LAW & ETHICS IN THE BUSINESS ENVIRONMENT 8e
Test Bank
CHAPTER 1
Law, Ethics, Business: An Introduction
Questions
1. Select the best definition of ethics:
a. a set of rules for behavior.
b. a menu of options regarding what we must do.
c. a menu of options regarding what we should do.
d. standards that must be met to avoid penalty.
ANSWER: C PAGE: 1
2. Laws must be static and unyielding in order to provide stability for a society.
a. True
b. False
ANSWER: B PAGE: 1
3. Choose the statement regarding duty to rescue that is false:
a. There is no general duty to rescue an individual.
b. Individual freedom of dictates that a person should not be forced to act.
c. Under a liberal–communitarian approach, citizens owe a duty to the state to
rescue other citizens.
d. When one taunts another person who then puts themselves in danger in response
to the teasing, the teaser has a duty to rescue the person teased.
ANSWER: D PAGE: 3-8
,4. All of the following are considered exceptions to the general rule that there is no duty
to rescue except:
a. Pre-existing duty: For example, lifeguards have signed contracts agreeing to
rescue people in exchange for pay and benefits.
b. Witnessing an accident: This creates a duty to step in and help the injured.
c. Employer: A duty exists to help an employee injured while working for that
employer.
d. Endangerment: If one puts another in danger, they are obligated to rescue the
person put in danger.
ANSWER: B PAGE: 9 – 10
5. Which of the following views would be consistent with the free market ethics
approach advocated by Milton Friedman?
a. Outsourcing to other countries is wrong because it is detrimental to the overall US
economy.
b. When making decisions, corporate managers should consider the interests of all
the corporation’s stakeholders.
c. The only social responsibility of business is to increase profits in a legal and
ethical manner.
d. Automating processes and replacing workers is unethical since it does not serve a
greater good.
ANSWER: C PAGE: 13 - 16
6. Which of the following statements best illustrates the view of “utilitarianism”?
I. From each according to his abilities, to each according to his needs.
II. The risk reasonably to be perceived defines the duty to be obeyed and risks
imports relation; it is risk to another or to others within the range of
apprehension.
III. An action is right when maximizing welfare and total well-being.
IV. Individuals should pursue his or her own self-interest, even at the expense
of others.
, a. I only
b. III only
c. I and II
d. I, II, and III
ANSWER: B PAGE: 16
7. According to deontological thinker Kant:
I. It is only acceptable to lie when done to protect an innocent person.
II. The level of respect owed to another is based on one’s relationship to that
person.
III. It is wrong to use another person unless mutual benefit is attached.
IV. Once chosen, actions will be repeated whenever the same situation arises.
a. I and III
b. II and IV
c. III and IV
d. I, III, and IV
ANSWER: C PAGE: 20 - 23
8. Virtue ethics:
a. focuses on what human beings are capable of being.
b. develop from learning how to make choices in difficult situations.
c. accepts that individuals rarely reach moral excellence.
d. are based on the concept that a person’s ethical beliefs are developed in
childhood and do not change.
ANSWER: A PAGE: 24-25
9. The Ethic of Care is:
, a. A set of rules that explain how to prioritize those people affected by a decision
so that a utilitarian analysis can be done successfully.
b. A set of universal principles, which applied evenly to all decisions will result
in fairness and equity in ethical decisions.
c. The idea that we should all make decisions under the assumption that we
don’t know our station in life, that we could be the person most negatively
impacted by the decision.
d. A set of principles that encourage decision makers to look at human
relationships as a primary motivator for a decision.
ANSWER: D PAGE: 27-30
10. Assuming a business ethical dilemma, which statement best illustrates Gilligan
approach suggested in her theory of “The Ethics of Care”?
a. individual rights and justice for all
b. applies only to women and not men
c. care and responsibility to others
d. obedience to independent moral rules or duties
ANSWER: C PAGE: 27
11. Which of the following statements is INCORRECT regarding the rights of
shareholders?
I. voting power on major issues and ownership in a portion of the company
II. right to transfer ownership and dividend entitlement
III. hire and fire management and select and appoint a chief executive
a. I and II
b. I, II, and III
c. I only
d. III only
ANSWER: D PAGE: 33
Test Bank
CHAPTER 1
Law, Ethics, Business: An Introduction
Questions
1. Select the best definition of ethics:
a. a set of rules for behavior.
b. a menu of options regarding what we must do.
c. a menu of options regarding what we should do.
d. standards that must be met to avoid penalty.
ANSWER: C PAGE: 1
2. Laws must be static and unyielding in order to provide stability for a society.
a. True
b. False
ANSWER: B PAGE: 1
3. Choose the statement regarding duty to rescue that is false:
a. There is no general duty to rescue an individual.
b. Individual freedom of dictates that a person should not be forced to act.
c. Under a liberal–communitarian approach, citizens owe a duty to the state to
rescue other citizens.
d. When one taunts another person who then puts themselves in danger in response
to the teasing, the teaser has a duty to rescue the person teased.
ANSWER: D PAGE: 3-8
,4. All of the following are considered exceptions to the general rule that there is no duty
to rescue except:
a. Pre-existing duty: For example, lifeguards have signed contracts agreeing to
rescue people in exchange for pay and benefits.
b. Witnessing an accident: This creates a duty to step in and help the injured.
c. Employer: A duty exists to help an employee injured while working for that
employer.
d. Endangerment: If one puts another in danger, they are obligated to rescue the
person put in danger.
ANSWER: B PAGE: 9 – 10
5. Which of the following views would be consistent with the free market ethics
approach advocated by Milton Friedman?
a. Outsourcing to other countries is wrong because it is detrimental to the overall US
economy.
b. When making decisions, corporate managers should consider the interests of all
the corporation’s stakeholders.
c. The only social responsibility of business is to increase profits in a legal and
ethical manner.
d. Automating processes and replacing workers is unethical since it does not serve a
greater good.
ANSWER: C PAGE: 13 - 16
6. Which of the following statements best illustrates the view of “utilitarianism”?
I. From each according to his abilities, to each according to his needs.
II. The risk reasonably to be perceived defines the duty to be obeyed and risks
imports relation; it is risk to another or to others within the range of
apprehension.
III. An action is right when maximizing welfare and total well-being.
IV. Individuals should pursue his or her own self-interest, even at the expense
of others.
, a. I only
b. III only
c. I and II
d. I, II, and III
ANSWER: B PAGE: 16
7. According to deontological thinker Kant:
I. It is only acceptable to lie when done to protect an innocent person.
II. The level of respect owed to another is based on one’s relationship to that
person.
III. It is wrong to use another person unless mutual benefit is attached.
IV. Once chosen, actions will be repeated whenever the same situation arises.
a. I and III
b. II and IV
c. III and IV
d. I, III, and IV
ANSWER: C PAGE: 20 - 23
8. Virtue ethics:
a. focuses on what human beings are capable of being.
b. develop from learning how to make choices in difficult situations.
c. accepts that individuals rarely reach moral excellence.
d. are based on the concept that a person’s ethical beliefs are developed in
childhood and do not change.
ANSWER: A PAGE: 24-25
9. The Ethic of Care is:
, a. A set of rules that explain how to prioritize those people affected by a decision
so that a utilitarian analysis can be done successfully.
b. A set of universal principles, which applied evenly to all decisions will result
in fairness and equity in ethical decisions.
c. The idea that we should all make decisions under the assumption that we
don’t know our station in life, that we could be the person most negatively
impacted by the decision.
d. A set of principles that encourage decision makers to look at human
relationships as a primary motivator for a decision.
ANSWER: D PAGE: 27-30
10. Assuming a business ethical dilemma, which statement best illustrates Gilligan
approach suggested in her theory of “The Ethics of Care”?
a. individual rights and justice for all
b. applies only to women and not men
c. care and responsibility to others
d. obedience to independent moral rules or duties
ANSWER: C PAGE: 27
11. Which of the following statements is INCORRECT regarding the rights of
shareholders?
I. voting power on major issues and ownership in a portion of the company
II. right to transfer ownership and dividend entitlement
III. hire and fire management and select and appoint a chief executive
a. I and II
b. I, II, and III
c. I only
d. III only
ANSWER: D PAGE: 33
