Chapter 52: Ethics at the Individual Level (JAIIB – Paper 2)
1. Which of the following best defines "Values" in the context of ethics?
A. Temporary personal preferences
B. Legally enforced obligations
C. Cultural practices followed in society
D. Deeply held beliefs that guide behavior and decision-making
Values are guiding principles or standards that influence how individuals behave, make choices, and prioritize their actions.
2. Norms in ethical context are:
A. Shared expectations and informal rules of behavior within a group
B. Individual’s private opinions
C. Legal frameworks established by the state
D. Personal hobbies and lifestyle choices
Norms are informal societal or organizational rules that indicate acceptable behavior and help maintain harmony.
3. A bank employee refuses to process a fraudulent transaction even though pressured by peers. This reflects which ethical component?
A. Cultural norm
B. Value conflict
C. Core personal values and morality
D. Organizational belief system
Standing firm against unethical actions even under pressure demonstrates strong personal values and moral integrity.
4. "The Value of a Value" means:
A. Values are fixed and unchangeable
B. The significance and impact values have on guiding decisions and behavior
C. Values are equivalent to legal rules
D. The monetary benefit attached to ethical choices
"The Value of a Value" highlights the importance of values in shaping ethical conduct, decision-making, and organizational culture.
5. When an individual faces a dilemma between professional duty and personal gain, it is an example of:
A. Norm compliance
B. Belief reinforcement
C. Core value expression
D. Value conflict
Value conflict occurs when two or more important values clash, requiring ethical judgment to resolve the dilemma.
6. Which of the following best describes "Beliefs" in ethics?
A. Convictions or acceptance that something is true, often based on culture, faith, or experience
B. Legally binding codes
C. Temporary decisions made under pressure
D. Monetary assessment of right and wrong
Beliefs are assumptions or convictions individuals hold to be true, shaping values, attitudes, and actions.
7. Personal ethics primarily deal with:
A. Rules set by the government
B. Business strategies for profit-making
C. An individual’s moral principles guiding personal conduct
D. Organizational code of conduct
Personal ethics refer to individual standards of right and wrong, shaped by values, culture, and upbringing.
8. Business ethics differ from personal ethics because they:
A. Relate to corporate behavior, governance, and stakeholder responsibility
B. Are only based on individual moral choices
C. Apply only in personal life and not in the workplace
D. Are completely unrelated to laws and regulations
Business ethics are standards applied to corporate behavior, covering fairness, transparency, and responsibility toward stakeholders.
9. Which quality best defines "Integrity" in an individual?
A. Following rules only when monitored
B. Consistency in words, actions, and moral principles, even in difficult situations
C. Balancing profit with personal gain
D. Adjusting ethics to suit workplace demands
Integrity is about honesty, consistency, and adherence to ethical principles regardless of external circumstances.
10. In the banking profession, responsibility of an individual mainly refers to:
A. Following only personal preferences
B. Delegating all decisions to senior management
C. Ignoring organizational policies in ethical conflicts
D. Being accountable for one’s decisions, actions, and their consequences
Responsibility in ethics means being accountable for choices made and ensuring they align with both professional and personal integrity.
11. The Golden Rule in ethics is commonly expressed as:
A. Treat others as you would like to be treated
B. Maximize profit at any cost
C. Follow the majority opinion always
D. Do not question authority
The Golden Rule is a universal ethical principle emphasizing empathy and fairness in human interactions.
12. A bank manager resolves a customer complaint fairly, keeping in mind how he would want to be treated in the same situation. This is an example of:
A. Value conflict
B. Organizational compliance
C. Application of the Golden Rule
D. Profit-driven decision-making
Applying the Golden Rule in practice means treating customers, colleagues, and stakeholders with fairness and respect.
13. Understanding "right and wrong" in ethics primarily means:
A. Following personal interests above all
B. Distinguishing between morally acceptable and unacceptable behavior
C. Doing what is profitable for business only
D. Following rules without questioning
Ethics guides individuals in identifying which actions are right (just, fair, honest) and which are wrong (unfair, dishonest, harmful).
14. In the workplace, "doing the right thing" means:
A. Always agreeing with superiors
B. Choosing personal convenience
C. Avoiding decisions to escape responsibility
D. Acting with honesty, fairness, and responsibility, even if it is difficult
"Doing the right thing" means upholding ethical principles like honesty, fairness, and responsibility, even under pressure.
15. A cashier finds excess cash mistakenly deposited by a customer. The ethical action is to:
A. Keep the money since the customer did not notice
B. Delay reporting it until asked
C. Immediately report and rectify the transaction
D. Share it with colleagues secretly
Ethical responsibility requires correcting mistakes honestly and promptly to maintain trust and fairness.
16. A bank officer refuses a bribe offered by a borrower for loan approval. This action reflects:
A. Commitment to ethical decision-making and integrity
B. Value conflict
C. Norm compliance
D. Legal enforcement only
Refusing unethical practices like bribery shows integrity and commitment to "doing the right thing."
17. Which principle should guide a banker when in doubt about whether an action is right or wrong?
A. Whether it benefits them personally
B. Whether peers approve of it
C. Whether it avoids immediate trouble
D. Whether it is honest, fair, and would stand public scrutiny
Ethical tests like the "public scrutiny test" ask if the action would be acceptable if known publicly — a guide to doing the right thing.
18. Ethical reasoning involves:
A. Finding legal loopholes to justify decisions
B. Choosing actions based only on personal benefits
C. Analyzing situations to decide what is morally right and responsible
D. Following orders without questioning
Ethical reasoning means applying logic and values to judge right vs. wrong in complex real-life scenarios.
19. A customer accidentally shares confidential account details. The banker’s ethical duty is to:
A. Use the information for personal gain
B. Maintain confidentiality and protect customer interests
C. Share it with colleagues casually
D. Post it on social media
Real-world application of ethics requires bankers to respect confidentiality and protect sensitive customer data.
20. Which of the following is an example of a conflict of interest for a banker?
A. Approving a loan for a close relative without proper appraisal
B. Explaining loan terms clearly to a borrower
C. Reporting suspicious transactions as per KYC norms
D. Following RBI compliance guidelines
Approving financial benefits for relatives without proper due process creates a direct conflict between personal and professional interests.
21. A bank employee is aware of insider information about a company applying for a loan. Ethically, the employee should:
A. Invest in the company’s shares for profit
B. Share the information with friends
C. Ignore RBI guidelines
D. Maintain confidentiality and avoid misuse of insider information
Ethical reasoning demands non-disclosure and responsible handling of insider information to prevent misuse.
22. Which ethical test is often used in real-world application to judge decisions?
A. Profit maximization test
B. Public disclosure or "newspaper test" — would you be comfortable if your decision was public?
C. Peer approval test
D. Convenience test
The "public disclosure test" checks whether a decision is ethically sound by imagining it being made public.
23. A banker notices a colleague manipulating records to cover up an error. The most ethical response is:
A. Ignore it to maintain friendship
B. Join in covering the mistake
C. Report the issue through proper internal channels
D. Post about it anonymously on social media
Ethical reasoning requires addressing misconduct transparently through official reporting mechanisms, not concealment or gossip.
24. What is the first step in resolving an ethical dilemma?
A. Identifying the ethical issue
B. Choosing the most profitable option
C. Ignoring minor ethical concerns
D. Looking for personal benefit
The first step in ethical decision-making is to clearly identify the ethical issue or conflict before exploring possible solutions.
25. An ethical dilemma generally arises when:
A. Legal rules are clear
B. The decision benefits everyone equally
C. Profit and ethics always align
D. Conflicting values or principles are involved
Ethical dilemmas occur when there is a conflict between values, principles, or possible actions, making it hard to choose the right path.
26. Which of the following is NOT part of a standard framework for ethical decision-making?
A. Identifying stakeholders
B. Evaluating consequences of actions
C. Ignoring ethical concerns if legally safe
D. Considering fairness and justice
Ethical frameworks emphasize identifying stakeholders, evaluating outcomes, fairness, and justice. Ignoring ethical concerns is never part of a genuine framework.
27. In ethical decision-making, the principle of "greatest good for the greatest number" reflects:
A. Deontological ethics
B. Utilitarianism
C. Virtue ethics
D. Egoism
Utilitarianism focuses on maximizing overall happiness or benefit, often summarized as "the greatest good for the greatest number."
28. Which question is most relevant in evaluating an ethical decision?
A. Will this decision increase my profit?
B. Will this decision be kept secret?
C. Will this decision make me popular?
D. Is this decision fair to all stakeholders?
Ethical evaluation requires asking whether the decision is fair and just for all stakeholders, not just for personal gain or popularity.
29. Which ethical decision-making step ensures accountability and transparency?
A. Documenting the reasoning and outcome
B. Keeping the process confidential
C. Ignoring opposing viewpoints
D. Relying solely on intuition
Documenting ethical reasoning and decisions improves accountability, transparency, and consistency in resolving dilemmas.
