Question 1

We know that:

Accepted Answer

A)  the terms corporate culture and corporate ethics are well understood. 
B)  the term corporate ethics can be well articulated, but not corporate culture. 
C)  the term corporate culture can be well articulated, but not corporate ethics. 
D)  the terms corporate culture and corporate ethics are elusive. 
A)  the terms corporate culture and corporate ethics are well understood. 
B)  the term corporate ethics can be well articulated, but not corporate culture. 
C)  the term corporate culture can be well articulated, but not corporate ethics. 
D)  the terms corporate culture and corporate ethics are elusive.

Question 2

To design a value-increasing architectural system we need:

Accepted Answer

A)  top management to assign decision rights, middle management to evaluate performance, and an external agency to sanction unethical behavior 
B)  a clear partition between assigning decision rights and evaluating performance from sanctioning unethical behavior 
C)  internal consistency between assigning decision rights, evaluating performance, but sanctioning unethical behavior must be left to top management 
D)  internal consistency between assigning decision rights, evaluating performance and sanctioning unethical behavior 
A)  top management to assign decision rights, middle management to evaluate performance, and an external agency to sanction unethical behavior 
B)  a clear partition between assigning decision rights and evaluating performance from sanctioning unethical behavior 
C)  internal consistency between assigning decision rights, evaluating performance, but sanctioning unethical behavior must be left to top management 
D)  internal consistency between assigning decision rights, evaluating performance and sanctioning unethical behavior

Question 3

Ethics might be defined as virtuous behavior. Clearly, over time, a market economy perceives wealth creation as one form of virtuous behavior. What can go wrong in this process?

Accepted Answer

Wealth creation could involve activities

Question 4

A seller warranty is often offered to a consumer to:

Accepted Answer

A)  assure the consumer that cheating will not occur. 
B)  bring attention to the cheating in that industry. 
C)  increase the risk assumed by the consumer. 
D)  increase the cost of doing business. 
A)  assure the consumer that cheating will not occur. 
B)  bring attention to the cheating in that industry. 
C)  increase the risk assumed by the consumer. 
D)  increase the cost of doing business.

Question 5

Ralph Nader has long argued that large corporations in oligopolistic markets should use their vast productive powers to redress social ills. Implementing this policy may put the company:

Accepted Answer

A)  in conflict with the government. 
B)  in conflict with its trade unions. 
C)  in conflict with the process of wealth maximization. 
D)  on a list of companies disliked by religious groups. 
A)  in conflict with the government. 
B)  in conflict with its trade unions. 
C)  in conflict with the process of wealth maximization. 
D)  on a list of companies disliked by religious groups.

Question 6

That corporations have obvious and simplistic written code of honor only to defend themselves from legal action is:

Accepted Answer

A)  the correct view. 
B)  the most common view. 
C)  a perfectly understandable view. 
D)  a cynical view. 
A)  the correct view. 
B)  the most common view. 
C)  a perfectly understandable view. 
D)  a cynical view.

Question 7

Johnson & Johnson, a personal care products company, has a four-tiered credo or mission. In order, it states its relationship to customers, employees, communities, and, finally, stockholders. This credo seems to increase the ethical behavior of this corporation. Why doesn't it conflict with wealth creation?

Accepted Answer

The credo focuses managers on the long t

Question 8

Milton Friedman's view about the corporate social mission:

Accepted Answer

A)  acknowledges that shareholders are likely to use some of their wealth for altruistic purposes. 
B)  assumes shareholders are not rational. 
C)  advocates that corporations engage in philanthropic activities. 
D)  applies only to U.S. corporations. 
A)  acknowledges that shareholders are likely to use some of their wealth for altruistic purposes. 
B)  assumes shareholders are not rational. 
C)  advocates that corporations engage in philanthropic activities. 
D)  applies only to U.S. corporations.

Question 9

What are some mechanisms for encouraging ethical behavior?

Accepted Answer

Repeat Sales, Warranties, Third-Party Mo

Question 10

Corporate responsibility may require changing the mission of the company to a 'constrained' wealth maximization. Is it possible for a few firms in the marketplace to shift their objective functions in this way? Why?

Accepted Answer

It may be possible for a subset of firms

Question 11

The optimal amount of shirking or opportunistic behavior by an agent:

Accepted Answer

A)  can be determined apriori. 
B)  is less than zero. 
C)  is zero. 
D)  is greater than zero. 
A)  can be determined apriori. 
B)  is less than zero. 
C)  is zero. 
D)  is greater than zero.

Question 12

Warranties:

Accepted Answer

A)  are not important costs in the business world. 
B)  leave contracting costs unchanged in the business world. 
C)  increase contracting costs in the business world. 
D)  reduce contracting costs in the business world. 
A)  are not important costs in the business world. 
B)  leave contracting costs unchanged in the business world. 
C)  increase contracting costs in the business world. 
D)  reduce contracting costs in the business world.

Question 13

Incentive problems in a business can easily cause:

Accepted Answer

A)  wealth maximization. 
B)  employees enhancement. 
C)  risk reduction. 
D)  ethical problems. 
A)  wealth maximization. 
B)  employees enhancement. 
C)  risk reduction. 
D)  ethical problems.

Question 14

Compensating differentials for employees can be seen as one measure as adjusting for:

Accepted Answer

A)  wages being paid at market rates. 
B)  problems of ethical conflict. 
C)  not pursuing wealth creation as a corporate goal. 
D)  being a risk-taking entrepreneur. 
A)  wages being paid at market rates. 
B)  problems of ethical conflict. 
C)  not pursuing wealth creation as a corporate goal. 
D)  being a risk-taking entrepreneur.

Question 15

Economist Adam Smith noted that in trade, different ethical standards seem to prevail in different situations. In a market environment where customers will never be seen again, there is a tendency towards:

Accepted Answer

A)  market inefficiency. 
B)  sellers cheating on price or quality. 
C)  supply to not equal demand. 
D)  increased honesty in transactions. 
A)  market inefficiency. 
B)  sellers cheating on price or quality. 
C)  supply to not equal demand. 
D)  increased honesty in transactions.

Question 16

The text notes that many firms that use animals in production or advertising adopt the animal treatment standards of the American Society for Prevention of Cruelty to Animals. Why do companies adopt a professional group's standard of behavior?

Accepted Answer

Professional groups such as ASPCA are we

Question 17

Ethics can be defined as:

Accepted Answer

A)  virtuous behavior. 
B)  following the letter of the law. 
C)  employing people with minority status. 
D)  a philosophy that believes the "ends justify the means." 
A)  virtuous behavior. 
B)  following the letter of the law. 
C)  employing people with minority status. 
D)  a philosophy that believes the "ends justify the means."

Question 18

Many codes of ethics attempt to alter or reinforce standards of behavior. An economist wouldn't argue with the codes but would probably note that:

Accepted Answer

A)  the codes need to be posted in every office to be effective. 
B)  codes will never in any circumstances help. 
C)  designing an organizational architecture with proper incentives is more important. 
D)  the laws of supply and demand usually require that codes of ethical behavior are tertiary artifacts. 
A)  the codes need to be posted in every office to be effective. 
B)  codes will never in any circumstances help. 
C)  designing an organizational architecture with proper incentives is more important. 
D)  the laws of supply and demand usually require that codes of ethical behavior are tertiary artifacts.

We know that:

To design a value-increasing architectural system we need:

Ethics might be defined as virtuous behavior. Clearly, over time, a market economy perceives wealth creation as one form of virtuous behavior. What can go wrong in this process?

A seller warranty is often offered to a consumer to:

Ralph Nader has long argued that large corporations in oligopolistic markets should use their vast productive powers to redress social ills. Implementing this policy may put the company:

That corporations have obvious and simplistic written code of honor only to defend themselves from legal action is:

Milton Friedman's view about the corporate social mission:

What are some mechanisms for encouraging ethical behavior?

Corporate responsibility may require changing the mission of the company to a 'constrained' wealth maximization. Is it possible for a few firms in the marketplace to shift their objective functions in this way? Why?

The optimal amount of shirking or opportunistic behavior by an agent:

Warranties:

Incentive problems in a business can easily cause:

Compensating differentials for employees can be seen as one measure as adjusting for:

Economist Adam Smith noted that in trade, different ethical standards seem to prevail in different situations. In a market environment where customers will never be seen again, there is a tendency towards:

The text notes that many firms that use animals in production or advertising adopt the animal treatment standards of the American Society for Prevention of Cruelty to Animals. Why do companies adopt a professional group's standard of behavior?

Ethics can be defined as:

Many codes of ethics attempt to alter or reinforce standards of behavior. An economist wouldn't argue with the codes but would probably note that:

Introduction

Economists View of Behavior

Markets, Organizations, and the Role of Knowledge

Demand

Production and Cost

Market Structure

Pricing With Market Power

Economics of Strategy: Creating and Capturing Value

Economics of Strategy: Game Theory

Incentive Conflicts and Contracts

Organizational Architecture

Decision Rights: The Level of Empowerment

Decision Rights: Bundling Tasks Into Jobs and Subunits

Attracting and Retaining Qualified Employees

Incentive Compensation

Individual Performance Evaluation

Divisional Performance Evaluation

Corporate Governance

Vertical Integration and Outsourcing

Leadership: Motivating Change Within Organizations

Understanding the Business Environment: The Economics of Regulation

Organizational Architecture and the Process of Management Innovation

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Exam 22: Ethics and Organizational Architecture

We know that:

To design a value-increasing architectural system we need:

Ethics might be defined as virtuous behavior. Clearly, over time, a market economy perceives wealth creation as one form of virtuous behavior. What can go wrong in this process?

A seller warranty is often offered to a consumer to:

Ralph Nader has long argued that large corporations in oligopolistic markets should use their vast productive powers to redress social ills. Implementing this policy may put the company:

That corporations have obvious and simplistic written code of honor only to defend themselves from legal action is:

Milton Friedman's view about the corporate social mission:

What are some mechanisms for encouraging ethical behavior?

Corporate responsibility may require changing the mission of the company to a 'constrained' wealth maximization. Is it possible for a few firms in the marketplace to shift their objective functions in this way? Why?

The optimal amount of shirking or opportunistic behavior by an agent:

Warranties:

Incentive problems in a business can easily cause:

Compensating differentials for employees can be seen as one measure as adjusting for:

Economist Adam Smith noted that in trade, different ethical standards seem to prevail in different situations. In a market environment where customers will never be seen again, there is a tendency towards:

The text notes that many firms that use animals in production or advertising adopt the animal treatment standards of the American Society for Prevention of Cruelty to Animals. Why do companies adopt a professional group's standard of behavior?

Ethics can be defined as:

Many codes of ethics attempt to alter or reinforce standards of behavior. An economist wouldn't argue with the codes but would probably note that:

Introduction

Economists View of Behavior

Markets, Organizations, and the Role of Knowledge

Demand

Production and Cost

Market Structure

Pricing With Market Power

Economics of Strategy: Creating and Capturing Value

Economics of Strategy: Game Theory

Incentive Conflicts and Contracts

Organizational Architecture

Decision Rights: The Level of Empowerment

Decision Rights: Bundling Tasks Into Jobs and Subunits

Attracting and Retaining Qualified Employees

Incentive Compensation

Individual Performance Evaluation

Divisional Performance Evaluation

Corporate Governance

Vertical Integration and Outsourcing

Leadership: Motivating Change Within Organizations

Understanding the Business Environment: The Economics of Regulation

Organizational Architecture and the Process of Management Innovation

Filters