One approach to better match executive rewards to the accomplishment of strategic
objectives is
A) return on investment.
B) year-end bonuses.
C) zero base budgeting.
D) weighted-factor method.
E) return on assets.
Answer:
The Z-value uses ________ ratios and weights them according to their importance to a
corporation’s financial strength.
A) 2
B) 3
C) 4
D) 5
E) 6
Answer:
According to the text, what percentage of security analysts use annual reports when
making decisions?
A) 20%
B) 35%
C) 50%
D) 75%
E) 100%
Answer:
The displacement of one technology by another, as shown by two S-shaped curves on a
graph, is referred to as
A) economies of scope versus operating leverage.
B) technology transfer.
C) the R&D mix.
D) technological discontinuity.
E) a disjunctive learning or experience curve.
Answer:
In international dealings, turnkey operations are
A) a way in which an MNC may contract with a foreign government or local firm to
trade raw materials for certain resources belonging to the MNC.
B) a way in which an MNC can take total control of operations by either starting a
business from scratch or acquiring a firm already established in the host country.
C) when a corporation chooses to build a facility from scratch allowing it the freedom
to design the plant, choose suppliers, and hire a workforce.
D) when an MNC has a large amount of management talent available and chooses to
use its personnel to assist a firm in a host country for a specified fee and period of time.
E) contracting for construction of operating facilities in exchange for a fee.
Answer:
A 2012 survey of 169 CFOs at publicly traded companies in the United States found
what percent intentionally misrepresented their economic performance primarily to
influence stock price?
A) 1%
B) 20%
C) 40%
D) 60 %
E) 90%
Answer:
According to the text, which one of the following is NOT one of the reasons why
innovations seem to occur more often in small firms rather than in large, established
corporations?
A) An entrepreneur in a small firm is more willing to accept greater risk than would a
larger firm of diversified ownership.
B) Small firms are completely ignorant of risk management.
C) The greater the assets involved and the longer they are tied up, the more likely top
management in large firms is to demand a high probability of success.
D) Companies operating in global industries must deal with a greater amount of risk
than firms operating only in one country.
E) If the corporation’s stock is widely held as in the case of large firms and experiences
stock price declines due to some external assessment, it places the firm in jeopardy of
being acquired.
Answer:
Corporate parenting generates corporate strategy by focusing on
A) the core competencies of the parent corporation and on the value created from the
relationship between the parent and its units.
B) the cash flow among its business units.
C) whether a business unit should be growing, stabilizing, or retrenching.
D) acquiring distinctive competencies in the marketplace.
E) differentiating its activities into separate units and integrating these activities through
complex integrating mechanisms.
Answer:
The two general types of cooperative strategies are
A) competitive and functional.
B) collusion and competitive.
C) strategic alliances and collusion.
D) strategic alliances and competitive.
E) competitive and collusive alliances.
Answer:
Growth through diversification out of an industry into an unrelated industry is called
A) concentration.
B) horizontal growth.
C) concentric diversification.
D) vertical growth.
E) conglomerate diversification.
Answer:
Action plans are important for several reasons. Which one of the following is NOT one
of these reasons?
A) If the action plan is implemented properly, it ensures that the strategy will be a
success.
B) It serves as a link between strategy formulation and evaluation and control.
C) The action plan specifies what needs to be done differently from the way operations
are currently carried out.
D) During the evaluation and control process, an action plan helps in the appraisal of
the performance and identifying remedial actions needed.
E) Motivation may be improved with the assignment of specific responsibility.
Answer:
What percent of large U.S. companies have CEO succession plans in place?
A) 10
B) 25
C) 50
D) 75
E) 90
Answer:
Which of Porter’s competitive strategies recommends that a company emphasize a
particular buyer group or geographic market and attempts to seek a cost advantage in its
targeted segment?
A) differentiation
B) cost leadership
C) differentiation focus
D) competitive advantage
E) cost focus
Answer:
When scientists concentrate on quality control and the development of design
specifications and improved production equipment, it is referred to as
A) basic R&D.
B) product R&D.
C) engineering R&D.
D) life cycle R&D.
E) R&D mix.
Answer:
Approximately what percent of manufacturing companies have implemented some form
of quality management practices?
A) 92
B) 76
C) 50
D) 22
E) 10
Answer:
Which of the following is NOT descriptive of a network structure?
A) The network organization is a series of independent firms or business units linked
together through design, production, and marketing.
B) Independent inventors and entertainment companies often use the network structure.
C) The network structure typically is located in a large, single building or areas with
many work projects in operation on the site.
D) The network structure provides an organization with increased flexibility and
adaptability to cope with rapid technological changes.
E) The network structure is particularly suited to coping with the shifting patterns of
international trade and competition.
Answer:
Which of the following is NOT a function of corporate culture?
A) conveys a sense of identity for employees
B) adds to the stability of the organization as a social system
C) helps generate employee commitment to something greater than themselves
D) keeps people guessing about what to do next
E) serves as a frame of reference for employees to use as a guide for appropriate
behavior
Answer:
The first step in constructing a corporate scenario is to
A) develop a common-sized financial statement.
B) construct detailed pro forma financial statements.
C) decide upon how much risk management is willing to accept.
D) analyze the societal environment.
E) use industry scenarios to develop a set of assumptions about the task environment.
Answer:
The relationship among the board of directors, top management, and shareholders is
referred to as
A) corporate synergy.
B) corporate management.
C) corporate governance.
D) corporate strategy.
E) corporate responsibility.
Answer:
The end result of activity is known as
A) measurement.
B) gratuity.
C) performance.
D) return on equity.
E) achievement.
Answer:
According to Porter, the generic competitive strategy that reflects the ability of the
corporation or its business unit to design, produce, and market a comparable product
more efficiently than its competitors is called
A) competitive scope.
B) differentiation.
C) cost leadership.
D) diversification.
E) focus.
Answer:
Which of the following is a way in which managers can improve their company’s or
business unit’s EVA?
A) earning more profit without using more capital
B) using more capital
C) investing capital in multiple low-return projects
D) extending their line of credit
E) all of the above
Answer:
Which type of structure was used by Nestle to tailor products to regional differences
and to achieve regional coordination?
A) geographic-area structure
B) network structure
C) product-group structure
D) international structure
E) functional structure
Answer:
Which of the following is NOT a primary activity of the value chain?
A) raw materials handling
B) installation
C) repair
D) purchasing
E) warehousing
Answer:
Stage V in the organizational life cycle is the
A) birth stage.
B) growth stage.
C) maturity stage.
D) decline stage.
E) death stage.
Answer:
What is the additional phase in the organizational life cycle that may occur sometime
during the maturity or decline stages?
A) pause phase
B) acquisition phase
C) recovery phase
D) temporal displacement phase
E) revival phase
Answer:
The theory that proposes organizations can and do adapt to changing conditions by
imitating other successful organizations is known as
A) population ecology.
B) institution theory.
C) citizenship theory.
D) strategic theory.
E) sample theory.
Answer:
The concept of ________ was taken one step further in JITII, in which vendor sales
representatives usually have desks next to the purchasing company’s factory floor,
attend production status meetings, visit the R&D lab, and analyze the purchasing
company’s sales forecasts.
A) multiple sourcing
B) outsourcing
C) sole sourcing
D) parallel sourcing
E) all of the above
Answer:
According to Barney’s VRIO framework, the firm’s exploitation of a competency
pertains to
A) value.
B) rareness.
C) imitability.
D) organization.
E) durability.
Answer:
Which one of the following is NOT a part of the evaluation and control of
performance?
A) Establish corporate strategies.
B) Determine what to measure.
C) Establish standards for performance.
D) Measure actual performance.
E) Take corrective actions.
Answer:
The time horizon involved with regard to basic financial planning is usually
A) one year.
B) one quarter.
C) more than five years.
D) less than one month.
E) more than three years.
Answer:
An automobile assembly line is an example of which approach to manufacturing?
A) continuous system
B) debt capacity
C) sequential processing
D) job shop
E) intermittent system
Answer:
The balanced scorecard approach to evaluation and control assigns to each
goal/objective in an area one or more measures that are each essential for achieving a
desired strategic option. These measures are called
A) critical success factors.
B) strategic factors.
C) key performance measures.
D) behavioral measures.
E) responsibility centers.
Answer: