TEST BANK
UNIT ONE – ETHICAL THEORY, PHILOSOPHICAL
FOUNDATIONS,
OUR REASONING FLAWS, AND TYPES OF ETHICAL
DILEMMAS
True/False Questions
F 1. A credo consists of how you define yourself by job title and income.
T 2. Part of a credo includes a list of lines you would never cross to be successful.
T 3. An ethical breach is not necessarily a violation of the law.
T 4. Unwritten rules of conduct are part of our normative standards.
F 5. Self-interest is the same as selfishness.
F 6. Ethical egoism is selfishness.
F 7. Kant would label paying lower wages in developing countries than the wages
paid in developed economies as unethical.
F 8. Kant is part of the utilitarian school of thought on ethics.
T 9. Kant and Rand do not agree on the importance of self-interest in ethical theory.
T 10. Locke and Rawls develop their ethical theory on the basis of a tabula rasa.
T 11. Locke and Rawls are contractarians.
F 12. The Rights Theory is generally associated with Plato and Aristotle.
F 13. Robert Nozick is the leading thinker for utilitarianism.
T 14. Third-trimester abortions would be supported under a Rights Theory.
T 15. Robert Solomon is a proponent of virtue ethics.
F 16. “It’s a gray area,” is an example of ethical analysis.
,T 17. “We all don’t share the same ethics” fails to consider common values that do
exist in business.
T 18. Hank Greenberg’s ability to find a way around rules was evident from his conduct
as a soldier in London.
T 19. Hank Greenberg was ousted from his position as CEO of AIG.
T 20. Laura Nash provides tools for examining how a company got into an ethical
dilemma.
T 21. It is not plagiarism to use facts obtained from several sources that are footnoted
or listed as sources.
T 22. It is plagiarism to rewrite the phrasing of another source and not use quotes or a
footnote.
F 23. A conflict of interest is unethical only if those involved actually change their
decision based on the benefits to be derived.
T 24. An illegal act is an unethical act.
T 25. Using positive law as an ethical standard means simply compliance with the law.
T 26. The element of balance in the Blanchard/Peale ethical model requires an
examination of the issue from the perspective of the affected party.
T 27. A valid ethical barometer is the reaction of family and friends outside the
business setting to your proposed decision.
F 28. An agreement by an agent to accept a 10% commission from a seller who will
sell goods to the agent’s employer is ethical so long as the agent would have
chosen that seller anyway.
T 29. A real estate agent who recommends a management firm to an apartment
complex buyer without disclosing that the agent owns 50% of the firm has
committed an ethical violation.
F 30. A commercial broker who accepts fees from both the seller and the buyer of the
business without disclosure to either has not committed an ethical violation if
both parties are happy with the transaction.
T 31. A member of the city council who is employed by a waste management firm
would have a conflict of interest in voting on the city’s award of a contract for the
handling of the city’s waste.
,F 32. A physician conducting a study on a new prescription drug manufactured by a
firm in which he is a 10% shareholder does not have a conflict of interest so long
as his stock ownership is disclosed in his report on the drug.
T 33. A physical fitness expert retained by a fitness magazine to evaluate walking
shoes has a conflict of interest if she has an endorsement contract with one of
the shoe companies that manufactures the shoes she will be evaluating.
F 34. Giving preferential treatment in contract bidding to the daughter of a member of
the company board is not a conflict of interest.
F 35. A major donation by one of your long-term suppliers to a non-profit organization
run by your spouse should not create perception problems so long as your
purchasing decisions are based on the merits.
F 36. Having loan applicants pay for the expenses of bank officer travel for purposes of
evaluating collateral is not a conflict of interest.
T 37. Purchasing agents accepting a pleasure trip from a supplier when no bids are
pending is still an ethical violation.
T 38. Payments of royalties from drug sales by a pharmaceutical firm to the university
where a researcher conducting studies has validated the firm’s claims is a
conflict of interest.
T 39. The failure to disclose that your college degree was withheld because of
outstanding parking fines and violations is unethical.
F 40. Taking information from a confidential file accidentally left on your desk is not
unethical.
T 41. The failure to speak out when an ethical or legal lapse occurs within your firm is
in itself an ethical violation.
T 42. “Everyone else does it,” is a signal of an ethical pitfall.
F 43. “The lawyers have okayed this,” is a signal that the decision/action is legal and
ethical.
T 44. Labeling infertility surgery as “diagnostic surgery” in order to allow the patient to
recover the costs from an insurer is unethical.
T 45. A company executive exerting pressure on a scientist and her university to delay
disclosure of study results harmful to the company and its products would be
unethical.
T 46. Ethical choices often prove costly to firms in the short term.
, F 47. Taking advantage of a party in a contract situation due to the party’s
inexperience, and not due to any lack of disclosure on your part, is ethical.
T 48. The failure to disclose relevant information about a product or service is
unethical.
T 49. Long-term relationships create ethical and legal obligations between the parties
through conduct and accommodations.
T 50. If I worked in purchasing in my company, it would be unethical for me to accept
season tickets for my city's NBA team from the company that has supplied
catering for the company's training sessions.
F 51. If I discover that a fellow employee is reporting falsely his overtime hours, it is
best for me to say nothing and ignore the situation.
F 52. If I discovered that I unintentionally violated a federal environmental regulation, I
should just wait and see if anything happens before taking any action.
F 53. If my supervisor asked me to cover for him by lying about his whereabouts, I
should agree to do it but remind him that I can't make it a habit.
T 54. Your company's policy on company vehicles is that no family members may use
them or ride in them. It would be unethical to use a company car to drive you
and your spouse to a movie.
T 55. You are taking a graduate level course in management that will help you in
performing your duties at work. Each week you must submit case analyses to
your professor. Using work time to complete the analyses would be unethical.
T 56. With respect to #55, using your work computer and paper to complete the case
analyses would be unethical.
T 57. Attending a class on company time would be unethical.
F 58. A supplier has just been awarded a large contract by your company. As an
employee in purchasing, you were largely responsible for awarding that supplier
the contract. The supplier's sales representative has just called and would like to
take you to lunch to thank you for the support. Going to lunch with the sale
representative does not present any ethical problems.
F 59. Accepting gifts from suppliers and vendors is not a problem so long as no bid
decisions are pending.
F 60. You are a building inspector for the county. A friend of yours is a plumbing
contractor. Under county regulations, all steps in plumbing construction from the
initial dig to the final installation of sink and bathroom fixtures requires an
inspection sign-off. Your plumbing contractor friend has just called and wants to
UNIT ONE – ETHICAL THEORY, PHILOSOPHICAL
FOUNDATIONS,
OUR REASONING FLAWS, AND TYPES OF ETHICAL
DILEMMAS
True/False Questions
F 1. A credo consists of how you define yourself by job title and income.
T 2. Part of a credo includes a list of lines you would never cross to be successful.
T 3. An ethical breach is not necessarily a violation of the law.
T 4. Unwritten rules of conduct are part of our normative standards.
F 5. Self-interest is the same as selfishness.
F 6. Ethical egoism is selfishness.
F 7. Kant would label paying lower wages in developing countries than the wages
paid in developed economies as unethical.
F 8. Kant is part of the utilitarian school of thought on ethics.
T 9. Kant and Rand do not agree on the importance of self-interest in ethical theory.
T 10. Locke and Rawls develop their ethical theory on the basis of a tabula rasa.
T 11. Locke and Rawls are contractarians.
F 12. The Rights Theory is generally associated with Plato and Aristotle.
F 13. Robert Nozick is the leading thinker for utilitarianism.
T 14. Third-trimester abortions would be supported under a Rights Theory.
T 15. Robert Solomon is a proponent of virtue ethics.
F 16. “It’s a gray area,” is an example of ethical analysis.
,T 17. “We all don’t share the same ethics” fails to consider common values that do
exist in business.
T 18. Hank Greenberg’s ability to find a way around rules was evident from his conduct
as a soldier in London.
T 19. Hank Greenberg was ousted from his position as CEO of AIG.
T 20. Laura Nash provides tools for examining how a company got into an ethical
dilemma.
T 21. It is not plagiarism to use facts obtained from several sources that are footnoted
or listed as sources.
T 22. It is plagiarism to rewrite the phrasing of another source and not use quotes or a
footnote.
F 23. A conflict of interest is unethical only if those involved actually change their
decision based on the benefits to be derived.
T 24. An illegal act is an unethical act.
T 25. Using positive law as an ethical standard means simply compliance with the law.
T 26. The element of balance in the Blanchard/Peale ethical model requires an
examination of the issue from the perspective of the affected party.
T 27. A valid ethical barometer is the reaction of family and friends outside the
business setting to your proposed decision.
F 28. An agreement by an agent to accept a 10% commission from a seller who will
sell goods to the agent’s employer is ethical so long as the agent would have
chosen that seller anyway.
T 29. A real estate agent who recommends a management firm to an apartment
complex buyer without disclosing that the agent owns 50% of the firm has
committed an ethical violation.
F 30. A commercial broker who accepts fees from both the seller and the buyer of the
business without disclosure to either has not committed an ethical violation if
both parties are happy with the transaction.
T 31. A member of the city council who is employed by a waste management firm
would have a conflict of interest in voting on the city’s award of a contract for the
handling of the city’s waste.
,F 32. A physician conducting a study on a new prescription drug manufactured by a
firm in which he is a 10% shareholder does not have a conflict of interest so long
as his stock ownership is disclosed in his report on the drug.
T 33. A physical fitness expert retained by a fitness magazine to evaluate walking
shoes has a conflict of interest if she has an endorsement contract with one of
the shoe companies that manufactures the shoes she will be evaluating.
F 34. Giving preferential treatment in contract bidding to the daughter of a member of
the company board is not a conflict of interest.
F 35. A major donation by one of your long-term suppliers to a non-profit organization
run by your spouse should not create perception problems so long as your
purchasing decisions are based on the merits.
F 36. Having loan applicants pay for the expenses of bank officer travel for purposes of
evaluating collateral is not a conflict of interest.
T 37. Purchasing agents accepting a pleasure trip from a supplier when no bids are
pending is still an ethical violation.
T 38. Payments of royalties from drug sales by a pharmaceutical firm to the university
where a researcher conducting studies has validated the firm’s claims is a
conflict of interest.
T 39. The failure to disclose that your college degree was withheld because of
outstanding parking fines and violations is unethical.
F 40. Taking information from a confidential file accidentally left on your desk is not
unethical.
T 41. The failure to speak out when an ethical or legal lapse occurs within your firm is
in itself an ethical violation.
T 42. “Everyone else does it,” is a signal of an ethical pitfall.
F 43. “The lawyers have okayed this,” is a signal that the decision/action is legal and
ethical.
T 44. Labeling infertility surgery as “diagnostic surgery” in order to allow the patient to
recover the costs from an insurer is unethical.
T 45. A company executive exerting pressure on a scientist and her university to delay
disclosure of study results harmful to the company and its products would be
unethical.
T 46. Ethical choices often prove costly to firms in the short term.
, F 47. Taking advantage of a party in a contract situation due to the party’s
inexperience, and not due to any lack of disclosure on your part, is ethical.
T 48. The failure to disclose relevant information about a product or service is
unethical.
T 49. Long-term relationships create ethical and legal obligations between the parties
through conduct and accommodations.
T 50. If I worked in purchasing in my company, it would be unethical for me to accept
season tickets for my city's NBA team from the company that has supplied
catering for the company's training sessions.
F 51. If I discover that a fellow employee is reporting falsely his overtime hours, it is
best for me to say nothing and ignore the situation.
F 52. If I discovered that I unintentionally violated a federal environmental regulation, I
should just wait and see if anything happens before taking any action.
F 53. If my supervisor asked me to cover for him by lying about his whereabouts, I
should agree to do it but remind him that I can't make it a habit.
T 54. Your company's policy on company vehicles is that no family members may use
them or ride in them. It would be unethical to use a company car to drive you
and your spouse to a movie.
T 55. You are taking a graduate level course in management that will help you in
performing your duties at work. Each week you must submit case analyses to
your professor. Using work time to complete the analyses would be unethical.
T 56. With respect to #55, using your work computer and paper to complete the case
analyses would be unethical.
T 57. Attending a class on company time would be unethical.
F 58. A supplier has just been awarded a large contract by your company. As an
employee in purchasing, you were largely responsible for awarding that supplier
the contract. The supplier's sales representative has just called and would like to
take you to lunch to thank you for the support. Going to lunch with the sale
representative does not present any ethical problems.
F 59. Accepting gifts from suppliers and vendors is not a problem so long as no bid
decisions are pending.
F 60. You are a building inspector for the county. A friend of yours is a plumbing
contractor. Under county regulations, all steps in plumbing construction from the
initial dig to the final installation of sink and bathroom fixtures requires an
inspection sign-off. Your plumbing contractor friend has just called and wants to
