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Chapter 4 Activity
Identification
Insider. a person who is either employed by the
corporation can be an executive, manager, employee
or somebody who has significant personal and/or
business relationships with corporate management.
Keiretsu refers to industrial groups linked by trading
relationships as well as cross-shareholdings of debt
and equity; boards of directors composed almost
solely of insiders; and a comparatively low (in some
corporations, non-existent) level of input of outside
shareholders, caused and exacerbated by
complicated procedures for exercising shareholders'
votes.
Outsider a person or institution which has no direct
relationship with the corporation or corporate
management.
Japanese model model of governance characterized
by a high level of stock ownership by affiliated banks
and companies; a banking system characterized by
strong, long-term links between bank and corporation;
a legal, public policy and industrial policy framework.
Equity Financing Common method of raising capital in
European and US Companies.
True or False
True 1. It is possible to outline a model of corporate
governance for a given country.
True 2. To date, researchers have identified
three models of corporate governance in
developed capital markets.
False 3. The corporate governance structure in
each country develops in response to countryspecific factors and interest.
True 4. If a profits fall over an extended period, the
main bank and the members of the keiretsu may
remove directors and appoint their own candidates to
the company's board.
True 5. Most German corporations have traditionally
preferred bank financing over equity financing.
True 6. The Anglo-US model is characterized
by share ownership of individual, and
increasingly institutional, investors not affiliated
with the corporation.
False 7. Equity financing is not a common method of
raising capital for corporations in the United Kingdom
and the US.
True 8. There is a causal relationship between the
importance of equity financing, the size of the capital
market and the development of a corporate governance
system.
True 9. The US is both the world's largest capital
market and the home of the world's most-developed
system of proxy voting and shareholder activism by
institutional investors.
True 10. Players in the Anglo-US model include
management, directors, shareholders, government
agencies, stock exchanges, self-regulatory
organizations and consulting firms which advise
corporations and/or shareholders on corporate
governance at proxy voting.
False 11. The interests of shareholders and management
always coincide.
False 12. A synonym for insider is executive director; a
synonym for outsider is a executive director.
True 13. Equity financing is important for Japanese
corporations.
True 14. Traditionally, the same person has
served as both chairman of the board of
directors and chief executive officer of the
corporation.
True 15. Investors avoid legal liability by ceding to
management control of the corporation, paying
management for acting as their agent by undertaking
the affairs of the corporation.
True 16. In Japan, financial institutions and corporations
firmly hold ownership of the equity market
True 17. UK and US boards are generally smaller than
boards in Japan and Germany.
False 18. In the UK and US, a wide range of laws
and regulatory codes do not define relationships
among management, directors and
shareholders.
True 19. Stock exchanges play an important role in
the Anglo-US model by establishing listing,
disclosure and other requirements.
True 20. There is one important distinction
between the US and the UK: in the US,
shareholders do not have the right to vote on
the dividend proposed by the board of
directors.
True 21. Similar to the trend in the UK and US, the shift
during the postwar period has been away from individual
ownership to institutional and corporate ownership.
False 22. Japanese corporations prefer that a
minority of its shareholders be long-term, preferably
affiliated, parties.
True 23. German banks, and to a lesser extent,
corporate shareholders, are the key players in the
German corporate governance system.
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Multiple Choice
1. The corporate governance structure of joint
stock corporations in a given country is
determined by several factors
a. the legal and regulatory framework outlining
the rights and responsibilities of the parties
involved in corporate governance.
b. the de facto realities of the corporate environment
in the country.
c. each corporation's articles of association.
d. All of the above
e. None of the above
2. While corporate governance provisions may differ
from corporation to corporation many de facto and de
jure factors
a.
b.
c.
d.
e.
have no effect at de facto.
affect corporations in a similar way.
affect only de facto.
do not affect corporations in a similar way.
none of the above
3. In Germany, corporations are also shareholders,
sometimes holding long-term stakes in other
corporations, even
a. where there is industrial or commercial affiliation
between the two.
b. where there is no industrial or
with commercial affiliation
between the two. c. where there
is with industrial or no
commercial affiliation between
the two.
c. where there is no industrial or
commercial affiliation between
the two.
d. any of the above
4. In each country, the corporate governance structure
has certain characteristics or constituent elements, which
distinguish it from structures in other countries
researchers have identified
a.
b.
c.
d.
e.
one single model.
two models.
three models.
more than three models.
no model.
5. The three models identified by the researchers with
regards to corporate governance are:
a. These are the Anglo-Russian model, the
Japanese model, and the German
model
b. These are the Anglo-US model, the
Chinese model, and the German model.
c. These are the French-US model, the
Japanese model, and the German
model
d. These are the Anglo-US model, the
Japanese model, and the Russian
model.
e. These are the Anglo-US model, the
Japanese model, and the German
model.
6. Each model identifies the following constituent
elements:
a. non interest group in the corporate environment;
the share ownership pattern in the given
country; the composition of the board of
directors; the regulatory framework; disclosure
requirements for publicly-listed stock
corporations; corporate actions requiring
shareholder approval; and interaction among
key players.
b. key players in the corporate environment;
the share ownership pattern in the given
country; the composition of the board of
directors; the regulatory framework;
disclosure requirements for publicly-listed
stock corporations; corporate actions
requiring shareholder approval; and
interaction among key players.
c. key players in the corporate environment; do not
share ownership pattern in the given country; the
composition of the board of directors; the
regulatory framework; disclosure requirements
for publicly-listed stock corporations; corporate
actions requiring shareholder approval; and
interaction among key players.
d. non interest group in the corporate environment;
do not share ownership pattern in the given
country; the composition of the board of directors;
the regulatory framework; disclosure
requirements for publicly-listed stock
corporations; corporate actions requiring
shareholder approval; and interaction among key
players.
e. none of the above
7. The Anglo-US model is characterized by
a.
b.
c.
d.
not increasingly institutional.
share ownership of individual.
investors affiliated with the corporation.
Undeveloped legal framework defining the rights
and responsibilities of three key players, namely
management, directors and shareholders.
e. comparatively complicated
procedure for interaction between
shareholder and corporation.
8. The Japanese model is characterized by a high level
a. of stock ownership by affiliated banks and
companies.
b. banking system characterized by strong, longterm links between bank and corporation c. a
legal, public policy and industrial policy
framework designed to support and promote
"keiretsu" boards of directors composed
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almost solely of insiders, and a comparatively
low level of input of outside shareholders.
c. all of the above
d. none of the above
9. Equity financing is a common method of raising capital
for corporations in the
a.
b.
c.
d.
e.
Philippines.
Japan.
China.
United Kingdom (UK) and the US.
all of the above
10. It is not surprising, that the US is the largest
capital market in the world, and the third largest
stock exchange in the world in terms of market
capitalization after the New York Stock Exchange
(NYSE) and Tokyo is
a.
b.
c.
d.
e.
the Mumbai Stock Exchange.
the London Stock Exchange.
Philippine Stock Exchange.
NASDAQ.
none of the above
11. Institutional investors plays an important role in both
a.
b.
c.
d.
e.
the capital market and corporate governance.
the operations and corporate governance.
the capital market and government
all of the above
none of the above
12. The Japanese system of corporate governance
a. is many-sided, centering around the
financial/industrial network or keiretsu
b. is many-sided, centering around government and
a financial/industrial network or keiretsu.
c. is many-sided, centering around a main bank
and creditors
d. is many-sided, centering around a main
bank and a financial/industrial network or
keiretsu
e. is many-sided, centering around the
stockholders and a financial/industrial
network or keiretsu
13. Players in the Anglo-US model include
a. management, non directors,
shareholders, government agencies,
stock exchanges, self-regulatory
organizations and consulting firms.
b. management, directors, shareholders,
government agencies, stock exchanges,
self-regulatory organizations and
consulting firms.
c. management, directors, shareholders,
non government agencies, stock
exchanges, self-regulatory organizations
and consulting firms.
d. all of the above
e. none of the above
14. The German model prescribes
a.
b.
c.
d.
e.
all boards with separate members
two boards with no separate members.
All the boards with no separate members.
two boards with separate members.
none of the above
15. Good governance practitioners prescribe the election
of a board of directors
a. by shareholders but do not require that
boards act as fiduciaries for
shareholders' interests by overseeing
management on behalf of
shareholders.
b. by shareholders and require that boards
act as agent for shareholders' interests
by overseeing management on behalf of
shareholders.
c. by shareholders and require that boards
act as fiduciaries for shareholders'
interests by overseeing management on
behalf of shareholders.
d. by shareholders and require that boards act
as fiduciaries for shareholders' interests by
overseeing management on behalf of the
government.
e. by creditors and require that boards act
as fiduciaries for shareholders' interests
by overseeing management on behalf of
shareholders.
16. A synonym for insider is
a.
b.
c.
d.
e.
executive director.
stakeholder.
stockholder.
government representative.
non-executive director or independent director.
17. Banks hold long-term stakes in
German corporations and as in Japan
bank representatives are elected
a.
b.
c.
d.
e.
to Japanese boards.
to German boards.
to US boards.
all of the above
none of the above
18. Germans' conservative investment strategy, the
corporate governance structure are geared
a. towards relationships between the key players,
notably stockholders and government
b. towards cutting the relationships between the key
players, notably banks and corporations.
c. towards bridging relationships between the key
players, notably banks and corporations.
d. towards preserving relationships between the
key players, notably banks and corporations.
e. towards mend relationships between the key
players, notably banks and corporations.
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19. in the Japanese model, the four key players are:
a. creditor, affiliated company or
keiretsu, management and the
government.
b. main bank, non-affiliated company,
management and the government.
c. non-government organizations,
affiliated company or keiretsu, the
government. d. suppliers, affiliated
company or keiretsu, management
and the government.
d. main bank, affiliated company
or keiretsu (a major inside
shareholder), management and
the government.
20. A synonym for outsider is
a.
b.
c.
d.
e.
executive director.
stakeholder.
stockholder.
government representative.
non-executive director or independent
director.
21. The board of directors of Japanese corporations is
composed almost completely of
a. middle managers
b. creditors.
c. insiders, that is, executive managers,
usually the heads of major divisions of the
d. all of the above
d. none of the above
22. The German corporate governance model
a. significantly similar from both the Anglo-Us and
the Japanese model, although some of its
elements resemble the Japanese model.
b. differs significantly from both the Anglo-Us
and the Japanese model, but some of its
elements are copied from the Japanese
model.
c. differs significantly from both the AngloUS and the Japanese model, although
some of its elements resemble the
Japanese model.
d. significantly similar from both the Anglo-US and
the Japanese model, although some of its
elements differ the Japanese model.
e. differs significantly from both the Anglo-US
and the Japanese model, and no elements
resemble the US model
23. Board composition and board representation
remain important shareholder concerns of shareholders
in
a.
b.
c.
d.
e.
Asia.
Japan in particular.
Europe in General.
the UK and IJS.
other countries.
24. German and Japanese competitors in
response to competition, individual and
institutional investors began
a. to shy themselves about trends, conduct
research and organize themselves in order to
represent their interests as shareholders and
inform themselves about trends, conduct
research and organize themselves in order to
represent their interests as shareholders.
b. to focus themselves about non-trends,
conduct research and organize themselves
in order to represent their interests as
shareholders.
c. to inform themselves about trends,
conduct research and organize themselves
in order to represent their interests as
shareholders.
d. to inform themselves about trends, avoid
conduct research and organize themselves in
order to represent their interests as
shareholders.
e. to inform themselves about trends, conduct
research and work alone in order to represent
their interests as shareholders.
25. The term "capital market" is broad
a. encompassing not all the markets where stocks,
bonds, futures, derivative and other financial
instruments are traded. "Securities market" is
more specific referring to stocks and bonds.
b. encompassing all the markets where
stocks, bonds, futures, derivatives and
other financial instruments are traded.
"Securities market" is more specific
referring to stocks and bonds.
c. encompassing all the markets where stocks,
excluding bonds, futures, derivatives and
other financial instruments are traded.
"Securities market" is more specific, referring
to stocks and bonds.
d. encompassing all the markets where stocks,
bonds, excluding futures and derivatives and
other financial instruments are traded. "Securities
market" is more specific, referring to stocks and
bonds.
e. encompassing all the markets where stocks,
bonds, futures, derivatives and other financial
instruments are not traded. "Securities market"
is more specific referring to stocks and bonds.
Chapter 5 Activity
Identification
1. Agency cost Resources to be sacrificed to keep an
eye on things that are perceived or need to be closely
controlled from the perception of the principal are
significant costs in a principal/agent relationship
2. Proxy voting Refers to an exercise of voting on behalf
of shareholders through the use of a special authority
given by shareholder/principal
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3. Derivative suit A give lawsuit filed by a shareholder on
behalf of the corporation against a third party
4. Corporate Takeover The general term referring to
transfer of control of a firm from one group of
shareholders to another group of shareholders.
5.Tender offer T An act whereby the acquiring
company makes a public offer the price of which is
way higher than the current market price making it
hard for the existing shareholders to resist.
6. Partial or full equity conversion This takeover is
done by giving the shareholders of the target company
offers that include a debt instrument in partial/full
payment of shares
7. Share swap or all share deal A takeover where there
will be no money involved; instead the bidder company
issues its own new shares to the shareholders of the
company.
8. Competitors Refers to corporations and other
business entities private or public offering the same
product or services that the company is offering at the
same time.
9. Watchdogs Refers to independent organizations
regulating or trying to police a particular industry or
corporate conduct to make certain that, the activities of
these companies belonging to the same industry are
accordance with the acceptable standards that are
backed up by laws.
10. Predator companies Corporations that are
always on the watch and waiting for a chance to
take over a certain company, be it via friendly or
hostile takeover.
11. Gatekeepers The term given to independent
third party persons or entity whose cooperation is
important because they have the capability to at
least deter, if not prevent misconducts of
corporations.
12. Investment bankers An individual or entity which
acts as an agent for corporation isstiq securities.
13. Underwriting An arrangement with an investment
banker whereby the investment banker agrees to buys
the entire issue at a set price. It also refers to the
guarantee by the investment banker that the issuer
company will receive a certain minimum amount for
their new issued securities for sale.
14. Stock Exchanges Refers to an entity which
offers trading services and facilities for stock
brokers and traders, to buy and sell shares of stock
and other securities.
15. Hostile takeover A type of takeover which permits
the "acquirer to be" company to bypass the target
company's management if it is uncooperative and
unwilling to agree to a merger or takeover
True 1. Control pyramids effectively entrust the
corporate governance of the greater part of the
corporate sectors of many countries to a handful of elite,
established families who can quite reasonably be
described as oligarchs.
True 2. Agency theory is relevant to many aspects
of corporations from the fundamental question of
why firms exist to questions of corporate structure.
False 3. Even if shareholders are highly interested in
profit maximization , they should also care about the
corporation's harms to society.
False 4. Managers may have incentives to reveal
negative information in the hope that they can ultimately
avoid responsibility.
False 5. Even if impersonal owners have financial
incentives to do social good, their financial
incentives may lead them to be more socially
responsible than sole proprietors
True 6. The traditional analysis of firm behavior is
concerned with potential principal-agent problems
between managers and owners, with the latter typified
by individual and family shareholders.
True 7. The non-financial incentives of sole proprietors
do not necessarily lead them to be more socially
responsible than morally disengaged owners who seek
only to earn as much money as possible.
False 8. The relevant legal questions for the corporate
social responsibility debate focus on what contracts
shareholders and managers should not be allowed to
make with the firm.
True 9. Though social responsibility theorists assume
that public corporation shareholders are morally
removed from corporate actions, this does not take
into account that shareholders make individual
decisions to invest in particular firms.
False 10. Socially-responsible shareholders
derive utility from socially-responsible
investments or dis-utility from sociallyresponsible investments.
True 11. Investors may invest in mutual funds
that investigate and monitor the social
responsibility of its portfolio firms.
True 12. Financially innocuous social investing may
influence management
True 13. The fact that social investors hold a significant
chunk of corporation's shares signal that managers will
not face discipline from shareholders if they depart to
some extent from strict profit maximization, as by
following the investment guidelines of socially
responsible investment funds
True 14. Institutional shareholders are potentially
influential in spurring socially-responsible governance.
True or False
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False 15. While managers of most institutional
investors have duties to minimize financial returns,
this would not apply to managers of social investment
funds
True 16. It is at least equally plausible that socially
motivated shareholders would balk at investing in or
approving adoption of governance mechanisms that
make managers significantly more accountable to
shareholders.
True 17. Credit and asset markets can operate with
regulation to cause firms to internalize harms even
when they do not deal directly with their victims.
False 18. Mandatory disclosure requirements may not be
needed to supplement market and contractual devices.
False 19. Like shareholders, employees cannot insist
on socially-responsible behavior by choosing where to
work.
False 20. Labor market discipline may be perfect.
True 21. Consumers buying branded goods can be
more confident in the firm's attention to social
characteristics, and that firms will react quickly to
protect the brand if social responsibility issues arise.
Multiple Choice
1. The study of the morality of choices made by people is
known
a.
b.
c.
d.
e.
ethics.
business ethics.
freedom of choice.
moral aptitude.
standard of behavior
2. Some Enron executives were aware of the
financial problems the company was facing and yet
failed to reveal this information to the public. These
actions taken by Enron executives were
a.
b.
c.
d.
e.
moral.
normal.
in the best interests of the shareholders.
unethical.
in the best interests of the employees.
3. Taking credit for others' ideas or work or not
meeting one's commitments in a mutual agreement
are ethical issues concerning
a.
b.
c.
d.
e.
fairness and honesty.
organizational relationships.
conflict of interest.
communications.
freedom of choice.
4. Bribes are
a.
b.
c.
d.
unethical.
ethical only under certain circumstances.
uncommon in many foreign countries,
economic returns.
e. ethical.
5. You are the decision maker for purchasing office
equipment in your organization. One sales representative
privately offers you PBA season tickets if you help him
out. This tactic is
a.
b.
c.
d.
e.
a corporate discount.
a common business practice.
bribe.
personal selling.
ethical.
6. The _________ factor affecting ethical behavior
includes one's moral values and central attitude.
a.
b.
c.
d.
e.
individual
social
opportunity
moral
ethical
7. All of the following are factors that affect the level
of ethical behavior organization in an organization
except
a.
b.
c.
d.
e.
individual factors.
social factors.
opportunity.
demographic factors.
moral values.
8. What are the three sets of factors that
influence the standards of behavior in an
organization?
a. organizational norms, circumstances, morals
b. peer pressure, attitudes, social factors
c. historical factors, management attitudes,
opportunity
d. opportunity, individual factors, social factors
e. financial factors, opportunity, morals
9. Ed works in a position where there is very little
supervision. In fact, although he considers himself
ethical, he figures he could go away for a week without
anyone noticing. Which general set of factors is most
likely to influence Ed's e behavior?
a.
b.
c.
d.
e.
Individual
Social
Moral
Circumstantial
Opportunity
10. Suppose that when making decisions with ethical
content, an executive for the Coca-Cola Company
always considers whether she would be comfortable
explaining her decision after the fact to a national TV
audience. Such thinking
a. is clearly a way to shift responsibility and should
be avoided.
b. encourages ethical decision making.
c. is likely to be illegal.
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XGOVERN | MIDTERM
d. would encourage legal payoffs to
university officials for making Coke the
official on campus drink
e. violates several international laws.
11. What is probably the most effective way for a
company to encourage ethical behavior?
a. Hire employees who are ethical
and in agreement with the
companies views.
b. Have ethics training sessions
for interested employees.
c. Threaten employees with
immediate termination for
unethical behavior. d. post
signs discouraging sexual
harassment and
discrimination
d. enforce a written code of ethics for the
organization.
12. Family ownership is one feature of the _______ of
much of the world.
a.
b.
c.
d.
e.
government sector
corporate sector
non-governmental sectors
civic groups
all of the above
13. In Japan, there are extensive cross-holdings within
business groups known as ________
a.
b.
c.
d.
e.
Kaizen
Keiretsu
Kanban
social responsibility
agency cost
14. Because agency problems are likely to be significantly
different from a
a.
b.
c.
d.
e.
multinational corporation.
freestanding family firm.
transnational corporations
Corporate take-over
business ethics
15. ________________is an important example of the
agency problems created in a control pyramid.
a.
b.
c.
d.
e.
Bribes
Contract fixing
Tunneling
All of the above
None of the above
16. Existing company policies addresses three sets of
principal/agent problems which are inherent in the
structure of large companies those arising bet
management and the shareholders as a class
a. between majority creditor and minority
shareholders, and between the controllers of
the company and non-shareholder
stakeholders.
b. between majority shareholders
and minority shareholders, and
between the non-controllers of
the company and nonshareholder stakeholders.
c. between majority shareholders and
minority shareholders, and between
the controllers of the company and
non-shareholder stakeholders.
d. All of the above
e. None of the above
17. Where the typical pattern is one of dispersed
shareholding, legislative and policy attention tends to
focus, as the provisions of the Code of Good
Governance demonstrate on
a.
b.
c.
d.
e.
profit maximization.
the first agency problem.
corporate control
corporate merger.
None of the above
18. The collapse of giant Enron in 2001 showed how
catastrophic___________ can be
a.
b.
c.
d.
e.
the credit crunch
the Asian financial crisis
the agency problem
corporate takeover
business ethics
19. When an executive uses company assets to
underwrite persons' loans, the _______ as company
takes on debts to provide its executives with higher
incomes.
a.
b.
c.
d.
e.
tunneling
pyramiding
corporate take-over
agency problem occurs
any of the above
20. External regulation may be inadequate to align
corporate profits with
a.
b.
c.
d.
e.
corporate stakeholders
government regulators
best practices
social welfare
all of the above
21. Social responsibility theorists argue that excessive
accountability to shareholders causes managers to ignore
social costs and benefits in favor of ____________
a.
b.
c.
d.
e.
personal gain
corporate takeover
merger with other company
government regulations
sort of short-term accounting profits that are
reflected in share price.
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22. Lawmakers rely on those
responsible for internal governance to
achieve socially-desirable results by
responding to the _____
a.
b.
c.
d.
e.
regulation.
stakeholders.
board of directors.
creditors.
code of ethics.
23. Given stakeholders' heterogeneous
objectives, internal dissension might seriously
compromise their effectiveness
a.
b.
c.
d.
e.
in governing the firm.
in satisfying other stakeholders.
in addressing agency problems.
all of the above
none of the above
24. Managers may be more likely than remote owners
to feel responsibility for the firm acts and thus to be
subject to the same social norms and moral sc
influence
a.
b.
c.
d.
e.
corporate takeovers
creditors.
government agencies
other interest groups.
individuals in their personal lives.
Chapter 6 Activity
True or False
True 10. Most authorities agree that business ethics
should be improved.
True 11. A personnel manager of a large company
would probably agree that the more ethical the
company, the easier it is to attract good people.
True 12. A code of ethics is a written guide to acceptable
and ethical behavior as defined by an organization.
True 13. Awareness of corporate social responsibility has
increased along with government involvement.
True 14. Within a firm, social responsibility begins with
manager's attitude.
True 15. The economic model of social responsibility
emphasizes profits.
False 16. The economic model of social
responsibility emphasizes the effect of business
decisions on society.
True 17. The socioeconomic model of social
responsibility emphasizes the effect of business decisions
on society.
False 18. Because of the continuing problem of
inflation, an increasing number of have adopted the
economic model of social responsibility.
False 19. There are many more socially responsible
businesses today them there were ten managers years
ago.
True 1. The field of business ethics applies moral
standards to business situations.
False 20. In support of their position, proponents of
the socioeconomic model argue that businesses
should be allowed to ignore social issues.
True 2. Business people face ethical issues every
day and some of these issues can be difficult to
assess.
True 21. The right to choose means that consumers
must have a choice of products offered by different
manufacturers and sellers.
False 3. Business people by the very nature of
their work rarely face ethical issues to resolve.
False 22. The lesser the competition, the greater the
choice available to consumers.
True 4. Fairness and honesty in business are two
important ethical concerns.
True 23. Affirmative-action plans encompass all
areas of human resources management, including
recruiting, hiring, training, promotion and pay.
False 5. Relationships with customers and co-workers
rarely create ethical problems.
True 6. Sponsors of advertisements aimed at children
must be especially careful to avoid misleading
messages.
False 7. There is nothing unethical about accepting
payments to do something you would normally do in
your job anyway.
False 8. Ethical behavior is most likely to be
compromised when the personal ethics of
business people are high.
True 9. An individual's moral values and central,
value-related attitudes clearly influence one's
business behavior.
False 24. To achieve affirmative action goals and
to remedy past discrimination, hiring quotas are
required.
False 25. The hard-core unemployed are made up of
mentally-ill individuals and those with prior criminal
convictions.
Multiple Choice
1. Which of the following best describes social
responsibility?
a. A corporation's rights, such as due
process in a court of law, freedom of
speech and privacy.
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b. Adoption by a business of a strategic
focus for fulfilling the economic,
legal, ethical, and philanthropic
responsibilities expected of it by its
stakeholders.
c. A company's attempt to maximize its profits in
order to benefit stockholders.
d. All the policies of a company that promote ethical
business practices.
e. All businesses except those with less than 50
employees.
2. To which of the following forms of business can
the concept of social responsibility be applied?
a.
b.
c.
d.
Large, public corporations
Small, privately held corporations
All forms of corporations
Any form of business from a sole
proprietorship to a large corporation
e. All businesses except those with less than 50
employees
3. In order for any social responsibility initiative to have
strategic significance in a company, it must be fully
supported and valued by
a.
b.
c.
d.
e.
7. Business ethics refers to
a. regulations and laws that guide companies in
their business decisions.
b. companies retraining from forming monopolies or
restricting competition in any way
c. principles and standards that guide behavior in the
business world.
d. unique industry and professional factors that
influence employees.
a. e the percentage of after-tax profits given to nonprofit and community groups.
8. Minimal responsibility primarily involves
a. incorporating efforts in such a way as to benefit all
stakeholders of the company.
b. b. fulfilling social responsibilities including legal
and ethical guidelines.
c. addressing the concerns of
contractual stakeholders in regards
to legal and economic matters.
d. trying to maximize stockholder wealth.
top management.
legislators who develop federal law and policy.
government officials in the local area.
the company's stockholders.
non-profit groups who benefit from a company's
philanthropic spending.
4. Which of the following is not one of the four types of
corporate social responsibility?
a.
b.
c.
d.
e.
Ethical
Economic
Environmental
Legal
Philanthropic
5. Many claimed that Microsoft's dominance in the
computer operating systems market violated which
corporate social responsibility?
a.
b.
c.
d.
e.
Ethical
Economic
Legal
Environmental
Philanthropic
6. Society's primary method of enforcing its
requirements regarding business behavior is
through
a.
b.
c.
d.
e.
the legal system.
boycotts and demonstrations.
the media.
buying foreign made products,
self-regulation.
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