(11) You are Chairman of the Board of a successful technology firm. There is a nominal federal corporate tax rate of 35 percent, yet the effective tax rate of the typical corporation is about 12.6%. Your firm has been clever with use of transfer pricing and keeping money abroad and has barely paid any taxes over the last 5 years; during this same time period, profits were $28 billion. One member of the board feels that it is un-American to use various accounting devices in order to avoid paying taxes. Others feel that these are legal loopholes and corporations have a fiduciary responsibility to minimize taxes. One board member quoted what the CEO of Exxon once said: “I’m not a U.S. company and I don’t make decisions based on what’s good for the U.S.” What should you do?
(12) You are CEO of a small company that manufactures sophisticated drones. Your company’s drones are used for non-military purposes such as fighting wildfires, monitoring borders, aerial photography, and law enforcement (finding criminals). You have just received a huge order worth millions of dollars from a firm located in a country ruled by a vicious dictator. This dictator has been known to suppress human rights and has been waging a war against a group fighting for democracy. In the past, he has even used chlorine gas against his own people. The company assures you that the drones will not be used for military purposes. You suspect that the company is a front for the government and may modify the drones as weapons so that they can be used to target freedom fighters and terrorize civilians throughout the country. What should you do?
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