A common suggestion to align the goals of managers with those of the stockholder

Question

A common suggestion to align the goals of managers with those of the stockholders is to pursue

stock options.

liberal vacation leave.

lower salaries.

None of the above.

1 points   

QUESTION 2

A purchase of a controlling quantity of shares of a firm by an individual, a group of investors, or another organization is known as a

leveraged buyout.

takeover.

stock option.

None of the above.

1 points   

QUESTION 3

A situation in which a firm’s managers fail to act in the best interest of the shareholders is known as the stakeholder dilemma.

True

False

1 points   

QUESTION 4

A situation in which a firm’s managers fail to act in the best interest of the shareholders is known as

management ineffectiveness.

the agency problem.

managerial goal incongruity.

None of the above.

1 points   

QUESTION 5

Adverse selection exists when the parties in an arrangement do not share equally in the risks and benefits.

True

False

1 points   

QUESTION 6

Any purchase of a controlling quantity of shares of a firm by an individual, a group of investors, or another organization is known as a leveraged buyout (LBO).

True

False

1 points   

QUESTION 7

Contracting out a firm’s non-core, non-revenue-producing activities to other organizations primarily to reduce costs is known as

outsourcing.

offshoring.

mass customization.

commoditization.

1 points   

QUESTION 8

Corporate takeovers have been promoted as a system of checks and balances for firm management.

True

False

1 points   

QUESTION 9

Creditors and suppliers typically share the same goals for the organization.

True

False

1 points   

QUESTION 10

Discuss the two opposing perspectives on firm social responsibility.

1 points   

QUESTION 11

Do boards of directors serve the interest of the shareholders? Explain.

Path: p

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1 points   

QUESTION 12

Goals are verifiable and specific, and are developed so that management can measure performance.

True

False

1 points   

QUESTION 13

Identify six common perspectives on managerial ethics. What is your perspective, and why?

Path: p

Words:0

1 points   

QUESTION 14

Identify the two perspectives on the agency problem. Should this be a major concern in most U.S. firms? Why or why not.

Path: p

Words:0

1 points   

QUESTION 15

Individuals or groups who are affected by or can influence an organization’s operations are called

shareholders.

stakeholders.

organizational constituencies.

None of the above.

1 points   

QUESTION 16

Many companies limit the number of board memberships their own board members may hold.

True

False

1 points   

QUESTION 17

Objectives are specific, often quantified, versions of goals.

True

False

1 points   

QUESTION 18

Offshoring refers to relocating some or all of a firm’s manufacturing or other business processes to another country to reduce costs.

True

False

1 points   

QUESTION 19

Outsourcing efforts can fail because

of hidden costs.

of loss of control of the outsourced activity.

a firm might outsource an activity that should not be outsourced.

All of the above.

1 points   

QUESTION 20

Outsourcing refers to contracting out a firm’s non-core, non-revenue-producing activities to other organizations primarily to reduce costs.

True

False

1 points   

QUESTION 21

Over the past several decades, the composition of the typical board has shifted from one controlled by insiders to one controlled by outsiders.

True

False

1 points   

QUESTION 22

Relocating some or all of a firm’s manufacturing or other business processes to another country to reduce costs is known as

outsourcing.

offshoring.

mass customization.

commoditization.

1 points   

QUESTION 23

Social responsibility and managerial ethics

are synonymous.

are related, but different concepts.

are relative easy to assess.

None of the above.

1 points   

QUESTION 24

Social responsibility refers to an individual’s responsibility to make business decisions that are legal, honest, moral, and fair.

True

False

1 points   

QUESTION 25

The CEO also serving as chair of the board is known as

rubber stamp mentality.

corporate governance.

CEO duality.

executive leadership.

1 points   

QUESTION 26

The attractiveness of diversification is consistent with which agency perspective?

Management serves its own interests.

Management and stockholders share the same interests.

Management pursues the interests of the stakeholders.

None of the above.

1 points   

QUESTION 27

The attractiveness of downsizing is consistent with which agency perspective?

Management serves its own interests.

Management and stockholders share the same interests.

Management pursues the interests of the stakeholders.

None of the above.

1 points   

QUESTION 28

The competing priorities of an organization’s stakeholders are known as

the organization’s goals.

the mission.

the organization’s objectives.

None of the above.

1 points   

QUESTION 29

The desired ends toward which efforts are directed comprise

the organization’s goals.

the mission.

the organization’s objectives.

None of the above.

1 points   

QUESTION 30

The idea that business firms should serve both society and the financial interests of the shareholders is known as

the corporate charter.

the corporate dilemma.

managerial ethics.

None of the above.

1 points   

QUESTION 31

The preoccupation with firm growth is consistent with which agency perspective?

Management serves its own interests.

Management and stockholders share the same interests.

Management pursues the interests of the stakeholders.

None of the above.

1 points   

QUESTION 32

The triple bottom line refers to the notion that firms must maintain and improve social and ecological performance in addition to economic performance.

True

False

1 points   

QUESTION 33

The utilitarian view of ethics suggests that anticipated outcomes and consequences should be the primary considerations when evaluating an ethical dilemma.

True

False

1 points   

QUESTION 34

What is the difference between takeovers and leveraged buyouts? Are either good for U.S. firms or the economy?

Path: p

Words:0

1 points   

QUESTION 35

When additional insiders are added to outsider-dominated boards, CEO dismissal is more likely when corporate performance declines.

True

False

1 points   

QUESTION 36

When implemented properly, outsourcing can

cut costs.

refocus the core business.

improve firm performance.

All of the above.

1 points   

QUESTION 37

When outsiders are added to insider-dominated boards,

CEO dismissal is less likely when performance is poor.

insiders are more likely to press for corporate restructuring.

insiders are likely to retain their relative influence on the management of the firm.

None of the above.

1 points   

QUESTION 38

Which of the following might represent the goals of customers?

The company should provide high quality products and services at the most reasonable prices possible.

The company should maintain a healthy financial posture and a policy of on-time payment of debt

The company should produce a higher-than-average return on equity.

The company should provide goods and services with minimum environmental costs, increase employment opportunities, and contributing to social and charitable causes.

1 points   

QUESTION 39

Which of the following might represent the goals of shareholders?

The company should provide high quality products and services at the most reasonable prices possible.

The company should maintain a healthy financial posture and a policy of on-time payment of debt.

The company should produce a higher-than-average return on equity.

The company should provide goods and services with minimum environmental costs, increase employment opportunities, and contributing to social and charitable causes.

1 points   

QUESTION 40

Which view of ethics suggests that decisions should be based on existing norms of behavior, including cultural, community, or industry factors?

rights view

cultural view

religious view

None of the above.

stock options.

liberal vacation leave.

lower salaries.

None of the above.

Mashups

Explanation / Answer

The correct answer is "Stock option".

Stock option refers to the benefit by which company's share can be bought at a discounted price or stated fixed price. When the company provide stock options, managers gets aligned to the shareholders interest because they will be the stockholders.

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