Ethics and environment 2.2

Question 1

What is ethics?

Answer 1

whether a business decision is thought to be morally right or wrong.

Question 2

What determines a business ‘ethical’?

Answer 2

donating profits to charity, setting up branches in places of unemployment to create jobs, avoiding targeting children, setting reasonable prices, designing products with less environmental impact, buying from ethical suppliers, making recyclable products

Question 3

The effect of being ethical

Answer 3

lower profit, higher cost, more consideration and investing into market

Question 4

what is traffic congestion

Answer 4

occurs when the volume of vehicles using a road is such that queues and delays result

Question 5

What is external cost?

Answer 5

arises when a business’s activities result in harmful effects on other people not directly involved in production

Question 6

What environmental considerations might a business have?

Answer 6

traffic congestion, air and noise pollution, the use of scarce resources, global warming, disposal of waste, methods of transport

Question 7

advantages of ethics?

Answer 7

• charge higher prices for their products (more profit for business)
• helps a business to win new customers by being different from competition
• positive publicity from environmental reporting

Question 8

what are the disadvantages of ethics?

Answer 8

increase costs due to expensive supplies and higher wages

have to ensure that they stay ethical throughout their existence to keep receiving good publicity