EXAMINATION 1

EXAMINATION 1

Name:

Institutional Affiliation:

Chapter One

This century the United States has bailed out certain industries and companies; such as insurance, banking and part of the auto industry. Some said that this changed our society from a capitalistic society into a socialist society. Please write a 1 ½ to 2 page paper discussing this.Capitalism is defined as a system of government in which the means of production such as land and capital are owned privately, while socialism refers to a system of government in which the means of production are publicly owned. In capitalistic systems, each individual works towards accumulating more wealth for themselves while under socialism, the entire country works to accumulate collective wealth that is then distributed among the citizens. Capitalism is mainly an individualistic system because each person works towards benefiting themselves, while socialism encouraged fairness and equality in society (Schumpeter 2010). Socialism encourages people to work for the collective benefit of their society.

The role of government in the two forms of government are quite different. In a socialist system, the government oversees all aspects of the economic and political activities in the country. However, capitalistic systems are different because they are based on the concept of free-markets. Free markets mean that the market equilibrium determines the distribution of resources. The market always comes back to equilibrium, and this is the best way to handle the economy of the country. However, the government plays a major role in other areas such as money supply, law and order, and national defense (Xu 2017). The government in a capitalistic country regulates the money in circulation using fiscal and monetary policies. An oversupply of money can cause inflation, and undersupply also comes with challenges. The government administers different policies depending on the situation at hand to optimize the money supply as per the needs of the economy. The government also steps in to regulate large corporations and monopolies to ensure free and fair competition in the market. Additionally, the government operates and maintains public utilities such as infrastructure, education, and medical care which are a vital part of the economy. The government also protects the freedoms of individuals and ensures that justice prevails in the country.

The United States is a capitalistic society. The economy of the country is mainly governed by the concept of the free market. In the recent past, the government has bailed out several companies and industries, but this does not make this a socialist society. Sometimes, the free market is not the most efficient, and the government has to step in to ensure that balance is restored. The government also steps in in such cases because some companies and industries provide employment and essential goods and services to the people, and allowing them to collapse would be detrimental to the economy. We are still a capitalistic society because every individual works towards the accumulation of personal wealth, and the government only plays a limited role in the economy. Without the government’s role in the capitalistic economy, chaos would ensue.

Chapter Two

My definition of ethics for a person or Company is doing what you know is right and not doing what you think is wrong. Is this a good definition for individuals? What about Companies. Explain why you think that way. Then conclude with your own definition and what you think of corporate ethics.

Yes, I agree with this definition of ethics. A person must always do what they know to be right and not just act based on suspicions. If one thinks that something might be right, but they are unsure, they should find out before taking any action. Additionally, a person should not do what they think is wrong. An individual always has a sense of right and wrong, and any suspicion that something could be wrong is reason enough not to take any action. This definition of ethics works for both corporations and individuals. For a corporation or company, any improper action taken might lead to severe consequences; hence it must always make sure that any action to be taken is the right thing to do. If the company suspects that an action might be wrong, they should not take it. The company or corporation is made up of individuals; hence, the definition of ethics applies to both parties. I would define corporate ethics as the policies and laws that corporations have put in place to address its functions and processes, as well as any controversial areas. Sometimes employees of a corporation are unsure of what to do or how to do it, and the ethics of the company will guide them in making a decision. Corporate ethics is an important part of the corporation or company because it outlines the beliefs, values, and standards that regulate the operations of the corporation.

Chapter Three

Do a search of the phrase Think Globally, Act Locally using an internet search engine. I amnot talking about this phrase as it is used by environmentalists, but rather by business.Then write summary of what this means

Think Globally, Act Locally is a popular phrase in the business world, especially in the case of multinationals or companies thinking of expanding into different areas. Globalization has made it easier for businesses and companies to different markets in various countries. Some of the factors that have encouraged and promoted globalization are technology, trade agreements, and treaties. Many companies have a goal to reach the widest market possible, and this might involve expanding into different countries across the world. This is the meaning of thinking global. The company then has to consider the differences in business factors across different regions such as target markets, prices, production costs, and many others that would influence their business operations (Parnell 2006). Act local means that businesses must tailor their products, services, and operations to suit each market on the local level. For example, a company that produces women’s clothing must consider several factors when setting up business in various locations. Assume that such a company sets up branches in Dubai, Canada, Australia, and South Africa. While the primary business is the sale of women’s clothes and accessories, these will have to be tailored to the locations. For example, the majority of the population in Dubai is Muslim; hence it makes sense to sell clothes suited for them, which are quite different from those to be sold in Canada for example. Businesses and companies have to adapt to local conditions even though they may operate on a global scale. Thinking locally will help the business maximize on the local market, and this will lead to overall profitability in the global network.

References

Parnell, J. (2006). Reassessing the “think global, act local” mandate: evaluation and synthesis. Serbian Journal of Management, 1(1), 21-28.

Schumpeter, J. A. (2010). Capitalism, socialism and democracy. routledge.

Xu, C. (2017). Capitalism and Socialism: A Review of Kornai’s Dynamism, Rivalry, and the Surplus Economy. Journal of Economic Literature, 55(1), 191-208.