Social Responsibility and Business International Edition 4th Edition – Test Bank

a.

keep prices of products low so that all consumers can purchase convenience and luxury goods.

b.

create more jobs.

c.

encourage larger companies to conduct business in many other countries.

d.

provide laws based on the Constitution and Bill of Rights and enforce those laws through the judicial system.

e.

encourage competition by providing economic support to smaller companies in order to be competitive with powerful companies.

a.

legal and regulatory systems are constantly evolving and changing in response to social institutions, including business.

b.

the “invisible hand of competition” has replaced many business and economic regulations.

c.

companies do not have to worry about meeting every law and regulation, since they are likely to change.

d.

self-regulatory mechanisms have created less of a need for government oversight.

e.

the costs of business regulation have decreased.

a.

Monopoly

b.

Lower prices due to that company’s efficiency

c.

Oligopoly

d.

Trust

e.

Deregulation

a.

Collaborating with a competitor to establish prices so that each firm can ensure a certain level of profit

b.

Obtaining information through ethical competitive intelligence practices

c.

Using a “bait and switch” method for selling products to customers

d.

Lowering prices significantly in an effort to drive competitors out of a market, and then raising prices afterwards

e.

Stealing competitors’ trade secrets

a.

Most companies eagerly pay for the costs involved with protecting their environment because they realize their future is closely linked with the future of the environment.

b.

Consumers have willingly footed the bill for the costs of protecting the environment through paying higher prices for products and services.

c.

Companies have felt pressured to “voluntarily” pay for environmental protection acts because they are afraid of the impact on their businesses if they are not viewed as environmentally responsible organizations.

d.

Social reasons have led to regulations such as environmental protection and preservation because, although most companies voluntarily take on these responsibilities, a few companies have shirked their share of the responsibility.

e.

Social reasons have led to regulations such as environmental protection since most companies are unwilling to pay for these costs voluntarily.

a.

Pharmaceuticals

b.

Defense

c.

Food

d.

Automobile

e.

Toy

a.

Sherman Antitrust Act

b.

Clayton Antitrust Act

c.

Federal Trade Commission Act

d.

Anti-Monopoly Act

e.

Roosevelt Antitrust Act

a.

It created an organization to protect consumers and businesses from unfair competition.

b.

It limited mergers and acquisitions that have the potential to stifle competition.

c.

It provided specific exemptions to utility and other similar industries, which tend to have natural monopolies due to the exorbitant costs involved with starting up.

d.

The Clayton Act actually made most of the provisions of the Sherman Antitrust Act null and void rather than expanding on the earlier legislation.

e.

It specified that one person could be a member of only three boards of directors within the same industry.

a.

The FTC can issue a formal complaint stating that a firm is in violation of the law.

b.

The FTC can issue a cease-and-desist order that requires a company to stop engaging in a specified illegal behavior.

c.

The FTC can file criminal charges against companies that break antitrust laws.

d.

The FTC can seek civil penalties against an offending company.

e.

The FTC helps to resolve complaints and issues rulings on areas of emerging concern in business.