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1. BUS 309 Week 10 Quiz – Strayer
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Quiz 9 Chapter 10
Moral Choices Facing Employees
MULTIPLE CHOICE
1. Based on guidelines of employer/employee relations, which statement is true?
a. company loyalty is an outmoded,
illegitimate concept that employees today
reject
b. the traditional law of agency obliges
employees to act loyally and in good faith
and to carry out lawful instructions
c. an employee's work contract is irrelevant
to his or her moral obligations
d. no value is more important than loyalty,
whether to a person or an organization
2. Conflicts of interest
a. have become less frequent today.
b. always involve personal financial gain.
c. are morally worrisome only when the
employee acts to the detriment of the
company.
d. occur when employees' private interests
are substantial enough to potentially
interfere with their job duties.
3. According to the Supreme Court,
a. there is nothing improper about an
outsider’s using information, as long as
the information is not obtained from an
insider who breaches a legal duty to the
corporation’s shareholders.
b. anyone buying/selling stock based on
nonpublic information is guilty of inside
trading.
c. insider trading violates the interstate
commerce clause of the Constitution.

2. d. it should be left up to the company, not
the government, to decide whether or not
to prohibit insider trading.
36
4. A "trade secret"
a. is legally equivalent to a patent or
copyright.
b. need not be treated confidentially by the
company in order to be protected.
c. can become part of an employee's
technical knowledge, experience, and
skill.
d. is a narrow, precise concept that the law
defines in great detail.
5. The Foreign Corrupt Practices Act (FCPA)
a. doesn't apply to countries where bribery is
common.
b. is alleged by its critics to put American
companies at a disadvantage.
c. carefully distinguishes bribery from
extortion payments.
d. outlaws "grease payments".
6. In determining the morality of giving and receiving gifts in a business situation,
which of the following factors is MOST relevant?
a. the purpose of the gift
b. the size of the business
c. amount of the cash
d. whether the company is privately held or
publicly held
7. A whistle-blower
a. doesn't have to be a past or present
member of the organization.
b. doesn't have to report activity that is
illegal, immoral, or harmful.
c. is any employer who spreads gossip.
d. far from being disloyal, may be acting in

3. the best interest of the organization.
8. The Sarbanes-Oxley Act
a. makes it easier to fire whistle blowers.
b. reduces the law's protection of employees
who disclose securities fraud.
c. makes it illegal for executives to retaliate
against employees who report possible
violations of federal law.
d. provides penalties for blowing the whistle
illegitimately or maliciously.
9. According to Professor Norman Bowie, which of the following factors is relevant to
determining the morality of blowing the whistle?
a. the whistle blower's motive
b. whether internal channels have been
exhausted
c. whether the whistle blowing has some
chance of success
d. all of the above
10. In discussing the case of the truck stop cashier who is asked to write up phony chits or
receipts, the text argues that
a. there is nothing wrong with writing up the
chits.
b. she should resign immediately.
c. she may be justified in "going along," at
least temporarily.
d. morality never requires us to sacrifice our
own interests.
11. In the 1997 case of U.S. v. Hagan, the Supreme Court found that Hagan
a. had been discriminated against because of
whistle blowing.
b. was innocent of insider trading.
c. violated the FCPA despite never having
gone overseas.
d. had misappropriated confidential
information.

4. 12. The Donald Wohlgemuth case shows that
a. trade secrets can be patented.
b. trade secrets often become an integral part
of an employee's total job skills and
capabilities.
c. employees need to divest themselves of
any skill acquired while handling trade
secrets.
d. "noncompete" or "nondisclosure"
contracts are always legally valid.
13. Some writers deny that employees have any obligation of loyalty to the company,
because
a. companies are not the kind of things that
are properly objects of loyalty.
b. you cannot trust anyone.
c. it’s every man for himself.
d. companies just aren’t the same any more.
14. When an employee’s interests are likely to interfere with the employee’s ability to
exercise proper judgment on behalf of the organization, what exists?
a. a golden
opportunity
c. a balance of power
b. a conflict of interest d. a disaster
15. Insider trading is
a. the buying or selling of stocks (or other
financial securities) by business “insiders”
on the basis of information that has not
yet been made public and is likely to
affect the price of the stock.
b. a corporate merger.
c. knowing when to make the best buy.
d. giving great advice on a deal.
16. Inside traders ordinarily defend their actions by claiming that they don’t injure
a. the boss. b. their
family.
c. the
Presiden
t.
d. anyone.

5. 17. Shaw and Barry mention three arguments for legally protecting trade secrets. Which
of these is one of them?
a. Trade secrets are the intellectual property
of the employee who developed them.
b. Employees who disclose trade secrets
violate the confidentiality owed to their
employers
c. Trade secrets are patented.
d. Trade secrets are trademarked.
18. U.S. companies have a history of paying off foreign officials for business favors.
Such acts were declared illegal by
a. the U.S. Customs department.
b. the Vice President.
c. the Foreign Corrupt Practices Act (FCPA)
of 1977.
d. the United Nations.
19. To resolve difficult moral dilemmas, the better we understand the exact ramifications
of the
alternatives—the more likely we are
a. to make a sound
moral decision.
c. to be a success.
b. to drive the boss
crazy.
d. to go to jail.
20. Whistle-blowing involves exposing activities that are
a. sports related. c. too close to call.
b. immoral or illegal. d. boring and need
some excitement.
21. Whistle-blowers are only human beings, not saints, and they sometimes have their
own
a. salary. c. bandwagon.
b. self-serving agenda. d. office.

6. 22. Which act provides sweeping new legal protection for employees who report possible
securities fraud, making it unlawful for companies to “discharge, demote, suspend,
threaten, harass, or in any other manner discriminate against” them?
a. Sarbanes-Oxley Act
of 2002
c. Economic
Espionage Act
b. Foreign Corruption
Act
d. U.S. vs. O’Hagan
23. Conflicts of interest may exist when employees have financial investments
a. in suppliers, customers, or distributors
with whom their organizations do
business.
b. in sports teams.
c. and question the wisdom of the deal.
d. that lead to office romance.
24. The use of one’s official position for what always raises moral concerns and
questions?
a. power trips c. stepping stones to
success
b. egos d. personal gain
25. Experimental studies suggest that when informed that the advice they’re receiving
may be biased because of a conflict of interest,
a. those who disclose a conflict of interest
rarely end up giving more biased advice
than those who do not disclose
b. those who disclose a conflict of interest
always end up giving more biased advice
than those who do not disclose
c. People tend to fail to discount the advice
as much as they should.
d. people tend to discount the advice as
much as they should.
TRUE/FALSE
1. An employee can have a conflict of interest even if he or she doesn't act to the
detriment of the organization.

7. 2. Insider trading is the buying or selling of stocks by insiders on the basis of
information attained by an “insider” that has not yet been made public and is likely to
affect the price of the stock.
3. The law precisely defines the concept of a trade secret, just as it does patents and
copyrights.
4. A kickback is a kind of bribe.
5. By definition, whistle-blowing can only be done by a past or present member of the
organization.
6. Prudential reasons are reasons that refer to the interests of others and the demands of
morality.
7. All gifts are bribes.
8. According to Norman Bowie, whistle blowing can never be justified because it
involves violating one's duties to the organization.
9. A bribe is remuneration for the performance of an act that's inconsistent with the work
contract or the nature of the work one has been hired to perform.
10. The Supreme Court has rejected the idea that inside trading involves
"misappropriating" confidential information.
11. A conflict of interest arises when an employee has private interests that are substantial
enough to potentially interfere with his or her job duties.
12. The Foreign Corrupt Practices Act (FCPA) outlaws grease payments.
13. A common argument against the Foreign Corrupt Practices Act is that it illegitimately
imposes parochial American standards on foreign countries.
14. Employees have no obligations to people with whom they have no business relations.
15. As a general rule, if the contents of the work agreement that exists between the
employee and the employer are legal and if the employee freely consents to them,

8. then the employee is under an obligation to fulfill the terms of the agreement.
16. Sometimes companies require employees to sign contracts restricting their ability to
get a job with, or start, a competing company. Because they can conflict with freedom
of employment, not all such “noncompete” or “nondisclosure” contracts are legally
valid.
17. Justice Ginsberg and Arthur Levitt suggest that allowing insider trading could lead to
a widespread perception that “the game is rigged.”
18. The Foreign Corrupt Practices Act of 1977 forbids companies to pay kickbacks in the
United States, but permits them to pay kickbacks to companies outside the United
States.
19. Employees have certain general duties to their employers, and because of the specific
business, professional, or organizational responsibilities they have assumed, they may
have other more precise role-based obligations.
20. When faced with a moral decision, employees should follow the two-step procedure
of identifying the relevant obligations, ideals, and effects; and then decide where the
emphasis should lie among these considerations.
21. According to one expert's definition, whistle blowing is conceptually restricted to
reporting on activities that are harmful to third parties, violations of human rights, or
contrary to the public purpose and legitimate goals of the organization.
22. According to Norman Bowie, a discussion of whistle blowing in the 1990s parallels
the discussion of civil disobedience in the 1960s.
23. Prudential reasons are those moral reasons that are separate from self-interest.
24. According to Jennifer Moore the real reason insider trading should be prohibited is
that it undermines the fiduciary relationship that is at the heart of business
management.
25. The Sarbanes-Oxley Act weakened legal protections for whistle blowers.
SHORT ANSWER

9. 1. When does a conflict of interest arise?
2. What is insider trading?
3. Name an argument that's given against legalizing insider trading?
4. How do trade secrets differ from information that is patented or copyrighted?
5. What are the main features of the 1977 Foreign Corrupt Practices Act (FCPA)?
6. Name an argument given against foreign forms of bribery.
7. There are at least seven factors to take into consideration in determining the morality
of giving and receiving gifts in a business situation. Explain three of them.
8. What is whistle-blowing, and what motivates whistle-blowers?
9. According to Norman Bowie, whistle-blowing is morally justified only if five criteria
are met. What are these five criteria?
10. What is a key lesson to be learned from the example of the cashier at a truck stop who
is asked by her manager to provide the truckers with phony chits so they can get a
larger reimbursement from their companies?
ESSAY
1. How do we know when whistle-blowing is morally right or wrong? Justify your
answer.
2. Consider Coleen Rowley who blew the whistle against the FBI. How could we justify
the fact that she did the right thing? Consider at least two different moral theories.

10. 3. When, if ever, are employees overly disloyal for getting a job for a competing
organization? Justify your answer.
4. If all the other businesses in a foreign country are providing a “grease payment” for
border patrol. Is it all right and ethical to do that? State and defend your answer.
5. Provide an example of an abuse of an official position. Justify your answer.