Chapter 18 Ethics and Socially Responsible Marketing

Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 18-02 Distinguish between ethics and social responsibility.. Accessibility: Keyboard Naviga

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Chapter 18 Ethics and Socially Responsible Marketing

Multiple Choice Questions

1 Using profit as the sole guide for corporate action can lead to:

B short-term profits but long-term loss of customers.

Using profit as the sole guide for corporate action will lead to short-term profits but long-termloss of customers Firms should balance their priorities of making a profit and keeping their customers

Accessibility: Keyboard Navigation

Blooms: Understand

Difficulty: Easy

Learning Objective: 18-01 Identify why marketers should be concerned about ethics.

Topic: 18-01 The Scope of Marketing Ethics

2 Which of the following should be of paramount importance to marketers?

B Maintaining consumer trust

Maintaining consumer trust should be of paramount importance to marketers If customers feel that a company is not acting responsibly, they will no longer support it by purchasing its products

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Difficulty: Easy

3 Which of the following statement is NOT true about ethical issues associated with

marketing decisions?

priority

D Generally speaking, customers do not trust professionals.

As illustrated in Exhibit 18.1, customers trust level varies for various professionals Nurses, pharmacists, medical doctors, and teachers are trusted professions and advertising

practitioners, car salespeople, and telemarketers are among the least trusted professions

Difficulty: Moderate

4 Which of the following refers to a branch of ethical study that examines ethical rules and principles within a commercial context?

A Business ethics

Business ethics is the branch of ethical study that examines ethical rules and principles within

a commercial context It also examines various moral or ethical problems that might arise in a business setting, and any special duties or obligations that apply to persons engaged in

commerce

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Blooms: Remember

Difficulty: Easy

5 Special duties or obligations that apply to persons engaged in commerce fall under:

A business ethics.

Special duties or obligations that apply to persons engaged in commerce fall under business ethics Firms need to follow business ethics to maintain customer trust

Blooms: Remember

Difficulty: Easy

6 Deceptive advertising and promotion of inferior products are examples of unethical

practices related to:

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Difficulty: Easy

7 The use of sweatshop labour is an issue most closely associated with:

8 Which of the following is an example of individual consumer issue?

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9 Which of the following professions is often singled out as the root cause of a host of ethicalconcerns?

C Marketing

Marketing ethics refers to those ethical problems that are specific to the domain of marketing Because the marketing profession often is singled out among business disciplines as the root cause of a host of ethical concerns (e.g., unethical advertising or the promotion of shoddy products), anyone involved in marketing activities must recognize the ethical implications of his or her actions

10 The set of values within a marketing firm or in the marketing division of any firm that guides decision making and behaviour is referred to as:

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Blooms: Remember

Difficulty: Easy

Topic: 18-03 Creating an Ethical Climate in the Workplace

11 Which of the following is the first step in the process of creating a strong ethical climate within a marketing firm?

C Having a set of values that guides decision making

Within a marketing firm, the first step in the process of creating a strong ethical climate is having a set of values that guides decision making Everyone within the firm must share the same understanding of these values and how they translate into the business activities of the firm, and they must share a consistent language to discuss them

Blooms: Remember

Difficulty: Easy

12 Which of the following is true about creating an ethical climate in a workplace?

B It requires a set of explicit rules and implicit understandings that govern all the transactions

of a firm

Creating an ethical climate in a workplace requires rules and checks to ensure ethical

standards in all the transactions of a firm It is necessary that both the top management and theemployees cooperate to create an ethical environment in a workplace

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13 Lawrence has recently joined a publishing company As part of his initial training, he attends a session on marketing ethics Through the session he learns that the basic starting point for creating a strong ethical climate within a marketing firm is having a(n):

B set of values that guides behaviour.

The basic starting point for creating a strong ethical climate within a marketing firm is having

a set of values that guides behaviour The top management of the firm should be committed tofollow these values in all its transactions

14 To create an ethical climate in a workplace, what must occur after employees understand the company's values?

D Developing explicit rules for transactions

After employees understand the values of their company, it is necessary to develop explicit rules for transactions This point of reference helps employees to adhere to appropriate ethicalpractices

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Blooms: Remember

Difficulty: Easy

15 Almost every organization includes values and ethics in its mission statement, but the establishment of an ethical business climate primarily requires:

D commitment from senior management.

The establishment of an ethical climate within an organization primarily requires commitmentfrom senior management The commitment from the management motivates workers to be ethical and responsible

16 Establishing an ethical business climate requires all employees to be dedicated to that goalbecause:

E the roots of ethical conflict often are the competing values of individuals.

The employees of a firm should be dedicated to the cause of establishing an ethical business climate because the roots of ethical conflict often are competing values of individuals The employees should make an effort to align their values along with the values of the firm

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17 Once the explicit rules and implicit understandings that govern all the transactions of a firm are in place, there must be:

A a system of controls that rewards appropriate behaviour and punishes inappropriate

behaviour

Once the explicit rules and implicit understandings that govern all the transactions of a firm are in place, there must be a system of controls that rewards appropriate behaviour and punishes inappropriate behaviour This ensures that the firm's values are followed in practice

Blooms: Remember

Difficulty: Easy

18 The Canadian Marketing Association's Code of Ethics is designed mainly to:

B establish and maintain standards for the conduct of marketing.

The Canadian Marketing Association (CMA) Code of Ethics and Standards of Practice (the

"Code") is designed to establish and maintain standards for the conduct of marketing in Canada

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19 One of the reasons that people act unethically is because:

B they must choose between conflicting outcomes.

One of the reasons that people act unethically is because they must choose between

conflicting outcomes Each person's understanding of ethical dilemmas influences his or her reaction to a conflicting situation

Topic: 18-04 The Influence of Personal Ethics

20 Howard, the sales manager of a real estate company, is not able to meet the sales target forthe current quarter However, he is confident that the sales for the next quarter will improve Which of the following actions indicates Howard's lack of personal ethics?

the next quarter

C He inflates the sales figures for the current quarter so that it looks better for his branch and

himself

unable to meet the sales target

current quarter

Howard's act of inflating the sales figures for the current year so that it looks better for his branch and himself indicates his lack of personal ethics By inflating the sales figure, Howard gives priority to his image than the larger interests of his company

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Blooms: Apply

Difficulty: Difficult

21 Lori exaggerates her firm's current earnings in the belief that revenue will increase in the next few months Her exaggeration benefits herself, the company, and the employees in the short term but may have serious ethical and legal consequences for the company in the long term In this scenario, Lori should:

company

D align the company's long-term goals with her short-term goals.

Lori should align the company's long-term goals with her short-term goal Thus she can avoid the ethical dilemma arising out of conflicting priorities

22 Presto Clockworks Inc has received a customer complaint regarding the inappropriate sales tactics of one of its sales representatives The company's code of ethics distinctly states that sales personnel are to refrain from such selling practices In this scenario, the manager of Presto Clockworks should:

D determine what punishment is appropriate.

The manager of the Presto Clockworks should determine what punishment is appropriate for the sales representative It is necessary to avoid future lapses and to ensure an ethical businessclimate

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Blooms: Apply

23 Max, the branch manager of Money Tree Bank, has received an email from a customer stating that a huge fee has been charged for his account and that he was not aware of such a charge when he opened the account Max sends a reply expressing the bank's commitment to ethical practices and assures the customer that such events would not be repeated Which of the following is most likely to be Max's next step to sort the issue?

B Examining the existing explicit rules governing the firm's transactions

Max is most likely to examine the existing explicit rules governing the firm's transactions Once a firm expresses its commitment to follow ethical practices, it needs to form and adhere

to explicit rules that govern its transactions

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Blooms: Apply

24 Which of the following is true of Nielsen's Global Survey on Corporate Social

Responsibility?

declining trend in 43 of 58 countries from 2011 to 2013

socially irresponsible

century

D Consumers were more willing to buy products and services from companies with programs

that give back to society

or all subunits within it will act ethically

Nielsen's Global Survey on Corporate Social Responsibility indicated that consumers were more willing to buy products and services from companies with programs that give back to society This willingness to spend more increased in 43 of 58 countries from 2011 to 2013

Learning Objective: 18-02 Distinguish between ethics and social responsibility.

Topic: 18-05 Corporate Social Responsibility

25 Firms with strong ethical climates tend to:

C be more socially responsible than firms without strong ethical climates.

Firms with strong ethical climates tend to be more socially responsible For a company to act

in a socially responsible manner, the employees within the company must also maintain high ethical standards and recognize how their individual decisions lead to the collective actions ofthe firm

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26 Which of the following is true about CSR programs?

responsibility programs

D Corporate social responsibility and business ethics are two different concepts A company

can be socially responsible and makes unethical practices at the same time

27 Which of the following terms best describes the voluntary actions taken by a company to address the ethical, social, and environmental impacts of its business operations and the concerns of its stakeholders?

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Blooms: Remember

Difficulty: Easy

28 Apart from implementing socially responsible programs, which of the following is the primary requirement for a firm to fulfill corporate social responsibility?

C The employees of the firm must act in an ethically responsible manner.

For a firm to fulfill corporate social responsibility, one of the primary requirements is that its employees must act in an ethically responsible manner It ensures an ethical business climate within the firm

Blooms: Remember

Difficulty: Easy

29 Molloy Inc has an exclusive internal research department that supports its ethical

commitment to offer healthy food products The company also encourages its employees to donate to various charities Given this information, which of the following is being best exemplified by Molloy's activities?

Through its activities, Molloy Inc ensures corporate social responsibility Along with creating

an ethical environment within the organization, it ensures that socially responsible programs are undertaken

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Blooms: Apply

30 Kosher Aqua Inc., a manufacturer of bottled water, claims that its bottles are manufacturedwith 60 percent less plastic content compared to its competitors' bottles It further advises consumers to crush the bottles and recycle them after use Given this information, Kosher Aqua is trying to focus consumer attention on:

C its socially responsible business practices.

Kosher Aqua is trying to focus customer attention on its socially responsible business

practices By making its products eco-friendly, it fulfills its social responsibility

Blooms: Apply

31 Safe Health is an association that approves food products as being safe for consumption Quick Breakfast Inc., a manufacturer of cereals, insists on quality standards and has a Safe Health seal on all its products In this scenario, Quick Breakfast is demonstrating:

D socially responsible marketing.

Quick Breakfast is demonstrating socially responsible marketing This helps the firm to earn consumer satisfaction and trust

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Blooms: Apply

32 As a part of its initiative to reduce deforestation, Silicon Inc., a trading company, limits the usage of paper by computerizing its operations It also invests money in media campaigns against deforestation In this scenario, the company's initiative is an example of:

C corporate social responsibility.

33 According to the Conference Board of Canada, which of the following is regarded as the

D Corporate social responsibility

The importance of CSR is underlined by the finding that a majority of Canadians have

rewarded or punished companies for their corporate citizenship

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Blooms: Remember

Difficulty: Easy

34 Which of the following is addressed by a company that undertakes corporate social responsibility?

B The ethics of its business operations

A company that undertakes corporate social responsibility addresses the ethics of its business operations An ethical climate within the organization is necessary for a company to achieve this successfully

Blooms: Remember

Difficulty: Easy

35 Coinage Inc., an international financial services company, supports many social causes by donating a share of its net profit to the community in which it operates However, Coinage lacks transparency in many of its transactions and failed to provide fair wages to its

employees Given this information, which of the following best describes the activities of Coinage?

A Socially responsible firm involved in unethical practices

Coinage is being socially responsible but unethical Both an ethical business climate and implementation of socially responsible program are required for a firm to fulfill its corporate social responsibility

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Blooms: Apply

36 Which of the following best exemplifies a clothing retailer that supports many local charities but occasionally engages in questionable pricing practices?

A Socially responsible firm involved in unethical practices

The clothing retailer is socially responsible but unethical It fails in fulfilling corporate social responsibility in its complete sense

37 Keith Inc., a multinational firm, has extensive business operations in less developed countries In one such country, Keith recently introduced a policy wherein it will donate 2 percent of its net profit to educational institutions with poor infrastructure However, Keith was imposed a fine of $60,000 for violating the fair wage standards in the same country Which of the following best exemplifies Keith's activity?

B Socially responsible firm involved in unethical practices

Some firms that are perceived as socially responsible can still take actions that are viewed as unethical In this scenario, Keith Inc committed itself to donate a share of its profits for socialwell-being, but at the same time it violated the fair wage standards of the host country

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Blooms: Apply

38 Which of the following is true about companies being socially responsible?

Companies earn both tangible and intangible benefits for acting in a socially desirable

manner It makes good business sense to take actions that benefit society

39 Corporate social responsibility means firms are committing time and resources to projects

in the community that:

D may not directly relate to generating profit.

Corporate social responsibility means firms are committing time and resources to projects in the community that may not directly relate to generating profit It does not necessarily mean that the employees of the firm follow ethical business practices

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Blooms: Remember

Difficulty: Easy

40 Consumerism is a(n):

Blooms: Remember

Difficulty: Easy

Learning Objective: 18-03 Describe consumerism and explain how it fosters ethical and socially responsible business practices.

Topic: 18-06 Consumerism, Ethics, and Socially Responsible Practices

41 In which of the following scenarios is a company fulfilling its corporate social

responsibility toward its employees?

A NuPower Inc., a producer of nuclear power, securing its workplace from radiation

accidents

children

vehicles environmentally friendly

NuPower Inc which secures its workplace from radiation accidents, is fulfilling its corporate social responsibility toward employees Employees are important stakeholders for a company

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Blooms: Apply

42 Crystal Inc., a manufacturer of cosmetics, ensures that all its products are free of any sort

of allergens The company is fulfilling its corporate social responsibility toward:

43 What are the two key factors that have been driving the trend toward greater CSR in Canada?

B Consumerism and enhanced environmental awareness

responsible companies

Consumerism and enhanced environmental awareness and activism are two key factors that have been driving the trend toward greater CSR in Canada

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44 When competitors prompt a company to undertake corporate social responsibility

initiatives, the company is subjected to the influence of:

important stakeholder for a company

45 PureIn Inc., a manufacturer of bottled water, depends extensively on groundwater sources for its operations The management of the company decides to take up groundwater

replenishment programs and to assist communities in developing efficient ways to recycle water Following PureIn's initiative, several firms take up similar programs leading to an increased awareness about the subject This scenario is an example of how corporate social responsibility is subjected to the influence of:

This scenario is an example of how corporate social responsibility is subjected to the

influence of marketplace The initiative by PureIn Inc prompts other firms to follow it and thus results in a social awareness about the subject

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Blooms: Apply

46 Companies adoption of CSR programs appeal to

D shareholders and stakeholders

When companies embrace CSR, they appeal not only to their shareholders but also to their key stakeholders including their own employees, consumers, the market place, and society at large

47 Which of the following is true of corporate social responsibility?

responsibility program

marketplace

corporate ethical behaviour

D Some firms that are perceived as socially responsible can still take actions that are viewed

as unethical

Some firms that are perceived as socially responsible can still take actions that are viewed as unethical For instance, a firm might be considered socially responsible because it makes generous donations to charities but is simultaneously involved in questionable sales practices

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48 Leonard, who has just purchased a high-end cigar distributorship, wishes to increase his firm's visibility in the local markets Leonard, however, is aware of the existing regulations and socially acceptable practices with regard to the promotion of tobacco products Followingthe framework for ethical decision making, Leonard's first step will be:

A identifying issues.

Leonard's first step would be to identify issues involved It would help him to decide the required course of action to solve it

Blooms: Apply

Learning Objective: 18-04 Identify four steps in ethical decision making.

Topic: 18-07 A Framework for Ethical Decision Making

49 Trends, a marketing research firm, conducts a survey without telling the respondents aboutthe real purpose of the survey Trends has failed in:

A identifying the ethical concerns in its action.

The firm has failed in identifying the ethical concerns in its action Identifying issues is the first step in making an ethical decision

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50 An audit conducted at Jason University revealed wasteful spending of $8,590 on hotel rents, banquets, and dining at luxury hotels Following this, the university president was fired and fewer government contributions were made to many of the school's funds Staff members who were disturbed by this crisis chose to leave the university This example illustrates:

D how the parties involved failed to identify issues.

The example illustrates how the parties involved failed to identify issues Identifying an issue

is the first step in resolving an ethical dilemma

Blooms: Apply

51 Golden Rings High School is facing a crisis as students are leaving the school due to a lack of qualified and experienced teachers The management of the school has realized that there have been lapses while recruiting teachers The school identifies students, teachers, and parents as the stakeholders in the issue and wants to take them into confidence for solving the issue Which of the following is most likely to be the management's next step to solve the issue?

C Brainstorming and evaluating alternatives

The management is most likely to brainstorm and evaluate alternatives to solve the issues The alternatives need to be reviewed and refined to arrive at the most appropriate one

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Blooms: Apply

52 Charles's company, which is facing an ethical issue, has identified the stakeholders, listened to their concerns, and gathered available data to deal with the issue Which of the following is the next step to be undertaken by the company?

E Brainstorming and evaluating alternatives

After the firm has identified the stakeholders and their issues and gathered the available data, all parties relevant to the decision should come together to brainstorm any alternative courses

of action

53 SwiftWheels Inc., a manufacturer of automobiles, is facing an ethical dilemma It must decide between buying out a competing firm and maintaining one of its factories The

stakeholders have raised their concerns and all parties relevant to the decision-making processhave engaged in a brainstorming session After considering the various alternatives, the management has decided to buy out the competing firm If the management is unsure about the action, it will most likely consider:

B reviewing and refining the alternatives.

If the management of SwiftWheels Inc is unsure about its decision, it will most likely

consider reviewing and refining its alternatives

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Blooms: Apply

54 A firm addresses the issue of being prepared to support the development of an ethical climate during the phase of:

Blooms: Remember

Difficulty: Easy

Learning Objective: 18-05 Outline how ethics and social responsibility can be integrated into a firm's marketing strategy.

Topic: 18-09 Planning Phase

55 By including ethical statements in a firm's mission statement, marketers have the

opportunity to introduce ethics during the stage of:

By including ethical statements in a firm's mission statement, marketers have the opportunity

to introduce ethics during the stage of planning This is the primary step to ensure an ethical climate in an organization

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Blooms: Remember

Difficulty: Easy

56 When a firm decides to integrate ethical decision making into its strategic planning

process, which of the following questions would most likely be asked at the planning phase?

B Does the firm want to include a commitment to ethics in its mission statement?

The question most likely to be asked in the planning phase is "Does the firm want to include acommitment to ethics in its mission statement?" In the planning stage, the firm will decide its level of commitment to ethical policies and standards it is willing to declare publicly

57 In relation to strategic planning process, the question whether a firm can serve a market ethically switches to whether the firm should indulge in particular marketing practices during the phase of:

The ethical question focuses on the nature of marketing practices during the phase of

implementation Ethical decisions taken at this phase help a firm to earn customer recognition and brand image

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Blooms: Remember

Difficulty: Easy

Topic: 18-10 Implementation Phase

58 When a firm decides to integrate ethical decision making into its strategic planning process, which of the following questions would most likely be asked at the implementation phase?

C Is the product priced fairly?

The question most likely to be asked is "Is the product priced fairly?" A firm needs to think of the ethical implications while determining the appropriate marketing mix for its products

59 DrinkUp Beverages Inc was forced to withdraw the promotion of its alcoholic beverages after it was criticized for advertising the products to children younger than 18 years old In this scenario, DrinkUp's ethical error was the failure to consider whether it:

C targeted the appropriate market segment.

DrinkUp's ethical error was the failure to consider whether it targeted the appropriate market segment In the implementation phase of strategic planning, a firm needs to determine the appropriate market segment it needs to target

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Blooms: Apply

60 While segmenting a market, the marketer of a tobacco and alcoholic beverages company should always ask the ethical question of whether the firm:

C has fixed the appropriate marketing mix for the products.

The firm should ask whether it has fixed the appropriate market mix for the products

Unethical decisions during the phase of implementation will cause long-term losses for the company

61 During which phase of the strategic marketing plan would a firm address the issue of location of its production in another country?

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Blooms: Remember

Difficulty: Easy

62 In the context of strategic planning, the ethical impacts of resource allocations need to be carefully evaluated during the phase of:

Blooms: Remember

Difficulty: Easy

63 In the context of strategic planning process, charges that firms use sweatshop labour to produce their products arise due to lapses during the phase of:

Tiêu đề	Ethics and Socially Responsible Marketing
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