Strategic Management Theory An Integrated Approach 11th Edition By Charles – Test Bank

Overview

2. In corporations, agency theory is used to explain the relationship between stockholders and corporate managers, and between upper-level managers and the lower-level managers they supervise.
a. True
b. False

ANSWER: True POINTS: I DIFFICULTY: Easy
LEARNING OBJECTIVES: SMIA.HILL.l5.11.01 -Understand the relationship between stakeholder management and corporate performance
NATIONAL STANDARDS: United States- BUSPROG: Analytic
KEYWORDS: Bloom’s: Knowledge

3. An agency relationship continues down a hierarchy within a company.
a. True
b. False

ANSWER: True POINTS:I
DIFFICULTY:Easy
LEARNING OBJECTIVES: SMIA.HILL.l5.11.01 -Understand the relationship between stakeholder management and corporate performance
NATIONAL STANDARDS: United States- BUSPROG: Analytic
KEYWORDS: Bloom’s: Knowledge

4. There is a certain amount of performance ambiguity inherent in the relationship between a principal and agent.
a. True
b. False

ANSWER: True POINTS: I DIFFICULTY: Easy
LEARNING OBJECTIVES: SMIA.HILL.l5.11.01 -Understand the relationship between stakeholder management and corporate performance
NATIONAL STANDARDS: United States- BUSPROG: Analytic
KEYWORDS: Bloom’s: Knowledge

DIFFICULTY: Moderate
LEARNING OBJECTIVES: SMIA.HILL.l5.11.01 -Understand the relationship between stakeholder management and corporate performance
NATIONAL STANDARDS: United States- BUSPROG: Reflective Thinking
KEYWORDS: Bloom’s: Application

6. All stakeholders have an exchange relationship with the company.
a. True
b. False

ANSWER: True POINTS: I
DIFFICULTY: Easy

LEARNING OBJECTIVES: SMIA.HILL.l5.11.01 -Understand the relationship between stakeholder management and corporate performance
NATIONAL STANDARDS: United States- BUSPROG: Reflective Thin- BUSPROG: Analytic
KEYWORDS: Bloom’s: Knowledge

7. Agency theory offers a way of understanding why managers do not always act in the best interests of stakeholders.
a. True
b. False

ANSWER: True POINTS: I DIFFICULTY: Easy
LEARNING OBJECTIVES: SMIA.HILL.l5.11.01 -Understand the relationship between stakeholder management and corporate performance
NATIONAL STANDARDS: United States- BUSPROG: Analytic
KEYWORDS: Bloom’s: Knowledge

8. While many agency relationships work well, problems arise when agents and principals have different goals.
a. True
b. False

ANSWER: True POINTS: I
DIFFICULTY: Easy

LEARNING OBJECTIVES: SMIA.HILL.l5.11.01 -Understand the relationship between stakeholder management and corporate performance
NATIONAL STANDARDS: United States- BUSPROG: Analytic
KEYWORDS: Bloom’s: Knowledge

LEARNING OBJECTIVES: SMIA.HILL.15.11.01 -Understand the relationship between stakeholder management and corporate performance
NATIONAL STANDARDS: United States- BUSPROG: Reflective Thin- BUSPROG: Analytic
KEYWORDS: Bloom’s: Knowledge

10. Strike price is the price at which the stock was trading when the option was originally granted.
a. True
b. False

ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: SMIA.HILL.15.11.03 -Describe the various governance mechanisms that are used to align the interests of stockholders and managers
NATIONAL STANDARDS: United States- BUSPROG: Reflective Thin- BUSPROG: Analytic
KEYWORDS: Bloom’s: Knowledge

11. Stockholders receive a return on their investment in a company’s stock from dividend payments and capital appreciation.
a. True
b. False

ANSWER: True POINTS:I
DIFFICULTY:I

LEARNING OBJECTIVES: SMIA.HILL.15.11.02- Explain why maximizing returns to stockholders is often viewed as the preeminent goal in many corporations
NATIONAL STANDARDS: United States- BUSPROG: Reflective Thin- BUSPROG: Analytic
KEYWORDS: Bloom’s: Knowledge