The management of Doc's Drug Company, Inc. (Doc's) believes that the theory of social responsibility of the Company is to make the most profits for its shareholders. Doc's is selling and plans to continue selling a diet drug that is popular and effective and makes 80 percent of Doc's profits but can cause heart problems in 30 percent of the population.

(a) What is the name of this theory of social responsibility as discussed in Chapter 10 of the text?

(b) If you see any problems with this theory of social responsibility as used by Doc's, describe the problem.

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Question 20 (5 points)

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Sharp, Inc. is a manufacturer of various types of cutting blades. Sharp negligently failed to properly temper and harden its lawnmower blades. Such defect in the lawnmower blades would not be apparent upon visual inspection and would only become readily apparent upon operation of the lawnmower. Yardguy, a lawn mower manufacturer, uses Sharp's blades in all of its mowers. Yardguy distributes the mowers through Lawn Supplies. Lawn Supplies sells the mowers to retail dealers, including Helpful Hardware. Carl purchased a Yardguy lawn mower from Helpful Hardware. The first time Carl used the lawn mower, he was seriously injured because of the defective blade.

(a) Name the possible defendants if Carl brings a STRICT LIABILITY IN TORT action to recover for his injury.

(b) Discuss the likelihood that the possible defendants named in (a ) above will be held liable if Carl brings a STRICT LIABILITY IN TORT action to recover for his injury.