AGB 302 Chapter 5 Exam Questions and
Answers
Ethics - Answer-Accepted principles of right or wrong that govern the conduct of a
person, the members of a profession, or the actions of an organization
Business Ethics - Answer-accepted principles of right or wrong governing the conduct of
businesspeople
Ethical Strategy - Answer-A strategy, course of action, that does not violate these
accepted principles
Tragedy of Commons - Answer-Occurs when a resource held in common by all, but
owned by no one, is overused by individuals, resulting in its degradation
facilitating payments - Answer-are not payments to secure contracts that would not
otherwise be secured, nor are they payments to obtain exclusive or preferential
treatment
Convention on Combatting Bribery of Foreign Public Officials in International Business
Transactions - Answer-The convention obliges member states and other signatories to
make the bribery of foreign public officials a criminal offense
Foreign Corrupt Practices Act (FCPA) - Answer-The act outlawed the paying of bribes
to foreign government officials to gain business
Organizational Culture - Answer-The values and norms that are shared among
employees of an organization
The Roots of Unethical Behavior - Answer-1) Personal Ethics
2) Decision-making processes
3) Organizational Culture
4) Unrealistic performance culture
5) Leadership
6) Societal Culture
Straw Men - Answer-their approaches to business ethics are raised by business ethics
scholars primarily to demonstrate that they offer inappropriate guidelines for ethical
decision making in a multinational enterprise
Cultural Relativism - Answer-the belief that ethics are nothing more than the reflection of
a culture and that a company should adopt the thics of the culture in which it is
operating
, Righteous Moralist - Answer-A multinational's home-country standards of ethics are the
appropriate ones for companies to follow in foreign countries
Naive Immoralist - Answer-asserts that if a manager of a multinational sees that firms
from other nations are not following ethical norms in a host nation, that manager should
not either
Utilitarian approaches to ethics - Answer-hold that the moral worth of actions or
practices is determined by their consequences; an action is judged desirable if it leads
to the best possible balance of good consequences over bad consequences
Kantian ethics - Answer-holds that people should be treated as ends and never purely
as means to the ends of others
Rights theories - Answer-recognize human beings have fundamental rights and
privileges that transcend national boundaries and cultures
Universal Declaration of Human Rights - Answer-adopted in 1948
When a tourist goes to a bank in a foreign country to convert money into a local
currency exchange rate used is the - Answer-Spot rate
Country X and country Y reach an agreement to boost bilateral trade they agreed to
remove all barriers to the trade of goods and services. They however are free to
determine their own trade policies with regard to nonmembers which level of economic
integration is this an example of? - Answer-A free trade area
The short term movement of funds from one currency to another in the hopes of
profiting from shifts in exchange rates is known as - Answer-Currency speculation
A _____ entails even closer economic integration and cooperation than a common
market. - Answer-Economic union
An exchange rate of € = $1. 30 indicates that - Answer-One euro buys 1.30 dollars
Which of the following is a reason why the European Union is considered an imperfect
economic union? - Answer-Not all members of the union have adopted the euro
Inflation occurs when - Answer-The quantity of money in circulation rises faster than the
stock of goods and services
A _____ is one which prices do not reflect all available information - Answer-Inefficient
market
Which feature of a common market differentiates it from a customs union? - Answer-
Ability of factors of production to move freely between members
Answers
Ethics - Answer-Accepted principles of right or wrong that govern the conduct of a
person, the members of a profession, or the actions of an organization
Business Ethics - Answer-accepted principles of right or wrong governing the conduct of
businesspeople
Ethical Strategy - Answer-A strategy, course of action, that does not violate these
accepted principles
Tragedy of Commons - Answer-Occurs when a resource held in common by all, but
owned by no one, is overused by individuals, resulting in its degradation
facilitating payments - Answer-are not payments to secure contracts that would not
otherwise be secured, nor are they payments to obtain exclusive or preferential
treatment
Convention on Combatting Bribery of Foreign Public Officials in International Business
Transactions - Answer-The convention obliges member states and other signatories to
make the bribery of foreign public officials a criminal offense
Foreign Corrupt Practices Act (FCPA) - Answer-The act outlawed the paying of bribes
to foreign government officials to gain business
Organizational Culture - Answer-The values and norms that are shared among
employees of an organization
The Roots of Unethical Behavior - Answer-1) Personal Ethics
2) Decision-making processes
3) Organizational Culture
4) Unrealistic performance culture
5) Leadership
6) Societal Culture
Straw Men - Answer-their approaches to business ethics are raised by business ethics
scholars primarily to demonstrate that they offer inappropriate guidelines for ethical
decision making in a multinational enterprise
Cultural Relativism - Answer-the belief that ethics are nothing more than the reflection of
a culture and that a company should adopt the thics of the culture in which it is
operating
, Righteous Moralist - Answer-A multinational's home-country standards of ethics are the
appropriate ones for companies to follow in foreign countries
Naive Immoralist - Answer-asserts that if a manager of a multinational sees that firms
from other nations are not following ethical norms in a host nation, that manager should
not either
Utilitarian approaches to ethics - Answer-hold that the moral worth of actions or
practices is determined by their consequences; an action is judged desirable if it leads
to the best possible balance of good consequences over bad consequences
Kantian ethics - Answer-holds that people should be treated as ends and never purely
as means to the ends of others
Rights theories - Answer-recognize human beings have fundamental rights and
privileges that transcend national boundaries and cultures
Universal Declaration of Human Rights - Answer-adopted in 1948
When a tourist goes to a bank in a foreign country to convert money into a local
currency exchange rate used is the - Answer-Spot rate
Country X and country Y reach an agreement to boost bilateral trade they agreed to
remove all barriers to the trade of goods and services. They however are free to
determine their own trade policies with regard to nonmembers which level of economic
integration is this an example of? - Answer-A free trade area
The short term movement of funds from one currency to another in the hopes of
profiting from shifts in exchange rates is known as - Answer-Currency speculation
A _____ entails even closer economic integration and cooperation than a common
market. - Answer-Economic union
An exchange rate of € = $1. 30 indicates that - Answer-One euro buys 1.30 dollars
Which of the following is a reason why the European Union is considered an imperfect
economic union? - Answer-Not all members of the union have adopted the euro
Inflation occurs when - Answer-The quantity of money in circulation rises faster than the
stock of goods and services
A _____ is one which prices do not reflect all available information - Answer-Inefficient
market
Which feature of a common market differentiates it from a customs union? - Answer-
Ability of factors of production to move freely between members
