COMM 216 TEST PAPER ANSWERS AND QUESTIONS
SET A+
✔✔What does capitalism assume? - ✔✔Assumes economic decision-making is in
hands of individuals / enterprises making decisions expecting to earn a profit
(different forms of of exist in the world)
✔✔Consumer capitalism? - ✔✔Limited government involvement, open borders (+/-),
profit mentality
(Canada, Britain)
✔✔Producer capitalism? - ✔✔emphasizes production, employment and statist policies
(France, Japan)
✔✔Social market economy? - ✔✔regulated capitalist market with generous social
welfare
(Germany)
✔✔Family capitalism? - ✔✔extended clans dominate business activities and control
capital flows
(Thailand, Indonesia)
✔✔Frontier capitalism? - ✔✔fundamentals of business being introduced; capitalism in
beginning stages; weaker consistent rule of law
(Russia, China)
✔✔State capitalism? - ✔✔economic system in which governments manipulate market
outcomes for political and social purposes
(USSR, China before 1970's)
✔✔5 pros of capitalism? - ✔✔▪ Produces wealth, promotes prosperity, ▪ Provides
greater human well-being than other economic systems
▪ Allows creative and productive forces to operate
▪ Cooperation is encouraged within the competitive market
,▪ Respects freedoms (+/-), including right for individuals to pursue happiness
✔✔5 cons for capitalism? - ✔✔▪ Greed
▪ Income & wealth inequality
▪ Stagnant incomes vs. increasing CEO salaries
▪ Corporate crime and wrongdoing
▪ Environmental pollution, Climate change
▪ Market system seldom works perfectly
▪ Economic downturns
▪ Business failures
✔✔What are businesses considering to help their relationship to society? - ✔✔- Meeting
humanity's needs without harming future generations
- Progressive and innovative responses to social, ethical, and environment
responsibilities constitute a valuable intangible asset.
- Executives must have skills and competencies to manage these additional
responsibilities successfully.
✔✔Integrity? - ✔✔The appropriateness of a corporation's behaviour and its adherence
to moral guidelines acceptable to society such as honesty, fairness, and justice.
- Similar to acting ethically
✔✔What does managing with integrity mean? - ✔✔Means that business leaders
behave in a manner consistent with their own highest values and norms of behaviour.
✔✔Ethics of Business? - ✔✔The rules, standards, codes, or principles that provide
guidelines for morally right behaviour and truthfulness in specific situations.
✔✔Stakeholder? - ✔✔An individual or group who can influence and/or is influenced by
the achievement of an organisation's purpose.
✔✔Corporate Social Responsibility? - ✔✔The way a corporation achieves a balance
among its economic, social, and environmental responsibilities in its operations so as to
address shareholder and other stakeholder expectations.
✔✔Corporate Sustainability? - ✔✔Corporate activities demonstrating the inclusion of
social and environmental as well as economic responsibilities in business operations as
they impact all stakeholders presently and in the future
✔✔Triple bottom line? - ✔✔Evaluates a corporation's performance according to a
summary of the economic, social, and environmental value the corporation adds or
destroys.
Economic, ethical, and environmental
, ✔✔Corporate Citizenship? - ✔✔Occurs when a corporation demonstrates that it takes
into account its complete impact on society and the environment as well as its economic
influence.
- describe the role of business in society
✔✔Free enterprise system? - ✔✔An economic system characterised by ownership of
private property by individuals and enterprises, the profit motive, a competitive market
system, and a limited involvement by government.
✔✔Laissez-faire capitalism? - ✔✔An economic system operating with absolute
minimum interference by the government in the affairs of business. Government
involvement is strictly limited to providing essential services such as police and fire
protection.
✔✔Responsible enterprise system? - ✔✔An economic system operating as a free
enterprise system but incorporating the element of accountability.
✔✔Two problems with the business system? - ✔✔Selling unsafe products to consumers
Monopolistic behaviour for example price fixing and supplier discrimination.
✔✔Who are the 3 groups of people who are responsible for the operations of Canadian
Business? - ✔✔1. Owners
2. Boards of directions
3. Managers
✔✔Owners? - ✔✔Direct and indirect owners
Direct = shareholders or investors
✔✔Boards of directions? - ✔✔They are elected by shareholders (direct owners)
The board's main tasks are to:
Select, evaluate, and terminate employment of top management.
Provide shareholders with financial statements
Direct and evaluate strategic planning
Represent shareholders by participation in any major decisions
Fulfil the fiduciary and legal requirements
✔✔Managers? - ✔✔Managers must know how to direct the corporation's affairs in an
increasingly competitive environment and how to cope with large-scale changes.
✔✔The Fundamental? - ✔✔The right to ownership of property by individuals
corporations is fundamental to the business system
✔✔Right of private property? - ✔✔The legal right to own and use economic goods, for
example land and buildings.
SET A+
✔✔What does capitalism assume? - ✔✔Assumes economic decision-making is in
hands of individuals / enterprises making decisions expecting to earn a profit
(different forms of of exist in the world)
✔✔Consumer capitalism? - ✔✔Limited government involvement, open borders (+/-),
profit mentality
(Canada, Britain)
✔✔Producer capitalism? - ✔✔emphasizes production, employment and statist policies
(France, Japan)
✔✔Social market economy? - ✔✔regulated capitalist market with generous social
welfare
(Germany)
✔✔Family capitalism? - ✔✔extended clans dominate business activities and control
capital flows
(Thailand, Indonesia)
✔✔Frontier capitalism? - ✔✔fundamentals of business being introduced; capitalism in
beginning stages; weaker consistent rule of law
(Russia, China)
✔✔State capitalism? - ✔✔economic system in which governments manipulate market
outcomes for political and social purposes
(USSR, China before 1970's)
✔✔5 pros of capitalism? - ✔✔▪ Produces wealth, promotes prosperity, ▪ Provides
greater human well-being than other economic systems
▪ Allows creative and productive forces to operate
▪ Cooperation is encouraged within the competitive market
,▪ Respects freedoms (+/-), including right for individuals to pursue happiness
✔✔5 cons for capitalism? - ✔✔▪ Greed
▪ Income & wealth inequality
▪ Stagnant incomes vs. increasing CEO salaries
▪ Corporate crime and wrongdoing
▪ Environmental pollution, Climate change
▪ Market system seldom works perfectly
▪ Economic downturns
▪ Business failures
✔✔What are businesses considering to help their relationship to society? - ✔✔- Meeting
humanity's needs without harming future generations
- Progressive and innovative responses to social, ethical, and environment
responsibilities constitute a valuable intangible asset.
- Executives must have skills and competencies to manage these additional
responsibilities successfully.
✔✔Integrity? - ✔✔The appropriateness of a corporation's behaviour and its adherence
to moral guidelines acceptable to society such as honesty, fairness, and justice.
- Similar to acting ethically
✔✔What does managing with integrity mean? - ✔✔Means that business leaders
behave in a manner consistent with their own highest values and norms of behaviour.
✔✔Ethics of Business? - ✔✔The rules, standards, codes, or principles that provide
guidelines for morally right behaviour and truthfulness in specific situations.
✔✔Stakeholder? - ✔✔An individual or group who can influence and/or is influenced by
the achievement of an organisation's purpose.
✔✔Corporate Social Responsibility? - ✔✔The way a corporation achieves a balance
among its economic, social, and environmental responsibilities in its operations so as to
address shareholder and other stakeholder expectations.
✔✔Corporate Sustainability? - ✔✔Corporate activities demonstrating the inclusion of
social and environmental as well as economic responsibilities in business operations as
they impact all stakeholders presently and in the future
✔✔Triple bottom line? - ✔✔Evaluates a corporation's performance according to a
summary of the economic, social, and environmental value the corporation adds or
destroys.
Economic, ethical, and environmental
, ✔✔Corporate Citizenship? - ✔✔Occurs when a corporation demonstrates that it takes
into account its complete impact on society and the environment as well as its economic
influence.
- describe the role of business in society
✔✔Free enterprise system? - ✔✔An economic system characterised by ownership of
private property by individuals and enterprises, the profit motive, a competitive market
system, and a limited involvement by government.
✔✔Laissez-faire capitalism? - ✔✔An economic system operating with absolute
minimum interference by the government in the affairs of business. Government
involvement is strictly limited to providing essential services such as police and fire
protection.
✔✔Responsible enterprise system? - ✔✔An economic system operating as a free
enterprise system but incorporating the element of accountability.
✔✔Two problems with the business system? - ✔✔Selling unsafe products to consumers
Monopolistic behaviour for example price fixing and supplier discrimination.
✔✔Who are the 3 groups of people who are responsible for the operations of Canadian
Business? - ✔✔1. Owners
2. Boards of directions
3. Managers
✔✔Owners? - ✔✔Direct and indirect owners
Direct = shareholders or investors
✔✔Boards of directions? - ✔✔They are elected by shareholders (direct owners)
The board's main tasks are to:
Select, evaluate, and terminate employment of top management.
Provide shareholders with financial statements
Direct and evaluate strategic planning
Represent shareholders by participation in any major decisions
Fulfil the fiduciary and legal requirements
✔✔Managers? - ✔✔Managers must know how to direct the corporation's affairs in an
increasingly competitive environment and how to cope with large-scale changes.
✔✔The Fundamental? - ✔✔The right to ownership of property by individuals
corporations is fundamental to the business system
✔✔Right of private property? - ✔✔The legal right to own and use economic goods, for
example land and buildings.
