Question 1

In the United States,the board of directors of corporations have a fiduciary responsibility to:

Accepted Answer

A) set the prices of the products the corporation produces. 
B) raise investment capital in their spare time. 
C) operate the company on a day-to-day basis. 
D) represent the interest of its shareholders. 
A) set the prices of the products the corporation produces. 
B) raise investment capital in their spare time. 
C) operate the company on a day-to-day basis. 
D) represent the interest of its shareholders.

Question 2

The Wall Street Journal ("Boards Tie CEO Pay More Tightly to Performance," 2/21/06,p.A1)reports an increase in the number of major U.S.corporations that tie the CEO's stock options to performance targets.Comment on the wisdom of this trend,given the separation of ownership and control in U.S.corporations.

Accepted Answer

The separation of ownership and control

Question 3

Adolph Berle and Gardiner Means argued that widely held corporations will be run inefficiently by professional managers.Their argument is based on:

Accepted Answer

A) inefficient product market structures. 
B) an inefficient market for CEOs. 
C) blockholders' control. 
D) incentive conflicts between shareholders and managers. 
A) inefficient product market structures. 
B) an inefficient market for CEOs. 
C) blockholders' control. 
D) incentive conflicts between shareholders and managers.

Question 4

Closely held corporations are characterized by:

Accepted Answer

A) a small number of shareholders,each holding on to lots of shares for a long time. 
B) a large number of shareholders,each holding on to a few shares for a long time. 
C) stock that is freely traded only among a few shareholders. 
D) stock that is not freely traded and often held by a few shareholders. 
A) a small number of shareholders,each holding on to lots of shares for a long time. 
B) a large number of shareholders,each holding on to a few shares for a long time. 
C) stock that is freely traded only among a few shareholders. 
D) stock that is not freely traded and often held by a few shareholders.

Question 5

Identify a characteristic of the corporate form of organization.

Accepted Answer

A) The top management of such an organization has unlimited liability. 
B) It does not have the discretion and authority to issue stock. 
C) It has the legal standing of an individual and can participate in law-suits. 
D) It is run by a board of directors elected by the government. 
A) The top management of such an organization has unlimited liability. 
B) It does not have the discretion and authority to issue stock. 
C) It has the legal standing of an individual and can participate in law-suits. 
D) It is run by a board of directors elected by the government.

Question 6

Which of the following types of shareholders can be categorized under institutional investors?

Accepted Answer

A) Traders 
B) Inventory suppliers 
C) Insurance companies 
D) Blockholders 
A) Traders 
B) Inventory suppliers 
C) Insurance companies 
D) Blockholders

Question 7

The ______ directs the organization's goals,objectives,and budgets.He/she oversees the investment of funds and manages associated risks,supervises cash management activities,executes capital-raising strategies to support a firm's expansion,and deals with mergers and acquisitions.

Accepted Answer

A) chief accounting officer 
B) chief executive officer 
C) chief financial officer 
D) chief operating officer 
A) chief accounting officer 
B) chief executive officer 
C) chief financial officer 
D) chief operating officer

Question 8

The cumulative voting system used by firms in the election of directors allows:

Accepted Answer

A) the prospective candidates for the board of directors to manipulate the federal laws and regulation. 
B) the blockholders to elect some directors even though they are barred from participating in the internal decision making. 
C) a large minority shareholder to elect some directors even if their election is opposed by the majority of shareholders. 
D) large shareholders to nominate board members through the normal proxy process without any legal binding. 
A) the prospective candidates for the board of directors to manipulate the federal laws and regulation. 
B) the blockholders to elect some directors even though they are barred from participating in the internal decision making. 
C) a large minority shareholder to elect some directors even if their election is opposed by the majority of shareholders. 
D) large shareholders to nominate board members through the normal proxy process without any legal binding.

Question 9

What is managerial power theory and what are its implications?

Accepted Answer

According to this theory,(1)the typical

Question 10

The Sarbanes-Oxley Act of 2002 attempts to reduce corporate fraud among top-level executives.Comment on the strengths and weaknesses of this act.

Accepted Answer

To reduce fraudulent activity in firms,t

Question 11

What are the shareholder incentives within a corporation?

Accepted Answer

Shareholders are divided into three type

Question 12

Corporate governance refers to:

Accepted Answer

A) government control of the top management. 
B) organizational architecture at the bottom-level of an organization. 
C) organizational architecture at the middle-management level of an organization. 
D) organizational architecture at the top of an organization. 
A) government control of the top management. 
B) organizational architecture at the bottom-level of an organization. 
C) organizational architecture at the middle-management level of an organization. 
D) organizational architecture at the top of an organization.

Question 13

Which of these is an external control mechanism faced by corporate boards and executives?

Accepted Answer

A) The market for lemons 
B) The managerial labor market 
C) The foreign exchange market 
D) The stock market 
A) The market for lemons 
B) The managerial labor market 
C) The foreign exchange market 
D) The stock market

Question 14

Which of these is true of shareholders?

Accepted Answer

A) They are the ultimate owners and have major decision authority in the management of the firm. 
B) They are not the ultimate owners,yet have major decision authority in the management of the firm. 
C) They are not the ultimate owners and have no decision authority in the management of the firm. 
D) They are the ultimate owners but have no major decision authority in the management of the firm. 
A) They are the ultimate owners and have major decision authority in the management of the firm. 
B) They are not the ultimate owners,yet have major decision authority in the management of the firm. 
C) They are not the ultimate owners and have no decision authority in the management of the firm. 
D) They are the ultimate owners but have no major decision authority in the management of the firm.

In the United States,the board of directors of corporations have a fiduciary responsibility to:

Adolph Berle and Gardiner Means argued that widely held corporations will be run inefficiently by professional managers.Their argument is based on:

Closely held corporations are characterized by:

Identify a characteristic of the corporate form of organization.

Which of the following types of shareholders can be categorized under institutional investors?

The ______ directs the organization's goals,objectives,and budgets.He/she oversees the investment of funds and manages associated risks,supervises cash management activities,executes capital-raising strategies to support a firm's expansion,and deals with mergers and acquisitions.

The cumulative voting system used by firms in the election of directors allows:

What is managerial power theory and what are its implications?

The Sarbanes-Oxley Act of 2002 attempts to reduce corporate fraud among top-level executives.Comment on the strengths and weaknesses of this act.

What are the shareholder incentives within a corporation?

Corporate governance refers to:

Which of these is an external control mechanism faced by corporate boards and executives?

Which of these is true of shareholders?

Introduction

Economists View of Behavior

Exchange and Markets

Demand

Production and Cost

Market Structure

Pricing With Market Power

Economics of Strategy: Creating and Capturing Value

Economics of Strategy: Game Theory

Incentive Conflicts and Contracts

Organizational Architecture

Decision Rights: the Level of Empowerment

Decision Rights: Bundling Tasks Into Jobs and Subunits

Attracting and Retaining Qualified Employees

Incentive Compensation

Individual Performance Evaluation

Divisional Performance Evaluation

Vertical Integration and Outsourcing

Leadership: Motivating Change Within Organizations

Understanding the Business Environment: the Economics of Regulation

Ethics and Organizational Architecture

Organizational Architecture and the Process of Management Innovation

Filters

Exam 18: Corporate Governance

In the United States,the board of directors of corporations have a fiduciary responsibility to:

Adolph Berle and Gardiner Means argued that widely held corporations will be run inefficiently by professional managers.Their argument is based on:

Closely held corporations are characterized by:

Identify a characteristic of the corporate form of organization.

Which of the following types of shareholders can be categorized under institutional investors?

The ______ directs the organization's goals,objectives,and budgets.He/she oversees the investment of funds and manages associated risks,supervises cash management activities,executes capital-raising strategies to support a firm's expansion,and deals with mergers and acquisitions.

The cumulative voting system used by firms in the election of directors allows:

What is managerial power theory and what are its implications?

The Sarbanes-Oxley Act of 2002 attempts to reduce corporate fraud among top-level executives.Comment on the strengths and weaknesses of this act.

What are the shareholder incentives within a corporation?

Corporate governance refers to:

Which of these is an external control mechanism faced by corporate boards and executives?

Which of these is true of shareholders?

Introduction

Economists View of Behavior

Exchange and Markets

Demand

Production and Cost

Market Structure

Pricing With Market Power

Economics of Strategy: Creating and Capturing Value

Economics of Strategy: Game Theory

Incentive Conflicts and Contracts

Organizational Architecture

Decision Rights: the Level of Empowerment

Decision Rights: Bundling Tasks Into Jobs and Subunits

Attracting and Retaining Qualified Employees

Incentive Compensation

Individual Performance Evaluation

Divisional Performance Evaluation

Vertical Integration and Outsourcing

Leadership: Motivating Change Within Organizations

Understanding the Business Environment: the Economics of Regulation

Ethics and Organizational Architecture

Organizational Architecture and the Process of Management Innovation

Filters