BUS 101 Exam 1

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The answers to Exam 1...

Profits

In the U.S. economy,__________ are considered the reward for the risk of entering business.

Natural Resources, human resources, and capital.

The factors of production in an economic system are________.

False

If it is not illegal, it also must be ethical.

Using outside vendors to produce goods or fulfill services that were previously done in house.

Outsourcing refers to________.

Conflict of interest

Tanisha is a diabetes educator at a local clinic. Recently she was offered a lavish trip by a sales rep that has been pushing the clinic to use their diabetic supplies. Tanisha declined the gift. Which ethical challenge did she face?

Loyalty vs. Truth

Your supervisor asks you to conceal information from outside auditors examining the company's financial records. What is your ethical challenge?

The first step when facing an ethical problem is to ask:

"Is it legal?"

Business have a responsibility to ______which includes: the right to be safe, the right to be
informed, the right to choose, and the right to be heard.

Their customers

Regulations on financial reporting for business generally come from...

The Securities and Exchange Commission

Success Management, an advertising company, currently prepares advertising layouts and campaign slogans for Burger King. Recently, they have been approached by McDonalds to help build a new marketing strategy for that firm as well. The management of Success refused the offer because:

They saw a conflict of interest.

When a firm donates supplies to a not-for-profit organization or contributes to cultural organizations, this is referred to as...

Corporate philanthropy

Serena's boss tells her in confidence that Julie will be laid off when the company announces a round of job cuts next week. Afterward, Julie asks Serena if there is any truth to the rumor of impending job cuts and if she knows anything about her status. What is Serena's ethical challenge?

Honesty vs. Integrity

Which of the following is an ethical issue dealing with a company and its direct relations with investors and the financial community?

Questioning accounting practices

Under tort law, product liability is an area where:

businesses can be held liable for their negligence involving their products.

The remedy for a tort is:

monetary compensation

Chicago's mayor has just signed legislation requiring fire sprinklers in every public school. This is
an example of:

Statutory Law

When each party to a contract provides something of value to the other party, the principle of competence has been satisfied.

False

Which of the following represents a statement from a "Confused Fact-Finder"?

They taught us in Business School that this model of supply chain management is correct.

The type of law that recognizes the inherent duties in the world of commerce and provides a way to correct problems?

Tort Laws

When a business decision maker deals with Suppliers they are mostly governed by this type of
law.

Contract Laws

If Mary agrees to give Tom her used textbook at the end of the semester they have a contract?

False

Miguel Hernandez and his 5 year old daughter Amelia were shopping in Wal-Mart one day. Amelia was too big to fit in the baby seat, so crawled under the shopping cart to ride on the undercarriage. An employee rounded a corner too fast and banged into Miguel's cart. Amelia's hand got caught in the wheel was injured requiring stitches. This type of case is most likely to fall under:

Tort Law

Which of the following does NOT represent a principal/fiduciary relationship?

employee / employer

A fiduciary must abide by each of the following obligations EXCEPT __________.

reimbursement

The business decision maker has a fiduciary responsibility to society.

False

Which of the following statements is accurate?

Every stockholder is a stakeholder

The view of the firm that recognizes suppliers, customers, employees, and owners as stakeholders is the

managerial view

Which group is a stakeholder group we consider?

Community, suppliers, Owners

Not all stakeholder groups have a stake in each business decision.

True

In the Nike Case, Nike's Business practices were illegal.

False

Most political speech is considered to be on what critical thinking level

Biased jumper

A strategic revsioner:

Is able to pick a plan from many, Is able understand that the plan may need to be changed, Understand the value of analysis

A perpetual analyzer:

Understand the value of analysis

What if the following is not a stakeholder group

Customers and Government

The economic responsibility that firms owe to their stockholders refers to

Maximizing profits

The main reason that the production view of the firm evolved into the managerial view of the firm was

A separation of ownership from control

Critical thinking requires....

Deep analysis of the an issue, looking at consequences, assumptions and implications of a problem, recognizing multiple perspectives of an issue

"It is possible that we will be out of oil in 20 years, but we should do more research before we make any policy decision..."

This is an example of a Perpetual Analyzer

Which of the following describes the synthesis approach to stakeholder management?

The firm recognizes the importance of a wide variety of stakeholders, but has fiduciary responsibility only to shareholders.

Which of the following is an example of outsourcing?

Hiring a firm to clean up your offices at night.

In the Nike Case which we discussed in class the AFL-CIO represented which group of stakeholders?

Community because the group had an interest in Nikes practices

Stakeholder theory is universally accepted as the model for business decision-making.

False because there are a number of competing decision- making frameworks.

Customers as a group:

Has an interest in many of the business decisions that are made making it a stakeholder.

Which of the following is an example of the principle of Work-at-will?

None of the above...

LOOK UP CASE STUDY

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