The Controller of One Division of IntroTel, a Large Diversified

question 111

Essay

The controller of one division of IntroTel, a large diversified firm is compensated by salary plus bonus. The bonus is a significant part of total compensation and is based directly on the profits of the division. Thus, the controller has an incentive to find ways to increase profits, including the delay of discretionary expenses such as research and development, delay of maintenance and repair of manufacturing equipment, and delay of sales promotions.
Is finding ways to increase profits as described above unethical? Why or why not? Who is to blame, if anyone?

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Definitions:

Working Memory

The part of short-term memory that is concerned with immediate conscious perceptual and linguistic processing.

Monitor

A device or individual that observes, checks, and keeps a continuous record of a process or situation.

Sensory Memory

The shortest-term element of memory, it allows the ability to retain impressions of sensory information after the original stimuli have ended.

Limited-Capacity

The concept that there is an upper limit on the amount of information or number of tasks that an individual can process or perform at one time.