Chapter 7 Business Ethics

1 September 2022
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Which of the following statements about power is true?
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Power can be used to motivate individuals ethically or unethically.
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Ethical concerns in centralized structures can occur because of very little
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upward communication.
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The apathetic organizational culture exhibits
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minimal concern for people and performance.
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The Sarbanes-Oxley Act
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has institutionalized internal whistle-blowing.
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_______ includes a requirement that management assess the effectiveness of an organization's internal controls and commission an audit of these controls by an external auditor in conjunction with the audit of its financial statements.
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Sarbanes-Oxley 404
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A high concern for people but minimal concern for performance can best describe the _____ culture.
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caring
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Because all organizations have some type of culture, _____ and _____ are often used interchangeably.
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organizational culture; corporate culture
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Which of the following statements about group norms is false?
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Group norms never conflict with the overall organization's culture.
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The ability to influence the behavior of others by offering them something desirable is best described as
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reward power.
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Expert power usually stems from
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a superior's credibility with his or her subordinates.
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Which of the following statements about corporate culture is false?
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The values and ethical beliefs that actually guide the firm's employees tend not to be the same ones that management states as defining the firm's culture.
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When a foreman orders an assembly-line employee to carry out a task which the employee perceives as unethical, yet the employee feels compelled to do it because of the foreman's position, the foreman is exercising
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legitimate power.
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An advantage of the decentralized organization is that
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it is adaptable and can quickly respond to external change.
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In order for whistle-blowing to be effective,
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it requires that the individual have adequate knowledge of wrongdoing that could damage society.
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Marcus is the best performing development director his non-profit organization has ever had. He possesses countless tricks and tips to continue to bring in donations, positive publicity, and supporters. Marcus would likely have _____ over new development department staff.
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expert power
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_____ are satisfied by social and interpersonal relationships, and _____ are satisfied by creative or productive activities.
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Relatedness needs; growth needs
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Both individual ethics and organizational ethics have an impact on an employee's
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ethical intention.
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Management's sense of the organization's culture
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may be quite different from employees' perceptions.
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The _____ leader demands instantaneous obedience and focuses on punishing wrong behavior, achievement, initiative, and self-control.
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coercive
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_____ bring together the functional expertise of employees from several different areas of the organization on a single project.
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Teams
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A values-based ethics approach to ethical corporate cultures relies on a(n) _____ that defines the firm as well as how customers and employees should be treated
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explicit mission statement
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The establishment of an ethics committee within an organization
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might raise ethical concerns or resolve ethical dilemmas.
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Melinda is a very popular executive. She inspires her employees to follow a common vision, facilitates change, and creates a strongly positive climate, all while stressing performance. Melinda has helped to create a(n) _____ culture.
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integrative
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An organization that delegates decision-making authority as far down the chain of command as possible and has relatively few formal rules is
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decentralized.
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When considering centralized and decentralized structures, which one tends to be more ethical and why?
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Centralized because of the strict formalization and implementation of ethics policies and procedures
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The idea that people learn ethical or unethical behavior while interacting with others who are a part of their role-sets is referred to as
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differential association.
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To motivate employees, an organization offers _____ to _____ employees to work toward organizational objectives.
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incentives; encourage
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Individuals, often from the same department, who have a common interest but not an explicit organizational structure are known as
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informal groups.
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Which of the following cultures combines high levels of concern for people and performance?
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Integrative culture
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Over the years, scholars have developed more than 100 definitions of culture. According to the text, all have the following common elements:
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Culture is shared, relatively stable, and is formed over a long period of time.
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​Which power is likely to be effective in the short-run but not in the long-run?
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Coercive power
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Which of the following is an informal channel of communication? ​
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The grapevine
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No formal dress codes, working late, participation in extracurricular activities, gestures, and legends represent
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informal expressions of an organization's culture.
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The exacting organizational culture is interested in
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performance but has little concern for employees.
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Associating with others who are unethical and who have the opportunity to act unethically can lead to a learning process known as
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differential association.
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The ____ rule explains variation in employee conduct through generalizing on the percentage of employees in any given organization who will seek to do right versus how many will be indifferent.
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10-40-40-10
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When developing an ethical culture, there has to be a(n) _____ element because every organization has employees that will try to take advantage if there is an opportunity for misconduct.
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compliance
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_____ are used to subdivide duties within functional areas of a company.
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Work groups
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A cultural audit may be used to assess
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an organization's values.
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The 2010 passage of the Dodd-Frank Act proposed additional monetary incentives for whistle-blowers. A primary concern about these new incentives is
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whistle-blowers might be tempted to report to the SEC and not report the misconduct to the company's internal compliance program.