Question

0/1 pts incorrect Question 10 The maximum acceptable standard for ethical behavior is compliance with the law True False Quiz Score: 8 out of

Answer 1

Question 10 - False

There are three levels of ethical behaviour. They are

1. Compliance with the law ( of all the places where the organisation operates)

2. Compliance with the policies and procedures of the organisation/ institution (including relationships with vendors, non discriminatory hiring practices, sexual harassment issues, etc.)

3. Upholding ethical values of the individual - the highest standard of ethical behaviour. For example, when an organisation supports the moral values and ethical behaviour by all its employees by ethical policies and guidelines, positive incentives and appreciation for ethical actions, leading by example, etc

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Question 2 - Fast Food Corporation - Operators, owners, suppliers, the society or community as a whole

In a business environment, the decisions of a business impacts all its stakeholders. The stakeholders are all the persons or organisations or law enforcement agencies which deal with the business entity. They include Customers, suppliers, owners, operators, tax department, society, etc.

Suppose, the Fast food corporation decides to stop selling french fries, as there is a rising awareness of the adverse impacts of french fries leading to obesity, cholestrol, etc. The Corporation does not want its other food items' business to get affacted because of the French fries. So, it decides to discontinue french fries, while promising the customers that the corporation will bring a healthier option soon.

Thus, it will have direct positive impact on food habits of the Society (assuming the Corporation is a Food Giant).

The Suppliers of raw material for french fries will be adversely affected.

The operators will have to discard the specific equipments used for making french fries, or have to put it in store for possible future use. Their revenues will also get affected as they won't be able to sell french fries from now onwards.

The owners will stand to lose earnings due to less sales in short term, but will surely gain in the long term.

Lesser revenues in the short term will mean less taxes paid.

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Question 2 - Lesser Protection than Political speech

First Amendment to the US Constitution says - Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

While political speech is mostly not regulated, Commercial speech is regulated by Central Hudson gas test and FTC. In the Central Hudson Gas & Electric Corp. v. Public Service Commission(1980), the Supreme Court developed a four part test to determine whether the commercial speech violates the First Amendment. Also, the Federal Trade Commission (FTC) regulates commercial spech, such as advertisements, so that consumers are not misleaded by false claims and ads.