Examination Paper of Business Ethics
IIBM Institute of Business Management 1
IIBM Institute of Business Management
Examination Paper MM.100
Business Ethics
Section A: Objective Type (30 marks)
• This section consists of Multiple Choice questions & Short Answer type questions.
• Answer all the questions.
• Part one questions carry 1 mark each & Part Two questions carry 5 marks each.
Part One:
Multiple Choices:
1. Term used to denote the existence of information of an electronic network of linked computer
system
a. Information technology
b. Nanotechnology
c. Cyberspace
d. None of the above
2. Egalitarianism is
a. Equal distribution of all benefits & burdens on peoples
b. Equal distribution of all benefits on people
c. Equal distribution of all burdens on people
d. None of the above
3. Justice of blaming or punishing persons for doing wrong is
a. Libertarianism
b. Compensatory justice
c. Retributive justice
d. Socialism
4. Markets in which each individual is able to voluntarily exchange goods with others
a. Restricted Markets
b. Free Markets
c. Open Markets
d. None of the above
5. The Marxist view of history as determined by changes in the economic methods by which
humanity produces the materials on which it much live
a. Alienation
b. Immiseration
c. Social Darwinism
d. Historical materialism
Examination Paper of Business Ethics
IIBM Institute of Business Management 2
6. Market in which a single firm is the only seller in the market and which new sellers are barred
from entering is
a. Pure monopoly
b. Oligopoly
c. Bipoly
d. None of the above
7. Oligopoly markets that are dominated by a few large firms
a. Highly concentrated market
b. Concentrated market
c. Imperfectly competitive market
d. None of the above
8. Ozone depletion is caused by release of
a. Sulfurdioxide
b. Chlorofluorocarbons
c. Carbondioxide
d. None of the above
9. The private internal costs and the wider external costs of engaging in a particular economic
activity
a. Private cost
b. Market cost
c. Social cost
d. None of the above
10. Acid rain occurs due to
a. Sulfur oxides
b. Nitrogen oxides
c. Both (a) & (b)
d. None of the above
Part Two:
1. Write short note on “Depletion of Minerals”?
2. Explain Oligopolistic Competition?
3. Write short note on “Immiseration of workers”?
4. What is Retributive Justice?
END OF SECTION A
Examination Paper of Business Ethics
IIBM Institute of Business Management 3
Section B: Caselets (40 marks)
• This section consists of Caselets.
• Answer all the questions.
• Each caselet carries 20 marks.
• Detailed information should form the part of your answer (Word limit 200 to 250 words).
Caselet 1
The stakes were high for Gene Elliot, whose on-the-job injuries were estimated to be serious enough
to merit at least a $2.4 million settlement. But who should pay for his injuries: Turner Construction
or B&C Steel? Or should he be forced to pay for at least part of his injuries because of his own
carelessness?
Gene Elliot worked for Mabey Bridge and Shore, a small business that rented temporary steel
pedestrian foot bridges to other companies. The temporary bridges had to be put together by the
renter, and Gene Elliot’s job was to go to the site where the steel bridge was going to be installed,
show the renter how to bolt the bridge sections together and how to install the bridge over a river or
waterway, and inspect the bridge to make sure it was done properly and according to Mabey
Bridge’s high standards. Elliot was a devoted hard worker who strove to do everything possible to
ensure that a bridge installation was successful and according to Mabey’s standards.
Turner Construction was a general contractor hired to build Invesco Field at the Mile High
Stadium in Denver, Colorado. Part of the job involved installing a temporary pedestrian bridge over
the Platte River near the stadium. Turner Construction subcontracted (hired) B&C Steel to build and
install the bridge, which Turner Construction would pay for. B&C Steel was a small company that
specialized in putting together and installing steel structures like those Mabey Bridge rented out.
B&C Steel would pick up the bridge, put it together, and install it for Turner.
Turner Construction rented the long steel bridge from Mabey Bridge. Mabey Bridge agreed that
the rental included the services of Gene Elliot, who would be loaned to Turner to instruct and inspect
the bridge assembly and installation. B&C Steel’s workers picked up the bridge sections from
Mabey Bridge’s warehouse and drove them to the river but didn’t unload the bridge sections where
they had to be assembled. B&C then had to move the sections to the correct site but didn’t plan for
the fence, guardrails, and trolley tracks that were in the way and later had to work around these
obstructions. B&C Steel began bolting the bridge sections together. When Elliot inspected the job,
he found the bridge had been bolted together upside down. Elliot made B&C do the job over, while
he climbed up and down and over the bridge, continuously checking and making sure that all the
bolts were tight and all the pieces were in the right place so that the installation would be a success.
When the bridge was finished, B&C workers used a truck to move the long steel structure to the
edge of the river. Unfortunately, B&C had not adequately checked the route and their truck hit a low
hanging power line, which sparked and started a fire. The fire department arrived and put out the
fire. Afterwards, the installation job continued.
B&C workers set up a crane on the other side of the river near a retaining wall, and a strong nylon
strap was strung from the crane, over the water, and tied to one end of the bridge, which was set on
rollers. The B&C crane would lift and pull the bridge over the river to its side, while workers on the
other side of the river pushed on their end of the bridge. The work began, and as the pulling crane
held the bridge suspended in the air about a quarter of the way over the river, Elliot noticed that the
retaining wall which was supporting the crane on the other side of the river was beginning to
collapse, causing the crane to begin to tip sideways. The B&C crane operator on the other side began
to untie the strap holding the bridge, Concerned that once the strap was cut the bridge would fall into
the river and the installation would end in failure, Elliot ran up on the bridge and gave the standard
Examination Paper of Business Ethics
IIBM Institute of Business Management 4
emergency OSHA all-stop signal that all construction workers know means not to move anything.
But the bridge, still attached to the crane, somehow moved, and Elliot felt, sustaining numerous
pelvic injuries and a severed urethra (the tube that carries urine). The cause of the movement was
never established.
Elliot sued Turner Construction and B&C Steel for negligence resulting in economic losses of
$28,000, noneconomic injuries of $1,200,000, and permanent impairment of $1,200,000. These
figures were established by a qualified expert in the field of worker injuries and were not seriously
contested.
Turner Construction, however, denied its responsibility. It claimed that Turner was Elliot’s
temporary employer and workers’ compensation law required employees to pay only the economic
looses, here only $28,000, suffered by their employees. Turner Construction pointed to the law,
which stated: “Any company leasing or contracting out any part of the work to any lessee or
subcontractor, shall be constructed to be an employer and shall be liable to pay [only] compensation
for injury resulting therefrom to said lessees and subcontractors and their employees.” Turner
Construction claimed that Mabey was a subcontractor to Turner, so Turner should be construed to be
Elliot’s temporary employer. Moreover, Colorado’s worker’s compensation law, which was
designed to ensure that employers always paid for workers injuries “grants an injured employee
compensation from the employer without regard to negligence and, in return, the responsible
employer is granted immunity from common law negligence liability.”
B&C claimed that it, too, was not responsible, because according to the law a company is not
responsible for negligence when an injury is not “reasonably foreseeable” to the company. B&C
contended that a reasonable person could not have anticipated that placing the crane near to the
retaining wall and subsequently attempting to remove the nylon strap holding up the bridge might
end by prompting someone to get on the bridge in an attempt to save it from falling into the river. On
the other hand, B&C claimed, since “Elliot chose to remove himself from a secure and safe position
and placed himself in one that he understood was potentially unsafe,” Elliot was himself responsible
for his injuries.
Elliot claimed that he was not really Turner’s employee, since he was working for Mabey. He
also argued that B&C had shown a pattern of negligence from the time that the bridge was received
until the time that it was installed. B&C and its employees, he said, were unprepared for the project
and negligently failed to adequately plan for it, as shown by the sequence of events leading up to his
injury. B&C there fore did not exercise the degree of care that a reasonably careful person should
have exercised in similar circumstances and so was liable to him for his injuries. He himself was not
responsible, he said, because good, devoted employee would try his best to ensure that the bridge
installation did not end in failure, and he would have been perfectly safe if the standard OSHA allstop
signal had been followed by B&C employees, as he had a right to expect it to be.
1. In your judgement, and from an ethical point of view, should Turner Construction and/or B&C
Steel pay for all or part of the $2,428,000 (if part, indicate which part)? Explain your view?
2. In your judgement, is the Colorado worker’s compensation law to which Turner Construction
appealed fair? Explain your view?
Caselet 2
Although many people believe that the World Wide Web is anonymous and secure from censorship,
the reality is very different. Governments, law courts, and other officials who want to censor,
examine, or trace a file of materials on the Web need merely go to the server (the online computer)
where they think the file is stored. Using their subpoena power, they can comb through the server’s
drives to find the files they are looking for and the identity of the person who created the files.
Examination Paper of Business Ethics
IIBM Institute of Business Management 5
On Friday June 30, 2000, however, researchers at AT & T Labs announced the creation of
Publius, a software program that enables Web users to encrypt (translate into a secret code) their files
– text, pictures, or music – break them up like the pieces of a jigsaw puzzle, and store the encrypted
pieces on many different servers scattered all over the globe on the World Wide Web. As a result,
anyone wanting to examine or censor the files or wanting to trace the original transaction that
produced the file would find it impossible because they world have to examine the contents of dozens
of different servers all over the world, and the files in the servers would be encrypted and fragmented
in a way that would make the pieces impossible to identify without the help of the person who created
the file. A person authorized to retrieve the file, however, would look through a directory of his files
posted on a Publius-affiliated website, and the Publius network would reassemble the file upon
request. Researchers published a description of Publius at www.cs.nyu.edu/waldman/publius.
Although many people welcomed the way that the new software would enhance freedom of
speech on the Web, many others were dismayed. Bruce Taylor, an antipornography activist for the
National Law Center for Children and Families, stated: “Its nice to be anonymous, but who wants to
be more anonymous than criminals, terrorists, child molester, child pornographers, hackers, and email
virus punks?” Aviel Rubin and Lorrie Cranor, the creators of Publius hoped, however, that their
program would help people in countries where freedom of speech was repressed and individuals were
punished for speaking out. The ideal user of Publius, they stated, was “a person in China observing
abuses of human rights on a day-to-day basis.”
1. Analyze the ethics of marketing Publius using utilitarianism, rights, justice, and caring. In your
judgement, is it ethical to market Publius? Explain?
2. In your judgement, should the U.S. government allow the implementation of Publius? Why or
why not?
END OF SECTION B
Section C: Applied Theory (30 marks)
• This section consists of Long Questions.
• Answer all the questions.
• Each question carries 15 marks.
• Detailed information should form the part of your answer (Word limit 150 to 200 words).
1. What is utilitarianism and what are its benefits in business?
2. How market approach to consumer protection benefits consumer?
END OF SECTION C
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