Environmental and ethical issues

Question 1

Social responsibility

Answer 1

is when a business decision benefits stakeholders other than shareholders, for example, a decision to protect the environment by reducing pollution by using the latest and ‘greenest’ production equipment

Question 2

Enviornment

Answer 2

is our natural world including, for example, pure air, clean water and undeveloped countryside.

Question 3

Global warming

Answer 3

is a gradual increase in the overall temperature of the earth’s atmosphere, generally through the increase of CO2.

Question 4

Pressure groups

Answer 4

is made up of people who want to change business decisions by taking actions, such as organizing consumer boycotts

Question 5

Private costs

Answer 5

of an activity are the costs paid for by a business or the consumer of the product

Question 6

Private benefits

Answer 6

of an activity are gains to a business or consumer of the product

Question 7

External costs

Answer 7

are costs paid for by the rest of the society, other than the business, as a result of business activity.

Question 8

External benefits

Answer 8

are the gains to the rest of society, other than the business, as a result of business activity

Question 9

Social cost

Answer 9

= external costs + private costs

Question 10

Social benefit

Answer 10

= external benefits + private benefits

Question 11

Sustainable development

Answer 11

is development is development which does not put at risk the living standards of future generation.

Question 12

How can businesses achieve sustainability

Answer 12

• Use renewable energy
• Recycle waste
• Use fewer resources
• Develop new environmentally friendly products and production methods.

Question 13

Consumer boycott

Answer 13

is when consumers decide not to buy products from businesses that do not act in a socially responsible way

Question 14

Ethical decisions

Answer 14

are based on moral code, referred to as ‘doing the right thing’