BMAL-590 BUSINESS ETHNICS EXAM
QUESTIONS AND ANSWERS. VERIFIED
2025/2026.
The difference between an ordinary decision and an ethical one: - ANS accepted rules or
standard practices are not clearly applicable, and the decision maker must weigh values and
diverging perspectives in a situation which is not quite the same as any he or she has faced
previously.
Values and judgments play a critical role in the making of ethical decisions, as does recognizing
how different groups may be impacted by a decision.
Business ethics - ANS comprises principles and standards that guide behavior in the world of
business.
Investors, employees, customers, interest groups, the legal system, and the community often
determine whether a specific action is right or wrong -- ethical or unethical.
Some special aspects must be considered when applying ethics to business: Businesses must
earn a profit to survive. Businesses must balance their desires for profits against the needs and
desires of society, and maintaining this balance often requires compromises or tradeoffs.
Reports of unethical activities: - ANS accounting fraud, insider trading, falsifying documents,
deceptive advertising, defective products, bribery, abusive behavior, harassment, and employee
theft regularly appear in the media
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
,Many examples of unethical activities go unreported and/or undetected. But many do come to
light, with devastating implications for the individuals involved, and potentially impacting many
other innocent individuals.
Organizations that develop a culture where ethical considerations are part of every decision are
more likely to make a positive impact on society, and less likely to be embroiled in scandals.
Reasons for Studying Business Ethics: - ANS 1. an individual's personal values and morality
are only one factor in the ethical decision-making process
2. being a good person and having sound personal ethics may not be sufficient to handle the
ethical issues that arise in a business organization
3. business strategy decisions involve complex and detailed discussions, and a high level of
personal moral development may not prevent an individual from violating the law in an
organizational context
4. the values people learn from family, religion, and school may not provide specific guidelines
for complex business decisions.
Studying ethics helps business people begin to identify ethical issues, recognize the approaches
available to resolve them, learn about the ethical decision-making process and ways to promote
ethical behavior, and begin to understand how to cope with conflicts between personal,
organizational, and societal values.
Historic Tensions of business ethics: - ANS With the development of big businesses, large
mining operations, and expansive agricultural firms, along with the "Industrial Revolution,"
society struggled to determine the appropriate role of these large organizations. Unions
developed to ensure workers' interests and well-being were considered, and the idea of a living
wage that was sufficient for education, recreation, health, and retirement began to take hold.
Industrialization also led to concerns about pollution and the environment
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
,Consumer protection became increasingly important, with legislation in many countries that
sought to safeguard consumers from potentially dangerous products.
The sense that corporations could become too large, and have too much power over
consumers, workers, and governments led to the enactment of anti-trust legislation that split up
some large firms, and prevented others from becoming too powerful.
social responsibility - ANS the duty of a business to contribute to the well-being of a
community
an organization's obligation to maximize its positive impact on stakeholders and to minimize its
negative impact.
Milton Friedman - ANS He was a famous American economist. He strongly promoted the idea
of free trade and condemned government regulation and socialism.
argued persuasively that the business of business was business, and that the primary role of a
business was to maximize profits within the rules dictated by governments and society.
He and others argued that companies should make charitable contributions and engage in social
issues only if these actions also contributed to the companies' reputation, ability to recruit
qualified employees, or other factors that ultimately contributed to profits and shareholder
value.
In society, he argued, there are other entities such as governments and non-profit organizations
that bear the primary social responsibilities of society, and are best equipped to deal with social
issues.
Utilitarian approach - ANS ethical philosophy that advocates a decision that provides the
most good or the least harm
Hence a community might decide to build a road that will improve the flow of traffic for many
citizens, even if that means that some individuals may be forced to sell their land, homes, or
farms to allow for the road.
3 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
, Similarly, a company should develop an employee benefits package that serves the interests of
most employees, although some employees would prefer a slightly different package.
Moral Rights approach - ANS guided by respect for the fundamental rights of human beings
suggests that every human being has some fundamental rights that must always be protected,
and that no decision should infringe upon those fundamental rights.
Employees should not be expected, for example, to perform dangerous operations unless they
are properly trained and are fully aware of the risks (e.g., firefighters).
Justice approach - ANS moral decisions must be based on standards of equity, fairness, and
impartiality
Justice can apply to both the outcomes of decisions (are differences in salaries paid to different
employees justified by differences in the work they do) as well as the procedures by which
decisions are made (was every applicant for a job evaluated using the same criteria). The first is
referred to as distributive justice, while the second is procedural justice.
golden rule - ANS Treat others the way you want to be treated
Sarbanes-Oxley Act - ANS The law made securities fraud a criminal offense and stiffened
penalties for corporate fraud.
It created an accounting oversight board that requires corporations to establish codes of ethics
for financial reporting and to develop greater transparency in financial reports to investors and
other interested parties.
It required top executives to sign off on their firm's financial reports, and risk fines and long jail
sentences if they misrepresented their company's financial position.
4 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
QUESTIONS AND ANSWERS. VERIFIED
2025/2026.
The difference between an ordinary decision and an ethical one: - ANS accepted rules or
standard practices are not clearly applicable, and the decision maker must weigh values and
diverging perspectives in a situation which is not quite the same as any he or she has faced
previously.
Values and judgments play a critical role in the making of ethical decisions, as does recognizing
how different groups may be impacted by a decision.
Business ethics - ANS comprises principles and standards that guide behavior in the world of
business.
Investors, employees, customers, interest groups, the legal system, and the community often
determine whether a specific action is right or wrong -- ethical or unethical.
Some special aspects must be considered when applying ethics to business: Businesses must
earn a profit to survive. Businesses must balance their desires for profits against the needs and
desires of society, and maintaining this balance often requires compromises or tradeoffs.
Reports of unethical activities: - ANS accounting fraud, insider trading, falsifying documents,
deceptive advertising, defective products, bribery, abusive behavior, harassment, and employee
theft regularly appear in the media
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
,Many examples of unethical activities go unreported and/or undetected. But many do come to
light, with devastating implications for the individuals involved, and potentially impacting many
other innocent individuals.
Organizations that develop a culture where ethical considerations are part of every decision are
more likely to make a positive impact on society, and less likely to be embroiled in scandals.
Reasons for Studying Business Ethics: - ANS 1. an individual's personal values and morality
are only one factor in the ethical decision-making process
2. being a good person and having sound personal ethics may not be sufficient to handle the
ethical issues that arise in a business organization
3. business strategy decisions involve complex and detailed discussions, and a high level of
personal moral development may not prevent an individual from violating the law in an
organizational context
4. the values people learn from family, religion, and school may not provide specific guidelines
for complex business decisions.
Studying ethics helps business people begin to identify ethical issues, recognize the approaches
available to resolve them, learn about the ethical decision-making process and ways to promote
ethical behavior, and begin to understand how to cope with conflicts between personal,
organizational, and societal values.
Historic Tensions of business ethics: - ANS With the development of big businesses, large
mining operations, and expansive agricultural firms, along with the "Industrial Revolution,"
society struggled to determine the appropriate role of these large organizations. Unions
developed to ensure workers' interests and well-being were considered, and the idea of a living
wage that was sufficient for education, recreation, health, and retirement began to take hold.
Industrialization also led to concerns about pollution and the environment
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
,Consumer protection became increasingly important, with legislation in many countries that
sought to safeguard consumers from potentially dangerous products.
The sense that corporations could become too large, and have too much power over
consumers, workers, and governments led to the enactment of anti-trust legislation that split up
some large firms, and prevented others from becoming too powerful.
social responsibility - ANS the duty of a business to contribute to the well-being of a
community
an organization's obligation to maximize its positive impact on stakeholders and to minimize its
negative impact.
Milton Friedman - ANS He was a famous American economist. He strongly promoted the idea
of free trade and condemned government regulation and socialism.
argued persuasively that the business of business was business, and that the primary role of a
business was to maximize profits within the rules dictated by governments and society.
He and others argued that companies should make charitable contributions and engage in social
issues only if these actions also contributed to the companies' reputation, ability to recruit
qualified employees, or other factors that ultimately contributed to profits and shareholder
value.
In society, he argued, there are other entities such as governments and non-profit organizations
that bear the primary social responsibilities of society, and are best equipped to deal with social
issues.
Utilitarian approach - ANS ethical philosophy that advocates a decision that provides the
most good or the least harm
Hence a community might decide to build a road that will improve the flow of traffic for many
citizens, even if that means that some individuals may be forced to sell their land, homes, or
farms to allow for the road.
3 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
, Similarly, a company should develop an employee benefits package that serves the interests of
most employees, although some employees would prefer a slightly different package.
Moral Rights approach - ANS guided by respect for the fundamental rights of human beings
suggests that every human being has some fundamental rights that must always be protected,
and that no decision should infringe upon those fundamental rights.
Employees should not be expected, for example, to perform dangerous operations unless they
are properly trained and are fully aware of the risks (e.g., firefighters).
Justice approach - ANS moral decisions must be based on standards of equity, fairness, and
impartiality
Justice can apply to both the outcomes of decisions (are differences in salaries paid to different
employees justified by differences in the work they do) as well as the procedures by which
decisions are made (was every applicant for a job evaluated using the same criteria). The first is
referred to as distributive justice, while the second is procedural justice.
golden rule - ANS Treat others the way you want to be treated
Sarbanes-Oxley Act - ANS The law made securities fraud a criminal offense and stiffened
penalties for corporate fraud.
It created an accounting oversight board that requires corporations to establish codes of ethics
for financial reporting and to develop greater transparency in financial reports to investors and
other interested parties.
It required top executives to sign off on their firm's financial reports, and risk fines and long jail
sentences if they misrepresented their company's financial position.
4 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
