UNIT 4

Question 1

Business Ethics

Answer 1

A set of rules or guidelines the management or individuals follow to make decisions for their company

Question 2

Centralized marketing strategy

Answer 2

When a company sells the same product worldwide with few or no modifications to the global brand

Question 3

Competitive advantage

Answer 3

The ability of a company to produce a product more cheaply than another, or when it has an edge over companies that make similar products

Question 4

Corporate social responsibility

Answer 4

The duty of a company’s management to work in the best interests of the society it relies on for its resources (human, material, and environmental) to advance the welfare of society, and to act as a good global citizen through its policies

Question 5

Cultural relativism

Answer 5

The values of different cultures should be respected, as the ethics of one culture are not seen as better than those of another, companies make decision in the context of the cultural values of the countries in which they are doing business

Question 6

Decentralized marketing strategy

Answer 6

When a company tailors marketing elements specifically to each country

Question 7

Discretionary income

Answer 7

The amount left after the necessities of life have been paid

Question 8

Demographics

Answer 8

Are studied by dividing a large market into age, gender, education, marital status, lifestyle and household formation

Question 9

Ethical imperialism

Answer 9

Certain universal truths or values are standard across all cultures, if something is wrong in one country it is wrong in all countries, includes domestic and international laws, the company’s code of ethics and corporate governance, and the personal values of the individual making the decision

Question 10

Ethnocentrism

Answer 10

a belief that your own culture, values, beliefs, and customs represent the right way of doing things, and that value systems of other countries are not important.

Question 11

Marketing

Answer 11

The sum total of all activities involved in getting goods and services from the original producer to the ultimate consumer, includes market research, products development, pricing, advertising and promotion, sales and logistics. The main purpose is to sell the output of production.

Question 12

Microcredit

Answer 12

The granting of very small loans-often as little as $100 to spur entrepreneurship. Money from private or corporate investors is used to start a small business

Question 13

Primary stakeholder

Answer 13

Stakeholders that directly affect the company and its profitability. They are of critical importance and their interests should be considered first. Customers, suppliers, competitors, and employees

Question 14

Resource depletion

Answer 14

Consumption of scarce or non-renewable resources

Question 15

Stakeholder analysis

Answer 15

Analyzes which stakeholders have the most power and influence in the decision-making process

Question 16

Subsidizing

Answer 16

Occurs when the importing of a good is helped through financial assistance from the foreign government e.g tax incentives

Question 17

Sweatshops

Answer 17

Factories in underdeveloped and developing countries where employees work in unsafe environments, are treated unfairly and have no chance to address these conditions

Question 18

Test of disclosure

Answer 18

“How would we feel if everyone knew about the
decision we made?” If they are not concerned, they
have likely made an ethical decision. If they are
concerned, they have probably not made the right
choice.

Question 19

Pricing for products sold internationally

Answer 19

Shipping costs, tariffs, exchange rates, insurance, travel costs for employees, lawyers, translations, culture consultants, packaging modifications

Question 20

Criticisms of corporate social responsibility

Answer 20

Costs companies money, which reduces profit, companies spend valuable time and employee energy on CSR instead they could concentrate on maximizing shareholders wealth, good corporate practices can be used to distract customers from problems a company may be creating, companies may use CSR to enhance their reputation with domestic customers but may not act ethically in other countries

Question 21

Benefit of corporate social responsibility

Answer 21

Companies use CSR as a marketing tool, dissuades governemnts from implementing regulations that might interfere with businesses, companies can attract and retain excellent employees if they have solid CSR practices

Question 22

5 Pricing strategies

Answer 22

Penetration pricing, price skimming, premium pricing, discount pricing, psychological pricing

Question 23

Penetration pricing

Answer 23

entering a market at a lower price than competition

Question 24

Price skimming

Answer 24

entering a market as a high price during the introductory phase

Question 25

Premium pricing

Answer 25

setting the price higher than the competition’s price to evoke an illusion of luxury and high quality

Question 26

Discount pricing

Answer 26

This strategy is often used in a B2B situation where the producer wants to sell high volumes to a wholesaler or retailer

Question 27

Psychological pricing

Answer 27

setting a price at $199 rather than $200 will sell more product

Question 28

4 P’S of marketing

Answer 28

Product, place, price promotion

Question 29

Ways to promote a product or service

Answer 29

Advertising, premiums (free goods offered with a purchase), coupons, point-of-purchasing, contests, personal selling, social media

Question 30

Ethical imperialism

Answer 30

Ethical imperialism: one set of values for all cultures, right and wrong are the same in all cultures, a person’s ethics are not situational
Cultural relativism: values are dependant on the culture, right and wrong depend on local values, when in Rome do as the Romans do