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Questions
Q:
Bilt-Well Construction Corporation makes a side payment to a governÂment official in Nigeria to obtain a contract. In the United States, this is
a. illegal and unethical.
b. illegal but not unethical.
c. unethical but not illegal.
d. legal and ethical.
Q:
General partners are not permitted to sue the partnership or other partners at law.
Q:
Ethical standards would most likely be considered violated if Retail Mart Corporation deals with a company in a developing nation that
a. agrees to produce goods at Retail Mart's desired price.
b. goes unnoticed by "corporate watch" groups.
c. exploits its workers.
d. pays its workers less than the U.S. minimum wage.
Q:
The right to share in the profitsof the partnership is the right to share in the earnings from the investment of capital.
Q:
Since the income of a partnership must be reported on the individual partners' personal income tax returns, this results in double-taxation of partnership profits.
Q:
Spencer Hydraulics Corporation's ethics committee is asked a business ethics questionshould the firm bid low to obtain a contract that it knows it can fulfill only at a higher price? A practical method to investigate and solve this question involves all of the following steps except
a. absolution.
b. decision.
c. inquiry.
d. justification.
Q:
When the marginal physical product is falling,A) marginal cost is rising. B) average fixed costs are rising.C) total costs are falling. D) average variable costs are falling.
Q:
General partnerships do not pay federal income taxes.
Q:
Fealty Credit Corporation asks its employees to evaluate their actions and get on the ethical business decision-making "bandwagon." Guidelines for judging individual actions include all of the following except
a. an individual's conscience.
b. business rules and procedures.
c. loopholes in the law or company policies.
d. promises to others.
Q:
Sunny Energy Corporation engages in ethical behavior solely for the purpose of getÂting good publicity and thereby increasing profits. Sunny is
a. acting unethically in its pursuit of publicity.
b. acting unethically in its pursuit of profits.
c. acting unethically in its setting of priorities.
d. not acting unethically.
Q:
A general partnership agreement must always be in writing to be considered legal.
Q:
BarBQ Sushi Taco Company considers the impact of its corporate decisions on various groups and often acts in the interest of a group that has a greater stake in a decision than BarBQ's shareholders. This is most likely to attract potential employees who are
a. investors focused on short-term profits.
b. irresponsible slackers.
c. politically-motivated complainers.
d. recent college graduates.
Q:
The name selected by a general partnership cannot indicate that it is a corporation.
Q:
Applied Business Corporation makes and markets its products nationwide. Under the stakeholder approach, to be considered socially responsible when making a business decision, Applied must take into account the needs of
a. its consumers, the community, and society only.
b. its employees and owners only.
c. its employees, owners, consumers, the community, and society.
d. no one.
Q:
Receipt of a share of business profits is prima facie evidence of a general partnership.
Q:
ʺIn economics, the short run commonly refers to a period within one year and the long run is a period longer than one year.ʺ Do you agree or disagree? Explain your answer.
Q:
The Revised Uniform Partnership Act is a federal statute that is recognized in all states.
Q:
In deciding questions of corporate social responsibility, Valley Disposal & Recycling, Inc., is concerned with
a. how the corporation can best fulfill any ethical duty to society.
b. the effect on corporate profits of ignoring any ethical duty to society.
c. whether the corporation owes any ethical duty to society.
d. all of the choices.
Q:
The Uniform Partnership Act (UPA) is a model act that codifies sole proprietorship law.
Q:
A common ethical dilemma faced by the management of General Holdings Corporation involves the effect that its decision will have on
a. one group as opposed to another.
b. the firm's competitors.
c. the government.
d. the U.S. Chamber of Commerce.
Q:
In making decisions for United Merchandising Company, Vance uses a cost-benefit analysis. This is part of
a. duty-based ethics.
b. Kantian ethics.
c. the principle of rights.
d. utilitarianism.
Q:
According to priority, which of the following claims is satisfied first after dissolution?
A) creditors
B) creditor-partners
C) capital contributions
D) profits
Q:
Accounting profits are typicallyA) greater than economic profits because accounting profits do not include explicit costs. B) greater than economic profits because accounting profits do not include implicit costs. C) smaller than economic profits because accounting profits do not include explicit costs. D) equal to economic profits in the long run.
Q:
In making business decisions, Glenda, personnel manager for HVAC Maintenance, Inc., applies his belief that all persons have fundamental rights. This is
a. a religious rule.
b. the categorical imperative.
c. the principle of rights.
d. utilitarianism.
Q:
________ is a situation in which a partner withdraws from a partnership without having the right to do so at that time.
A) Winding up
B) Indemnification
C) Wrongful dissolution
D) Proliferation
Q:
The change in the relationship of partners in a partnership caused by any partner ceasing to be associated in the carrying on of the business is known as ________.
A) an action for an accounting
B) indemnification
C) winding up
D) dissolution
Q:
Fess, research manager for Greenergy Products, Inc., apÂplies utilitarian ethics to determine that an action is morally corÂrect when it produces the greatest good for
a. Fess.
b. Greenergy.
c. the fewest people.
d. the most people.
Q:
Solid Tool Company's decision makers view a particular risk in the use of Solid's product as open and obvious. Continuing to market the product without telling consumers of the risk could be justified from a perspective of
a. duty-based ethics.
b. Kantian ethics.
c. rights-based ethics.
d. utilitarian ethics.
Q:
Which of the following is true of the liability of an incoming partner?
A) An incoming partner is liable for the antecedent debts of the partnership.
B) An incoming partner has joint and several liability with existing partners for the antecedent debts of the partnership.
C) An incoming partner is liable for the existing debts of the partnership only to the extent of his or her capital contribution.
D) An incoming partner is not liable for the future debts of the partnership.
Q:
Ryan, the owner of SuperMart Stores, Inc., adheres to the "principle of rights" theory. Under this theory, a key factor in determining whether a business decision is ethical is how that decision affects
a. the right determination under a cost-benefit analysis.
b. the rights of others.
c. the "right" thing to do.
d. the right to make a profit.
Q:
Which of the following is true of tort liability of a general partnership?
A) Only the partner who committed the tort is liable.
B) Under the UPA, general partners have joint, but not several, liability for torts committed in the course and scope of the partnership.
C) A partner can be sued even if he or she did not participate in the commission of the tort.
D) If one of the partners in the partnership is released, the other partners are discharged of liability.
Q:
Use the above figure. The optimal position for the consumer is atA) J or L B) M C) K D) N
Q:
Dion, an accountant for Entertainment Sports, Inc., attempts to apply a duty-based approach to ethical reasoning in conflicts that occur on the job. This approach is based on the idea that a person must
a. achieve the greatest good for the most people.
b. avoid unethical behavior regardless of the consequences.
c. conform to society's ethical standards.
d. place his or her employer's interest first.
Q:
Instead of suing the partnerships or other partners at law, general partners are given the right to bring a(n) ________ against other partners.
A) claim for damages
B) tort action
C) call for action
D) action for an accounting
Q:
Tilly, the chief financial officer for USA Products Corporation, atÂtempts to apply Christian precepts in making ethical decisions and in doÂing business. In applying duty-based ethical standards that are derived from a religious source, Tilly would consider the motive behind an act to be
a. irrelevant.
b. the least important consideration.
c. the most important consideration.
d. the only consideration.
Q:
Which of the following is true of profits and losses in a general partnership?
A) By law, it is presumed that the proportion of profits shared is equal to the general partner's initial investment.
B) Unless otherwise agreed, losses are shared equally by all general partners.
C) The general partner who proposed the idea of the business receives the greatest share of profits.
D) The proportion of investment governs only the proportion of losses shared and not profits obtained.
Q:
In business deals, Felipe, the chief executive officer of Glazed Donuts, Inc., follows duty-based ethical standards. These are most likely derived from
a. a corporate ethics code.
b. a cost-benefit analysis.
c. philosophical reasoning.
d. the law.
Q:
Which of the following is true of the management of a general partnership?
A) The number of votes a general partner has depends on the proportion of his or her capital investment.
B) Partnership matters are decided by unanimous agreement only.
C) Only a general partner who is also a member of the partnership's board of directors has the authority to participate in the management of the partnership.
D) If the vote is tied, the action being voted on is considered to be defeated.
Q:
According to the Statute of Frauds, a general partnership that exists for more than ________ must have a written partnership agreement.
A) three months
B) six months
C) nine months
D) one year
Q:
Quantity of PizzaMarginal UtilityQuantity of BeerMarginal Utility1451402402403303354154105-550In the above table, how much beer and pizza will Bob consume if the price of a piece of pizza is $2.00 and the price of a beer is $2.00?A) 1 piece of pizza and 3 beers B) 2 pieces of pizza and 2 beersC) 2 pieces of pizza and 3 beers D) 3 pieces of pizza and 1 beer
Q:
Global Distribution Corporation suggests that its employees apply the "categorical imperative" to ethical issues that arise at work. This reÂquires that the employees
a. categorize the issues according to legality, morality, and profitability.
b. consider only the benefits that would accrue to them personally.
c. look only at the result, regardless of the means to attain it.
d. weigh the consequences that would follow if everyone acted the same.
Q:
Which of the following must be in writing under the Statute of Frauds?
A) a business that has more than one commercial venture
B) a partnership that is authorized to deal in real estate
C) a business that is authorized to lend money
D) an enterprise that deals in health and medicine
Q:
Whirlwind Financial Corporation sends its executives to a resort in Mexicoat taxpayers' expenseto consider using the firm's cash to buy back its stock and thereby prop up the value. Many of its competitors are doing the same thing. One of the best ways to learn about the ethical responsibilities inherent in operating a business is to look at
a. the mistakes made by other companies.
b. the benefits of pursuing profit despite the appearance of impropriety.
c. the prevalence of a practice among other corporations.
d. who is footing the bill for a particular action.
Q:
Which of the following is true in the creation of a general partnership?
A) The business name must include the names of all partners.
B) The business name cannot be a fictitious name.
C) The name selected by the partnership cannot indicate that it is a corporation.
D) The business cannot operate under a trade name.
Q:
Ergonomic Corporation convenes its employees for its managers to announce (1) a new company-wide ethical code of conduct, (2) an ad campaign to publicize the new code, and (3) the discharge of employees who do not adhere to the code. One of the most effective ways to set a tone of ethical behavior within a business organization is
a. to create an ethical code of conduct.
b. to discharge employees who do not create the appearance of impropriety.
c. to post a marketing campaign online touting the firm's ethical tone.
d. for management to direct employees to "do as we say, not as we do."
Q:
Where a partnership agreement provides for the sharing of profits but is silent as to how losses are to be shared, ________.
A) losses are shared in the same proportion as profits
B) losses are shared in greater proportion than profits
C) profits are shared in greater proportion than losses
D) losses are absorbed by the partnership entity rather than borne by the individual partners
Q:
Straitway Company encourages its managers to behave ethically, reasoning that the employees will take their cues from management. One of the most important ways to create and maintain an ethical behavior workplace is for management to
a. demonstrate a commitment to ethical decision making.
b. discreetly engage in unethical or illegal acts.
c. look the other way when an employee engages in an unethical act.
d. direct employees to "do as we say, not as we do."
Q:
Which of the following goods is likely to have the highest income elasticity?A) A designer blouse B) Tomato soupC) Hamburger D) Can of tuna
Q:
Which of the following is true of a general partnership?
A) A business must generate a profit in order to qualify as a general partnership.
B) The general partners need not be the co-owners of the business.
C) A general partnership may be formed with little or no formality.
D) Charity organizations and schools are usually formed as general partnerships.
Q:
Flexo Trucking Company transports hazardÂous waste. Garn is a Flexo driver, whom the company knows drives longer hours than federal regulations permit. One night, Garn exceeds the limit and has an accident. Spilled chemicals contaminate Hill City's water source, forcing the residents to move away. Flexo acted unethically because
a. Flexo showed reckless disregard for Hill City's residents and others.
b. Garn exceeded the federal time limit.
c. harm was caused by an unfortunate accident.
d. Hill City should have better protected its water source.
Q:
An organization or venture must have a ________ motive in order to qualify as a partnership.
A) large-scale expansion
B) noncommercial
C) profit
D) target market
Q:
Housemate, Inc., makes and sells a variety of household products. With a fair amount of certainty, Housemate's decision makers can predict whether a given business action would be legal in
a. all situations.
b. many situations.
c. no situations.
d. practically no situations.
Q:
An association of two or more persons to carry on as co-owners of a business for profit is known as a ________.
A) limited partnership
B) sole proprietorship
C) corporation
D) general partnership
Q:
Peak & Vale Accountants provides other firms with accounting services. Questions of what is ethical involve the extent to which Peak & Vale has
a. a legal duty beyond those duties mandated by ethics.
b. an ethical duty beyond those duties mandated by law.
c. any duty beyond those mandated by both ethics and the law.
d. any duty when it is uncertain whether a legal duty exists.
Q:
List the advantages and disadvantages of a sole proprietorship.
Q:
Eden, the chief executive officer of Flo-Thru Piping Corporation, wants to enÂsure that Flo-Thru's activities are legal and ethical. The best course for Eden and Flo-Thru is to act in
a. good faith.
b. ignorance of the law.
c. regard for the firm's shareholders only.
d. their own self interest.
Q:
The sole proprietor has ________ liability.
Q:
If the absolute value of the price elasticity of demand for a product is 1.5, and the price of a product increased 30 percent, then the quantity demanded will decline byA) 45 percent. B) 20 percent. C) 5 percent. D) 10 percent.
Q:
Sharon, the human resources director for Tempo Corporation, atÂtempts to comply with the law in dealing with applicants and employÂees. One of the challenges Sharon faces is that the legality of an action is
a. always clear.
b. never clear.
c. sometimes clear.
d. usually clear.
Q:
A(n) ________ is a document that is filed with the state that designates a trade name of a business.
Q:
Bess runs Creditors Asset Recovery. She recruits clients by misrepresenting the facts and pretending to be licensed in various occupations in Michigan. Bess's conduct most likely warrants
a. an ethical admonishment but no other sanctions.
b. an injunction plus other sanctions.
c. no sanctions but no praise.
d. praise for her aggression in recovering the assets of "deadbeat" debtors.
Q:
The designation for a business that is operating under a trade name is ________.
Q:
Mariah works in the public relations department of New Trends Sales Company. Her job includes portraying New Trends's activities in their best light. In this context, ethics consist of
a. a different set of principles from those that apply to other activities.
b. the same moral principles that apply to non-business activities.
c. those principles that produce the most favorable financial outcome.
d. whatever saves New Trends's "face."
Q:
A sole proprietorship does not pay taxes at the business level.
Q:
Lia works for Media Marketing Company. Her job includes putting "spin" on the firm's successes and failures. In this context, ethics consist of
a. "bad" versus "good" publicity.
b. questions of rightness and wrongness.
c. the firm's quarterly revenue.
d. whatever is legal.
Q:
A sole proprietor has limited personal liability.
Q:
Buffalo in the United States almost became extinct while cattle, an animal that provides similar products, never has been close to extinction. The difference is due to
A) the greater marginal value of a head of cattle relative to buffalo, leading to over -hunting of buffalo.
B) the greater marginal value of a buffalo relative to a steer, leading to the overharvesting of buffalo.
C) cattle existing in Europe also while buffalo were specific to North America.
D) the use of private property rights on cattle and common property rights on buffalo.
Q:
Bribery of foreign government officials is both an ethical and a legal issue.
Q:
A sole proprietorship can operate under the name of the sole proprietor or a trade name.
Q:
One guideline to evaluating the ethics of a particular action is to "let your conscience be your guide."
Q:
If no other form of business organization is chosen while obtaining a license, the business is by default a sole proprietorship.
Q:
A business organization and its actions cannot be based on trust.
Q:
No federal or state government approval is required for creating a sole proprietorship.
Q:
Businesspersons who would choose to act unethically may be deterred from doing so because of public opinion.
Q:
In a sole proprietorship, the business is considered a separate legal entity.
Q:
Currently less than of all health care spending is paid by individuals.A) 60 percent. B) 35 percent. C) 20 percent. D) 5 percent.
Q:
To be ethical is to "do the right thing" but it does not otherwise "pay."
Q:
A sole proprietor is legally responsible for the business's contracts.
Q:
Corporations can be good citizens by promoting goals that society deems worthwhile.
Q:
A sole proprietorship cannot be easily transferred when the owner desires to do so.