Learning Activity #2
When in Malaysia W.B. Milestone, Inc., a manufacturer of sophisticated computer parts, recently moved the operations of one of its divisions to Malaysia. The Company has hired several hundred workers at wages considerably below their U.S. counterparts, but consistent with the prevailing wages in Malaysia. Not only is the Company benefiting from the lower wages, it is also able to reduce its costs further because of the deplorable factories used for its operations (no air conditioning and poor ventilation), it can dispose of waste without any government oversight, and government inspectors are routinely given gratuities for favorable inspection reports or to otherwise grease the skids for the Company. The Company's operations are in all key respects in accordance with the laws of Malaysia.
You were recently hired as a senior vice-president in charge of the Malaysian operations and you are concerned about what you have seen and heard as to how the plants are being operated. When you called a colleague in the states, he said to you "keep your mouth shut and when in Rome do as the Romans do". What are some of the ethical issues you should consider in charting your course of action and how would you resolve them?
To meet the everyday needs of an individual or a business many times, money is borrowed. Loan is this borrowed money. The duration of a loan can be short or a long period. Repay the loan on time comes under the duty of the borrower.
Answer and Explanation:
In case of default or failure to repay as provided in this scenario, the Bank has the right to enforce the loan agreement. Usually mentioned in the loan agreement itself, the conditions in which agreement can be enforced like the default in payment, breach of contract, and others. However loan default terms are not mentioned in the agreement in this case. Still as per various laws and codes, to ask borrowers to accelerate the payment of loan amount or the lender can reduce the maturity period of the debt. Under the Uniform Commercial Code, the lender has various remedies related to self-help in case of securities or collateral. For instance, selling the securities in possession of the bank or take possession of those which were not in their possession before. In case the borrower files bankruptcy suit, then the borrower has to act as per the US Bankruptcy Code. Thus, acting under law, Bank has many ways to get back the lent money.
Learn more about this topic:
from Focus on Personal Finance: Online Textbook HelpChapter 5 / Lesson 17