7 - Common Unethical Practices of Business Establishments

Question 1

2 types of unethical problems of business establishments

Answer 1

1. Misinterpretation
2. Over-persuasion

Question 2

Actively misrepresenting about the product or customers

Answer 2

Direct Misinterpretation

Question 3

Placing the product in containers of exaggerated sizes to give false impression of its actual contents; only filled up to 85-95% of their capacity

Answer 3

Deceptive Packaging

Question 4

Practice of making false statements on the label of a product making its container similar to a well-known product

Answer 4

Misbranding

Question 5

Greatly exaggerates the virtues of a product and tells only half of the truth.

Answer 5

False Advertising

Question 6

Useful purpose if it conveys the right information; principal means by which people are informed about the availability.

Answer 6

Advertising

Question 7

Unethical practice of debasing a pure or genuine commodity by imitating or counterfeiting it.

Answer 7

Adulteration

Question 8

Mechanism of the weighing scale is tampered so that the scale registers more than the actual weight.

Answer 8

Short weighing

Question 9

Measurement is shorter than the real length or smaller in volume than the standard.

Answer 9

Short measurement

Question 10

Seller gives customer less than the number ask or paid for

Answer 10

Short numbering

Question 11

Omitting unfavorable information about the product or service

Answer 11

Indirect Misinterpretation

Question 12

Means “let the buyer beware”

Answer 12

Caveat emptor

Question 13

Seller is not obligated to reveal any defect in the product; it is the responsibility of the customer to determine for himself

Answer 13

Caveat emptor

Question 14

Deliberate withholding of significant info; no business transaction is fair where one of the parties does not exactly know what he is giving away or receiving in return

Answer 14

Deliberate Withholding of Information

Question 15

Contributes to the impression that businessmen are liars and are out to make a fast buck.

Answer 15

Passive deception

Question 16

Unable to provide the customer with the complete information that they need to make a fair decision

Answer 16

Business ignorance

Question 17

Process of appealing to the emotions of a prospective customer and urging him to buy an item; necessary in the selling of goods if done in the interest of a buyer

Answer 17

Persuasion

Question 18

Persuasion used for the sole benefit of selling a product without considering the interest of the buyer is not ethical

Answer 18

Over-Persuasion

Question 19

2 types of unethical practices of corporate management

Answer 19

1. practices of the BOD
2. practices of executive officers

Question 20

BOD help themselves to the earnings that otherwise would go to other stockholders

Answer 20

Plain Graft

Question 21

Often practiced by a person who holds directorial positions in 2 or more corporation that do business with each other and may involve conflict or interest and can result to disloyal selling.

Answer 21

Interlocking Directorship

Question 22

Happens when this person is compelled to decide which of the two corporation’s interest should be protected or upheld.

Answer 22

Disloyal selling

Question 23

When they fail to attend board meetings regularly; non-attendance of board meetings could result to betrayal of trust of the parties who elected them to their positions

Answer 23

Negligence of Duty

Question 24

Involved trading in a public company’s stock by someone who has non-public material information

Answer 24

Insider Trading

Question 25

Insider trading is ____ if material information is still non-public

Answer 25

Illegal

Question 26

Any information that could substantially impact on investor's decision to buy or sell the security

Answer 26

Material non-public information

Question 27

Insider trading is ____ when directors purchase or sell shares but disclose their transactions legally

Answer 27

Legal

Question 28

President or Vice President reports his personal vacation as a business trip so he can get reimbursement for his expenses

Answer 28

Claiming a vacation trip to be a business trip

Question 29

Ask company employees to do personal things for them on company time

Answer 29

Having employees do work unrelated to the business

Question 30

Managers do not provide adequate controls to discourage employees from engaging in unethical practices.

Answer 30

Loose or ineffective controls

Question 31

Unfair labor practices committed by employer

Answer 31

Unfair labor practices

Question 32

Employers claim non-existent losses so they can be exempted from paying minimum wage required by law.

Answer 32

Making false claims about losses to free themselves form paying the compensation and benefits provided by law.

Question 33

Committed by a person having authority over another

Answer 33

Sexual Harassment

Question 34

Arises when employee who is duty bound to protect interests of his employer violates this obligation by getting himself into situations where his decision is influenced by what he can gain personally from it.

Answer 34

Conflicts of Interest

Question 35

Dishonest acts

Answer 35

Dishonesty