Question

ethics program and corporate social responsibility quiz

quiz instructions
this quiz contains 20 true/false questions worth 1 point each. you will have 30 minutes to complete the quiz.

question 1
level 3 business costs of ethical failure involves government fines and penalties.
true
false

Explanation:

Analyze the levels of costs of ethical failure

The costs of ethical failure in business are typically categorized into three levels:

• Level 1 Costs (Less visible, direct costs): Government fines, penalties, and administrative costs.
• Level 2 Costs (Indirect/administrative costs): Audit costs, legal and investigative fees, corrective actions, and public relations campaigns.
• Level 3 Costs (Intangible, long-term costs): Loss of reputation, loss of customer goodwill, employee turnover, and decreased morale.

Evaluate the statement

The statement asserts that "Level 3 business costs of ethical failure involves government fines and penalties." Since government fines and penalties are classified as Level 1 costs (the most direct and easily calculated costs), the statement is false.

Answer:

• True
• False (Correct answer)