The Entrepreneur Can Implement and Maintain Ethical Standards By

question 135

Multiple Choice

The entrepreneur can implement and maintain ethical standards by:

• A)performing periodic ethical audits.
• B)making examples of clearly visible violators.
• C)handing down a strict code of ethics established by upper management.
• D)doing all of these.

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Definitions:

Negative Externalities

Negative effects or costs that are incurred by third parties as a result of economic activities, for which they are not compensated, such as pollution.

Equilibrium

Equilibrium represents a state of balance where there is no net tendency for change, often used to describe the point at which market supply and demand balances each other.

External Benefits

Positive effects that an activity or transaction has on individuals or entities who are not directly involved in the activity, often justifying government intervention or subsidies.

Allocative Efficiency

A state of resource allocation where resources are distributed according to consumer preferences, leading to optimal production levels and pricing.