When a company operates in the markets of two or more different countries, its foremost strategic issue is
A. whether to use strategic alliances to help defeat its rivals.
B. whether to vary the company's competitive approach to fit specific market conditions and buyer preferences in each host country or whether to employ essentially the same strategy in all countries.
C. whether to maintain a national (one-country) manufacturing base and export goods to the other countries.
D. choosing which foreign companies to team up with via strategic alliances or joint ventures.
E. whether to test the waters with an export strategy before committing to some other competitive approach.
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Q: Ultimately, ethical choices are based on A) the personal moral philosophy of the decision maker. B) societal culture and norms. C) business culture and industry practices. D) laws enacted by Congress and regulations by federal and state governments. E) chance and opportunity.
Q: Two former sales representatives of Amgen, a biotech company, alleged the company strongly encouraged its salesforce to search confidential medical records in dermatologists' offices to find names of patients that would benefit from Amgen's drug Enbrel, a psoriasis treatment. After reporting this practice to the president, one rep was fired and the other resigned after receiving a poor performance review. Both sued Amgen, claiming they did not go along with the scheme because they objected to it as being unethical. The two sales representatives are A) scabs. B) cronies. C) whistle-blowers. D) contrarians. E) ombudsmen.
Q: Which of the following statements best describes the activities of a whistle-blower? A) Mattel issued a statement apologizing for the 150 of the 10 million Power Wheels cars and trucks the company sold that had caught on fire. B) Mattel research engineers proved that the spate of fires in the company's Power Wheels cars and trucks was the result of consumers' tinkering with the engine. C) A former Mattel employee owned one of the Mattel Power Wheel cars that caught on fire and slightly burned its rider. D) The Consumer Product Safety Commission investigated the fires and ordered a recall to repair all of the 10 million units that had been sold. E) A Mattel employee reported to the Consumer Product Safety Commission that Mattel knowingly sold Power Wheels with an electrical system that could catch on fire after prolonged use.
Q: Which of the following statements best describes the activities of a whistle-blower? A) An employee is unhappy because his company is downsizing. B) An employee tells the Consumer Product Safety Commission his company falsified safety reports on a child's car seat. C) A salesperson for a company finds out that a member of his softball team, who works for another firm, "borrowed" some paper clips from that firm to use for his personal use and wants to "tell on him." D) An employee criticizes his employer's finance personnel to his fellow co-workers for picking the wrong stocks in his retirement fund; they lost value last year due to a downturn in the stock market. E) An employee spends the afternoon at work studying for her test rather than counting inventory as she was supposed to be doing.
Q: Rank the following from highest average historical return to lowest average historical return from 1926 to 2017. I. Small stocks II. Long-term bonds III. Large stocks IV. T-bills A) I, II, III, IV B) III, IV, II, I C) I, III, II, IV D) III, I, II, IV
Q: An employee who contacts the SEC to report her company's use of illegal accounting procedures is an example of a(n) A) crony. B) scab. C) whistle-blower. D) corporate snitch. E) ombudsman.
Q: Whistle-blowers refer to A) employees who are simultaneously employed by competing firms and who trade company secrets. B) employees who blackmail or extort money from their employers. C) employees who are coerced by their employers to participate in illegal or unethical activities. D) customers who report unethical or illegal actions of the firms that market the offerings they purchased. E) employees who report unethical or illegal actions of their employers.
Q: If you want to measure the performance of your investment in a fund, including the timing of your purchases and redemptions, you should calculate the ________. A) geometric average return B) arithmetic average return C) dollar-weighted return D) index return
Q: 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.
Q: As mergers, acquisitions, and restructuring have increased in importance, agency theory has become more important in assessing whether A) a stock repurchase should be undertaken. B) shareholder goals are truly being achieved by managers in the long run. C) managers are actually agents or only employees of the firm. D) managers are owners of the company and act the same with the same interests.
Q: Even though his business is very small, the owner of a local restaurant wants to follow the American Marketing Association Statement of Ethics. Every month there is a "company cookout." At the end of the meal, the employee (from owner to members of the cleaning staff) who had the best idea for improving the restaurant is honored and given a $25 gift certificate plus a T-shirt that reads, "Great Minds Think Like Me." This action exhibits which key AMA ethical value? A) honesty B) responsibility C) fairness D) respect E) openness
Q: You put up $50 at the beginning of the year for an investment. The value of the investment grows 4% and you earn a dividend of $3.50. Your HPR was ________. A) 4% B) 3.5% C) 7% D) 11%
Q: A health club wishes to follow the American Marketing Association Statement of Ethics and decides to offer a modified workout class at a very low price for senior citizens who otherwise might not be able to afford their services. This action exhibits which key AMA ethical value? A) honesty B) fairness C) respect D) openness E) responsibility
Q: The American Marketing Association Statement of Ethics identifies six key aspirational ethical values, one of which is A) diversity. B) integrity. C) openness. D) perseverance. E) charity.
Q: A financial manager's goal of maximizing current or short-term earnings may not be appropriate because A) it fails to consider the timing when shareholders want increased earnings and may instead consider the manager's own goals. B) increased earnings may be accompanied by unacceptably higher levels of risk. C) earnings are subjective; they can be defined in various ways such as accounting or economic earnings. D) All of the options are true.
Q: The American Marketing Association Statement of Ethics is centered on three general norms, one of which is to A) initiate fair and honest dialogues in developing markets. B) foster trust in the marketing system. C) champion new legislation that protects ethical business firms and punishes those who abuse consumer trust. D) support governmental agencies in their quest to identify and prosecute those who break the laws of ethical marketing. E) contribute to society's well-being through charitable contributions and cause-related marketing efforts.
Q: A home repair referral network profiles home service companies for homeowners looking for a contractor or handyman. To ensure that recommended companies are reliable, the network checks the business licenses, insurance coverages, Better Business Bureau records, and trade references. The recommended home service company also has to agree to a(n) ________, which includes maintaining professionalism and guaranteeing the quality of its work. A) statement of cultural values B) statement of values and beliefs C) industry endorsement D) code of ethics E) contract due diligence
Q: The Sarbanes-Oxley Act was passed in an effort to A) protect small business from large corporations dominating the market. B) ensure that partnerships divide profits among partners in a fair manner. C) guarantee that outside auditors can control corporate accounting practices. D) control corrupt corporate financial behavior.
Q: Six executives of Tyson Foods, one of the world's largest poultry, beef, and pork processors, were arrested for the illegal smuggling of undocumented foreign workers into the United States to work at Tyson plants. Based on this information, Tyson's violations may have been the result of ________, one of the major reasons some company employees engage in unethical behavior. A) a mission statement that is too broad B) the absence of a written core values statement C) the absence of whistle-blowers D) top management's behavior E) the absence of a stakeholder code of ethics
Q: The increasing percentage ownership of public corporations by institutional investors has A) had no effect on corporate management. B) created higher returns for the stock market in general. C) created more pressure on public companies to manage their firms more efficiently. D) taken away the voice of the individual investor.
Q: The five-star Morningstar rating implies A) superior returns compared to risk. B) superior risk compared to return. C) lowest turnover compared to peers. D) lowest fees compared to peers.
Q: Which of the following is a major reason for the violation of ethics codes? A) government regulation B) family influence C) lack of religious beliefs D) fear of disciplinary action E) perceived behavior of top management
Q: Institutional investors are important in today's business world because A) as large investors, they have more say in how businesses are managed. B) they have a fiduciary responsibility to the workers and investors that they represent to see that the firms they own are managed in an ethical way. C) as a group they can vote large blocks of stock for the election of board members. D) All of the options
Q: You are considering investing in a no-load mutual fund with an annual expense ratio of .6% and an annual 12b-1 fee of .75%. You could also invest in a bank CD paying 6.5% per year. What minimum annual rate of return must the fund earn to make you better off in the fund than in the CD? A) 7.1% B) 7.45% C) 7.25% D) 7.85%
Q: All of the following are typically addressed by an organization's code of ethics except which? A) the dress, sayings, and manner of work of employees B) contributions to political parties and government officials C) customer and supplier relationships D) accurate recordkeeping E) conflicts of interest
Q: Agency problems are least likely to arise in which organizational form? A) Sole proprietorship B) Limited partnership C) Corporation D) Subchapter S corporation
Q: A code of ethics refers to A) a formal statement of moral and ethical business attitudes. B) a formal statement of ethical principles and rules of conduct. C) an informal guide of ethical principles that can guide challenging decisions. D) the written, signed document stating the beliefs and values of each employee in a firm. E) a firm's itemized list of business activities that are and are not consistent with the company's mission statement.
Q: Agency theory deals with the issue of A) when to hire an agent to represent the firm in negotiations. B) the legal liabilities of a firm if an employee, acting as the firm's agent, injures someone. C) the limitations placed on an employee acting as the firm's agent to obligate or bind the firm. D) the conflicts that can arise between the viewpoints and motivations of a firm's owners and managers.
Q: Which one of the following statements about returns reported by mutual funds is not correct? A) Reported returns are net of management expenses. B) Reported returns are net of 12b-1 fees. C) Reported returns are net of brokerage fees paid on the fund's trading activity. D) None of these options. (All of the items are included in reported returns.)
Q: A formal statement of ethical principles and rules of conduct is referred to as a(n) A) ethical mission. B) moral code. C) core value pronouncement. D) code of conduct. E) code of ethics.