Why Is It So Important That Managers, and People in General

question 103

Multiple Choice

Why is it so important that managers, and people in general, should act ethically and temper their pursuit of self-interest by considering the effects of their actions on others?

• A)because giving excessive importance to oneself with no consideration of societal interests leads to disaster for each individual and for the whole society because scarce resources are destroyed
• B)because ethical issues are seldom clear-cut, since the rights, self-interests, goals, and incentives of different stakeholders often conflict
• C)because a manager has no reluctance about communicating an ethical decision to people outside the company since the typical person in a society would think it is acceptable
• D)because if all companies make the right choices, all stakeholders will benefit in the long run

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Definitions:

Profit-Maximizing Number

The output level at which a business achieves the highest possible profit, determined by analyzing costs and revenue functions.

Profit-Maximizing Firm

A business entity that seeks to achieve the highest possible profits through its operations and strategies.

Wage Rate

The amount of money paid to a worker per unit of time (hour, day, etc.) in exchange for labor.

Marginal Revenue Product

The additional revenue generated from employing one more unit of a resource or factor of production.