HRM 522 Week 11 Final Exam – Strayer University New

HRM/522 Week 11 Final Exam – Strayer New

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Chapters 7 Through 12

Chapter 7

1. Expert power usually stems from
a. a superior’s credibility with his or her subordinates.
b. the belief that a certain person has the right to exert influence and that certain others have an obligation to accept it.
c. a person’s ability to influence the behavior of others by offering them something desirable. d. a person’s ability to penalize the actions or behavior of another.
e. a person’s perceptions that his or her goals or objectives are similar to another’s.

2. Which of the following statements about power is true?
a. The five bases of power are mutually exclusive.
b. People generally use only one base of power to effect change in others.
c. Expert power exists when one person takes actions that will lead that person and others to achieve their mutual objectives.
d. Power can be used to motivate individuals ethically or unethically. e. The use of power is unethical.

3. An organization that delegates decision-making authority as far down the chain of command as possible and has relatively few formal rules is
a. centralized.
b. decentralized. c. flat.
d. tall.
e. ethical.

4. Which of the following is not a characteristic of an ethical corporate culture?
a. Management and the board demonstrate their commitment to strong controls through their communications and actions.
b. Every employee is encouraged and required to have hands-on involvement in the internal control system. c. Management conducts itself in a way that is not consistent with the code of conduct.
d. Employees are expected to be in the communication loop through resolutions and corrective actions.
e. Employees have the ability to report policy exceptions anonymously to any member of the organization.

5. Although both structures can create opportunities for unethical conduct, which organizational structure tends to be more ethical?
a. Tall b. Flat
c. Centralized
d. Decentralized
e. All organizational structures are equally ethical.

6. The ability to influence the behavior of others by offering them something desirable is best described as a. coercive power.
b. reward power. c. expert power.
d. legitimate power. e. referent power.

7. An advantage of the decentralized organization is that
a. the focus is on formal rules, policies, and procedures backed up with elaborate control systems. b. there is a high level of bureaucracy.
c. each worker knows his or her job and what is specifically expected as well as how to carry out designated tasks.
d. it is adaptable and can quickly respond to external change. e. there is minimal upward communication.

8. When developing an ethical culture, there has to be a(n)

element because every organization has employees

that will try to take advantage if there is an opportunity for misconduct. a. rules-based
b. statement of mission c. ethical
d. compliance e. punitive

9. The apathetic organizational culture exhibits
a. high concern for people but minimal concern for performance. b. little concern for people but a high concern for performance.
c. minimal concern for people and performance. d. high concern for people and performance.
e. no concern for maintaining a cohesive organizational culture.

10. The exacting organizational culture is interested in
a. performance but has little concern for employees. b. investors’ impressions of profitability.
c. maintaining a strong corporate culture. d. employees and performance.
e. employees’ impressions.

11. Associating with others who are unethical and who have the opportunity to act unethically can lead to a learning process known as
a. compliance. b. misconduct. c. opportunity.
d. differential equations.
e. differential association.

12. Which of the following statements about corporate culture is false?
a. Corporate culture refers to the patterns and rules that govern the behavior of an organization and its employees, particularly the shared values, beliefs, and customs.
b. The values and ethical beliefs that actually guide the firm’s employees tend not to be the same ones that management states as defining the firm’s culture.
c. Corporate culture includes the behavioral patterns, concepts, values, ceremonies, and rituals that take place in an organization.
d. The culture of an organization may be explicitly stated or unspoken.
e. Failure to monitor or manage an organization’s culture may foster unethical behavior.

13. No formal dress codes, working late, participation in extracurricular activities, gestures, and legends represent a. a complacent workplace.
b. codes of ethics.
c. a firm’s organizational chart.
d. formal expressions of an organization’s culture.
e. informal expressions of an organization’s culture.

14. A cultural audit may be used to identify a. how cultured a firm’s employees are. b. unethical employees.
c. unethical organizations.
d. an organization’s culture. e. organizational structure.

15. The 2010 passage of the Dodd-Frank Act proposed additional monetary incentives for whistle-blowers. A primary concern about these new incentives is
a. they will encourage too many employees to attempt to blow the whistle on firms, even those that have done nothing wrong.
b. people do not generally respond at all to monetary incentives.
c. whistle-blowers might be tempted to report to the SEC with their reports and not report the misconduct to the
company’s internal compliance program.
d. people may exaggerate their claims in order to get a reward.
e. the funds paid out to whistle-blower might bankrupt companies.

16. Marcus is the top-performing development director his non-profit organization has ever had. He possesses countless tricks and tips to continue to bring in donations, positive publicity, and supporters. Marcus would likely have
over new development department staff. a. coercive power
b. group power
c. legitimate power d. expert power
e. democratic power


bring together the functional expertise of employees from several different areas of the organization on a single project.
a. Quality circles
b. Informal groups c. Teams
d. Work groups e. Committees

18. Individuals, often from the same department, who band together for purposes that may or may not be relevant to the organization are called
a. quality circles.
b. informal groups. c. teams.
d. work groups. e. committees.

19. In order for whistle-blowing to be effective, a. financial compensation must be very high.
b. employees must wish ill on the organization for which they work.
c. lawmakers must make an effort to force employees to discuss details about the misconduct.
d. it requires that the individual have adequate knowledge of wrongdoing that could damage society. e. it must occur at a very large multinational corporation.

20. Which of the following statements about group norms is false?
a. Group norms define the limit on deviation from group expectations.
b. Group norms have the power to force a strong degree of conformity among group members.
c. Management must carefully monitor the norms of all the various groups within the organization, as well as the organization’s corporate culture.
d. Sanctions may be necessary to bring in line a group whose norms deviate sharply from the overall culture. e. Group norms never conflict with the overall organization’s culture.

21. Management’s sense of the organization’s culture a. is always the same as employees’ perceptions. b. is usually easily adopted by employees.
c. is always readily evident to employees.
d. may be quite different from employees’ perceptions. e. is always different from employees’ perceptions.

22. Motivation is defined as
a. a person’s incentive or drive to work.
b. a force within the individual that focuses his or her behavior on achieving a goal. c. personal ambition without regard to the impact on others.
d. a desire to be finished with a project. e. individual goals.

23. When a foreman orders an assembly-line employee to carry out a task, which the employee perceives as unethical yet the employee feels compelled to complete, the foreman is exercising
a. legitimate power. b. expert power.
c. reward power.
d. contingent punishment power.
e. noncontingent reward behavior.

24. To motivate employees, an organization offers to employees to work toward organizational objectives. a. punishment; force
b. peer pressure; guilt
c. incentives; encourage d. rewards; bribe
e. threats; frighten

25. Which of the following cultures combines high levels of concern for people and performance?
a. Apathetic culture b. Caring culture
c. Integrative culture d. Exacting culture
e. Cooperative culture

26. Ethical concerns in centralized structures can occur because of very little a. mobility.
b. upward communication. c. scapegoating.
d. downward communication. e. communication rigidity.

27. A high concern for people but minimal concern for performance can best describe the culture. a. caring
b. apathetic c. exacting
d. shareholder e. employee

28. The establishment of an ethics committee within an organization a. is usually highly informal.
b. is usually organized around general business topics.
c. might raise ethical concerns or resolve ethical dilemmas. d. usually always succeeds.
e. usually increases ethical tension.

29. Which of the following is not a form of retaliation commonly experienced by whistle-blowers?
a. Relocation or reassignment b. No promotion or raises
c. The cold shoulder by coworkers d. Exclusion from work activities
e. Praise by supervisors for their honesty

30. are used to subdivide duties within functional areas of a company. a. Work groups
b. Individuals c. Experts
d. Consultants e. Committees

31. The

leader demands instantaneous obedience and focuses on punishing wrong behavior, achievement,

initiative, and self-control. a. democratic
b. coaching c. affiliative d. coercive
e. pacesetting

32. Melinda is a very popular executive. She inspires her employees to follow a common vision, facilitates change, and creates a strongly positive climate, all while stressing performance. Melinda has helped to create a(n) culture. a. authoritative
b. caring
c. integrative d. exacting
e. affiliative


are satisfied by social and interpersonal relationships, and activities.
a. Growth needs; relatedness needs b. Personal needs; group needs
c. Coercive needs; ethical needs
d. Relatedness needs; growth needs e. Group needs; personal needs

are satisfied by creative or productive

34. Over the years, scholars have developed more than 100 definitions of culture. According to the text, all have the following common elements:
a. Culture is shared, relatively stable, and is formed over a long period of time. b. Culture is not shared, stable, and is formed over a long period of time.
c. Culture is shared, not stable, and is formed over a long period of time. d. Culture is shared, stable, and is formed over a short period of time.
e. Culture is man-made, shared, not stable, and is formed over a short period of time.

35. Because researchers have defined culture so many different ways, interchangeably.
a. cultural cues; management
b. cultural values; anthropology c. cultural values; culture
d. cultural cues; laws
e. cultural cues; management


are often used

36. Both individual ethics and organizational ethics have an impact on an employee’s
a. productivity.
b. personal happiness. c. compensation.
d. fitness level.
e. ethical intention.

37. A values-based ethics approach to ethical corporate cultures relies on a(n)
how customers and employees should be treated a. set of laws
b. explicit mission statement c. strong CEO
d. ethical audit
e. relaxed corporate culture

that defines the firm as well as

38. The idea that people learn ethical or unethical behavior while interacting with others who are a part of their role-sets is referred to as
a. differential dissonance.
b. cognitive memory dissonance. c. cognitive association.
d. differential association. e. casual interaction.

39. The Sarbanes-Oxley Act
a. only applies to firms with over 50 employees. b. has institutionalized internal whistle-blowing.
c. has placed more power under the Securities and Exchange Commission. d. requires all organizations to make their financial information public.
e. involves too many complicated steps for it to be feasible for most organizations.

40. The

rule explains variation in employee conduct through generalizing on the percentage of employees in any

given organization who will seek to do right versus how many will be indifferent. a. 10-30-40-20
b. 20-30-30-20 c. 40-10-10-40 d. 10-40-40-10 e. 80-20

41. Why do centralized organizations tend to be more ethical than decentralized ones? Can you think of a situation or example in which a decentralized organization might be more ethical than a centralized one?

42. How do societal expectations affect corporations and their ethical initiatives? Give an example of a company that
had to alter a product or service because of society’s concerns about its health, moral, or social impacts.

43. Describe the four organizational cultures and provide a company example of each organizational culture.

44. Describe the different kinds of power. Are some types of power more likely to result in ethical behavior than others?

45. How do group norms influence the ethical behavior of an organization? What happens when the norms of a particular group conflict with the organization’s corporate culture or objectives?

Chapter 8

1. Fostering ethical decision making within an organization requires improving the firm’s ethical standards and a. not doing business with suppliers.
b. implementing a hiring freeze.
c. training the “bad apples” so they are not bad anymore.
d. terminating ethical persons.
e. terminating the “bad apples” in the organization.

2. Which of the following statements about codes of conduct is false?
a. They are formal statements of what an organization expects of its employees. b. They guarantee an ethical business climate.
c. They help employees determine what behaviors are acceptable. d. They provide rules and guidelines for employees to follow.
e. They should be specific enough to be reasonably capable of preventing misconduct.

3. A strong ethics program includes all of the following elements except
a. a clause promising good stock market performance. b. a written code of conduct or ethics.
c. formal ethics training.
d. auditing, monitoring, enforcement, and revision of standards. e. an ethics officer to oversee the program.

4. In the absence of ethics programs, employees are likely to make decisions based on a. their observations of how their coworkers and superiors behave.
b. how they and their family members behave at home. c. their conscience.
d. their religious values. e. their family values.

5. are formal statements that describe what an organization expects of its employees in terms of ethical behavior.
a. Mission statements b. Codes of conduct
c. Policies on confidentiality d. Environmental policies
e. The Federal Sentencing Guidelines for Organizations

6. What is not a common mistake when designing and implementing an ethics program?
a. Failing to fully understand the goals of the program b. Not setting realistic or measurable goals
c. Having top management take ownership of the ethics program
d. Developing materials that do not address the needs of the average employee
e. Transferring a program between countries and cultures without making adjustments

7. A(n)

orientation creates order by requiring that employees identify with and commit to specific required

conduct, whereas a(n)
a. obedience; values b. compliance; values c. legal; values
d. values; compliance
e. values; obedience

orientation strives to develop shared standards.

8. For an ethical compliance program to properly function,
a. consistent enforcement and disciplinary action are essential. b. employees must be monitored using any means necessary. c. it is not necessary to set measurable program objectives.
d. the same program should be used in all countries of operation, regardless of cultural differences. e. the company must wait until after misconduct occurs to develop a means of preventing it.

9. Which of the following is the most comprehensive?
a. Code of values
b. Code of conduct c. Code of ethics
d. Statement of values
e. Statement of principles

10. At the heart of the Federal Sentencing Guidelines for Organizations is a a. “tit-for-tat” philosophy that punishes wrongdoing.
b. Golden Rule philosophy.
c. Iron Fist philosophy severely punishes wrongdoing.
d. carrot-and-stick philosophy that rewards efforts to improve ethics. e. utilitarian philosophy of the greatest good for the greatest number.

11. The Federal Sentencing Guidelines for Organizations require federal judges to increase fines for organizations that continually
a. improve their ethics programs. b. eliminate misconduct.
c. fail to install a Federal Sentencing Guidelines program. d. fail to report ethics program activities.
e. tolerate misconduct.

12. Which of the following legislation has increased the responsibilities on ethics officers and boards of directors to monitor financial reporting?
a. Sarbanes-Oxley Act
b. Robinson Patman Act
c. Ethics Officer Responsibility Act d. Sherman Antitrust Act
e. Enron Financial Responsibility Act


may be more inclined to engage in unethical organizational conduct because of social isolation that creates insensitivity and a lower level of motivation to regulate ethical decision making.
a. Low-level employees
b. International managers c. Top managers
d. Government officials
e. Fortune 500 companies

14. Top managers tend to focus on returns.
a. financial performance b. employee satisfaction
c. ethical performance

because their jobs and personal identity are often connected to quarterly

d. the board of directors’ recommendations
e. adherence to the code of conduct

15. All of the following are useful in monitoring ethical conduct and measuring the effectiveness of the ethical program
a. observation of employees. b. internal audits.
c. firing.
d. surveys.
e. reporting systems.

16. A code of ethics that does not address specific high-risk activities within the scope of daily activities is a. sufficient.
b. inadequate. c. satisfactory.
d. acceptable as long as individual values prevent misconduct.
e. acceptable according to the Federal Sentencing Guidelines for Organizations.

17. Organizational can contribute to diminished employee trust and increased employee turnover. a. leadership succession
b. compensation policies c. ethics programs
d. rules
e. misconduct

18. Most executives feel that which of the following is the primary reason for much of the unchecked misconduct in business?
a. Bad employees
b. An inattentive board of directors c. Customer pressures
d. Financial performance pressures
e. Inadequate ethics and compliance programs

19. Which of the following is an advantage of a values-based ethics program over a compliance-based one?
a. Employees learn to make decisions based on values such as fairness, compassion, respect, and transparency. b. Diverse employees have differing values.
c. It requires employees to identify with and commit to specific required conduct.
d. A values orientation uses legal terms, statutes, and contracts that teach employees the rules and penalties for noncompliance.
e. Values and compliance programs both take basically the same approach.

20. Which of the following is a common mistake made in implementing an ethics program?
a. Setting realistic and measurable program objectives
b. Developing materials that do not address the needs of the average employee c. Adapting a firm’s ethics program to its international operations
d. Allowing employees to practice the skills they learn in ethics training through case studies and/or group exercises
e. Management taking ownership of the ethics program

21. Aurico is a company that offers ethics hotline maintenance and monitoring services for organizations. Which component of the Federal Sentencing Guidelines for Organizations compliance program does this service help organizations to satisfy?
a. Code of conduct
b. Enforcement of standards, codes, and rules c. Delegation of authority to ethical persons
d. Systems for monitoring, auditing, and reporting misconduct e. Ethics training

22. Organizations can become “bad barrels” not because of unethical individuals but because a. the pressure to succeed creates opportunities that reward unethical decisions.
b. the pressure to succeed creates opportunities that punish unethical decisions. c. they lack leadership.
d. they lack values.
e. they have no “bad apples.”

23. Which of the following statements about training is false?
a. It can educate employees about the firm’s policies and expectations, as well as about relevant laws and regulations and general social standards.
b. It can dictate personal ethics on the job.
c. It can make employees aware of available resources, support systems, and designated personnel who can assist them with ethical and legal advice.
d. It can empower employees to ask tough questions and make ethical decisions.
e. It can affect the influence of organizational culture, coworkers and superiors, and opportunity.

24. Which of the following is not an advantage of having a comprehensive code of conduct?
a. To guide employees in situations where the ethical course of action is not obvious. b. To help a company remain in compliance with complex government regulations.
c. To help employees fight for satisfactory levels of compensation and benefits.
d. To help promote constructive social change by raising awareness of the community’s needs and encouraging
employees and other stakeholders to help.
e. To build public trust and enhance business reputations.

25. A

generates an ethical program that creates order by requiring that employees identify with and commit to

specific required conduct using legal terms and statutes. a. values orientation
b. code of conduct
c. statement of values d. code of ethics
e. compliance orientation

26. In the long run, a(n)

orientation may be better for companies, perhaps because it increases employees’

awareness of ethics issues at work. a. code
b. obedience c. compliance d. values
e. individual

27. Which of the following is not a main goal of successful ethics programs?
a. Identify key risk areas that employees will face.
b. Align employee conduct with organizational reputation and branding.
c. Provide a hierarchy of leadership for employees to contact when they are faced with an ethical dilemma that they do not know how to resolve.
d. Allow employees to solve ethical issues themselves using their best judgment.
e. Allow a mechanism for employees to voice their concerns that is anonymous, but allows for the provision of feedback to key questions.

28. The individual responsible for implementing disciplinary action for violation of a firm’s ethics standards is usually the a. CEO.
b. president.
c. immediate supervisor. d. ethics officer.
e. Chairman of the board.

29. To ensure that an ethics program addresses the needs of the average employee, it should include all of the following
a. feedback from employees across the firm. b. a question-and-answer section.
c. additional resources for guidance. d. lengthy legal documents.
e. checklists, illustrations, and cartoons where appropriate.


serve as a central contact point where critical comments, dilemmas, and advice can be assigned to the person most appropriate for handling a specific case.
a. Training programs b. Mission statements c. Codes of conduct
d. Hotlines
e. Boards of directors

31. One of the main reasons employees do not report observed misconduct is a. apathy.
b. most employees do not observe any misconduct. c. fear of retaliation.
d. laws and regulations protect the employee committing the misconduct. e. hotlines do not work well.

32. The ultimate “stick” associated with the FSGO is fines or probation, which involves on-site observation by consultants, monitoring of the company’s ethical compliance efforts, and
a. reporting to the U.S. Sentencing Commission on the company’s progress in avoiding misconduct. b. installation of an ethics hotline.
c. payment of any penalties levied.
d. appointment of an appropriate high-level manager to oversee the company’s program. e. divestiture of all assets.

33. Which of the following strives to create order by requiring that employees identify with and commit to specific required conduct?
a. Conduct orientation b. Values orientation
c. Coercive orientation
d. Obedience orientation e. Compliance orientation

34. Because top managers may be more insensitive to ethical issues due to their focus on financial performance, the
FSGO guidelines suggest that ethics officers report to the instead. a. stock market
b. board of directors c. middle managers d. customers
e. stakeholders

35. With regard to ethics, training and communication initiatives should reflect a. the structure of the board of directors.
b. the organization’s stock performance. c. the organization’s size.
d. the unique characteristics of an organization. e. the self-interest of the CEO.

36. What are some of the ways that organizations can develop effective ethics programs?

ANSWER: Refer to Table 8-1, Minimum Requirements for Ethics and Compliance Programs.
1. Standards and procedures, such as codes of ethics, that are reasonably capable of detecting and preventing misconduct
2. High-level personnel who are responsible for an ethics and compliance program
3. No substantial discretionary authority given to individuals with a propensity for misconduct
4. Standards and procedures communicated effectively via ethics training programs
5. Systems to monitor, audit, and report misconduct
6. Consistent enforcement of standards, codes, and punishment
7. Continuous improvement of the ethics and compliance program

37. How can ethical dilemmas and behavioral simulations help employees make more ethical decisions?

ANSWER: Many feel “hands on” training when employees are forced to confront actual or hypothetical ethical dilemmas helps them understand how their organization would like them to deal with potential problems. Lockheed Martin, for example, developed training games that include dilemmas that can be resolved in teams. Each team member offers his or her perspective, thereby helping other team members fully understand the ramifications of a decision for coworkers and the organization.

38. What are the major features of a successful ethics training program and communication systems? Think of an example of a company with strong employee ethics training.

39. What is the role of an ethics officer within an organization? What are his or her duties? To whom does the FSGO
guidelines recommend that the ethics officer report?

40. Discuss the advantages and disadvantages of implementing an ethics program with a compliance orientation versus one with a values orientation. Is one better than the other at maintaining an ethical organization?

Chapter 9

1. Which of the following does not have a significant impact on the success of an ethics program?
a. Senior management’s ability to successfully incorporate ethics into the organization
b. The quality of communication c. The size of the company
d. The content of the company’s code of ethics
e. The frequency of communication regarding the ethical code and program

2. Which of the following statements about ethics audits is false?
a. They provide an opportunity to measure conformity to the firm’s desired ethical standards.
b. Social audits and ethics audits perform basically the same function, so organizations can use them interchangeably.
c. They provide an objective method for demonstrating a company’s commitment to improving strategic planning, including its compliance with legal and ethical standards and social responsibility.
d. They can be a component of social audits.
e. They are systematic evaluations of an organization’s ethics program and performance to determine whether it is effective.

3. Which of the following is a possible unintended consequence of an organization’s focusing more on ethics planning
than on implementation?
a. Unethical conduct is viewed as acceptable behavior. b. The government implements its own audits.
c. The ethics program is poorly designed. d. Employees become annoyed.
e. The implementation process incurs large costs for the organization.

4. A(n) is a tool that companies can employ to identify and measure their ethical commitment to stakeholders. a. ethics audit
b. social audit
c. financial audit
d. performance audit e. external audit

5. Which of the following is not a step in the ethics auditing process?
a. Secure commitment of top executives and directors.
b. Review organizational mission, goals, values and policies, and define ethical priorities. c. Report the results to the U.S. Sentencing Commission.
d. Collect and analyze relevant information. e. Verify the results.

6. Which of the following is a statement that attests that the financial statements made in an audit are fairly stated, without limitations?
a. Adverse opinion b. Qualified opinion
c. Unqualified opinion d. Favorable opinion
e. Disclaimer of opinion

7. Under the statements.

, CEOs and CFOs may be criminally prosecuted if they knowingly certify misleading financial

a. Sherman Antitrust Act b. Ethical Compliance Act c. Robinson-Patman Act
d. Sarbanes-Oxley Act
e. Sherman Antitrust Act

8. During which of the following steps of the ethics auditing process does an organization identify the tools or methods
for measuring progress in improving employees’ ethical decisions and conduct?
a. Secure commitment of top managers and directors b. Establish a committee to oversee the audit
c. Define the scope of the audit
d. Collect and analyze relevant information e. Verify the results

9. Any attempt to verify outcomes and to compare them with standards can be considered a(n)
although many smaller firms do not use this word. a. ethical
b. auditing c. formal
d. informal
e. accounting



are a primary stakeholder group and should be included in the ethics auditing process because their loyalty determines an organization’s success.
a. Customers b. Employees
c. Special interest groups d. Competitors
e. Legislators

11. The concept of ethics auditing emerged from the movement to audit and report on companies’ broader initiatives.
a. product development b. legal compliance
c. risk management d. public relations
e. social responsibility

12. Which of the following is probably the best way for a manager to provide good ethics leadership?
a. Hire an ethics officer
b. Write a code of conduct c. Conduct ethics audits
d. Set a good example
e. Only hire good employees

13. Which of the following is not a benefit of ethics auditing? a. It can improve a firm’s performance and effectiveness. b. It can increase a firm’s attractiveness to investors.
c. It can identify potential risks.
d. It can harm relationships with stakeholders.
e. It can reduce the risks associated with misconduct.

14. The word

implies a balanced organization that makes ethical financial decisions and also is ethical in more

subjective matters of corporate culture. a. compliance
b. integrity
c. financial management d. corporate culture
e. transparency

15. Which of the following is not a measure of ethical climate?
a. Collective skill
b. Collective ethical sensitivity c. Collective character
d. Collective judgment
e. Collective moral motivation

16. During which step of the auditing process should a firm examine all documents that make explicit commitments to ethical, legal, or social responsibility?
a. Secure commitment of top managers and directors. b. Establish a committee to oversee the audit.
c. Define the scope of the audit process.
d. Review organizational mission, goals, values, and policies. e. Verify the results.

17. A(n)

is a financial accounting firm that offers social auditing services or a nonprofit special interest group

with auditing experience that verifies the results of ethics auditing data analysis a. stakeholder
b. ethics audit consultant c. best practices expert d. financial consultant
e. board of directors

18. The process of verifying the results of an audit should involve standard procedures that control the information.
a. completeness
b. effectiveness and efficiency c. reliability and validity
d. independence
e. veracity

of the

19. Which of the following is not one of the top challenges facing CEOs today? . a. Keeping pace with regulation
b. Protecting against risks
c. Managing and utilizing social media d. Gaining adequate compensation
e. Managing reputation

20. Two useful indicators for assessing employee issues are a. staff turnover and stock price.
b. staff turnover and employee satisfaction. c. staff turnover and honesty.
d. employee satisfaction and attendance. e. employee satisfaction and productivity.

21. At which stage of the ethics auditing process would a hospital conduct focus groups with management, doctors, nurses, related health professionals, support staff, and patients?
a. Collect and analyze relevant information
b. Review organizational mission, goals, values, and policies c. Identify stakeholders
d. Report the results e. Verify the results

22. While ideally the board of directors financial audit committee conducts ethics audits, in most firms they are conducted by
a. managers or ethics officers. b. executive officers.
c. the CEO.
d. outside consultants.
e. secondary stakeholders.

23. Because ethics and social audits are

, there are few standards that a company can apply with regard to

reporting frequency, disclosure requirements, and remedial actions that it should take in response to results. a. not necessary
b. expensive
c. required by law d. mandatory
e. voluntary

24. What are the three Triple Bottom Line factors incorporated into the Global Reporting Initiative framework?
a. Economic, social, personal indicators
b. Political, social, and environmental indicators
c. Economic, social, and environmental indicators
d. Political, individual, and environmental indicators e. Political, individual, and personal indicators

25. What should be the first step in the auditing process?
a. Secure the commitment of top executives and directors b. Define the scope of the audit
c. Establish a committee to oversee the audit d. Collect and analyze data
e. Review organizational mission, goals, values, and policies

26. Retaliation against employees that report misconduct is a problem in cultures. a. weak ethical
b. strong ethical
c. high power distance d. diverse
e. international

27. Which of the following is not a phase of escalation during an ethical disaster?
a. The firm’s discovery of the misconduct b. Ethical issue recognition
c. The firm’s response to the misconduct d. The decision to act unethically
e. The firm’s decision to conduct an ethics audit

28. Which of the following is not a technique for collecting evidence during the ethics audit?
a. Ratio analysis
b. Observing the data-collection process c. Publishing the results of the audit
d. Examining internal and external documents
e. Confirming information in the firm’s accounting records



is an independent assessment of the quality, accuracy, and completeness of a company’s social or ethics

a. Publication b. Verification c. Auditing
d. Analysis
e. Validation

30. What should be the final step in the ethics auditing process?
a. Define the scope of the audit
b. Secure the commitment of top managers and directors c. Collect and analyze data
d. Report the findings e. Verify the results

31. Ethics audits can help companies identify potential before they reach crisis dimensions.
a. competitive advantages b. risks and liabilities
c. productivity issues
d. technological glitches e. market opportunities

so they can implement plans to eliminate or reduce them

32. During the data-collection phase of the audit, the primary objective is to generate a variety of opinions about how the company is perceived and whether it is
a. fulfilling employee benefits commitments. b. bringing in new customers.
c. meeting profit projections.
d. meeting earnings projections.
e. fulfilling stakeholders’ expectations.

33. Independent verification of the ethics audit is important because it lends the report a. credibility and formality.
b. credibility and reliability. c. credibility and objectivity. d. objectivity and civility.
e. objectivity and reliability.

34. When The Gap posts the results of its ethics audit on its web site, it is engaged in which of the following steps of the ethics auditing process?
a. Submit the results to the U.S. Sentencing Commission b. Define the scope of the audit
c. Collect and analyze relevant information d. Verify the results
e. Report the results

35. While social reports often discuss issues related to a firm’s performance in the four dimensions of social responsibility, as well as to specific social responsibility and ethical issues, ethics audits have a narrower focus on assessing and reporting on a firm’s performance in terms of
a. ethical and legal conduct.
b. environmental performance. c. financial performance.
d. customer satisfaction. e. ethical misconduct.

36. Compare and contrast ethics auditing and financial auditing. How can the tools of financial auditing be applied to ethics audits?

37. Explain the benefits and risks of ethics auditing.

38. How can companies secure stakeholder input during an ethics audit? Why is it important to do so?

39. Describe the process of conducting an ethics audit in detail.

40. What is the Global Reporting Initiative? What is its goal? Why has it grown in importance?

Chapter 10

1. identified four cultural dimensions that can have a profound impact on the business environment:
individualism/collectivism, power distance, uncertainty avoidance, and masculinity/femininity. a. Milton Friedman
b. Abraham Maslow c. Adam Smith
d. Geert Hofstede
e. John Maynard Keynes

2. products encourage consumers to return and buy more. This approach is also known as planned obsolescence.
a. Laissez-faire b. Dumping
c. Collectivistic
d. Made-to-break e. Multinational

3. is a term used by Adam Smith to explain the inherent mechanisms at work in free market systems that keep
commerce in equilibrium. It is also known as the “invisible hand.”
a. Consumerism
b. Cultural relativism c. Social democracy d. Laissez-fair
e. Bimodal wealth distribution

4. assumes that humans may not act rationally because of genetics, learned behavior, and rules of thumb. a. Rational economics
b. Socialism
c. Cultural relativism d. National culture
e. Behavioral economics

5. Which of the following statements about multinational corporations (MNCs) is false?
a. MNCs are corporate organizations that operate on a global scale without significant ties to any one nation or region.
b. MNCs are inherently unethical and always do harm in the countries in which they operate.
c. MNCs are characterized by a global strategy of focusing on opportunities throughout the world.
d. Some MNCs are so large and powerful that their revenues are greater than the gross domestic products of many countries.
e. Because of their size and power, MNCs have been the subject of much criticism and the source of a number of ethical issues.

6. Increasing the wealth gap between nations and misusing and misallocating scarce resources are ethical issue accusations related to
a. cultural differences.
b. multinational corporations. c. consumerism.
d. legal differences.
e. international negotiations.

7. Which of the following is not a criticism of or charge against multinational corporations (MNCs)?
a. They transfer jobs overseas, where wage rates are lower b. They increase the gap between rich and poor nations
c. They pay excessively high taxes everywhere
d. They exploit the labor markets of host countries
e. They have an unfair advantage when competing with local businesses

8. Which of the following is a measure taken by governments to curtail MNC practices that create ethical issues?
a. Levying import taxes to lower the prices MNCs charge for their products b. Halting the establishment of minimum wage laws
c. Avoiding the United Nations’ monitoring efforts d. Preventing the formation of labor unions
e. Imposing export taxes to force MNCs to share more of their profits

9. occurs when the middle class shrinks, resulting in highly concentrated wealth amongst the rich and a large number of poor people with very few resources.
a. Communism b. Socialism
c. Bimodal wealth distribution d. A two-class social structure e. Laissez-faire capitalism

10. An unconscious reference to one’s own cultural values, experiences, and knowledge is referred to as the a. cultural reference criterion.
b. unconscious cultural criterion. c. cultural-self criterion.
d. self-reference criterion.
e. unconscious cultural-self criterion.

11. When in Rome, do as the Romans do, or you must adapt to the cultural practices of the country in which you are operating are rationalizations businesspeople sometimes offer for straying from their own ethical values when doing business abroad. This practice is called
a. self-reference criterion. b. country cultural values. c. consumerism.
d. cultural relativism. e. dumping.


involves transactions across national boundaries. It is a practice that brings together people who have different cultures, values, laws, and ethical standards.
a. Global business
b. Country cultural values c. Social democracy
d. Cultural relativism
e. Bimodal wealth distribution

13. What concept refers to economic theories advocating the creation of a society where wealth and power are distributed evenly, relative to the amount of work expended in production?
a. Rational economics b. Socialism
c. Capitalism
d. Rational capitalism e. Fascism

14. Risk compartmentalization occurs when
a. companies place their most problematic employees into separate profit centers so that they cannot influence one another to act unethically.
b. all profit centers within a corporation are aware of the code of ethics.
c. all profit centers within an organization become aware of the consequences of competitors’ actions.
d. various profit centers within an organization become unaware of the consequences of their actions on the firm as a whole.
e. ethics and compliance programs reduce the risk of misconduct.


has been codified in a United Nations document and is defined as an inherent dignity with equal and inalienable rights as the foundation of freedom, justice, and peace in the world.
a. Cultural relativism b. Human rights
c. Consumerism d. Dumping
e. Health care

16. Power distance dimension refers to the “power inequality” between superiors and subordinates. Which of the
following countries probably ranks high on the power distance scale?
a. Saudi Arabia b. Austria
c. England d. Denmark e. Sweden

17. Who argued during the 1930s that the state could stimulate economic growth and improve stability in the private sector?
a. Adam Smith
b. John Maynard Keynes c. Milton Friedman
d. Herbert Hoover e. Geert Hofstede

18. The practice of charging high prices for products sold in home markets while selling the same products in foreign markets at low prices, which do not cover the costs of exporting, is known as
a. price discrimination. b. price gouging.
c. dumping. d. skimming. e. loading.

19. assume(s) that a the market, through its own inherent mechanisms, will keep commerce in equilibrium. a. Social democracy
b. Laissez-faire economics c. Economics
d. Multinational corporations e. Rational economics

20. Those who ascribe to consumerism
a. believe that consumers should purchase everything they can afford. b. do not believe in taxes on locally made products.
c. believe that consumers should own the means of production.
d. believe that consumers, not producers, should dictate the economic structure of a society. e. believe that corporations should have the freedom to do whatever they want.


is based upon the assumption that people are predictable and will maximize the utility of their choices relative to their needs and wants.
a. Rational economics b. Socialism
c. Capitalism
d. Behavioral economics e. Consumerism


allows for private ownership of property and features a large government equipped to offer such services as education and health care to its citizens
a. Democracy b. Communism c. Socialism
d. Capitalism
e. Social democracy.

23. assumes that economic decisions are influenced by human behavior. a. Rational economics
b. Socialism c. Capitalism
d. Rational capitalism
e. Behavioral economics


refers to how members of a society respond to ambiguity. A high score means that a culture tends to minimize risk-taking.
a. Rational economics b. National culture
c. Bimodal wealth distribution d. Power distance
e. Uncertainty avoidance

25. The

formed in 1995 and administers its own trade agreements, facilitates future trade negotiations, settles

trade disputes, and monitors the trade policies of member nations a. International Monetary Fund
b. United Nations
c. World Trade Organization
d. North American Free Trade Act e. European Union

26. What is a major role of the International Monetary Fund (IMF)?
a. It determines the credit ratings of countries.
b. It is the lender of last resort for individuals who cannot secure other types of loans. c. It functions as a collection agent for global banks.
d. It makes short-term loans to member countries that have deficits and provides foreign currencies for its members.
e. It provides mortgage loans to international home buyers.

27. Which of the following organizations emerged from the Bretton Woods agreement of 1944, where a group of international leaders decided that the primary responsibility for the regulation of monetary relationships among national economies should rest in an extra-national body?
a. International Monetary Fund b. United Nations
c. World Trade Organization
d. North American Free Trade Act e. European Union

28. These values were developed by a reverend and the UN Secretary General. They express support for universal human rights.
a. The Global Sullivan Principles b. Sarbanes-Oxley Act
d. Global common values e. UN Global Compact

29. What is the purpose of the UN Global Compact?
a. To promote free trade around the world
b. To support international banking institutions c. To uphold the principle of consumerism
d. To provide legal representation to international corporations facing lawsuits e. To promote human rights, sustainability, and eradicate corruption

30. What is the AACSB?
a. A major international institution regulating banks around the world b. An accrediting institution for organizational ethics
c. A non-political international governing body
d. An international organization that promotes a set of principles promoting the teaching of responsible management in business schools
e. A group that promotes sustainability and environmental awareness

31. As business facilitates exchanges, consumption beyond basic needs will increase globally. The important issues related to consumerism include all but which of the following?
a. What are the impacts of production on the environment, on society, and on individuals?
b. What are the impacts of certain forms of consumerism on the environment, on society, and on individuals?
c. How much of what we deem necessary for consumption is influenced by corporations?
d. What are necessities and what are luxuries?
e. What are the impacts of poor countries’ consumption patterns on wealthy countries?

32. Which two developing countries are expected to generate some of the largest increases in consumption in the future?
a. The United States and Russia b. Russia and China
c. China and United States d. Brazil and Russia
e. China and India

33. According to the World Trade Organization, which of the following products and services are most vulnerable to protectionism?
a. Textbooks and other school supplies b. Travel agencies
c. Music and dance
d. Intellectual property
e. Shoes, cars, and steel

34. Which of the following is not an article in the UN Human Rights Declaration?
a. Freedom of religion
b. The right to work in favorable conditions c. The right to electricity and running water
d. The right to a home adequate for health and well-being
e. Mothers and children being entitled to a special level of care

35. The growth of the Internet and differing security laws between countries has led to an increase in concern for the human right of
a. religion.
b. a secure job. c. healthcare.
d. privacy.
e. freedom of speech.

36. Which of the following is not a key area of global ethical risk, as outlined by the Eurasia Group?
a. Political instability
b. Strained relations with China
c. Instability in emerging markets
d. Unequal levels of child labor laws
e. Outlook for Euro-zone countries remains weak

37. What is a living wage?
a. The minimum wage that a worker requires to meet basic needs. b. The wage at which the average worker can live really well.
c. It is a synonym for minimum wage.
d. The wage received by child workers in order to stay alive. e. A wage given to workers entirely in the form of food.

38. The benefit of healthcare is being debated as to whether it is a right or privilege. Which of the following countries does not consider health care to be a right?
a. The United States b. France
c. Sweden d. Germany e. Canada

39. The

was a result of a meeting in which international leaders decided that primary responsibility for the

regulation of monetary relationships among nations should rest in an external body. a. United Nations
b. North American Free Trade Agreement c. World Trade Agreement
d. World Bank
e. International Monetary Fund

40. Which of the following has the power to enact legally binding ground rules for international commerce and trade policy?
a. Global Sullivan Principles b. World Trade Organization
c. Global Sullivan Organization d. Federal Trade Commission
e. Global Commerce Association

41. Why are many international business ethics issues different from domestic ethical issues?

global firm cannot succeed simply by applying its domestic ethical programs to other global environments. Although ethical issues such as honesty and integrity are common to most countries, differences in laws, political systems, and cultures require a more targeted approach to ethical decision making. Global ethics is not a “one size fits all” concept.

42. How can differences in two countries’ cultures create ethical issues in business?

43. Discuss the ethical issues associated with multinational corporations.

44. What are the roles of the IMF and the WTO in encouraging, monitoring, and regulating international trade?

45. What is dumping and why is it considered anticompetitive? Does the United States allow dumping?

Chapter 11

1. The leader demands instantaneous obedience and focuses on achievement, initiative, and self-control. a. democratic
b. coaching c. affiliative d. coercive
e. pacesetting

2. Which of the following types of leaders attempts to create employee satisfaction through bartering or negotiating for desired behaviors or level of performance?
a. Pacesetting leaders b. Coercive leaders
c. Transactional leaders
d. Transformational leaders e. Transmogrified leaders

3. Which of the following is not a habit of ethical leaders?
a. They are primarily concerned with themselves. b. They are proactive.
c. They have a passion to do right.
d. They are concerned with stakeholders’ interests. e. They are role models for organizational values.

4. Which of the following leadership types has a strong influence on coworker support and building an ethical culture through increasing employee commitment and fostering motivation?
a. Transformational leaders b. Transactional leaders
c. Coercive leaders
d. Pacesetting leaders e. Authoritative leaders

5. A coaching leader builds a positive climate by
a. valuing people, their emotions, and their needs.
b. focusing on communication across all layers of the organization.
c. inspiring employees to follow their departmental leaders without question. d. focusing on achievement, initiative, and self-control.
e. developing skills for success, delegating responsibility, and issuing challenging assignments.

6. Which leadership type values people, their emotions, and their needs and relies on friendship and trust to promote flexibility, innovation, and risk taking?
a. Authoritative leadership b. Coaching leadership
c. Pacesetting leadership d. Coercive leadership
e. Affiliative leadership

7. Sherry’s leadership style often creates a negative working climate because of the high standards she sets. Sherry is most likely a(n) leader.
a. autocratic b. democratic c. pacesetting d. empathetic e. coercive

8. are a primary influence on employee’s ethical behavior because they are role models for the organization’s
a. Friends b. Parents c. Peers
d. Coworkers e. Leaders

9. As one of the seven habits of strong ethical leaders,

is “the glue that holds ethical concepts together.” This

trait can be developed early in life or developed over time through experience. a. adequate compensation
b. good employees
c. the passion to do right d. charisma
e. a great education

10. The

leader can create a negative climate because of the high standards that he or she sets. This style works

best for attaining quick results from highly motivated individuals who value achievement and take initiative. a. authoritative
b. affiliative
c. democratic d. coaching
e. pacesetting

11. The

of an organization can influence the acceptance of, adherence to, transmittal, and monitoring of

organizational norms, values, and codes of ethics. a. nation of origin
b. locus of control c. leadership style
d. production methods e. opportunity

12. Ethical leadership should be based on
a. holistic thinking that embraces the complex issues facing firms every day. b. a strong shareholder desire for profits.
c. the opinions of a leader who defines success in terms of group gratification. d. short­term thinking that looks at the firm’s health on a day­to­day basis.
e. people who embrace a transactional style of leadership.

13. A fundamental problem in traditional personal character development is that specific vales are used to teach about a philosophy, which may be inappropriate where cultural diversity and privacy must be respected. A solution is
a. to teach more general values to develop a set of basic beliefs.
b. to ignore moral philosophies and to train solely based on the organization’s code of conduct.
c. to teach completely different values and skills in different cultural environments.
d. to teach individuals intellectual skills that address the complexities of ethical issues in business.
e. to teach individuals the literary canons of the major philosophers from both western and eastern religions.

14. Strong ethical leaders have a passion for all of the following except to a. do the right thing.
b. be proactive
c. consider stakeholder interests
d. be role models for the organization and its employees. e. satisfy shareholders before other stakeholder groups.

15. Leaders whose decisions and actions are contrary to the firm’s values send a signal a. that the firm’s values are trivial or irrelevant.
b. that they are providing a good example of what not to do. c. that the firm’s corporate culture is highly important.
d. that they are working toward improving the ethical culture of the firm. e. that they care about the environment.

16. Which attribute of ethical leaders will not be effective unless the leader is personally involved in the organization’s
key ethical decisions?
a. Stakeholder compassion b. Proactive leadership
c. Transparency
d. Moral philosophy e. Compensation

17. Which type of leader relies on participation and teamwork to reach collaborative decisions?
a. Transformational b. Coercive
c. Democratic d. Coaching
e. Pacesetting

18. What is not a necessity for strong ethical leaders to make good decisions?
a. Complete information b. Courage
c. Experience making the right decisions d. Knowledge
e. The ability to coerce subordinates

19. Which of the following is not a way to avoid groupthink in small-group decision making?
a. Express the need to examine all alternatives. b. Assign one person to be “Devil’s advocate”.
c. Discourage team members from discussing the group’s ideas with people outside the group. d. Set up a number of independent groups to work on the same issue.
e. Emphasize to each team member that he or she is a “critical evaluator” with the responsibility to express opinions and objections freely.

20. is the ability or authority to guide and direct others toward a goal. a. Leadership
b. Collaboration c. Democracy
d. Transparency e. Pacesetting

21. These leaders are characterized as having superficial charm, no conscience, grandiose self-worth, little or no empathy, and enjoy flouting rules.
a. Unethical leaders
b. Psychopathic leaders c. Apathetic leaders
d. Ethical leaders
e. Charismatic leaders

22. This occurs when there are two or more positions on an ethical decision. a. Ethical leadership
b. Competing leadership c. Ethical conflicts
d. Empowerment
e. Interpersonal communication

23. Leaders having a(n) conflict management style are highly assertive and not very cooperative. a. Accommodating
b. Avoiding
c. Collaborating d. Competing
e. Compromising

24. Leaders having an accommodating conflict management style are a. Highly assertive and not very cooperative.
b. Not effective because they avoid conflict at any costs – even if it leads to misconduct. c. Highly cooperative but non-assertive.
d. In between the assertiveness and cooperativeness dimensions. e. Cooperative and assertive.

25. Leaders with a(n)

conflict management style desire to meet the needs of stakeholders and strongly adhere to

organizational values and principles. a. Avoiding
b. Competing
c. Compromising
d. Accommodating e. Collaborating

26. A

-based culture encourages employees to express concerns, bring up ethical issues, and take a proactive

approach toward resolving conflicts. a. Values
b. Profits
c. Consumers
d. Shareholders e. Stakeholders

27. and reporting are two major dimensions of ethical communication. a. Collaboration
b. Transparency c. Recognition
d. Listening
e. Compromising

28. is a two-way process in which the communicator communicates with superiors and subordinates. a. Cooperation
b. Transparency
c. Leader-follower congruence d. Reporting
e. Collaboration

29. The four categories of communication include all of the following except a. Reporting
b. Small group communication c. Nonverbal communication
d. Interpersonal communication e. Listening


occurs when one or more group members feel pressured to conform to the group’s decision even if they personally disagree.
a. Group polarization
b. Leader-follower congruence c. Groupthink
d. Competition e. Conflict

31. When a group is more likely to move toward a more extreme position than the group members might have done individually, this is referred to as
a. Leader-follower congruence b. Groupthink
c. Values-based culture d. Ethical leadership
e. Group polarization

32. This occurs when leaders and followers share the same vision, ethical expectations, and objectives for the company. a. Groupthink
b. Leader-follower congruence c. Group polarization
d. Values-based culture e. Ethical leadership

33. provide(s) important guidelines for employees on how to act in different situations. a. Leader-exchange theory
b. Small group communication c. Interpersonal communication d. Codes of ethics
e. Leader-follower congruence

34. Gossip, manipulation, playing favorites, and taking credit for another’s work are all examples commonly associated with
a. Organizational politics b. Political skills
c. Competitiveness d. Groupthink
e. Ethical conflict

35. can be used to promote organizational goals and help rather than hinder other employees. a. Office politics
b. Political skills
c. Ethical conflict d. Democracy
e. Coercion


leaders are passionate about the company, live out corporate values daily in their behavior in the workplace, and form long-term relationships with employees and other stakeholders.
a. Authentic b. Coaching
c. Transformational d. Transactional
e. Pacesetter

37. All of these are true about feedback except
a. Most companies recognize the need for organizational leaders to provide feedback to employees.
b. Most companies recognize the need for organizational leaders to get feedback from their employees.
c. Feedback can occur through informal methods like a simple conversation or through more formal systems such as employee performance evaluations.
d. Employee feedback can be generated in many different ways, including interviews, anonymous surveys, ethical audits, and websites.
e. Negative feedback is important to inform employees of weaknesses and provide constructive ways for improving them.


leaders communicate a sense of mission, stimulate new ways of thinking, and enhance as well as generate new learning experiences.
a. Authentic
b. Democratic
c. Transformational d. Transactional
e. Cooperative

39. The most effective leaders possess the ability to manage themselves and their relationships with others effectively, a skill known as
a. Conflict management b. Group theory
c. Collaboration
d. Emotional intelligence
e. Leader-follower theory

40. These leaders are passionate about the company, live out corporate values daily in their behavior in the workplace, and form long-term relationships with employees and other stakeholders.
a. Transactional b. Compromising
c. Transformational d. quantitative
e. Authentic

41. The acronym RADAR stands for
a. Recognize, Answer, Discourage, Avoid, & Recover b. Recognize, Answer, Detect, Avoid, & Recover
c. Recover, Answer, Discourage, Avoid, & Recognize d. Recognize, Avoid, Detect, Answer, & Recover
e. Recover, Avoid, Detect, Answer, & Recognize

42. From an ethical standpoint, leaders should take time during this step of the RADAR model to fix any weaknesses in the ethics program and develop improved ways of detecting misconduct.
a. Detect b. Answer
c. Recovery d. Avoid
e. Recognize

43. This step of the RADAR model involves responding to the discovery of an ethical dilemma through communication both internally and externally.
a. answer b. recover
c. recognize d. avoid
e. detect

44. Which two steps of the RADAR model occur when a firm is faced with an ethical conflict or dilemma. a. recognize & avoid
b. answer & recover c. detect & avoid
d. answer & detect
e. recover and detect

45. Many managers are reluctant to engage in this step of the RADAR model because they fear doing so will uncover questionable conduct that could put the firm in an unfavorable light.
a. avoid
b. recover c. answer d. detect
e. recognize

46. Discuss the role of leadership in understanding and executing ethical decision making in organizations.

47. Describe the RADAR model, discussing key objectives needed to be obtained for each step of the model.

48. Discuss the differences between the five styles of conflict management and provide an example for each conflict management style.

49. Discuss the differences between groupthink and group polarization, providing examples of each.

50. Describe and differentiate between a compliance-based approach and an integrity-based approach to leadership.
Which approach is preferred, justify your response.

Chapter 12

1. All of the following are facts about water pollution, except:
a. Projected increases in fertilizer use suggest there will be a 10% – 20% global increase in nitrogen water contamination.
b. Up to 90% of wastewater in developing countries flow untreated into rivers, lakes, and coastal zones. c. In developing countries, 70% of industrial waste is dumped untreated into water sources.
d. Every day, 2 million tons of untreated human waste is put into some water source. e. Water use is projected to decrease by 50% within 20 years.

2. Trying to pinpoint who is responsible for environmental degradation is not always easy, especially when it involves
__________ .
a. different countries b. several managers
c. more than one CEO
d. differing regulatory agencies
e. both federal and local governments

3. One of the biggest factors in land pollution is the dumping of waste into landfills.
world’s biggest wasters.
a. European b. Chinese
c. Russian
d. American e. Canadian

consumers are by far the

4. The world’s forests are being destroyed at a rate of nearly 50,000 square miles annually. The reasons for this wide­
scale destruction are varied and include all except:
a. The boom in biofuels
b. The soil is great for farming c. Logging profits
d. Cycle of poverty
e. Converting land to other use

5. Although limiting urban sprawl creates disadvantages for renewal movements that reduce sprawl.
a. car and oil companies b. the airline industry
c. the railroad industry
d. service oriented companies e. humans and animals

, many businesses can benefit from urban

6. Because genetically modified seeds are

, farmers cannot keep any of the seed themselves but must

purchase seeds each year from companies such as Monsanto. a. so small
b. worthless
c. uncollectable d. invisible
e. patented

7. The first Earth Day, increasing stakeholder awareness of environmental concerns and the creation of the
Environmental Protection Agency brought to the forefront. a. corporate social responsibility
b. alternative energy sources c. diversity
d. sustainability e. competition

8. All of the following are goals of the Environmental Protection Agency, except:
a. Focus on the activities of business b. Protecting America’s water
c. Cleaning up communities and advancing sustainable development d. Taking action on climate change and improving air quality
e. Ensuring the safety of chemicals and preventing pollution

9. The Clean Air Act:
a. Allowed the EPA to track industrial chemicals
b. Focuses on promoting alternative forms of energy c. Established national air quality standards
d. Provides tax benefits to consumers who purchase hybrid cars e. Focuses on reducing pollution through cost-effective change

10. The Clean Water Act makes it illegal for anyone to discharge any pollutant from a point source directly into navigable waters without a .
a. good reason b. direct order c. permit
d. inspector present e. limit

11. The
raw materials use.

focuses on reducing pollution through cost-effective changes in production, operation, and

a. Pollution Prevention Act
b. Toxic Substances Control Act c. Clean Air Act
d. Energy Policy Act e. Oil Pollution Act

12. All of these are ways of reducing pollution, except:
a. Designing environmentally friendly buildings b. Recycling
c. Greenwashing
d. Source reduction
e. Sustainable agriculture

13. Congress passed the

to empower the EPA with the ability to track the 75,000 industrial chemicals

currently produced or imported into the United States. a. Federal Water Pollution Control Act
b. Federal Insecticide, Fungicide and Rodenticide Act c. Safe Drinking Water Act
d. Toxic Substances Control Act e. Food Quality Protection Act

14. Wind power holds great promise for the United States because of the energy could meet as much as 20 percent of the nation’s energy needs. a. Rocky Mountains
b. Everglades c. Great Lakes d. Pacific Rim
e. Great Plains

, and experts believe wind

15. Geothermal energy provides alternative energy.
a. heat from the sun b. a radiated heat
c. heat from steam
d. a constant source of heat e. a dry heat

and is a more dependable energy source than some other forms of

16. Critics of nuclear power are concerned about all of the following, except:
a. Reduced emissions b. Worker safety
c. The transport of nuclear waste
d. Damage to plants from natural disasters e. Nuclear meltdowns

17. Perhaps the most controversial form of alternative energy after nuclear power is . a. hydopower
b. geothermal power c. solar power
d. wind power e. ethanol

18. in the United States,

provides only 7% of total output but provides 19% of total electricity

production worldwide, making it the largest form of renewable energy. a. wind power
b. geothermal power
c. hydroelectric power d. solar power
e. nuclear power

19. Many businesses responded to sustainability by adopting a triple-bottom line approach; taking into consideration social and environmental performance variables in addition to .
a. managerial performance b. economic performance
c. board of directors performance d. customer focus
e. stakeholder focus

20. A

business attempts to avoid dealing with environmental issues and hopes nothing bad happens or no

one ever finds out about an environmental accident or abuse. a. newly established
b. socially responsible c. low-commitment
d. bankrupt
e. law-abiding

21. is one of the country’s greatest sustainability success stories.
a. Water conservation b. Pollution control
c. Manufacturing d. Composting
e. Recycling

22. Stakeholder assessment is an important part of a approach to environmental issues. a. low-commitment
b. medium-commitment c. high-commitment
d. hands-off e. hands-on

23. Through

, it is possible to quantify the trade-offs to determine whether to accept or reject

environmentally-related activities and programs. a. risk management
b. management voting c. board directives
d. legal requirements e. customer input

24. Organizations highly committed to environmental responsibility may conduct an audit of their efforts and report the results to all interested .
a. agencies b. countries
c. stakeholders d. individuals
e. suppliers

25. Which option includes the assessment and improvement of business strategies, economic ectors, work practices, technologies, and lifestyles while maintaining the natural environment?
a. Competitive advantage b. Marketing
c. Sustainability d. Greenwashing e. Risk analysis

26. Sustainability is the long-term well-being of the natural environment and the mutually beneficial interactions among
a. customers, investors, managers, and policies
b. board members, presidents, managers, and nonprofit organizations c. investors, creditors, suppliers, and the marketing department
d. nature, individuals, organizations, and business strategies e. managers, boards, CEO’s, and stakeholder strategies

27. Which industry invests the most in alternative clean energy sources?
a. The automobile industry b. The clothing industry
c. The airline industry
d. The federal government e. The oil and gas industry

28. All of these are examples of social responsibility concerns, except:
a. Product price
b. Consumer protection c. Employee well-being d. Sustainability
e. Legal responsibilities

29. The protection of air, water, land, biodiversity, and emerged as a major issue in the twentieth century. a. employee relations
b. renewable natural resources
c. environmental legal regulations d. consumer protection
e. air pollution

30. can cause markedly shorter life spans, along with chronic respiratory problems in humans and animals. a. Water pollution
b. Air pollution
c. Global warming d. Deforestation
e. Acid rain

31. The Kyoto Protocol created in 1997 is an international treaty meant to curb global . a. natural resource use
b. greenwashing activities c. water pollution
d. greenhouse gas emissions e. competition

32. How does sustainability relate to ethical decision making and social responsibility?

33. Discuss the benefits of green marketing and the long-term pitfalls of greenwashing.

34. Why is the Environmental Protection Agency (EPA) said to be the most influential regulatory agency?