Chapter 4

Question 1

Ethics

Answer 1

Standards of moral behavior; that is, behavior accepted by society in general, as right versus wrong.

Question 2

Whistleblower

Answer 2

Inside person who reports illegal or unethical behavior.

Question 3

Corporate Social Responsibility

Answer 3

A business’s concern for the welfare of society. It is based on a commitment to integrity, fairness, and respect, and proponents argue that businesses owe their existence to the societies they serve and cannot exist in societies that fail.

Question 4

Insider Trading

Answer 4

An unethical activity in which insiders use private company information to further their own fortunes or those of their family and friends. This highly unethical behavior does financial damage to a company and investors are cheated.

Question 5

Social Audit

Answer 5

A systematic evaluation of an organization’s progress toward implementing socially responsible and responsive programs.

Question 6

Ponzi Scheme

Answer 6

A form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors.