Question 1

The expected level of shirking or opportunistic behavior by an agent:

Accepted Answer

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

Question 2

According to the theory of economic Darwinism,in the absence of barriers to entry,firms that survive in the long run are those that:

Accepted Answer

A) follow the most ethical practices. 
B) provide productivity-based incentives to the employees. 
C) deliver products consumers want at the lowest cost. 
D) do not compete with other firms in the industry on quality. 
A) follow the most ethical practices. 
B) provide productivity-based incentives to the employees. 
C) deliver products consumers want at the lowest cost. 
D) do not compete with other firms in the industry on quality.

Question 3

Economist Milton Friedman argued that the goal of corporations should be "to make as much money for its owners as possible while conforming to the basic rules of society." What does this mean in terms of corporate ethical behavior?

Accepted Answer

Friedman advocates keeping business deal

Question 4

Value maximization leads to predictable resource misallocation when the firm:

Accepted Answer

A) operates in a competitive market. 
B) buys inputs from a monopsonist. 
C) has monopoly power in the market. 
D) sets price below long-run marginal cost. 
A) operates in a competitive market. 
B) buys inputs from a monopsonist. 
C) has monopoly power in the market. 
D) sets price below long-run marginal cost.

Question 5

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 and evaluating performance while 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 and evaluating performance while sanctioning unethical behavior must be left to top management. 
D) internal consistency between assigning decision rights,evaluating performance,and sanctioning unethical behavior.

Question 6

Informational asymmetry in constructing a contract between a buyer and a seller can lead the seller to:

Accepted Answer

A) improve the quality of the product. 
B) lower the price of the product. 
C) focus on ethical codes of conduct. 
D) make a perfect contract. 
A) improve the quality of the product. 
B) lower the price of the product. 
C) focus on ethical codes of conduct. 
D) make a perfect contract.

Question 7

Which of the following is true of warranties?

Accepted Answer

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

Question 8

What are some mechanisms for encouraging ethical behavior?

Accepted Answer

Market mechanisms like repeat sales,warr

Question 9

Identify the correct statement regarding business ethics.

Accepted Answer

A) Business ethics seeks to proscribe those behaviors that maximize an organization's profit. 
B) Business ethics and organizational architecture are independent of each other. 
C) Business ethics and organizational architecture are interdependent. 
D) Business ethics seeks to proscribe those behaviors that maximize an employee's productivity. 
A) Business ethics seeks to proscribe those behaviors that maximize an organization's profit. 
B) Business ethics and organizational architecture are independent of each other. 
C) Business ethics and organizational architecture are interdependent. 
D) Business ethics seeks to proscribe those behaviors that maximize an employee's productivity.

Question 10

According to Kantian theory on ethics:

Accepted Answer

A) an act is ethical if and only if it promotes the individual's long-term interests. 
B) an act is ethical if it produces the greatest possible balance of good over bad for everyone affected by it. 
C) only good deeds matter. 
D) good deeds often result in bad outcomes. 
A) an act is ethical if and only if it promotes the individual's long-term interests. 
B) an act is ethical if it produces the greatest possible balance of good over bad for everyone affected by it. 
C) only good deeds matter. 
D) good deeds often result in bad outcomes.

Question 11

Corporate social 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 few firms to de

Question 12

The Project on Corporate Responsibility launched by Ralph Nader in 1969 seeks to:

Accepted Answer

A) lower the company's legal expenses. 
B) devote substantial resources to stakeholders instead of employees,customers,suppliers,and local communities. 
C) make corporate management responsible for upholding a broader spectrum of democratic values. 
D) reduce the company's wage bill. 
A) lower the company's legal expenses. 
B) devote substantial resources to stakeholders instead of employees,customers,suppliers,and local communities. 
C) make corporate management responsible for upholding a broader spectrum of democratic values. 
D) reduce the company's wage bill.

Question 13

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 have improved the ethical standards of this corporation.Why doesn't it conflict with wealth creation?

Accepted Answer

The credo mentions that the firm seeks t

Question 14

Ethics codes in corporate life tend to emphasize (a)compliance with laws and regulations,(b)honesty and integrity,and (c)avoidance of conflicts of interests.Which one is the most important in today's world? How does economics help in understanding its importance?

Accepted Answer

All of these factors have a bearing on s

The expected level of shirking or opportunistic behavior by an agent:

According to the theory of economic Darwinism,in the absence of barriers to entry,firms that survive in the long run are those that:

Economist Milton Friedman argued that the goal of corporations should be "to make as much money for its owners as possible while conforming to the basic rules of society." What does this mean in terms of corporate ethical behavior?

Value maximization leads to predictable resource misallocation when the firm:

To design a value-increasing architectural system we need:

Informational asymmetry in constructing a contract between a buyer and a seller can lead the seller to:

Which of the following is true of warranties?

What are some mechanisms for encouraging ethical behavior?

Identify the correct statement regarding business ethics.

According to Kantian theory on ethics:

Corporate social 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 Project on Corporate Responsibility launched by Ralph Nader in 1969 seeks to:

Ethics codes in corporate life tend to emphasize (a)compliance with laws and regulations,(b)honesty and integrity,and (c)avoidance of conflicts of interests.Which one is the most important in today's world? How does economics help in understanding its importance?

Introduction

Economists View of Behavior

Exchange and Markets

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

Exam 22: Ethics and Organizational Architecture

The expected level of shirking or opportunistic behavior by an agent:

According to the theory of economic Darwinism,in the absence of barriers to entry,firms that survive in the long run are those that:

Economist Milton Friedman argued that the goal of corporations should be "to make as much money for its owners as possible while conforming to the basic rules of society." What does this mean in terms of corporate ethical behavior?

Value maximization leads to predictable resource misallocation when the firm:

To design a value-increasing architectural system we need:

Informational asymmetry in constructing a contract between a buyer and a seller can lead the seller to:

Which of the following is true of warranties?

What are some mechanisms for encouraging ethical behavior?

Identify the correct statement regarding business ethics.

According to Kantian theory on ethics:

Corporate social 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 Project on Corporate Responsibility launched by Ralph Nader in 1969 seeks to:

Ethics codes in corporate life tend to emphasize (a)compliance with laws and regulations,(b)honesty and integrity,and (c)avoidance of conflicts of interests.Which one is the most important in today's world? How does economics help in understanding its importance?

Introduction

Economists View of Behavior

Exchange and Markets

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