should.
d. people tend to discount the advice as much as they should.
1. An employee can have a conflict of interest even if he or she doesn’t act to the detriment of the organization.
2. Insider trading is the buying or selling of stocks by insiders on the basis of information attained by an “insider” that has not yet been made public and is likely to affect the price of the stock.
3. The law precisely defines the concept of a trade secret, just as it does patents and copyrights.
4. A kickback is a kind of bribe.
5. By definition, whistle-blowing can only be done by a past or present member of the organization.
6. Prudential reasons are reasons that refer to the interests of others and the demands of morality.
7. All gifts are bribes.
8. According to Norman Bowie, whistle blowing can never be justified because it involves violating one’s duties to the organization.
9. A bribe is remuneration for the performance of an act that’s inconsistent with the work contract or the nature of the work one has been hired to perform.
10. The Supreme Court has rejected the idea that inside trading involves “misappropriating” confidential information.
11. A conflict of interest arises when an employee has private interests that are substantial enough to potentially interfere with his or her job duties.
12. The Foreign Corrupt Practices Act (FCPA) outlaws grease payments.
13. A common argument against the Foreign Corrupt Practices Act is that it illegitimately imposes parochial American standards on foreign countries.
14. Employees have no obligations to people with whom they have no business relations.
15. As a general rule, if the contents of the work agreement that exists between the employee and the employer are legal and if the employee freely consents to them, then the employee is under an obligation to fulfill the terms of the agreement.
16. Sometimes companies require employees to sign contracts restricting their ability to get a job with, or start, a competing company. Because they can conflict with freedom of employment, not all such “noncompete” or “nondisclosure” contracts are legally valid.
17. Justice Ginsberg and Arthur Levitt suggest that allowing insider trading could lead to a widespread perception that “the game is rigged.”
18. The Foreign Corrupt Practices Act of 1977 forbids companies to pay kickbacks in the United States, but permits them to pay kickbacks to companies outside the United States.
19. Employees have certain general duties to their employers, and because of the specific business, professional, or organizational responsibilities they have assumed, they may have other more precise role-based obligations.
20. When faced with a moral decision, employees should follow the two-step procedure of identifying the relevant obligations, ideals, and effects; and then decide where the emphasis should lie among these considerations.
21. According to one expert’s definition, whistle blowing is conceptually restricted to reporting on activities that are harmful to third parties, violations of human rights, or contrary to the public purpose and legitimate goals of the organization.
22. According to Norman Bowie, a discussion of whistle blowing in the 1990s parallels the discussion of civil disobedience in the 1960s.
23. Prudential reasons are those moral reasons that are separate from self-interest.
24. According to Jennifer Moore the real reason insider trading should be prohibited is that it undermines the fiduciary relationship that is at the heart of business management.
25. The Sarbanes-Oxley Act weakened legal protections for whistle blowers.
1. When does a conflict of interest arise?
2. What is insider trading?
3. Name an argument that’s given against legalizing insider trading?
4. How do trade secrets differ from information that is patented or copyrighted?
5. What are the main features of the 1977 Foreign Corrupt Practices Act (FCPA)?
6. Name an argument given against foreign forms of bribery.
7. There are at least seven factors to take into consideration in determining the morality of giving and receiving gifts in a business situation. Explain three of them.
8. What is whistle-blowing, and what motivates whistle-blowers?
9. According to Norman Bowie, whistle-blowing is morally justified only if five criteria are met. What are these five criteria?
10. What is a key lesson to be learned from the example of the cashier at a truck stop who is asked by her manager to provide the truckers with phony chits so they can get a larger reimbursement from their companies?
1. How do we know when whistle-blowing is morally right or wrong? Justify your answer.
2. Consider Coleen Rowley who blew the whistle against the FBI. How could we justify the fact that she did the right thing? Consider at least two different moral theories.
3. When, if ever, are employees overly disloyal for getting a job for a competing organization? Justify your answer.
4. If all the other businesses in a foreign country are providing a “grease payment” for border patrol. Is it all right and ethical to do that? State and defend your answer.
5. Provide an example of an abuse of an official position. Justify your answer.