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Profit responsibility refers to


A) the obligation of a firm to price its goods or services at a level whereby the consumer is treated fairly and the firm is still able to make a profit.
B) the duty of a firm to maximize profits for its owners or stockholders.
C) the view that an organization has an obligation only to those constituencies which can affect achievement of its objectives.
D) the concept that no expansion or additional research and development will occur until a company is making a profit.
E) the view that a portion of profit (after taxes) should be reinvested in a socially or environmentally beneficial endeavor.

F) B) and E)
G) A) and E)

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In 1962, President John F.Kennedy outlined a Consumer Bill of Rights that codified the ethics of exchange between buyers and sellers.These were the right (1) __________, (2) to be informed, (3) to choose, and (4) to be heard.


A) to privacy
B) to be informed
C) to be treated with respect
D) be treated without prejudice
E) to safety

F) B) and C)
G) C) and E)

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Burroughs Wellcome, the developer and maker of AZT, a drug to treat persons afflicted with AIDS, charges each patient $6,500 annually-more than many AIDS patients can afford because they are unable to work.This is an example of the manufacturer recognizing its


A) supply-demand continuum.
B) penetration pricing strategy.
C) profit responsibility.
D) human relations options.
E) corporate resource development.

F) All of the above
G) D) and E)

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A law that codified the ethics of exchange between buyers and sellers, including the rights to safety, to be informed, to choose, and to be heard is referred to as the


A) Lanham Act.
B) Fair Practices Act.
C) Caveat Emptor Decree.
D) Consumer Bill of Rights.
E) Customer Consent Decree.

F) A) and C)
G) B) and E)

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Why did 3M stop production of Scotchgard fabric protector?


A) New advances in fabric manufacturing, such as dirt repellant fibers, made the need for the product obsolete.
B) The product accidentally violated patent rights of a competitor.
C) Traces of a potentially harmful chemical were found in humans so the product was voluntarily halted.
D) New governmental legislation banned the production of one of the product's component chemicals.
E) The firm developed a new product that cost significantly less to produce, resulting in a significantly higher profit margin.

F) B) and E)
G) B) and D)

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The owners of Ben & Jerry's Homemade, Inc.adhere to the belief that the company should in no way harm the environment and when possible, it should improve its environment.This is an example of the __________ philosophy.


A) altruism
B) utilitarianism
C) existentialism
D) moral idealism
E) socialism

F) A) and D)
G) A) and E)

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A firm's formal statement of ethical principles and rules of conduct is called a


A) corporate business mission.
B) Employee Bill of Rights.
C) code of ethics.
D) executive mission statement.
E) values statement.

F) A) and E)
G) B) and C)

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The maker of Wrigley chewing gum funded a $10 million ad campaign aimed at getting African-Americans to use doctors for regular health care maintenance instead of only when they are sick.This is an example of


A) profit responsibility.
B) cause marketing.
C) stakeholder responsibility.
D) mass marketing.
E) societal responsibility.

F) B) and E)
G) None of the above

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A recent survey found that 79 percent of Internet and e-commerce companies take absolutely no social responsibility.Even more worrying is the finding that 75 percent of these Internet companies justify this omission on the grounds that they don't have any environmental or social impacts, while 55 percent said they didn't have time to think about these issues, and 50 percent said they didn't have the expertise to address them.Would these Internet-based companies benefit from acting more socially responsible? Explain your answer.

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Social responsibility encompasses profit...

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A current practice whereby retailers may demand cash or free goods in exchange for shelf space for new products is referred to as


A) taking kickbacks.
B) economic espionage.
C) tying arrangements.
D) slotting allowances.
E) industrial bribes.

F) B) and E)
G) B) and C)

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Starbucks' attention to quality coffee extends to its coffee growers located in more than 20 countries.Starbucks pays coffee farmers a fair price for the beans; that the coffee is grown in an ecologically sound manner; and that Starbucks invests in the farming communities where its coffees are produced.By following these objectives, Starbucks is engaged in


A) cause marketing
B) green marketing
C) sustainable development
D) moral idealism
E) utilitarianism

F) B) and D)
G) C) and D)

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Define the moral philosophy of utilitarianism and explain its relationship to capitalism.

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Utilitarianism is a personal moral philo...

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When the owner of a small publishing company allowed a friend who was starting a machine embroidery business to load the publishing company's copy of Microsoft WORD on the new business's computer, it was an example of


A) an activity that is legal and ethical.
B) caveat emptor.
C) an activity that is illegal but ethical.
D) an activity that is illegal and unethical.
E) a strategic alliance.

F) B) and E)
G) A) and B)

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Greenwashing refers to


A) the practice of using environmentally safe methods to maintain and clean industrial plants.
B) the practice of using natural organic cleansers for removing dirt and bacteria from organically grown produce.
C) the practice of making an unsubstantiated or misleading claim about the environmental benefits of a product, service, technology, or company practice.
D) the practice of making scientifically substantiated claims about the environmental benefits of a product, service, technology, or company practice.
E) a marketing program designed to stress the environmental benefits of a product, service, technology, or company practice.

F) A) and D)
G) B) and C)

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Starbucks has built a company that balances __________ with a social conscience.


A) market share
B) growth
C) standards of excellence
D) profitability
E) market strength

F) A) and B)
G) B) and D)

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A recent poll by Environics International, a public-opinion research firm, found that 67 percent of North Americans are willing to boycott products on ethical grounds.This survey did not ask if the person who was acting on ethical grounds would first see if the boycott was based on real fact.Which of the following statements describe a conclusion that should be drawn from this information?


A) If you are an ethical person, you should act according to your instincts.
B) Realistically speaking, in order to stay in business, all businesses must occasionally behave unethically.
C) All businesses will act unethically unless forced by consumers to act morally.
D) There is nothing consumers can do to stop unethical business activities.
E) Boycotting a product without knowing the facts can be viewed as unethical.

F) C) and D)
G) C) and E)

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Post supports the Boys & Girls Clubs.For every coupon found on a box of any of the Post brands redeemed, Post has promised to donate $.10 to the organization.This is an example of


A) philanthropic marketing.
B) goodwill marketing.
C) public relations marketing.
D) transactional marketing.
E) cause marketing.

F) C) and E)
G) A) and D)

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When shopping on the Internet, most consumers assume the personal information they give out is confidential.Subscribers to America Online (AOL) were upset when AOL proposed giving member information to partners without telling the subscribers.This is related most directly to the consumer's


A) right to choose.
B) right to be informed.
C) right to be treated courteously.
D) right to safety.
E) right to happiness.

F) B) and E)
G) None of the above

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Employees who report unethical or illegal actions of their employers are referred to as


A) whistle-blowers.
B) scabs.
C) cronies.
D) corporate snitches.
E) ombudsman.

F) A) and D)
G) A) and C)

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When charitable contributions of a firm are tied directly to the customer revenues produced through the promotion of one of its products, it is referred to as


A) cooperative contribution.
B) tie-in contributions.
C) cause marketing.
D) philanthropic partnership.
E) cause-related promotion.

F) D) and E)
G) A) and B)

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