You Have a Friend Who Tells You That Ethics Are

question 55

Essay

You have a friend who tells you that ethics are completely unimportant in business since a number of laws have been set up for us to know the rules of the game. Please discuss.

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Definitions:

Allocative Efficiency

The apportionment of resources among firms and industries to obtain the production of the products most wanted by society (consumers); the output of each product at which its marginal cost and marginal benefit are equal, and at which the sum of consumer surplus and producer surplus is maximized.

Marginal Costs

The additional cost incurred by producing one more unit of a good or service, crucial for making production and pricing decisions.

Marginal Benefits

The incremental satisfaction or benefit a consumer derives from consuming an additional unit of a good or service.

Net Benefits

The total benefits of a decision or project after subtracting all the costs associated with it.