Answer :
Final answer:
Business malpractice involves an entrepreneur defying legal and ethical boundaries for personal or business gain. This includes engaging in restrictive practices, such as price setting and market carving, and misrepresenting data. Laws and regulations exist to counter such practices, yet the prime responsibility for ethical operations rests with the entrepreneur.
Explanation:
The situation described where an entrepreneur defies legal and ethical boundaries leading to mismanagement of the venture is a characteristic of business malpractice. This could be because of the temptation to set market prices and carve up a market for higher profits, despite it being illegal in many parts of the world. This is a form of restrictive practices that businesses may engage in to gain an unfair advantage.
Entrepreneurship requires a balance of innovation and willingness to take risks, along with possessing a strong understanding of the law and ethics within the business sphere. Losing sight of these boundaries can result in negative cultural sanctions, legal sanctions, and potential contractual noncompliance as a consequence for defying laws and norms. This not only affects the entrepreneur and their business but can potentially slow economic growth.
Another example of business malpractice may be distorting or misrepresenting data to appear more favorable. The need for businesses to conduct themselves ethically and legally is of utmost importance to prevent such instances from occurring. The laws and regulations evolve continually to enhance business practices and prevent restrictive practices, but it is primarily the responsibility of the entrepreneur to conduct their business within legal and ethical boundaries.
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