Business/Value
Mod #1
Mod #1
What is one of Porter's Five Forces?
Supplier power
What is a market structure with a small number of firms dominating the market share?
Oligopoly
What is an example of a principal-agent problem?
Taking your car to be fixed by a mechanic
What characterizes the U.S. shareholder oriented model?
Focus on shareholder value
What results in Ethical Fading?
Unconscious unethical behavior
What is looked at in SWOT analysis?
Strengths, weaknesses, opportunities, threats
What is an example of a platform market that brings together buyers and sellers?
Uber
Why is governance less visible in a sole proprietorship than in firms with shareholders?
Owner directly manages decisions, aligning incentives naturally
What are examples of secondary stakeholders?
Government agencies, unions, media, local communities
What does Aristotle’s virtue ethics prioritize?
Rational pursuit of personal excellence
What would it be called if I bought shoes for $50 and sold them for $300?
Arbitrage
What do consumers and producers in capitalist systems need to negotiate to function best?
Their mutual advantage
Who (other than shareholders) is likely to be affected by poor corporate governance?
Employees, customers, suppliers, communities, etc
Which groups are considered primary stakeholders?
Customers, suppliers, employees
What often undermines utilitarian decision-making in businesses?
Favoring short term benefits
What is the name of the set of accounting rules US companies must follow?
GAAP
What is needed for a market to function well?
Robust competition & perfect information
What are key activities undertaken by a company's Board of Directors?
Reviewing important financial decisions, including capital investments, M&A
Whose POV is it if ethics is integrated into the foundation of a businesses' value creation?
Freeman
Which company faced criticism for calculating the cost of lawsuits versus fixing fuel tank issues in the Pinto model?
Ford
What is the discounting formula?
PMT/[(1 + i)^t]
What limits output and raises prices?
Collusion
What type of model when a single board of directors oversees management and hires the CEO?
One-tier (unitary)
What does Friedman argue is the potential danger of businesses focusing on social responsibilities?
Undermine free society by expanding collectivist practices
Which decision-making system is more likely to lead to ethical behavior?
System 2