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Chapter 4 ETHICS AND SOCIAL RESPONSIBILITY IN MARKETING Test Item Table Major Section of the Chapter Level of Learning Level 1: Definition (Knows Basic Terms and Facts) Level 2: Conceptual (Understands Concepts and Principles) Level 3: Application (Applies Principles) There Is More to Anheuser-Busch than Meets the Palate (pp. 81-82) 1, 2, 3, 4, 5 Nature and Significance of Marketing Ethics (pp. 82-83) 6, 7, 8, 10, 11, 22, 23, 9, 11, 12, 17, 18, 19, 20, 21, 13, 14, 15, 16, 24, 25 Understanding Ethical Marketing Behavior (pp. 83-88) 6, 27, 33, 34, 37, 38, 46, 49, 52, 53, 57, 58, 61, 62, 69, 70, 77, 78, 85, 86, 133, 140 29, 30, 32, 41, 42, 45, 47, 48, 50, 51, 54, 55, 59, 60, 63, 64, 67, 71, 72, 74, 75, 76, 76, 81, 82, 83, 87, 88, 89, 133, 134, 137, 138, 139 28, 31, 35, 36, 39, 40, 43, 44, 56, 65, 66, 68, 73, 80, 84, 90, 134, 135, 136, 141 Understanding Social Responsibility in Marketing (pp. 88-92) 91, 98, 101, 104, 107, 108, 112, 113, 121, 122, 123, 125, 142, 148 92, 93, 94, 99, 102,103, 105, 106, 109, 110, 114, 115, 116, 117, 118, 119, 120, 124, 126, 127, 128, 129, 142, 143, 146 95, 96, 97, 100, 111, 137, 138, 140, 144, 45, 147 Video Case: Energy Performance Systems, Inc. (pp. 93-95) 130, 131, 132, 149 Note: Bold numbers indicate short essay questions. CHAPTER 4 ETHICS AND SOCIAL RESPONSIBILITY IN MARKETING MULTIPLE CHOICE QUESTIONS 4-1CHAPTER OPENING EXAMPLE: ANHEUSER-BUSCHCONCEPTUAL Demarketing is defined as marketing to reduce demand for a good or service. Which of the following companies has engaged in demarketing? a. General Motors b. Microsoft c. Anheuser-Busch d. General Electric e. Johnson & Johnson Answer: c Page: 81 Rationale: Anheuser-Busch has worked to convince people not to abuse its products.
Demarketing does not destroy product demand; it only reduces or shifts it. 4-2CHAPTER OPENING EXAMPLE: ANHEUSER-BUSCHCONCEPTUAL Anheuser-Busch’s commitment to saving the environment indicates that it would act in accordance with the __________, the view that an organization should discover and satisfy the needs of its consumers in a way that provides for society’s well-being. a. societal marketing concept b. rights of the consumerist c. generic mission statement d. marketing concept e. sales concept Answer: a Page: 17 Rationale: Chapter 1 defines the societal marketing concept.
Many of Anheuser-Busch’s programs exemplify the societal marketing concept. It established a Consumer Awareness and Education department to promote responsible drinking through new programs, advertising, and partnerships. Anheuser-Busch also is an advocate and sponsor of numerous environmental programs. 4-3CHAPTER OPENING EXAMPLE: ANHEUSER-BUSCHCONCEPTUAL The Family Talk About Drinking campaign developed by Anheuser-Busch to help parents address the topic of underage drinking is an example of: a. ethical behavior in marketing. b. negative advertising. c. market orientation. d. consumerism. e. legal responsibility in marketing.
Answer: a Page: 81Other Location: web Rationale: The Anheuser-Busch campaign Family Talk About Drinking is an example of ethics in marketing. 4-4CHAPTER OPENING EXAMPLE: ANHEUSER-BUSCHCONCEPTUAL Anheuser-Busch is trying to act socially responsible toward which of its stakeholders? a. Environmentalists b. People who drink beer c. ABRC, the world’s largest recycler of aluminum d. Children who might think drinking beer would make them cool e. All of the above Answer: e Page: 81 Rationale: The term stakeholder refers to any person or group that can relate to what a company does and how well it performs.
All of the choices represent Anheuser-Busch stakeholders. 4-5CHAPTER OPENING EXAMPLE: ANHEUSER-BUSCHCONCEPTUAL When Anheuser-Busch introduced its Know When to Say When campaign, even though it might result in a loss of potential sales, it demonstrated: a. stakeholder responsibility. b. profit responsibility. c. utilitarianism. d. social responsibility. e. cause-related marketing. Answer: d Page: 81 Rationale: Social responsibility is the view that organizations are part of a larger society and are accountable to that society for their actions. 4-6ETHICSDEFINITION _________ are the moral principles and values that govern the actions and decisions of an individual or group. a. Laws b. Religious precepts c. Ethics d. Social norms e. Beliefs Answer: c Page: 82 Rationale: Key term definition???ethics 4-7ETHICSDEFINITION __________ serve as guidelines on how to act rightly and justly when faced with moral dilemmas. a. Laws b. Ethics c. Case studies d. Mentors e. Ombudsmen Answer: b Page: 82 Rationale: Key term definition???ethics 4-8ETHICSDEFINITION Ethics are the: a. religious tenets of the country or ethnic region you live in. . social norms of a nation, community, or family. c. laws of society that define a person’s beliefs and behaviors. d. moral principles and values that govern the actions and decisions of an individual or group. e. universal laws of man that go beyond individual beliefs of nations or religions. Answer: d Page: 82 Rationale: Key term definition???ethics 4-9ETHICSCONCEPTUAL There has been a public outcry about the ethical practices of businesspeople because: a. over half of U. S. adults rate the ethical standards of business executives as only “fair” or “poor. b. ninety percent of U. S. adults think white-collar crime is “very common” or “somewhat common. ” c. seventy-six percent of U. S. adults say the lack of ethics in businesspeople contributes to tumbling societal moral standards. d. forty-one percent of employees are aware of ethical problems in their companies. e. All of the above are reasons for the public outcry of ethical practices of businesspeople. Answer: ePage: 82-83 Rationale: These results are all reported as reasons for the public outcry about the ethical practices of businesspeople.
The current perceptions of ethical behavior of businesspeople are very low. 4-10LAWSDEFINITION Laws are: a. a specific set of behaviors a given society considers to be ethical. b. based on society’s values and standards that are enforceable in the courts. c. the agreed upon code of behavior for a given nation, community, religious group, or family unit. d. written documentation of a prescribed set of behaviors. e. a legislated code of ethics defining both what may and may not be done in specific circumstances. Answer: b Page: 82 Rationale: Key term definition???laws -11LAWSDEFINITION __________ are based on society’s values and standards that are enforceable in the courts. a. Ethics b. Cultural norms c. Industry practices d. Laws e. Rights Answer: dPage: 82 Rationale: Key term definition???laws 4-12LAWSCONCEPTUAL Which of the following statements accurately distinguishes between laws and ethics? a. Laws reflect the beliefs of the majority and ethics reflect the beliefs of smaller individual segments of society. b. Ethics deal with religious and moral beliefs and laws deal with social, economic, and environmental behaviors. c.
Ethics deal with internal (personal) issues and laws deal with external (social) issues. d. Ethics deal with personal and moral principles while laws are based on society’s values and are enforceable in the courts. e. There is no significant difference; the terms can be used interchangeably. Answer: dPage: 82 Rationale: Key term definition???laws 4-13ETHICAL/LEGAL FRAMEWORK IN MARKETINGAPPLICATION Many media today use pay-to-vote polls (in which respondents use a 900 telephone number to vote “yes” or “no” on a current issue) as a means of generating viewer or listener interest.
The Research Industry Coalition (RIC) has asked all media to acknowledge the questionable validity of such polls by informing viewers or listeners that the results are NOT representative of the population, but are just a frequency distribution of those who call. If a television station chooses not to make viewers aware of the shortcomings of the poll, its business practice would fall into which of the following categories? a. Ethical but illegal b. Ethical and legal c. Unethical and illegal d. Unethical but legal e. None of the above Answer: dPage: 82 Rationale: The use of pay-to-vote polls is legal.
However, if viewers believe they are valid or representative of the population, their use may be misleading and therefore, unethical. 4-14ETHICAL/LEGAL FRAMEWORK IN MARKETINGAPPLICATION A 1999 poll by Environics International, a public-opinion research firm, found that 67 percent of North Americans are willing to boycott products on ethical grounds. This survey did not ask if the person who was acting on ethical grounds would first see if the boycott was based on real fact. Which of the following statements describe a conclusion that should be drawn from this information? a.
If you are an ethical person, you should act according to your instincts. b. All businesses are unethical. c. All businesses will act unethically unless forced by consumers to act morally. d. There is nothing consumers can do to stop unethical business activities. e. Boycotting a product without knowing the facts can be viewed as unethical. Answer: ePage: 82 Rationale: The boycott is unethical because it inflicts damage on others needlessly. There are many examples of companies that have been boycotted on the basis of unfounded rumors and some that have not survived long enough to make the truth widely known. -15ETHICAL/LEGAL FRAMEWORK IN MARKETINGAPPLICATION A computer program aimed at car dealers shows financing outcomes that misstate taxes and interest. The computer company agrees the program misleads buyers, but says it will provide what dealers want as long as it is not against the law. This is an example of an act that is: a. ethical but illegal. b. ethical and legal. c. unethical and illegal. d. unethical but legal. Answer: dPage: 82 Rationale: Misleading consumers is a legal practice, although it is unethical. 4-16ETHICAL/LEGAL FRAMEWORK IN MARKETINGAPPLICATION
If numbers from the state-run China National Network Information Center (CNNIC) are correct, China has more than 17 million Internet users as of June 2000. The Chinese government is filtering, tracing, and monitoring everything Chinese users do online as it looks for dissidents. So it will not lose its ability to operate in China, Yahoo! , a U. S. Internet service provider, excludes correspondence transmission to and from China that is related to human rights, democracy, or Tibetan freedom. By self-regulating communication to and from China, Yahoo! is acting: a. ethically but illegally. b. ethically and legally. c. nethically and illegally. d. unethically but legally. e. none of the above Answer: dPage: 82Other Location: web Rationale: Chinese laws want to prevent communication about these issues. Yahoo! is helping the government accomplish its goals. Denying the people of China freedom of speech is unethical according to American standards. 4-17CURRENT PERCEPTIONS OF ETHICAL BEHAVIORCONCEPTUAL According to public opinion surveys, only the __________ is considered less trustworthy than corporations among institutions in the United States. a. medical profession b. television industry c. legal profession d. U. S. government e. ews media Answer: dPage: 82 Rationale: Only the U. S. government is viewed as less trustworthy than corporations among institutions in the United States. 4-18CURRENT PERCEPTIONS OF ETHICAL BEHAVIORCONCEPTUAL There has been a public outcry about the ethical practices of businesspeople. Public opinion surveys show that advertising practitioners, insurance agents, and __________ are thought to be among the least ethical occupations. a. accountants b. lawyers c. car salespeople d. professional boxers e. bankers Answer: cPage: 82 Rationale: A recent survey of 1,694 corporate employees generally confirms this public perception. -19CURRENT PERCEPTIONS OF ETHICAL BEHAVIORCONCEPTUAL The current low perception of ethical business behavior can be explained by: a. the increased pressure on business people to make decisions in a society characterized by diverse value systems. b. a growing tendency for business decisions to be judged publicly by groups with different values and interests. c. the decline of ethical business behavior. d. all of the above. e. none of the above. Answer: dPage: 83 Rationale: All of the options are possible reasons for the state of perceived ethical behavior. -20FACTORS INFLUENCING BUSINESS ETHICSCONCEPTUAL Which of the following is NOT considered to be a factor influencing ethical behavior? a. Societal culture and norms b. Business culture c. Industry practices d. Corporate culture and expectations e. Legislation Answer: ePage: 83; Figure 4-1 Rationale: Figure 4-1 illustrates a framework for understanding ethical behavior. It includes societal culture and norms, business culture and industry practices, corporate culture and expectations, which lead to personal moral philosophy and ethical behavior. 4-21FACTORS INFLUENCING BUSINESS ETHICSCONCEPTUAL
Which of the following is considered to be a positive factor that influences ethical behavior? a. Societal culture and norms b. Organizational structures c. Internal Revenue Service (I. R. S. ) d. Federal agencies e. Legislation Answer: aPage: 83; Figure 4-1Other Location: web Rationale: Figure 4-1 illustrates a framework for understanding ethical behavior. It includes societal culture and norms, business culture and industry practices, corporate culture and expectations, and personal moral philosophy and ethical behavior. 4-22SOCIETAL CULTURE AND NORMS: CULTUREDEFINITION
Culture serves as a socializing force that determines what: a. is the will of the largest minority in a society. b. is considered by the group to be morally right and just. c. is the considered opinion of a society’s elders. d. is exclusively the law of the land. e. expresses the diverse backgrounds of a nation’s subcultures. Answer: bPage: 83 Rationale: Text term definition???culture 4-23SOCIETAL CULTURE AND NORMS: CULTUREDEFINITION Culture refers to: a. the set of values, ideas, and attitudes that are learned and shared among the members of a group. b. the music, art, theater, etc. that reflects the values of an entire nation. . the learned behaviors of a specific racial, ethnic, or religious group based on ethics and protected by laws. d. the combination of beliefs and behaviors accepted as correct regardless of a person’s age, sex, race, or religion. e. the music, art, theater, etc. that expresses the diverse backgrounds of a nation’s subcultures. Answer: aPage: 83 Rationale: Text term definition???culture 4-24SOCIETAL CULTURE AND NORMSAPPLICATION Making counterfeit copies of Gucci purses, Hilfiger sportswear, and other international brands is pervasive in China because it is so easy to get away with it.
Laws protecting intellectual property are unclear and sporadically enforced. Even when they are applied, sanctions are minimal, typically consisting of confiscation, a warning, a public apology, and perhaps a fine. Moreover, copying enjoys a long tradition in China and does not carry a stigma. Copying a masterpiece was historically considered an art form in its own right and Chinese students have been taught for centuries to copy their teachers as accurately as possible. A business introducing a product into China needs to know that __________ may lead to trademark infringements. . societal culture and norms b. opinion leaders c. antecedent states d. organizational culture and expectations e. legislation Answer: a Page: 83 Rationale: In China, counterfeiting is viewed as a profitable way of doing business. An international company doing business there must be vigilant in protecting itself from this societal norm. 4-25SOCIETAL CULTURE AND NORMSAPPLICATION As the use of the Internet grows around the world, understanding between countries must be reached so that there can be as easy an exchange of ideas and information as possible.
One important issue is opt-in versus opt-out. All European websites have opt-in policies and U. S. websites have opt-out policies. Opt-in means customers must ask to be involved in data collection and marketing while opt-out companies automatically include customers in data collection unless the customer specifically asks not to be included. Europeans and European businesses believe it is unethical to invade someone’s privacy. American businesses do it all the time because Americans are not nearly as protective of their right to privacy. What ethical factor is illustrated by this example? . Societal culture and norms b. Business culture c. Industry practices d. Organizational culture and expectations e. Legislation Answer: aPage: 83 Rationale: The right to privacy is an ethics issue. The strength of the belief in that right is based on societal culture. 4-26BUSINESS CULTUREDEFINITION __________ consists of “the effective rules of the game, the boundaries between competitive and unethical behavior, [and] the codes of conduct in business dealings. ” a. Societal norms b. Cultural modes and mores c. Business culture d. Fair trade practices . Corporate values Answer: cPage: 84 Rationale: Text term definition???business culture 4-27BUSINESS CULTUREDEFINITION Business culture affects ethical conduct both in the exchange relationship between sellers and buyers and in the: a. competitive behavior among sellers. b. competitive behavior between unrelated industries. c. price, service, and product responsibility to the ultimate consumer. d. accountability of buyers and sellers to federal and state legislation. e. perception of ethical behavior as viewed by society as a whole. Answer: aPage: 84
Rationale: Text term definition???business culture 4-28BUSINESS CULTUREAPPLICATION A large investment bank has been notified by the Securities and Exchange Commission that several of its sales and trading officials may face charges for taking inflated commissions in exchange for providing information on IPO shares in 1999 and 2000. This, plus many other allegations, caused the bank to release the following statement: “Our business dealings follow an accepted code of conduct in our industry. ” This statement means the bank executives: a. are taking full blame for its actions. b. ill accept punishment for their actions if the punishment is determined by members of their industry. c. believe they should be punished only if everyone else in their industry is. d. attribute the bank’s action to business culture. e. have decided to act socially responsible. Answer: dPage: 84 Rationale: Business culture consists of “the effective rules of the game, the boundaries between competitive and unethical behavior, [and] the codes of conduct in business dealings. ” According to this bank, its sales and trading practices, although unethical, represent the business culture of its industry. -29MARKETING NEWSNETCONCEPTUAL When the owner of a small publishing company allowed a friend who was starting a machine embroidery business to load the publishing company’s copy of Microsoft Word on the new business’s computer, it was an example of: a. an activity that is legal and ethical. b. caveat emptor. c. an activity that is illegal but ethical. d. software piracy. e. a strategic alliance. Answer: dPage: 84 Rationale: Software piracy is the unauthorized copying of business software. 4-30MARKETING NEWSNETCONCEPTUAL
The Software & Information Industry Association (SIIA) and the Business Software Alliance (BSA) estimates that the unauthorized copying of computer software: a. is only a problem in the United States. b. is not really illegal in any countries. c. costs their producers more than $10 billion annually. d. costs their producers next to nothing since they charge such high prices. e. is almost non-existent in Europe. Answer: cPage: 84 Rationale: The SIIA/BSA estimates the unauthorized copying of computer software costs their producers the equivalent of $12 billion in worldwide sales annually. -31MARKETING NEWSNETAPPLICATION Which of the following actions would be considered software piracy? a. A printer in Taipei prints and binds 10,000 copies of a textbook without permission. b. The owner of a small start-up business in Miami installs software in its five computers by copying disks borrowed from his accountant. c. A designer in London uses a U. S. trademark on several of her products. d. A student in San Diego borrows three favorite CDs from a friend and copies them for his own personal listening while he commutes to class. e. All of the above actions would be considered examples of software piracy.
Answer: bPage: 84Other Location: web Rationale: All of these actions are piracy, or unauthorized copying of intellectual property. However, copying borrowed software is the only example of software piracy. U. S. companies estimate that unauthorized use of their copyrights, trademarks, and patents costs about $63 billion annually. 4-32MARKETING NEWSNETCONCEPTUAL Software piracy causes: a. the creation of potential barriers to success for startup software companies around the globe. b. lost jobs and wages. c. lost sales revenue. d. lost corporate taxes. e. all of the above. Answer: ePage: 84
Rationale: All of the options are outcomes of software piracy, discussed in the Marketing NewsNet on page 84. 4-33ETHICS OF EXCHANGE: CAVEAT EMPTORDEFINITION Another expression for the term caveat emptor is: a. let the buyer beware. b. the right to choose. c. the thoughts of one person should benefit all. d. the greatest good for the greatest number. e. if it’s legal, it’s ethical. Answer: aPage: 85 Rationale: Text term definition???caveat emptor 4-34ETHICS OF EXCHANGE: CAVEAT EMPTORDEFINITION The Latin phrase caveat emptor means: a. cash on delivery. b. let the buyer beware. c. on’t count your chickens before they hatch. d. the right to be heard. e. question the ethics. Answer: bPage: 85 Rationale: Text term definition???caveat emptor 4-35ETHICS OF EXCHANGE: CAVEAT EMPTORAPPLICATION When Sam went to buy an engagement ring, he decided to buy it from a friend of his cousin’s wife, rather than a jewelry store. He congratulated himself when he saw the size of the stone he had purchased for $400. The ring turned his fiancee’s finger green and the “diamond” turned out to be zirconium. Sam should have remembered: a. the iceberg principle. b. e pluribus unum. c. de facto marketing. d. he marketing concept. e. caveat emptor. Answer: ePage: 85 Rationale: “Caveat emptor” means let the buyer beware. Sam should have considered that the low price he paid for the diamond ring may have indicated low quality. 4-36ETHICS OF EXCHANGE: CAVEAT EMPTORAPPLICATION P. T. Barnum was a 19th century businessman who made fortunes displaying oddities at his museum. Some were freaks of nature; others were man-made, like the white horse with a horn glued in the middle of his forehead. When asked if it was right not to tell people the bearded lady was actually a man, Barnum might have replied with which of the following? . Modus operandi b. Caveat emptor c. De facto marketing d. E pluribus unum e. Corpus delecti Answer: bPage: 85Other Location: web Rationale: “Caveat emptor” means let the buyer beware. 4-37ETHICS OF EXCHANGE: CONSUMER BILL OF RIGHTSDEFINITION Which of the following is NOT specified in the Consumer Bill of Rights? a. The right to be informed b. The right to be heard c. The right to have fair prices d. The right to safety e. The right to choose Answer: cPage: 85 Rationale: Key term definition???Consumer Bill of Rights 4-38ETHICS OF EXCHANGE: CONSUMER BILL OF RIGHTSDEFINITION
In 1962, President John F. Kennedy outlined a Consumer Bill of Rights that codified the ethics of exchange between buyers and sellers. These were the right (1) to safety, (2) to __________, (3) to choose, and (4) to be heard. a. privacy b. be informed c. be treated courteously d. be left alone when shopping e. full disclosure of liability Answer: bPage: 85 Rationale: Key term definition???Consumer Bill of Rights 4-39ETHICS OF EXCHANGE: CONSUMER BILL OF RIGHTSAPPLICATION Which of the following issues would be addressed by the Consumer Bill of Rights? a.
In 31 states, insurance companies are required to notify policy owners if the insurance company has specified the use of non-genuine replacement parts in auto repairs. b. McDonald’s has alternate toy selections in their Happy Meals for children under the age of three, so the smaller children won’t choke on little game pieces. c. Most major universities now offer an extended selection of evening courses for those students who must work full time during the day. d. Students at a major university formed an action committee to protest a proposed “flat fee” tuition schedule. e.
All of the above issues would be addressed by the Consumer Bill of Rights. Answer: ePage: 85 Rationale: The Consumer Bill of Rights deals with the right to (1) be informed (Alternative a), (2) safety (Alternative b), (3) choose (Alternative c), and (4) be heard (Alternative d). 4-40ETHICS OF EXCHANGE: CONSUMER BILL OF RIGHTSAPPLICATION Which of the following would NOT be addressed by the Consumer Bill of Rights? a. In 31 states insurance companies are required to notify policy owners if the insurance company has specified the use of non-genuine replacement parts in auto repairs. b.
The sole manufacturer of a life-saving drug charges $4. 00 per capsule even though actual production costs are only 8 cents. The drug company claims they need to recover research and development costs. c. McDonald’s has alternate toy selections in their Happy Meals for children under the age of three so the smaller children won’t choke on little game pieces. d. Most major universities now offer an extended selection of evening courses for those students who must work full time during the day. e. Students at a major university formed an action committee to protest a proposed “flat fee” tuition schedule.
Answer: bPage: 85 Rationale: The Consumer Bill of Rights deals with the right to (1) be informed (choice a), (2) safety (choice c), (3) choose (choice d), and (4) be heard (choice e). Price is not a topic of the Consumer Bill of Rights. 4-41ETHICS OF EXCHANGE: CONSUMER BILL OF RIGHTSCONCEPTUAL In 1997 a project team for Cosco, the world’s largest children’s products company, developed a high chair that could be used as an infant feeding seat, a youth chair, a play chair, a booster chair, and it could be reclined to make an infant bed. Its design could be made and sold for $49.
The marketing manager, in consultation with other middle managers, decided to have the prototypes checked out by Cosco employees who had small children. This was the only product testing performed on the product. Before Cosco pulled the unsafe chair from the market, several children were injured and some died as a result of using the chair. Cosco was charged with being unconcerned about consumers’: a. right to choose. b. right to be informed. c. right to be treated courteously. d. right to safety. e. right to happiness. Answer: dPage: 85 Rationale: The U. S. Consumer Product Safety Commission fined Cosco $1. million for its misconduct of the chair. Their actions demonstrate violation of a consumer’s right to safety. 4-42ETHICS OF EXCHANGE: CONSUMER BILL OF RIGHTSCONCEPTUAL When shopping on the Internet, most consumers assume the personal information they give out is confidential. Subscribers to America Online (AOL) were upset when AOL proposed giving member information to partners without telling the subscribers. This is related most directly to the consumer’s: a. right to choose. b. right to be informed. c. right to be treated courteously. d. right to safety. e. right to happiness.
Answer: bPage: 85 Rationale: A consumer’s right to be informed is in violation when a company gives out consumer information without their knowledge. 4-43ETHICS OF EXCHANGE: CONSUMER BILL OF RIGHTSAPPLICATION When Toysmart. com filed for bankruptcy in June 2000, it listed its customer database as one of its assets, even though it had assured its customers it would never disclose their information to any third party. People who had purchased from Toysmart and were a part of its database were upset when they learned that their private information was being treated as property that was for sale.
These customers believed that, according to the Consumer Bill of Rights, they should know how their private information would be used. In other words, Toysmart’s former customers had a: a. right to choose. b. right to be informed. c. right to be treated courteously. d. right to safety. e. right to happiness. Answer: bPage: 85 Rationale: The consumers’ right to be informed was lost when Toysmart threatened to use their private information in a way not consistent with how it had been gathered. 4-44ETHICS OF EXCHANGE: CONSUMER BILL OF RIGHTSAPPLICATION
People who fly regularly collect frequent flyer miles that can be used for free flights at later dates. The existence of blackout days (days when frequent flyer miles cannot be redeemed) could interfere with consumers’: a. right to choose. b. right to be informed. c. right to be treated courteously. d. right to safety. e. right to happiness. Answer: aPage: 85 Rationale: Blackout days could prevent consumers from traveling on the days they would like to and it does interfere with their right to choose. 4-45ETHICS OF EXCHANGE: CONSUMER BILL OF RIGHTSCONCEPTUAL The Children’s Online Privacy Act is a law designed to protect consumers’: . right to choose. b. right to be informed. c. right to be treated courteously. d. right to safety. e. right to happiness. Answer: bPage: 85 Rationale: The Children’s Online Privacy Act stipulates a parent must give permission through postal mail, fax, telephone, or a digital signature before a child under the age of 13 can visit a site. This way the parent knows what his or her child is doing on the Internet. 4-46ETHICS OF EXCHANGE: SLOTTING ALLOWANCESDEFINITION A current practice whereby retailers may demand cash or free goods in exchange for shelf space for new products is referred to as: . kickbacks. b. economic espionage. c. caveat emptor. d. slotting allowances. e. bribes. Answer: dPage: 85 Rationale: Slotting allowances could limit the number of new products available to consumers and interfere with their right to choose. 4-47ETHICS OF EXCHANGE: THE RIGHT TO BE HEARDCONCEPTUAL The consumer’s right to be heard was illustrated in limitations put on late-night and repeated calls by the Telephone Consumer Protection Act of 1991. Additional curbs on telemarketers’ misrepresentations were enacted by the __________ in 1995 due to continued consumer complaints. a. U. S.
Department of Commerce b. American Advertising Federation c. Direct Marketing Association d. Federal Trade Commission e. Warren Commission Answer: dPage: 85Other Locations: web Rationale: The right to be heard means that consumers should have access to public-policy makers regarding complaints about products and services. This right was illustrated in limitations put on telemarketing practices. 4-48ETHICS OF COMPETITIONCONCEPTUAL The two most common types of unethical behavior in competition are: a. price fixing and copyright infringement. b. economic espionage and bribery. c. bribery and extortion. d. rice fixing and economic espionage. e. economic espionage and anti-trust infractions. Answer: bPage: 85 Rationale: Economic espionage and bribery are the most common types of unethical behavior. 4-49ETHICS OF COMPETITION: ECONOMIC ESPIONAGEDEFINITION Economic espionage involves: a. the destruction of a competitor’s goods or services through physical damage of property or damage to their reputation. b. the collection of trade secrets or proprietary information from a company’s competitors. c. knowledge of wrong doing within a firm that goes unreported in order to better a worker’s personal standing in the firm. d. raudulent activities by a firm whereby the consumer is intentionally sold inferior goods or provided with inferior services for the sake of a larger profit. e. accurately described by none of the above. Answer: b Page: 85 Rationale: Text term definition???economic espionage 4-50ETHICS OF COMPETITION: ECONOMIC ESPIONAGECONCEPTUAL Michael Smolensky, is the CEO of Lifeway Foods, Inc. , based in Skokie, Ill. The company sells kefir, a cultured milk product popular in Smolensky’s native Russia. In 1997, Smolensky, who had developed his own secret recipe, got a call from his supplier, saying: “Michael, someone is trying to steal your secrets. Smolensky discovered later that a prospective rival had called to ask the supplier for certain ingredients by their secret codes, known only to Smolensky and the supplier. The rival had picked them out of Lifeway’s trash. This is an example of: a. corporate curiosity. b. economic espionage. c. reasonable inquiry. d. industry standardization. e. standard operating procedure. Answer: bPage: 85 Rationale: Economic espionage is the clandestine collection of trade secrets or proprietary information about a company’s competitors. 4-51ETHICS OF COMPETITION: BRIBES AND KICKBACKSCONCPETUAL
Organizers of the Salt Lake City, Utah Olympics for the year 2002 were investigated for promising gifts and favors to members of the International Olympic Committee. This as an example of: a. bribes. b. customer service. c. espionage. d. target marketing. e. goodwill. Answer: aPage: 86Other Location: web Rationale: Promised gifts and favors are examples of bribery. 4-52ETHICS OF COMPETITION: BRIBES AND KICKBACKSDEFINITION Offering a bribe or kickback is considered unethical behavior in American business culture. A bribe occurs: a. before the exchange occurs. b. after the exchange occurs. c. to avoid espionage. . as standard operating procedure in the United States. e. as part of corporate curiosity. Answer: a Page: 86 Rationale: Text term definition???bribe 4-53ETHICS OF COMPETITION: BRIBES AND KICKBACKSDEFINITION Offering a bribe or kickback is considered unethical behavior in American business culture. A kickback occurs: a. before the exchange occurs. b. after the exchange occurs. c. to avoid espionage. d. as standard operating procedure in the United States. e. as part of corporate curiosity. Answer: bPage: 86 Rationale: Text term definition???kickback 4-54ETHICS OF COMPETITION: BRIBES AND KICKBACKSCONCEPTUAL
In general, bribery is most evident: a. in industries experiencing intense competition. b. in countries in earlier stages of economic development. c. in Cameroon. d. in Nigeria. e. All of the above are true of bribery. Answer: ePage: 86 Rationale: In general bribery occurs in industries experiencing intense competition and in countries in earlier stages of economic development (alternatives a, b). A recent poll of senior executives engaged in global marketing revealed that Cameroon and Nigeria were the most likely countries to use bribery to win or retain business (alternatives c, d).
Thus, the correct answer is “e. ” 4-55ETHICS OF COMPETITION: BRIBES AND KICKBACKSCONCEPTUAL In general, bribery is most evident: a. in industries experiencing intense competition. b. in countries in advanced stages of economic development. c. in Canada. d. in Denmark. e. All of the above are true of bribery. Answer: aPage: 86 Rationale: In general bribery occurs in industries experiencing intense competition and in countries in earlier, not later, stages of economic development (alternatives a, b). 4-56ETHICS OF COMPETITION: BRIBES AND KICKBACKSAPPLICATION
After Mobil Oil Corporation increased their ownership of the Tengiz oil field in Kazakhstan, a Mobil executive was arraigned before a federal judge in New York. The suit alleged that he routed millions of dollars to the President and the former Prime Minister of Kazakhstan prior to the acquisition. At the time of the deal, there was intense competition in the Caspian region, when almost every major oil company in the world was attempting to acquire a field to develop or explore in the region. Which of the following reasons is the most likely reason for the suit brought against the executive? . The executive received a kickback from the owners of the Tengiz oil field to help close the deal. b. The executive provided bribes to government officials. c. The executive received a bribe from the owners of the Tengiz oil field. d. The executive received a bribe from the negotiator for Mobil Oil. e. The executive worked for more than one oil company at the same time. Answer: bPage: 86 Rationale: Bribery and kickbacks often occur in industries experiencing intense competition (mentioned in the scenario) and in countries in earlier stages of economic development (Kazakhstan).
The executive would have provided bribes, since a bribe occurs before the transaction (alternative b). He would not have received a kickback from the owners of the field since there was much competition and this alone would get the owners their price. There is no statement or suggestion in the question that the executive worked for more than one company at a time. 4-57CORPORATE CULTUREDEFINITION Corporate culture: a. is a formalized method for controlling the marketing environment. b. is the set of accepted standards and practices within a given industry by its principal members. c. s the description of both ethical and behavioral attributes of “white collar” versus “blue collar” workers in the United States business environment. d. reflects the shared values, beliefs, and purpose of employees that affect individual and group behavior. e. is the formal statement of ethical principles and rules of conduct adopted by an organization. Answer: dPage: 86 Other Location: web Rationale: Text term definition???corporate culture 4-58CORPORATE CULTUREDEFINITION The __________ reflects the shared values, beliefs, and purpose of employees that affect individual and group behavior. . operational code b. mission environment c. socialization process d. environmental strategy e. corporate culture Answer: ePage: 86 Rationale: Text term definition???corporate culture 4-59CORPORATE CULTURECONCEPTUAL Lava. com is an Internet company that helps other organizations put concepts into action that they hope will let them dominate the market in their industry. In its promotion, it states, “We ignore the rules and we let no obstacle stand in your company’s way???no matter how bold or impossible your idea may seem. ” The company is composed of eighteen bright young Internet experts.
They work in one large room, which also contains dartboards, a pool table, and a meditation center. If you were to walk into the office, it would be next to impossible to tell the company owners from its lowest ranking employee. This is a description of the Internet company’s: a. operational code. b. mission environment. c. socialization process. d. environmental strategy. e. corporate culture. Answer: ePage: 86 Rationale: A corporate culture reflects the shared values, beliefs, and purpose of employees that affect individual and group behavior. -60CORPORATE CULTURECONCEPTUAL Which of the following statements about corporate culture is true? a. The corporate culture is revealed when all the employees wear jeans and t-shirts at work. b. The corporate culture is apparent in the expectations of ethical behavior present in formal codes of ethics. c. A company’s corporate culture is revealed by how its employees work together on group projects. d. A company’s use of the slogan “Quality is Job #1” reveals its corporate culture. e. All of the above statements about the corporate culture are true. Answer: ePage: 86
Rationale: Corporate culture reflects the shared values, beliefs, and purpose of employees that affect individual and group behavior. 4-61CODE OF ETHICSDEFINITION A formal statement of ethical principles and rules of conduct is called a: a. consumer bill of rights. b. business mission. c. corporate code. d. code of ethics. e. caveat emptor. Answer: dPage: 86 Rationale: Key term definition???code of ethics 4-62CODE OF ETHICSDEFINITION A code of ethics is a formal statement of ethical principles and: a. legal restrictions. b. moral reservations. c. cultural values. d. rules of engagement. e. ules of conduct. Answer: ePage: 86 Rationale: Key term definition???code of ethics 4-63CODE OF ETHICSCONCEPTUAL Which of the following statements describes shortcomings associated with codes of ethics? a. Most companies do not have a formal code of ethics and for those that do, there is no way for the codes to be enforced. b. Most companies overlook infractions if the action is unethical but legal and little action is taken if the unethical behavior results in a profit for the firm. c. Many codes of ethics lack specificity and a problem exists with the perceived behavior of top management and coworkers. d.
There is often a discrepancy between the code of ethics of a firm and the code of ethics of labor unions and there is often a discrepancy between the code of ethics of a firm and the personal and moral beliefs of an individual employee. e. There are very few violations in firms with written codes of ethics. Answer: cPage: 87 Rationale: The lack of specificity is one of the major reasons for the violation of ethics codes. A second reason for violating ethics codes rests in the perceived behavior of top management and coworkers. 4-64CODE OF ETHICSCONCEPTUAL Which of the following is one of the major reasons for the violation of ethics codes? . Government regulation b. Family influence c. Religious beliefs d. Fear of disciplinary action e. Lack of specificity Answer: ePage: 87Other Location: web Rationale: The lack of specificity is one of the major reasons for the violation of ethics codes. Employees must often judge whether a specific behavior is really unethical. 4-65CODE OF ETHICSAPPLICATION A new salesperson ought to become familiar with his or her new employer’s __________ in order to make sure he or she behaves in an ethical manner that is consistent with the policies of his or her firm. a. international marketing guide b. professional business manual . code of ethics d. sales training text book e. marketing program Answer: cPage: 87Other Location: web Rationale: A code of ethics is written, formal statement regarding a firm’s ethical principles and rules of conduct. 4-66CODE OF ETHICSAPPLICATION Tanya is a professional sales person for a marketing firm in the United States. Tanya sells a variety of consumer goods to retailers in several foreign countries. Tanya has recently been confronted with a dilemma. She has learned that the standard business practice in several of the foreign countries involves bribery and other forms of corruption.
In order to make sure she behaves in an ethical manner that is consistent with the policies of her own firm, Tanya should review her company’s __________. a. international marketing guide b. professional business manual c. code of ethics d. sales training text book e. none of the above Answer: cPage: 87 Rationale: A code of ethics is written, formal statement regarding a firm’s ethical principles and rules of conduct. In situations such as detailed in the question, it is quite common for professional sales people to first examine their personal, internalized ethics to help them make decisions.
If they need further clarification or assurance as to the correct behavior given a specific situation, sales people often resort to company guidelines (code of ethics) to guide their behavior. 4-67ETHICAL BEHAVIOR OF TOP MANAGEMENTCONCEPTUAL In 2002, six executives of Tyson Foods, one of the world’s largest poultry, beef, and pork processors, were arrested for illegal smuggling of undocumented foreign workers into the U. S. to work at Tyson plants. Tyson’s violations are the result of __________, one of the major reasons why some companies fail to establish ethical behavior. a. oo ambiguous a mission statement b. the absence of an executive summary c. anti whistle-blowing d. top management’s behavior e. poor marketing research Answer: dPage: 87 Rationale: Employees often gauge how serious a company is about ethical behavior by looking at the actions of upper management. 4-68ETHICAL BEHAVIOR OF TOP MANAGEMENTAPPLICATION In 2002, six executives of Tyson Foods, one of the world’s largest poultry, beef, and pork processors, were arrested for illegal smuggling undocumented foreign workers into the U. S. to work at Tyson plants. From this statement, you can infer that: . Tyson Foods has a strong ethical code in spite of the activities of its top management. b. the management of Tyson’s ethical code is overseen by a federal agency. c. no one that works at Tyson Foods is ethical. d. the management’s behavior would lead other individuals to believe they could also act unethically when making decisions that would affect the company. e. the executives at Tyson Foods believe in moral utility. Answer: dPage: 87Other Location: web Rationale: One of the reasons why codes of ethics fail is due to the lack of appropriate top-management behavior. -69WHISTLE-BLOWERSDEFINITION Employees who report unethical or illegal actions of their employers are officially called: a. whistle-blowers. b. scabs. c. cronies. d. ethical poachers. e. ombudsmen. Answer: aPage: 87 Rationale: Key term definition???whistle-blowers 4-70WHISTLE-BLOWERSDEFINITION __________ are employees who report unethical or illegal actions of their employers. a. Whistle-blowers b. Scabs c. Cronies. d. Ethical poachers e. Ombudsmen Answer: aPage: 87 Rationale: Key term definition???whistle-blowers 4-71WHISTLE-BLOWERSCONCEPTUAL
An employee who reports illegal accounting procedures is an example of a(n): a. corporate proctor. b. ethical ombudsman. c. whistle-blower. d. ethical poacher. e. scab. Answer: cPage: 87 Rationale: Whistle-blowers are employees who report unethical or illegal actions of their employers. 4-72WHISTLE-BLOWERSCONCEPTUAL Which of the following statements described the activities of whistle-blowers? a. Mattel employees were sorry that 150 of the 10 million Power Wheels cars and trucks the company sold had caught on fire. b. Mattel research engineers proved that the wave of fires in the company’s
Power Wheels cars and trucks was the result of consumers’ tinkering with the engine. c. One of the Mattel Power Wheel cars that caught on fire and slightly burned its rider was owned by a former Mattel employee. d. The Consumer Product Safety Commission investigated the fires and ordered a recall for repair of all 10 million units that have been sold. e. None of the above statements describes the activities of a whistleblower. Answer: ePage: 87 Rationale: Whistle-blowers are employees who report unethical or illegal actions of their employers.
If an employee of Mattel had reported to the CPSC that Mattel was knowingly manufacturing an electrical system for Power Wheels that would catch on fire after long use, he or she would have been a whistleblower. 4-73WHISTLE-BLOWERSAPPLICATION Bayer AG and GlaxoSmithKline, two pharmaceudical manufacturers agreed to pay a combined $345 million in civil damages and criminal fines because an employee reported that they allegedly cheated Medicaid out of required discounts and rebates on an antibiotic and a blood-pressure drug.
Which of the following actions would have likely lead to this outcome? a. Bayer AG voluntarily disclosed its wrongdoing. b. GlaxoSmithKline voluntarily disclosed its wrongdoing. c. Bayer AG and GlaxoSmithKline both voluntarily disclosed wrongdoing. d. A whistleblower reported the wrongdoing to the U. S. government. e. None of the above statements describes a likely action leading to this outcome. Answer: dPage: 87 Rationale: Whistle-blowers are employees who report unethical or illegal actions of their employers.
Since an employee of Bayer had reported to the federal government that Bayer had knowingly sold these drugs to Medicaid without the required discounts and rebates by changing the labels slightly to avoid detection, he was a whistleblower. 4-74WHISTLE-BLOWERSCONCEPTUAL Which of the following statements describes a whistle-blower? a. An employee is unhappy because his company is downsizing. b. An employee tells the Consumer Product Safety Commission his company falsified safety reports on a child’s car seat. c. A salesperson for a hardware wholesaler tries to sell insurance to his regular customers in order to earn some extra income. . An employee loses her retirement fund due to a downturn in the stock market. e. An employee spends the afternoon studying at work for her test rather than counting inventory as she was supposed to be doing. Answer: bPage: 87 Rationale: Whistle-blowers are employees who report unethical or illegal actions of their employers???in this case, a falsification of a safety document. 4-75PERSONAL MORAL PHILOSOPHYCONCEPTUAL Ultimately, ethical choices are based on: a. the personal moral philosophy of the decision maker. b. societal culture and norms. c. usiness culture and industry practices. d. laws enacted by Congress and regulations by federal and state governments. e. chance and opportunity. Answer: aPage: 87 Rationale: Ultimately, ethical choices are based on the personal moral philosophy of the decision-maker. Two moral philosophies are most prominent. They are moral idealism and utilitarianism. 4-76PERSONAL MORAL PHILOSOPHYCONCEPTUAL The two major types of moral philosophies are: a. existentialism and pragmatism. b. pragmatism and idealism. c. moral idealism and utilitarianism. d. social responsibility and personal ethics. . moral behaviorism and secular ethics. Answer: cPage: 87 Rationale: Two prominent personal moral philosophies???moral idealism and utilitarianism???have direct bearing on marketing practice. 4-77MORAL IDEALISMDEFINITION Moral idealism is: a. a personal moral philosophy that focuses on the greatest good for the greatest number by assessing the costs and benefits of the consequences of ethical behavior. b. a democratic consensus of moral principles and laws that govern the behavior of individuals based on legislation adopted at the federal, state and local levels. . a societal moral philosophy based on the Golden Rule of the Judeo-Christian ethic found in the Constitution’s Bill of Rights. d. a formal statement of ethical principles and rules of conduct. e. a personal moral philosophy that considers individual rights or duties as universal, regardless of the outcome. Answer: e Page: 87 Rationale: Key term definition???moral idealism 4-78MORAL IDEALISMCONCEPTUAL __________ is a moral philosophy that exists in the Consumer Bill of Rights and is favored by moral philosophers and consumer interest groups. . Ethical aspiration b. Moral idealism c. Utilitarianism d. Hedonism e. Religious zealotry Answer: bPage: 87 Rationale: Moral idealism is a personal moral philosophy that considers certain individual rights or duties as universal, regardless of the outcome. 4-79MORAL IDEALISMCONCEPTUAL 3M stopped production of a chemical it had manufactured for nearly 40 years when tests showed the chemical could be harmful in large doses, even though the products in which it was used had no known harmful health or environmental effect.
This is an example of: a. a code of ethics violation. b. moral idealism. c. utilitarianism. d. cultural and corporate ethics. e. internal economic espionage. Answer: b Page: 87 Rationale: Moral idealism is a personal moral philosophy that considers certain individual rights or duties as universal (in this case consumer safety), regardless of the outcome. 4-80MORAL IDEALISMAPPLICATION Western Digital, the Irvine, California-based maker of hard disk drives, announced recently that it will recall approximately 400,000 of its 6. GB per platter Caviar desktop hard drives, its flagship product, because of a faulty internal chip. The chip will not affect the disk drive motor until six to twelve months of use. This delay in the problem’s appearance means that many consumers would not think to blame a manufacturer of one of their computer’s parts. But instead of taking the less expensive route of remaining quiet about the problem, Western Digital chose to offer replacement disk drives for all the products that had the faulty chip. This action exemplifies: a. a code of ethics violation. . moral idealism. c. utilitarianism. d. cultural and corporate ethics. e. internal economic espionage. Answer: bPage: 87 Rationale: Moral idealism is a personal moral philosophy that considers certain individual rights or duties as universal, regardless of the outcome. 4-81MORAL IDEALISMCONCEPTUAL The owners of Ben & Jerry’s Homemade, Inc. adhere to the belief that the company should in no way harm the environment and when possible, it should improve its environment. This exemplifies: a. moral idealism. b. liberalism. c. grandstanding. d. oncern for stakeholders. e. situational ethics. Answer: aPage: 87 Rationale: The philosophy of moral idealism is a personal moral philosophy that considers certain individual rights or duties as universal, in this case, not harming the environment, regardless of the outcome. 4-82MORAL IDEALISMCONCEPTUAL A publishing company’s refusal to publish the autobiography of a serial killer because the company does not believe the killer should profit as a result of the pain he has caused others exemplifies: a. moral idealism. b. liberalism. c. grandstanding. . concern for stakeholders. e. situational ethics. Answer: aPage: 87 Rationale: The philosophy of moral idealism is a personal moral philosophy that considers certain individual rights or duties as universal, (not profiting from actions that were illegal) regardless of the outcome. 4-83MORAL IDEALISMCONCEPTUAL Source Perrier S. A. , the supplier of Perrier bottled water, recalled 160 million bottles of water after traces of a toxic chemical were found in 13 bottles. The recall cost the company $35 million and $40 million more was lost in sales.
Even though the chemical was not harmful to humans, the president of the company believed it was his duty to remove “the least doubt, as minimal as it might be, to weigh on the image of the quality and purity of our product. ” This exemplifies: a. moral idealism. b. liberalism. c. grandstanding. d. utilitarianism. e. situational ethics. Answer: aPage: 87 Other Location: web Rationale: The philosophy of moral idealism is a personal moral philosophy that considers certain individual rights or duties as universal, regardless of the outcome.
The outcome in this example was a loss of $75 million. 4-84MORAL IDEALISMAPPLICATION In 1988, the book Satanic Verses by Salman Rushdie was published. It was considered blasphemous by several national, political, and religious groups and there was a death threat made against the author’s life. In the United States, there was a controversy over whether bookstores should carry the book. Which of the following statements describes how an independent bookstore in a community with a large population that was opposed to the book would have responded to an offer to stock the book? a.
If the store carried the book because it knew the controversy would make the book a best seller, it would be operating within the framework of moral idealism. b. If the store refused to carry the book because this would offend too many of its regular customers, it would be operating within the framework of moral idealism. c. If the store refused to carry the book for fear of acts of vandalism against the store, it would be operating with the framework of moral idealism. d. If the store carried the book on the grounds of freedom of speech and freedom of the press, it would be operating within a framework of moral idealism. . If the store refused to carry the book because the storeowner believed Satanic Verses to be blasphemous, he or she would be operating within the framework of utilitarianism. Answer: dPage: 87 Rationale: Moral idealism is a personal moral philosophy that considers individual rights or duties as universal regardless of the outcome. In this case, freedom of speech and freedom of the press represent the universal right in which the bookstore owner believes. 4-85UTILITARIANISMDEFINITION
A personal moral philosophy that focuses on the greatest good for the greatest number by assessing the costs and benefits of the consequences of ethical behavior is called: a. moral idealism. b. ethics. c. utilitarianism. d. socialism. e. capitalism. Answer: cPage: 87 Rationale: Key term definition???utilitarianism 4-86UTILITARIANISMDEFINITION __________ is a personal moral philosophy that focuses on the greatest good for the greatest number by assessing the costs and benefits of the consequences of ethical behavior. a. Moral idealism. b. Ethics. c. Utilitarianism. d.
Socialism. e. Capitalism. Answer: cPage: 87 Rationale: Key term definition???utilitarianism 4-87UTILITARIANISMCONCEPTUAL In the late 18th century, English jurist Jeremy Bentham systematically analyzed law and legislation, laying the foundation for utilitarian philosophy. Which of the following statements about his philosophy is true today? a. This philosophy exists in the Consumer Bill of Rights. b. This philosophy considers certain individual rights or duties as universal, regardless of the outcome. c. Moral philosophers and consumer interest groups favor this philosophy. . This philosophy focuses on the greatest good for the greatest number by assessing the costs and benefits of the consequences of ethical behavior. e. All of the above statements about Bentham’s philosophy are true today. Answer: dPage: 87 Rationale: Utilitarianism is an alternative perspective on moral philosophy, which is a personal moral philosophy that focuses on the greatest good for the greatest number by assessing the costs and benefits of the consequences of ethical behavior. This philosophy underlies the economic tenets of capitalism.
Moral idealism exists in the Consumer Bill of Rights and is favored by moral philosophers and consumer groups. 4-88UTILITARIANISMCONCEPTUAL According to the philosophy of __________ if the benefits exceed the costs, the behavior is ethical. a. hedonism b. utilitarianism c. existentialism d. moral idealism e. socialism Answer: bPage: 87 Rationale: Utilitarianism assesses the costs and benefits of the consequences of a behavior. If the benefits exceed the costs, then the behavior is ethical. If not, then the behavior is unethical. 4-89UTILITARIANISMCONCEPTUAL The philosophy of utilitarianism underlies the economic tenets of: . existentialism. b. moral idealism. c. communism. d. socialism. e. capitalism. Answer: ePage: 87 Rationale: Utilitarianism is a personal moral philosophy that focuses on the greatest good for the greatest number by assessing the costs and benefits of the consequences of ethical behavior. 4-90UTILITARIANISMAPPLICATION In 1997 a project team for Cosco, the world’s largest children’s products company, developed a high chair that could be used as an infant feeding seat, a youth chair, a play chair, a booster chair, and it could be reclined to make an infant bed.
Its design could be made and sold for $49. To beat its competition, Cosco rushed the chair into production before it was properly safety tested. When some children were injured as a result of this chair, Cosco denied culpability by saying that only a few consumers had had any trouble with the chair. These consumers had not read the instructions that came with the chair and had assembled it improperly. Cosco’s actions exemplify which of the following philosophies? a. Existentialism b. Moral idealism c. Communism d. Socialism e. Utilitarianism Answer: ePage: 87
Rationale: Utilitarianism is a personal moral philosophy that focuses on the greatest good for the greatest number by assessing the costs and benefits of the consequences of ethical behavior. Cosco’s claim that only a few children were injured as a result of the chair is an example of the benefits outweighing the costs of the chair. 4-91SOCIAL RESPONSIBILITYDEFINITION The view that organizations are part of a larger society and are accountable to that society for their actions is called: a. the Golden Rule. b. social responsibility. c. profit responsibility. . utilitarianism. e. the Valdez Principle. Answer: bPage: 88 Rationale: Key term definition???social responsibility 4-92SOCIAL RESPONSIBILITYCONCEPTUAL Profit responsibility, societal responsibility, and stakeholder responsibility are three concepts of: a. social responsibility. b. moral idealism. c. utilitarianism. d. green marketing. e. cause-related marketing. Answer: aPage: 88; Figure 4-2 Rationale: Figure 4-2 illustrates the three concepts of social responsibility: profit responsibility, stakeholder responsibility, and societal responsibility. -93SOCIAL RESPONSIBILITYCONCEPTUAL Florida Gas Service Co. has put large stickers on all of its vehicles designating them as safety watch vehicles. Employees are trained to help children, older citizens, and others in need of help. This safety watch program is demonstrating: a. the Golden Rule. b. social responsibility. c. profit responsibility. d. utilitarianism. e. the Valdez Principle. Answer: bPage: 87 Rationale: The gas company has taken the view that it is part of a larger society and is accountable to that society for its actions. 4-94SOCIAL RESPONSIBILITYCONCEPTUAL
The residents of Alaska and people throughout the world were outraged when the Exxon Valdez crashed into a shoal and dumped millions of gallons of crude oil into the pristine waters of Prince William Sound. People were upset with Exxon’s response to the disaster. The company was slow to admit its mistake and even slower to implement cleanup activities. Exxon was criticized for acting in a manner that would benefit the organization, but would not benefit society in general. In short, Exxon did not demonstrate: a. social responsibility. b. value consciousness. c. gray marketing. d. rofit responsibility. e. transactional marketing. Answer: aPage: 88 Rationale: Social responsibility means that an organization is part of a larger society and is responsible to that society for its actions. Exxon acted, at least initially, with only the organization’s interests in mind. 4-95SOCIAL RESPONSIBILITYAPPLICATION The manufacturer of baby safety products has the following mission: “Products that protect our most valuable resource???our children. ” One of its products is a small cap that fits over sharp edges to prevent injury. The caps are made almost entirely of recycled plastic.
For each package of protective caps sold, the company donates five percent of its profits to the Center for the Rehabilitation of Head Injuries. The company is demonstrating: a. green marketing. b. cause-related marketing. c. societal responsibility. d. its corporate culture. e. all of the above. Answer: ePage: 88Other Location: web Rationale: The recycling of plastic is green marketing, the donation of profits is cause-related marketing, the concern for children and the environment (recycled plastic) reflects social responsibility, and the practice itself is part of its corporate culture derived from its mission. -96SOCIAL RESPONSIBILITYAPPLICATION The U. S. Department of Energy often ships radioactive trash from nuclear sites to dumps in various locations in the United States. Groups such as Heart of America Northwest, Columbia Riverkeeper, and the Sierra Club have filed suit to keep radioactive waste from entering Oregon. Gerald Pollet of Heart of America Northwest, a Seattle-based Hanford watchdog group said, “These shipments are like deadly ‘dirty bombs’ of plutonium waste being trucked through our communities. ” The suit is likely based on which of the