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The case of Ford Pinto is often used to teach business ethics ( although , as was explained in the introduction, it is about unethical

The case of Ford Pinto is often used to teach business ethics (although, as was explained in the introduction, it is about unethical behaviour). In the 1970s, Ford Motor Company developed a small car to compete with Volkswagen and other companies, which was marketed as a carefree car. While conducting some crash tests, Ford learned that the Pinto introduced a severe hazard in the case of a rear collision, even at low speed, the car would burst into flames. Ford officials faced a moral decision: should they go ahead with the existing design, thereby meeting the production schedule but possibly jeopardising consumer safety, or should they delay production of the Pinto and redesign the car to make it safer? The firm knew that if it chose the latter, the cost would be about US$11 per car (Ladenson,1995).According to a memo, which was later leaked, Ford did an informed calculation to decide which action to take. In this calculation, the company estimated that 180 people would die each year and that the cost per death would be about US$200,000(remember, this is the 1970s).Given these numbers, Ford decided to move ahead and sell the dangerous car, knowing very well that it would cause deaths. The Ford Pinto ended up killing many more people than estimated (over 1,000) and the damages caused to customers and the company far exceeded the calculation.Please answer the questions below in one-page max. Each worth 20 pts.1. Please identify the ethical problem.2. Who is affected by this ethical problem?

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