, TESTBANK for Managing Business Ethics
Straight Talk about How to Do It Right, 7th
Edition by Linda K. Trevino
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,Trevino & Nelson / Managing Business Ethics Test Bank
File: Chapter 1, Introducing Straight Talk about Managing Business Ethics: Where we’re Going
and Why
True/False
1. The interest in business ethics is just a fad that has only recently been created by popular
scandals (i.e., Enron, WorldCom, etc.) reported in the news.
Ans: False
Response: See Introduction.
Difficulty: Easy
2. The activities that brought down the U.S. economy and others around the world, in 2008,
were unethical in that they ultimately produced great harm and were contrary to a number of
ethical principles such as responsibility, transparency, and fairness.
Ans: True
Response: The Financial Disaster of 2008.
Difficulty: Moderate
3. In the early 2000s, borrowers no longer needed to provide proof of employment or income.
These were popularly called “no doc” or “liar loans” because banks weren’t bothering to
verify the “truth” of what borrowers were claiming on their mortgage applications. This was
one of the factors that laid the groundwork for the disaster in the United States.
Ans: True
Response: Mortgage Originators Peddled “Liar Loans”.
Difficulty: Moderate
Copyright ©2017 John Wiley & Sons, Inc. 1-1
,Trevino & Nelson / Managing Business Ethics Test Bank
4. In 2010, the U.S. Congress abolished the Dodd‐Frank Financial Regulation Legislation—an
attempt to revive the economy through stabilizing the financial industry.
Ans: False
Response: Those Who Were Supposed to Protect Us Didn’t.
Difficulty: Moderate
5. Discarding the few “bad apples” will usually solve all of the ethical problems within an
organization.
Ans: False
Response: See Can Business Ethics Be Taught?
Difficulty: Easy
6. Good character is the main factor determining whether an individual acts ethically within an
organization.
Ans: False
Response: See Shouldn’t Employees Already Know the Difference between Right and Wrong?
Difficulty: Moderate
7. According to research, one’s ethics are fully formed and unchangeable by the time one is old
enough to enter college or a job.
Ans: False
Response: See Aren’t Adults’ Ethics Fully Formed and Unchangeable?
Difficulty: Moderate
8. Federal laws define what is ethical. Therefore, all unethical behavior is considered unlawful.
Ans: False
Copyright ©2017 John Wiley & Sons, Inc. 1-2
,Trevino & Nelson / Managing Business Ethics Test Bank
Response: See Ethics and the Law. Some unethical behavior is not covered by law (for example,
lying to a manager about the reason for taking a sick day).
Difficulty: Difficult
9. Both characteristics of the environment and the individual contribute to unethical behavior.
Ans: True
Response: See Aren’t Bad Apples the Cause of Ethical Problems in Organizations?
Difficulty: Easy
10. When employees come to an organization, they have already developed into “good” or “bad”
apples. Therefore, there is little a manager can do to impact an employee’s ethical behavior.
Ans: False
Response: See Aren’t Adults’ Ethics Fully Formed and Unchangeable?
Difficulty: Moderate
11. According to the authors, most people are guided by a strict internal moral compass and will
not be swayed by organization factors.
Ans: False
Response: See Aren’t Bad Apples the Cause of Ethical Problems in Organizations?
Difficulty: Moderate
12. By ignoring the topic of ethical behavior, an organization may actually be encouraging
unethical behavior through benign neglect.
Ans: True
Response: See Aren’t Adults’ Ethics Fully Formed and Unchangeable?
Difficulty: Easy
Copyright ©2017 John Wiley & Sons, Inc. 1-3
,Trevino & Nelson / Managing Business Ethics Test Bank
13. It is unethical for managers to “control” employees’ ethical behavior through direct
management and the organization’s formal and informal cultural systems.
Ans: False
Response: See Aren’t Adults’ Ethics Fully Formed and Unchangeable?
Difficulty: Difficult
14. A new group of economists, called behavioral economists, have found that people are not
only less rational than classical economists assumed, but are more moral.
Ans: True
Response: Individuals Care about Ethics: The Motivation to Be Ethical.
Difficulty: Difficult
15. For individuals, values can be defined as “one’s core beliefs about what is important, what is
valued, and how one should behave across a wide variety of situations.”
Ans: True
Response: See The Importance of Values.
Difficulty: Moderate
Multiple Choice
16. Which of these is Adam Smith’s first book?
a) Wealth of Nations
b) The Theory of Moral Sentiments
c) The Corporation
d) The Moral Dimension
Ans: b
Response: See Introduction.
Copyright ©2017 John Wiley & Sons, Inc. 1-4
,Trevino & Nelson / Managing Business Ethics Test Bank
Difficulty: Moderate
17. The implosion of the financial markets in 2008 was largely the result of:
a) illegal behavior
b) the Federal government intervention
c) government regulation
d) unethical activities in that they ultimately produced great harm
Ans: d
Response: See The Financial Disaster of 2008.
Difficulty: Moderate
18. According to the authors, all of these are factors that laid the groundwork for the disaster in
the United States in 2008 EXCEPT:
a) borrowing was expensive
b) real estate became the investment of choice
c) mortgage originators peddled “Liar Loans”
d) banks securitized the poison and spread it around
Ans: a
Response: See Borrowing Was Cheap.
Difficulty: Difficult
19. John and Jessica recently went to a local bank for borrowing money to purchase a home. If
the bank offers them a 100-percent financing and are not required to provide proof of
employment or income, it would classify as the _____ from the 2000s era in the United
States.
a) “liar loan”
b) mortgage-backed security
c) rating agency calamity
d) LIBOR scandal
Ans: a
Response: See Mortgage Originators Peddled “Liar Loans”.
Copyright ©2017 John Wiley & Sons, Inc. 1-5
,Trevino & Nelson / Managing Business Ethics Test Bank
Difficulty: Difficult
20. Which of the following legislation was passed by the U.S. Congress to rein in the most
egregious practices in the financial industry?
a) The Credit‐Default Swaps Legislation
b) Title VII of the Civil Rights Act of 1964
c) The 2008 Rehabilitation Act
d) The Dodd‐Frank Financial Regulation Legislation
Ans: d
Response: See Mortgage Originators Peddled “Liar Loans”.
Difficulty: Difficult
21. According to the 2016 Edelman Trust Barometer, only _____ percent of consumers trust
institutions in general.
a) 12
b) 33
c) 49
d) 72
Ans: c
Response: See Moving Beyond Cynicism.
Difficulty: Difficult
22. Your roommate tells you that she just refuses to buy products from a company that has bad
reputation and she does not trust. According to the 2016 Edelman Trust Barometer, your
roommate is among the _____ percent of consumers who refuse to purchase products from a
company they mistrusted.
a) 91
b) 77
c) 49
d) 33
Ans: b
Copyright ©2017 John Wiley & Sons, Inc. 1-6
,Trevino & Nelson / Managing Business Ethics Test Bank
Response: See Moving Beyond Cynicism.
Difficulty: Difficult
23. The Ethics Resource Center’s 2011 National Business Ethics Survey found that only _____
percent of employees of for-profit enterprises report feeling pressured to compromise their
ethical standards.
a) 3
b) 9
c) 15
d) 21
Ans: b
Response: See Moving Beyond Cynicism.
Difficulty: Difficult
24. Which of the following statements is true?
a) “Bad apples” are just a few individuals who spoil it for the rest of us.
b) Employees’ good behavior can be spoiled by a “bad barrel.”
c) Ethics cannot be taught because individuals come into an organization already as a “bad
apple.”
d) “Bad barrels” are caused by “bad apples” in an organization.
Ans: b
Response: See Aren’t Bad Apples the Cause of Ethical Problems in Organizations?
Difficulty: Difficult
25. Given that you are a business student, research finds that you might need ethics training
_____ than students in political science, law, and medicine.
a) less
b) more
c) no different
d) completely different
Ans: b
Copyright ©2017 John Wiley & Sons, Inc. 1-7
, Trevino & Nelson / Managing Business Ethics Test Bank
Response: See Aren’t Adults’ Ethics Fully Formed and Unchangeable?
Difficulty: Moderate
26. _________ students may need more ethics training because research has found that they rank
lower in moral reasoning than other students.
a) Philosophy
b) Political science
c) Business
d) Medicine
Ans: c
Response: See Aren’t Adults’ Ethics Fully Formed and Unchangeable?
Difficulty: Moderate
27. Definition of ethics—“the principles, norms, and standards of conduct governing an
individual or group”—focuses on _______.
a) organization
b) society
c) business
d) conduct
Ans: d
Response: See Aren’t Adults’ Ethics Fully Formed and Unchangeable?
Difficulty: Easy
28. According to the authors, ethical behavior is defined as:
a) a set of moral principles or values that guide an individual
b) rules of behavior set by the Federal government
c) principles, norms, and standards agreed upon by society
d) none of these
Ans: c
Response: See This Book is About Managing Ethics in Business.
Difficulty: Moderate
Copyright ©2017 John Wiley & Sons, Inc. 1-8
Straight Talk about How to Do It Right, 7th
Edition by Linda K. Trevino
Hello all ,
We have all what you need with best price
Our email :
Our website :
testbanks-store.com
,Trevino & Nelson / Managing Business Ethics Test Bank
File: Chapter 1, Introducing Straight Talk about Managing Business Ethics: Where we’re Going
and Why
True/False
1. The interest in business ethics is just a fad that has only recently been created by popular
scandals (i.e., Enron, WorldCom, etc.) reported in the news.
Ans: False
Response: See Introduction.
Difficulty: Easy
2. The activities that brought down the U.S. economy and others around the world, in 2008,
were unethical in that they ultimately produced great harm and were contrary to a number of
ethical principles such as responsibility, transparency, and fairness.
Ans: True
Response: The Financial Disaster of 2008.
Difficulty: Moderate
3. In the early 2000s, borrowers no longer needed to provide proof of employment or income.
These were popularly called “no doc” or “liar loans” because banks weren’t bothering to
verify the “truth” of what borrowers were claiming on their mortgage applications. This was
one of the factors that laid the groundwork for the disaster in the United States.
Ans: True
Response: Mortgage Originators Peddled “Liar Loans”.
Difficulty: Moderate
Copyright ©2017 John Wiley & Sons, Inc. 1-1
,Trevino & Nelson / Managing Business Ethics Test Bank
4. In 2010, the U.S. Congress abolished the Dodd‐Frank Financial Regulation Legislation—an
attempt to revive the economy through stabilizing the financial industry.
Ans: False
Response: Those Who Were Supposed to Protect Us Didn’t.
Difficulty: Moderate
5. Discarding the few “bad apples” will usually solve all of the ethical problems within an
organization.
Ans: False
Response: See Can Business Ethics Be Taught?
Difficulty: Easy
6. Good character is the main factor determining whether an individual acts ethically within an
organization.
Ans: False
Response: See Shouldn’t Employees Already Know the Difference between Right and Wrong?
Difficulty: Moderate
7. According to research, one’s ethics are fully formed and unchangeable by the time one is old
enough to enter college or a job.
Ans: False
Response: See Aren’t Adults’ Ethics Fully Formed and Unchangeable?
Difficulty: Moderate
8. Federal laws define what is ethical. Therefore, all unethical behavior is considered unlawful.
Ans: False
Copyright ©2017 John Wiley & Sons, Inc. 1-2
,Trevino & Nelson / Managing Business Ethics Test Bank
Response: See Ethics and the Law. Some unethical behavior is not covered by law (for example,
lying to a manager about the reason for taking a sick day).
Difficulty: Difficult
9. Both characteristics of the environment and the individual contribute to unethical behavior.
Ans: True
Response: See Aren’t Bad Apples the Cause of Ethical Problems in Organizations?
Difficulty: Easy
10. When employees come to an organization, they have already developed into “good” or “bad”
apples. Therefore, there is little a manager can do to impact an employee’s ethical behavior.
Ans: False
Response: See Aren’t Adults’ Ethics Fully Formed and Unchangeable?
Difficulty: Moderate
11. According to the authors, most people are guided by a strict internal moral compass and will
not be swayed by organization factors.
Ans: False
Response: See Aren’t Bad Apples the Cause of Ethical Problems in Organizations?
Difficulty: Moderate
12. By ignoring the topic of ethical behavior, an organization may actually be encouraging
unethical behavior through benign neglect.
Ans: True
Response: See Aren’t Adults’ Ethics Fully Formed and Unchangeable?
Difficulty: Easy
Copyright ©2017 John Wiley & Sons, Inc. 1-3
,Trevino & Nelson / Managing Business Ethics Test Bank
13. It is unethical for managers to “control” employees’ ethical behavior through direct
management and the organization’s formal and informal cultural systems.
Ans: False
Response: See Aren’t Adults’ Ethics Fully Formed and Unchangeable?
Difficulty: Difficult
14. A new group of economists, called behavioral economists, have found that people are not
only less rational than classical economists assumed, but are more moral.
Ans: True
Response: Individuals Care about Ethics: The Motivation to Be Ethical.
Difficulty: Difficult
15. For individuals, values can be defined as “one’s core beliefs about what is important, what is
valued, and how one should behave across a wide variety of situations.”
Ans: True
Response: See The Importance of Values.
Difficulty: Moderate
Multiple Choice
16. Which of these is Adam Smith’s first book?
a) Wealth of Nations
b) The Theory of Moral Sentiments
c) The Corporation
d) The Moral Dimension
Ans: b
Response: See Introduction.
Copyright ©2017 John Wiley & Sons, Inc. 1-4
,Trevino & Nelson / Managing Business Ethics Test Bank
Difficulty: Moderate
17. The implosion of the financial markets in 2008 was largely the result of:
a) illegal behavior
b) the Federal government intervention
c) government regulation
d) unethical activities in that they ultimately produced great harm
Ans: d
Response: See The Financial Disaster of 2008.
Difficulty: Moderate
18. According to the authors, all of these are factors that laid the groundwork for the disaster in
the United States in 2008 EXCEPT:
a) borrowing was expensive
b) real estate became the investment of choice
c) mortgage originators peddled “Liar Loans”
d) banks securitized the poison and spread it around
Ans: a
Response: See Borrowing Was Cheap.
Difficulty: Difficult
19. John and Jessica recently went to a local bank for borrowing money to purchase a home. If
the bank offers them a 100-percent financing and are not required to provide proof of
employment or income, it would classify as the _____ from the 2000s era in the United
States.
a) “liar loan”
b) mortgage-backed security
c) rating agency calamity
d) LIBOR scandal
Ans: a
Response: See Mortgage Originators Peddled “Liar Loans”.
Copyright ©2017 John Wiley & Sons, Inc. 1-5
,Trevino & Nelson / Managing Business Ethics Test Bank
Difficulty: Difficult
20. Which of the following legislation was passed by the U.S. Congress to rein in the most
egregious practices in the financial industry?
a) The Credit‐Default Swaps Legislation
b) Title VII of the Civil Rights Act of 1964
c) The 2008 Rehabilitation Act
d) The Dodd‐Frank Financial Regulation Legislation
Ans: d
Response: See Mortgage Originators Peddled “Liar Loans”.
Difficulty: Difficult
21. According to the 2016 Edelman Trust Barometer, only _____ percent of consumers trust
institutions in general.
a) 12
b) 33
c) 49
d) 72
Ans: c
Response: See Moving Beyond Cynicism.
Difficulty: Difficult
22. Your roommate tells you that she just refuses to buy products from a company that has bad
reputation and she does not trust. According to the 2016 Edelman Trust Barometer, your
roommate is among the _____ percent of consumers who refuse to purchase products from a
company they mistrusted.
a) 91
b) 77
c) 49
d) 33
Ans: b
Copyright ©2017 John Wiley & Sons, Inc. 1-6
,Trevino & Nelson / Managing Business Ethics Test Bank
Response: See Moving Beyond Cynicism.
Difficulty: Difficult
23. The Ethics Resource Center’s 2011 National Business Ethics Survey found that only _____
percent of employees of for-profit enterprises report feeling pressured to compromise their
ethical standards.
a) 3
b) 9
c) 15
d) 21
Ans: b
Response: See Moving Beyond Cynicism.
Difficulty: Difficult
24. Which of the following statements is true?
a) “Bad apples” are just a few individuals who spoil it for the rest of us.
b) Employees’ good behavior can be spoiled by a “bad barrel.”
c) Ethics cannot be taught because individuals come into an organization already as a “bad
apple.”
d) “Bad barrels” are caused by “bad apples” in an organization.
Ans: b
Response: See Aren’t Bad Apples the Cause of Ethical Problems in Organizations?
Difficulty: Difficult
25. Given that you are a business student, research finds that you might need ethics training
_____ than students in political science, law, and medicine.
a) less
b) more
c) no different
d) completely different
Ans: b
Copyright ©2017 John Wiley & Sons, Inc. 1-7
, Trevino & Nelson / Managing Business Ethics Test Bank
Response: See Aren’t Adults’ Ethics Fully Formed and Unchangeable?
Difficulty: Moderate
26. _________ students may need more ethics training because research has found that they rank
lower in moral reasoning than other students.
a) Philosophy
b) Political science
c) Business
d) Medicine
Ans: c
Response: See Aren’t Adults’ Ethics Fully Formed and Unchangeable?
Difficulty: Moderate
27. Definition of ethics—“the principles, norms, and standards of conduct governing an
individual or group”—focuses on _______.
a) organization
b) society
c) business
d) conduct
Ans: d
Response: See Aren’t Adults’ Ethics Fully Formed and Unchangeable?
Difficulty: Easy
28. According to the authors, ethical behavior is defined as:
a) a set of moral principles or values that guide an individual
b) rules of behavior set by the Federal government
c) principles, norms, and standards agreed upon by society
d) none of these
Ans: c
Response: See This Book is About Managing Ethics in Business.
Difficulty: Moderate
Copyright ©2017 John Wiley & Sons, Inc. 1-8
