Question 1

Director independence and non-interlocking directorships are desirable traits of top-ranked boards.What does this mean?

Accepted Answer

A)   Directors can serve on the board of directors of other related companies.
B)   Directors are free of all ties to the CEO and the company.
C)   The CEO can serve as a director on the other director boards.
D)   Top managers cannot be on the board of directors.E) B) and C)
F) All of the above

Question 2

What is agency theory and what problems is it concerned with resolving?

Accepted Answer

Agency theory is a theory of the relatio...

Question 3

Which of the following is the primary drawback of traditional strategic control systems?

Accepted Answer

A)   They are only appropriate when the environment is stable and simple.
B)   Goals and objectives cannot be measured with a high level of certainty.
C)   They lead to complacency.
D)   They lack the flexibility needed to adjust to changes in the environment.E) A) and D)
F) C) and D)

Question 4

Individual and institutional shareholders have the same rights that include all the following except

Accepted Answer

A)   right to sell stock.
B)   right to vote the proxy.
C)   the right to bring suit for damages if the economy declines.
D)   certain residual rights following the liquidation of the company once creditors and claimants are paid.E) A) and B)
F) A) and C)

Question 5

Which of the following is not a key control lever of behavioral control?

Accepted Answer

A)   structure
B)   culture
C)   rewards
D)   boundariesE) B) and C)
F) None of the above

Question 6

Contemporary strategic controls involve comparing actual performance to predetermined goals.

Accepted Answer

A) True 
 B)False

Question 7

Rule-based controls are least appropriate in organizations with which one of the following characteristics?

Accepted Answer

A)   Environments are stable and predictable.
B)   Employees are highly skilled and independent.
C)   There is consistency in product and service.
D)   The risk of malfeasance is extremely high.E) C) and D)
F) A) and D)

Question 8

The best way to minimize improper and unethical conduct is to ________ and ________.

Accepted Answer

A)   set boundaries; constraints
B)   establish standards; guidelines
C)   develop policies; regulations
D)   design sanctions; guidelinesE) B) and D)
F) B) and C)

Question 9

Individual rationality ________ organizational rationality.

Accepted Answer

A)   is a good indicator of
B)   will ensure
C)   is often the opposite of
D)   does not always guaranteeE) None of the above
F) A) and B)

Question 10

Continuous monitoring,in the contemporary approach,is beneficial because

Accepted Answer

A)   it reduces time lags.
B)   it increases the time it takes to detect changes in the competitive environment.
C)   organizational flexibility is reduced.
D)   organization response time is increased.E) A) and B)
F) C) and D)

Question 11

Strategic control systems,both informational and behavioral,are used to correct the performance and ultimate strategy of a firm.

Accepted Answer

A) True 
 B)False

Question 12

Andy Grove,former CEO and cofounder of Intel,encouraged openness by not having many of the trappings of success.This is an example of evolving from boundaries to rewards and culture by

Accepted Answer

A)   hiring people who identify with the dominant values of the organization.
B)   developing managerial role models.
C)   maximizing training and indoctrination.
D)   aligning rules with organizational goals and objectives.E) A) and B)
F) A) and C)

Question 13

In principal-principal conflicts (conflicts between controlling shareholders and minority shareholders) ,the ownership (of equity) is

Accepted Answer

A)   widely dispersed.
B)   controlled almost completely by management.
C)   concentrated.
D)   often held by employee stock ownership programs.E) A) and B)
F) A) and C)

Question 14

In choosing sides concerning CEO duality,two schools of thought exist.Which of the following would not be a consideration for the Unity of Command school of thought?

Accepted Answer

A)   One person holding both roles will be able to act more efficiently and effectively.
B)   CEO duality provides smoother strategic decision making.
C)   CEO duality creates unit across the board of directors and managers of a company.
D)   CEO duality slows down decision making.E) A) and B)
F) A) and C)

Question 15

In order to have effective board operations,firms need to cultivate engaged and committed boards.

Accepted Answer

A) True 
 B)False

Question 16

Single-loop learning,according to Chris Argyris,is most appropriate when the environment is ________,goals and objective can be measured with a ________ of certainty,and there is ________ need for complex measures of performance.

Accepted Answer

A)   stable; high level; little
B)   unstable; low level; great
C)   stable; low level; great
D)   unstable; high level; littleE) B) and D)
F) B) and C)

Question 17

The primary participants in corporate governance do not include the

Accepted Answer

A)   shareholders.
B)   financial institutions.
C)   management (led by the chief executive officer) .
D)   board of directors.E) C) and D)
F) B) and D)

Question 18

Informational control is primarily concerned with whether the organization is doing the right things.

Accepted Answer

A) True 
 B)False

Question 19

As firms simultaneously downsize and face the need for increased coordination across organizational boundaries,a control system based primarily on ________ is dysfunctional.

Accepted Answer

A)   boundaries and constraints
B)   culture and rewards
C)   organizational loyalty
D)   innovation and risk takingE) B) and C)
F) A) and C)

Question 20

In addition to traditional institutional investors,a growing set of activist investors aggressively pressure firm managers for major changes.These activist investors include individual investors,such as ________,and activist investor funds,such as ________.

Accepted Answer

A)   CalPERS; Bill Gates
B)   ValuAct; Trian
C)   Berkshire Hathaway; Warren Buffet.
D)   Carl Icahn; Pershing Square.E) A) and B)
F) A) and D)

Exam 9: Strategic Control and Corporate Governance

Rule-based controls are least appropriate in organizations with which one of the following characteristics?

Correct AnswerverifiedShow Answer

Informational control is primarily concerned with whether the organization is doing the right things.

Correct AnswerverifiedShow Answer

Which of the following is not a key control lever of behavioral control?

Correct AnswerverifiedShow Answer

In addition to traditional institutional investors,a growing set of activist investors aggressively pressure firm managers for major changes.These activist investors include individual investors,such as ________,and activist investor funds,such as ________.

Correct AnswerverifiedShow Answer

Which of the following is the primary drawback of traditional strategic control systems?

Correct AnswerverifiedShow Answer

The best way to minimize improper and unethical conduct is to ________ and ________.

Correct AnswerverifiedShow Answer

In order to have effective board operations,firms need to cultivate engaged and committed boards.

Correct AnswerverifiedShow Answer

What is agency theory and what problems is it concerned with resolving?

Correct AnswerverifiedAgency theory is a theory of the relatio...View AnswerShow Answer

Andy Grove,former CEO and cofounder of Intel,encouraged openness by not having many of the trappings of success.This is an example of evolving from boundaries to rewards and culture by

Correct AnswerverifiedShow Answer

Single-loop learning,according to Chris Argyris,is most appropriate when the environment is ________,goals and objective can be measured with a ________ of certainty,and there is ________ need for complex measures of performance.

Correct AnswerverifiedShow Answer

Contemporary strategic controls involve comparing actual performance to predetermined goals.

Correct AnswerverifiedShow Answer

Individual and institutional shareholders have the same rights that include all the following except

Correct AnswerverifiedShow Answer

The primary participants in corporate governance do not include the

Correct AnswerverifiedShow Answer

Individual rationality ________ organizational rationality.

Correct AnswerverifiedShow Answer

In choosing sides concerning CEO duality,two schools of thought exist.Which of the following would not be a consideration for the Unity of Command school of thought?

Correct AnswerverifiedShow Answer

Strategic control systems,both informational and behavioral,are used to correct the performance and ultimate strategy of a firm.

Correct AnswerverifiedShow Answer

As firms simultaneously downsize and face the need for increased coordination across organizational boundaries,a control system based primarily on ________ is dysfunctional.

Correct AnswerverifiedShow Answer

In principal-principal conflicts (conflicts between controlling shareholders and minority shareholders) ,the ownership (of equity) is

Correct AnswerverifiedShow Answer

Director independence and non-interlocking directorships are desirable traits of top-ranked boards.What does this mean?

Correct AnswerverifiedShow Answer

Continuous monitoring,in the contemporary approach,is beneficial because

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

In addition to traditional institutional investors,a growing set of activist investors aggressively pressure firm managers for major changes.These activist investors include individual investors,such as ,and activist investor funds,such as .

Correct Answer
verified

Correct Answer
verified

The best way to minimize improper and unethical conduct is to and .

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Agency theory is a theory of the relatio...
View Answer

Correct Answer
verified

Single-loop learning,according to Chris Argyris,is most appropriate when the environment is ,goals and objective can be measured with a of certainty,and there is need for complex measures of performance.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified