BUSN 410 WEEK 8 FINAL EXAM | ACTUAL EXAM
QUESTIONS AND ANSWERS VERIFIED BY EXPERT | LATEST
UPDATE
Question 1
Which ethical theory emphasizes that the morality of an action is determined by its results and
consequences?
A) Deontology
B) Virtue Ethics
C) Consequentialism
D) Relativism
E) Justice
Correct Answer: C) Consequentialism
Rationale: Consequentialism, and its most famous form, utilitarianism, posits that the
rightness or wrongness of an act depends entirely on its consequences. The most ethical
choice is the one that will produce the greatest good for the greatest number. Deontology
(A), in contrast, focuses on duties and rules, while Virtue Ethics (B) focuses on the
character of the moral agent.
Question 2
According to Milton Friedman's shareholder model, the primary social responsibility of a
business is to?
A) Balance the needs of all stakeholders.
B) Obey the law and engage in ethical custom.
C) Increase its profits.
D) Contribute to charitable causes within the community.
E) Protect the natural environment.
Correct Answer: C) Increase its profits.
Rationale: Friedman famously argued in his 1970 essay that the sole social responsibility of
a business is to use its resources to engage in activities designed to increase its profits, so
long as it stays within the "rules of the game"—engaging in open and free competition
without deception or fraud. This view prioritizes shareholder returns above all other social
concerns.
Question 3
The concept that a business has obligations to society beyond the pursuit of profit is known as?
A) Corporate Social Responsibility (CSR)
B) Shareholder Primacy
C) Laissez-faire Economics
D) Legal Compliance
E) Profit Maximization
,[Type here]
Correct Answer: A) Corporate Social Responsibility (CSR)
Rationale: CSR is a broad business concept that describes a company's commitment to
operate in an ethical and sustainable manner and to contribute positively to society. This is
in direct contrast to the shareholder primacy model (B), which focuses exclusively on
profit.
Question 4
In stakeholder theory, which of the following would be considered a primary stakeholder?
A) The media
B) A competitor firm
C) The general public
D) Employees
E) A special interest group
Correct Answer: D) Employees
Rationale: Primary stakeholders are those groups without whose continuing participation
the corporation cannot survive as a going concern. This includes employees, customers,
suppliers, financiers (shareholders, creditors), and communities. The media (A),
competitors (B), and special interest groups (E) are typically considered secondary
stakeholders because they can influence the firm but are not directly essential for its
immediate survival.
Question 5
The ethical framework that focuses on the integrity and character of the moral agent rather than
the act itself is known as?
A) Utilitarianism
B) Deontology
C) Virtue Ethics
D) Rights-based Ethics
E) Social Contract Theory
Correct Answer: C) Virtue Ethics
Rationale: Virtue ethics asks the question, "What kind of person should I be?" rather than
"What should I do?" It is centered on the development of virtuous character traits (e.g.,
honesty, compassion, integrity). The assumption is that a person of good character will
naturally make ethical decisions.
Question 6
A "whistleblower" is an employee who?
A) Publicly praises the company for its ethical behavior.
B) Reports illegal or unethical activities within their organization to the public or a higher
authority.
C) Is responsible for monitoring the company's compliance with safety regulations.
,[Type here]
D) Leads union organizing efforts within the company.
E) Develops the company's code of conduct.
Correct Answer: B) Reports illegal or unethical activities within their organization to the
public or a higher authority.
Rationale: Whistleblowing involves exposing misconduct. It is often a difficult and
courageous act, as whistleblowers can face retaliation from their employers. Laws like the
Sarbanes-Oxley Act provide protections for whistleblowers in certain circumstances.
Question 7
The Sarbanes-Oxley Act of 2002 (SOX) was passed in the United States primarily in response
to?
A) Environmental disasters like the Exxon Valdez oil spill.
B) Widespread union strikes in the manufacturing sector.
C) A series of major corporate accounting scandals.
D) The rise of globalization and international trade.
E) Concerns about workplace discrimination.
Correct Answer: C) A series of major corporate accounting scandals.
Rationale: SOX was enacted as a direct result of high-profile accounting scandals at
companies like Enron and WorldCom. The act established stricter standards for all U.S.
public company boards, management, and public accounting firms, focusing on the
accuracy and reliability of corporate financial reporting.
Question 8
Which of the following describes a conflict of interest?
A) When a company's marketing efforts are not successful.
B) When a manager disagrees with a subordinate on a project's direction.
C) When an individual's private interests interfere, or appear to interfere, with their professional
duties.
D) When two companies compete for the same market share.
E) When an employee is not satisfied with their salary.
Correct Answer: C) When an individual's private interests interfere, or appear to interfere,
with their professional duties.
Rationale: A conflict of interest occurs when a person is in a position of trust that requires
them to exercise judgment on behalf of others (like an employer or client), but their
personal interests could potentially corrupt that judgment. For example, a manager who
hires a family member's unqualified company as a supplier.
Question 9
The approach to corporate social responsibility that involves actively seeking opportunities to
contribute to society is known as the?
, [Type here]
A) Obstructionist stance
B) Defensive stance
C) Accommodative stance
D) Proactive stance
E) Minimalist stance
Correct Answer: D) Proactive stance
Rationale: The proactive stance represents the highest level of social responsibility.
Companies taking this approach go beyond legal requirements and ethical norms to
actively look for ways to make positive contributions. The other stances represent lower
levels of commitment: obstructionist (doing as little as possible), defensive (doing only what
is legally required), and accommodative (doing what is legally and ethically required, and
sometimes more).
Question 10
Immanuel Kant's categorical imperative is a central concept in which ethical theory?
A) Utilitarianism
B) Virtue Ethics
C) Relativism
D) Deontology
E) Egoism
Correct Answer: D) Deontology
Rationale: Kant's categorical imperative is the foundation of his deontological ethics. It
states that one should "act only according to that maxim whereby you can at the same time
will that it should become a universal law." This means that actions are judged based on
whether the rule guiding them is universally applicable, not based on their consequences.
Question 11
The "triple bottom line" is a concept that encourages corporations to measure their performance
based on?
A) Sales, profits, and market share.
B) Legal, ethical, and philanthropic responsibilities.
C) Economic, social, and environmental impact.
D) Past, present, and future performance.
E) Shareholders, customers, and employees.
Correct Answer: C) Economic, social, and environmental impact.
Rationale: Coined by John Elkington, the triple bottom line (TBL) argues that companies
should focus on "People, Planet, and Profit." It is an accounting framework that
incorporates three dimensions of performance: social (people), environmental (planet), and
financial (profit). This encourages a more holistic and sustainable view of business success.
QUESTIONS AND ANSWERS VERIFIED BY EXPERT | LATEST
UPDATE
Question 1
Which ethical theory emphasizes that the morality of an action is determined by its results and
consequences?
A) Deontology
B) Virtue Ethics
C) Consequentialism
D) Relativism
E) Justice
Correct Answer: C) Consequentialism
Rationale: Consequentialism, and its most famous form, utilitarianism, posits that the
rightness or wrongness of an act depends entirely on its consequences. The most ethical
choice is the one that will produce the greatest good for the greatest number. Deontology
(A), in contrast, focuses on duties and rules, while Virtue Ethics (B) focuses on the
character of the moral agent.
Question 2
According to Milton Friedman's shareholder model, the primary social responsibility of a
business is to?
A) Balance the needs of all stakeholders.
B) Obey the law and engage in ethical custom.
C) Increase its profits.
D) Contribute to charitable causes within the community.
E) Protect the natural environment.
Correct Answer: C) Increase its profits.
Rationale: Friedman famously argued in his 1970 essay that the sole social responsibility of
a business is to use its resources to engage in activities designed to increase its profits, so
long as it stays within the "rules of the game"—engaging in open and free competition
without deception or fraud. This view prioritizes shareholder returns above all other social
concerns.
Question 3
The concept that a business has obligations to society beyond the pursuit of profit is known as?
A) Corporate Social Responsibility (CSR)
B) Shareholder Primacy
C) Laissez-faire Economics
D) Legal Compliance
E) Profit Maximization
,[Type here]
Correct Answer: A) Corporate Social Responsibility (CSR)
Rationale: CSR is a broad business concept that describes a company's commitment to
operate in an ethical and sustainable manner and to contribute positively to society. This is
in direct contrast to the shareholder primacy model (B), which focuses exclusively on
profit.
Question 4
In stakeholder theory, which of the following would be considered a primary stakeholder?
A) The media
B) A competitor firm
C) The general public
D) Employees
E) A special interest group
Correct Answer: D) Employees
Rationale: Primary stakeholders are those groups without whose continuing participation
the corporation cannot survive as a going concern. This includes employees, customers,
suppliers, financiers (shareholders, creditors), and communities. The media (A),
competitors (B), and special interest groups (E) are typically considered secondary
stakeholders because they can influence the firm but are not directly essential for its
immediate survival.
Question 5
The ethical framework that focuses on the integrity and character of the moral agent rather than
the act itself is known as?
A) Utilitarianism
B) Deontology
C) Virtue Ethics
D) Rights-based Ethics
E) Social Contract Theory
Correct Answer: C) Virtue Ethics
Rationale: Virtue ethics asks the question, "What kind of person should I be?" rather than
"What should I do?" It is centered on the development of virtuous character traits (e.g.,
honesty, compassion, integrity). The assumption is that a person of good character will
naturally make ethical decisions.
Question 6
A "whistleblower" is an employee who?
A) Publicly praises the company for its ethical behavior.
B) Reports illegal or unethical activities within their organization to the public or a higher
authority.
C) Is responsible for monitoring the company's compliance with safety regulations.
,[Type here]
D) Leads union organizing efforts within the company.
E) Develops the company's code of conduct.
Correct Answer: B) Reports illegal or unethical activities within their organization to the
public or a higher authority.
Rationale: Whistleblowing involves exposing misconduct. It is often a difficult and
courageous act, as whistleblowers can face retaliation from their employers. Laws like the
Sarbanes-Oxley Act provide protections for whistleblowers in certain circumstances.
Question 7
The Sarbanes-Oxley Act of 2002 (SOX) was passed in the United States primarily in response
to?
A) Environmental disasters like the Exxon Valdez oil spill.
B) Widespread union strikes in the manufacturing sector.
C) A series of major corporate accounting scandals.
D) The rise of globalization and international trade.
E) Concerns about workplace discrimination.
Correct Answer: C) A series of major corporate accounting scandals.
Rationale: SOX was enacted as a direct result of high-profile accounting scandals at
companies like Enron and WorldCom. The act established stricter standards for all U.S.
public company boards, management, and public accounting firms, focusing on the
accuracy and reliability of corporate financial reporting.
Question 8
Which of the following describes a conflict of interest?
A) When a company's marketing efforts are not successful.
B) When a manager disagrees with a subordinate on a project's direction.
C) When an individual's private interests interfere, or appear to interfere, with their professional
duties.
D) When two companies compete for the same market share.
E) When an employee is not satisfied with their salary.
Correct Answer: C) When an individual's private interests interfere, or appear to interfere,
with their professional duties.
Rationale: A conflict of interest occurs when a person is in a position of trust that requires
them to exercise judgment on behalf of others (like an employer or client), but their
personal interests could potentially corrupt that judgment. For example, a manager who
hires a family member's unqualified company as a supplier.
Question 9
The approach to corporate social responsibility that involves actively seeking opportunities to
contribute to society is known as the?
, [Type here]
A) Obstructionist stance
B) Defensive stance
C) Accommodative stance
D) Proactive stance
E) Minimalist stance
Correct Answer: D) Proactive stance
Rationale: The proactive stance represents the highest level of social responsibility.
Companies taking this approach go beyond legal requirements and ethical norms to
actively look for ways to make positive contributions. The other stances represent lower
levels of commitment: obstructionist (doing as little as possible), defensive (doing only what
is legally required), and accommodative (doing what is legally and ethically required, and
sometimes more).
Question 10
Immanuel Kant's categorical imperative is a central concept in which ethical theory?
A) Utilitarianism
B) Virtue Ethics
C) Relativism
D) Deontology
E) Egoism
Correct Answer: D) Deontology
Rationale: Kant's categorical imperative is the foundation of his deontological ethics. It
states that one should "act only according to that maxim whereby you can at the same time
will that it should become a universal law." This means that actions are judged based on
whether the rule guiding them is universally applicable, not based on their consequences.
Question 11
The "triple bottom line" is a concept that encourages corporations to measure their performance
based on?
A) Sales, profits, and market share.
B) Legal, ethical, and philanthropic responsibilities.
C) Economic, social, and environmental impact.
D) Past, present, and future performance.
E) Shareholders, customers, and employees.
Correct Answer: C) Economic, social, and environmental impact.
Rationale: Coined by John Elkington, the triple bottom line (TBL) argues that companies
should focus on "People, Planet, and Profit." It is an accounting framework that
incorporates three dimensions of performance: social (people), environmental (planet), and
financial (profit). This encourages a more holistic and sustainable view of business success.
