Assessment Questions

9.1 Entrepreneurship and Start-Up Culture

The atmosphere surrounding entrepreneurs and their start-ups can provide a dizzying rush. The opportunities to create a company, be your own boss, make a dramatic impact on business, establish an entrepreneurial culture that will be adopted by others, and possibly become rich in the process certainly all appeal to our human nature. Still, the entrepreneurial lifestyle is challenging, and the success rate for start-ups is exceptionally low. Interpersonal conflicts are prevalent in start-up environments, and entrepreneurs who seek to stay true to their vision and ethical values face a difficult road. At many points, start-up founders have to choose how they most wish to be remembered: for the sake of their business success alone or also for the ethical fashion in which they attained that success and the humane culture they have embedded in their new firm. Sometimes these are mutually exclusive goals, but the most ethical entrepreneurs do their best to ensure that both objectives mesh for themselves and their firms. This lies at the heart of any definition of ethical leadership.

9.2 The Influence of Advertising

The Internet and social media present new canvasses for marketing that possess great power and for which rules and ethical norms are being developed. Psychological appeals and subliminal messaging present their own ethical issues. Discerning consumers currently must rely on their own sensibility to ferret out factual claims for advertised products and bear the burden of shielding those under their charge from the worst manipulative effects of marketing.

9.3 The Insurance Industry

Business owners and individuals are willing to pay insurance premiums in the hope that they will never have to be file a claim for reimbursement on their policy. Because the insurance industry profits only when claims are few and small, there may be a bigger role for government to play in managing disaster insurance through a private/public partnership, such as FEMA currently does to provide flood insurance and the California Earthquake Authority does where potentially disastrous earthquakes may occur. Ethical issues such whether to expand the use of public tax revenues to subsidize these partnerships need to be resolved.

9.4 Ethical Issues in the Provision of Health Care

The United States, unlike countries in Europe, has little tradition of merging the efforts of the state or federal government with that of private employers in the provision of health care. Although the quality of U.S. health care has rarely been challenged, its limited accessibility has posed ethical quandaries for business because many employees necessarily look to their employers for this benefit. The 2010 Affordable Care Act is an ambitious effort to meet the need for health care for all. Individual states have considered, and sometimes enacted, programs of their own to supply universal health care.

1 . What characteristic is common to most entrepreneurs? a. an advanced degree b. deep management experience c. a driven, highly competitive nature d. a large network of business contacts 2 . Entrepreneurs are usually motivated by the teamwork spirit. a. True b. False 3 . Corporate culture comes from ________. a. the commitment of the company's employees b. the founder's idea of what the work environment should be like c. government regulations about labor relations d. the nature of the company’s product or service 4 . One danger a growing start-up can face is ________. a. encroaching bureaucracy b. lack of good employees c. legal issues d. venture capitalists 5 . The phrase caveat emptor means the seller is principally responsible for purchase decisions, not the buyer. a. True b. False 6 . Children are discerning viewers of television advertising. a. True b. False 7 . Psychological appeals succeed when they ________. a. make consumers feel better about themselves b. let consumers compare themselves to their peers c. show consumers how to save money d. introduce new products 8 . Even rational adults often fail to cast a suspicious eye to sophisticated ad pitches and end up making frivolous purchases. a. True b. False 9 . Should insurance coverage be mandatory for in some U.S. areas, such as hurricane coverage in the Southeast, tornado coverage in the Midwest, earthquake coverage on the Pacific Coast? Why or why not? Should government subsidies help underwrite the cost of this coverage? Why or why not? 10 . How prevalent has redlining been in the United States? 11 . Premium rates for insurance coverage are based on statistical calculations of the historical rate of incidence of certain kinds of accidents, disasters, and theft, among other calamities against which we insure ourselves. Is this the most equitable way to assign these rates? Why or why not? 12 . Business insurance is a relatively recent offering. a. True b. False 13 . Insurance coverage offers a benefit we hope never to claim. a. True b. False 14 . Employer-sponsored wellness programs have no downsides for employees. a. True b. False 15 . Most European countries have multipayer health care systems like the United States. a. True b. False 16 . In the European tradition, the main responsibility for supplying workers with health care lies with which of these groups? a. the government and labor unions b. labor unions c. nonprofit agencies and private companies d. individual workers 17 . A job setting in which an employee gym and a snack bar featuring healthy foods and beverages were perks would benefit which of these groups? a. the owners/managers b. the customers or clients of the firm c. the employees d. all the above 18 . Could an ethical case be made for managers dictating that employees adopt or avoid certain lifestyle practices (e.g., legally consuming cannabis) even when they are off the job? What would that argument be? What ethical counterarguments could be made?