QUESTION TEXT: Suppose a corporation is convicted of a crime…
DISCUSSION: There were three options for penalties in the passage.
- Economists’ naive view: Penalty higher than profits.
- Economists’ reformed view: Penalty higher than profits, accounting for detection ratios. (Higher penalty)
- Author’s view: Penalty in between first two, with adjustment for community moral standards.
Basically, the author thinks the penalty should be high enough that corporations don’t profit, but not so high that it puts companies out of business. Community opinion of the moral weight of the crime should increase the fine, to some extent.
- Too low. See paragraph 3.
- Also too low. See paragraph 3.
- CORRECT. This matches the author’s view in the fourth paragraph. Moral weight can fairly be taken to refer to community views, referenced in paragraph 2.
- In lines 43-47, the author disagrees with this level of fine, because it would destroy corporations.
- In lines 43-47, the author implies that it would be a bad idea to put corporations out of business; jobs would be lost.
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