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CH 6] Business 101 6-35

and does not also receive stock options who is harmed. As the Federal Reserve inflates
the currency (increasing money supply) it now takes more of the workers earned
dollars to purchase the same goods and services. Printing more currency, putting that
into the market, creates inflation which also robs workers of the value of their labors.
Top corporate executives do receive dollars as a part of their pay, but the more they
receive in stock options and stock for their remuneration, the higher is their earnings;
and even more so with inflation. It is the increase in money supply by the Federal
Reserve that increases the value of stocks and bonds that the executive receives, and
when he sells his shares, his income is greater than the stated salaries.
The Federal Reserve has excessively inflated the financial markets in its attempt
to create an economic recovery from the recession of 2001 and the Great Recession of
2007-2009 spurred by the Mortgage Financial Market collapse. This excessive asset
price inflation has pushed U.S. household wealth far out of line with its historic
relationship to GDP. Inflated currency also inflates the value of all real estate, which is
a good investment even for the working class.

Summary of Learning Goals
1. Discuss the meaning and context of the Law of Nature and its innateness. The Law of Nature
as a term originated with the ancient thinkers to refer to the innate qualities in a person to know
right and wrong. The innateness being something that all are born with and subject to, that is they
are not man-made as say a mathematical table. There are laws of physics and biology that cannot
be ignored because mankind is also subject to them. However, this Law of Nature, is a thing that
can be disobeyed at the choosing of man, and there are consequences to those choices. We often
express these through our behaviors and those of others. The Law of Nature may be thought of as
our moral character, that we are reminded of by our teachings, but they are not the product of the
teaching.
2. Explain the concept of “sustainability” in relation to the earth’s populations and its
resources. The concept that the earth can only support a limited number of people and that its
resources are finite. Too large of a population will prevent others from enjoying those resources.
Thus, people are not smart enough, cannot develop new technologies or employ science to 6
support and feed people. The end argument is that with a population of 8 billion people and the
planet can only support 1 billion people then there are 7 billion people that must be done away
with. Dictators have argued the same principles as they conquer other lands and displace the
peoples on those lands in a crude evacuation plan. Those who promote the “sustainable” planet
theme never discuss or describe their plan for evacuation.
3. There are many codes of conduct, right and wrong behavior. Explain two in relation
“abstain from all appearances of evil”. A code of conduct is an ethic that is exercised. The
United States Military Academy at West Point states “ "A cadet will not lie, cheat, steal, or
tolerate those who do." The guidance on this code of conduct asks the cadet to consider, (1) Does
this action attempt to deceive anyone or allow anyone to be deceived? (2) Does this action gain or
allow the gain of privilege or advantage to which I or someone else would not otherwise be
entitled? (3) Would I be satisfied by the outcome if I were on the receiving end of this action? The
code establishes the standard of conduct, and the consideration asks for a thoughtful reflection of
what an individual’s actions would accomplish.
Another code that is relative universal is “do unto others as you would have them do unto you.”
This thoughtful code asks the individual to consider their actions towards other people. If you do
not want to be cheated, do not cheat others. If you do not want to be slandered or gossiped about,
then do not slander others or gossip about others.
In both of these codes, the concept is held that they reflect evil and caution or demand that the
adherent not bring ill-repute on themselves through their conduct. In today’s modern society there
is the spirit of doing things “my way” which is evidence of selfishness and self-centeredness.
4. Discuss the meaning of social responsibility as an accepted business policy. Social
responsibility refers to management's consideration of the social as well as the economic effects
of its decisions. It is accepted policy in contemporary business affairs. Several firms now use the
term corporate citizenship interchangeably with social responsibility.
5. Describe the concept of business ethics and the process by which management makes ethical
decisions. Business ethics refers to a businessperson's moral values which are expressed in his

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