Question 1

Large shareholders in emerging economies usually need to have a significantly lower percentage of shares to ensure control than in theUnited States.

Accepted Answer

A) True 
 B)False  False

Question 2

Industry-based considerations regarding corporate governance include all of the following EXCEPT:

Accepted Answer

A) Having more outside directors on the board is often regarded as having a negative impact on performance because of their lack of understanding as compared to insiders. 
B) In industries characterized by rapid innovation requiring significant R&D investments (such as information technology), outside directors may have a negative impact on firm performance. 
C)  Research finds that for firms in low-growth, stable industries, no relationship exists between inside management ownership and firm performance. 
D)  In industries experiencing great turbulence, the presence of a single leader may allow a faster and more unified response to changing events. 
A) Having more outside directors on the board is often regarded as having a negative impact on performance because of their lack of understanding as compared to insiders. 
B) In industries characterized by rapid innovation requiring significant R&D investments (such as information technology), outside directors may have a negative impact on firm performance. 
C)  Research finds that for firms in low-growth, stable industries, no relationship exists between inside management ownership and firm performance. 
D)  In industries experiencing great turbulence, the presence of a single leader may allow a faster and more unified response to changing events. A

Question 3

Family ownership and control of large firms may:

Accepted Answer

A) ​Provide better incentive for a focus on long-term performance. 
B) ​Minimize conflicts between owners and managers typical of large firms. 
C)  ​Lead to destruction of value as a result of conflict. 
D)  ​All of the above. 
A) ​Provide better incentive for a focus on long-term performance. 
B) ​Minimize conflicts between owners and managers typical of large firms. 
C)  ​Lead to destruction of value as a result of conflict. 
D)  ​All of the above. D

Question 4

Most large, publicly traded UK corporations are now characterized by all of the following except:

Accepted Answer

A) Diffused ownership. 
B) Numerous small shareholders. 
C)  A separation of ownership and control. 
D)  Corporate managers who own a majority of the stock. 
A) Diffused ownership. 
B) Numerous small shareholders. 
C)  A separation of ownership and control. 
D)  Corporate managers who own a majority of the stock.

Question 5

The ability to successfully list a foreign firm on a high-profile exchange such as NYSE leads to a higher valuation for that firm as opposed to domestic firms.

Accepted Answer

A) True 
 B)False

Question 6

Because of the market for corporate control, the long-term profitability of postmerger firms is impressively high.

Accepted Answer

A) True 
 B)False

Question 7

Are there potential issues involving economic power and national sovereignty in the dominant stock ownership position of institutional investors?

Accepted Answer

Typically, people think of traditional U

Question 8

Inside directors are top executives of the firm.

Accepted Answer

A) True 
 B)False

Question 9

Can interlocking directorates lead to unfair market advantages and investor exploitation? How?

Accepted Answer

If the CEO of Firm A is on the board of

Question 10

In industries experience significant turbulence, the agency costs of CEO duality outweigh the benefits.

Accepted Answer

A) True 
 B)False

Question 11

FPI investors demand less protection.

Accepted Answer

A) True 
 B)False

Question 12

Formal legal protection encourages founding families and their heirs to dilute their equity.

Accepted Answer

A) True 
 B)False

Question 13

In corporate governance, most small shareholders:

Accepted Answer

A) ​Attend annual shareholder meetings. 
B) ​Have strong incentives to monitor how the firm is being run. 
C)  ​Prefer to free-ride and hope other shareholders monitor manager behavior. 
D)  ​Rarely hold stock for a long period of time. 
A) ​Attend annual shareholder meetings. 
B) ​Have strong incentives to monitor how the firm is being run. 
C)  ​Prefer to free-ride and hope other shareholders monitor manager behavior. 
D)  ​Rarely hold stock for a long period of time.

Question 14

The relationship between shareholders and professional managers is a relationship between principals and agents.

Accepted Answer

A) True 
 B)False

Question 15

The primary reason that agency problems persist is:

Accepted Answer

A) ​Poor stewardship on the part of principals. 
B) ​Poor delegation on the part of agents. 
C)  ​Information asymmetries. 
D)  ​None of the above. 
A) ​Poor stewardship on the part of principals. 
B) ​Poor delegation on the part of agents. 
C)  ​Information asymmetries. 
D)  ​None of the above.

Question 16

CEO duality presents a significant agency issue.

Accepted Answer

A) True 
 B)False

Question 17

As the opening case pointed out, on the positive side private, equity firms excel in all the following ways EXCEPT:

Accepted Answer

A) They reduce income inequality between financiers and the rest of us. 
B) They use a high level of debt that imposes strong financial discipline. 
C)  Private equity turns managers from agents to principals with substantial equity, thus providing a powerful incentive to them. 
D)  They pay managers more generously, but also punish failure more heavily. 
A) They reduce income inequality between financiers and the rest of us. 
B) They use a high level of debt that imposes strong financial discipline. 
C)  Private equity turns managers from agents to principals with substantial equity, thus providing a powerful incentive to them. 
D)  They pay managers more generously, but also punish failure more heavily.

Question 18

Outside directors of a board are not always independent.

Accepted Answer

A) True 
 B)False

Question 19

Outside of the Anglo-American world, most large firms:

Accepted Answer

A) ​Have a widely held ownership. 
B) ​Insist on significant separation between ownership and control. 
C)  ​Are typically owned and controlled by families or the state. 
D)  ​None of the above. 
A) ​Have a widely held ownership. 
B) ​Insist on significant separation between ownership and control. 
C)  ​Are typically owned and controlled by families or the state. 
D)  ​None of the above.

Question 20

Recently, stewardship theory suggests that by and large managers can be viewed as stewards of owners' interests.

Accepted Answer

A) True 
 B)False

Large shareholders in emerging economies usually need to have a significantly lower percentage of shares to ensure control than in theUnited States.

Industry-based considerations regarding corporate governance include all of the following EXCEPT:

Family ownership and control of large firms may:

Most large, publicly traded UK corporations are now characterized by all of the following except:

The ability to successfully list a foreign firm on a high-profile exchange such as NYSE leads to a higher valuation for that firm as opposed to domestic firms.

Because of the market for corporate control, the long-term profitability of postmerger firms is impressively high.

Are there potential issues involving economic power and national sovereignty in the dominant stock ownership position of institutional investors?

Inside directors are top executives of the firm.

Can interlocking directorates lead to unfair market advantages and investor exploitation? How?

In industries experience significant turbulence, the agency costs of CEO duality outweigh the benefits.

FPI investors demand less protection.

Formal legal protection encourages founding families and their heirs to dilute their equity.

In corporate governance, most small shareholders:

The relationship between shareholders and professional managers is a relationship between principals and agents.

The primary reason that agency problems persist is:

CEO duality presents a significant agency issue.

As the opening case pointed out, on the positive side private, equity firms excel in all the following ways EXCEPT:

Outside directors of a board are not always independent.

Outside of the Anglo-American world, most large firms:

Recently, stewardship theory suggests that by and large managers can be viewed as stewards of owners' interests.

Strategizing Around the Globe

Managing Industry Competition

Leveraging Resources and Capabilities

Emphasizing Institutions, Cultures, and Ethics

Growing and Internationalizingthe Entrepreneurial Firm

Entering Foreign Markets

Making Strategic Alliancee and Networks Work

Managing Global Competitive Dynamics

Diversifying, Acquiring, and Restructuring

Strategizing, Structuring, and Learningaround the World

Strategizing With Corporate Social Responsibility

Filters

Exam 11: Governing the Corporation Around the World

Large shareholders in emerging economies usually need to have a significantly lower percentage of shares to ensure control than in theUnited States.

Industry-based considerations regarding corporate governance include all of the following EXCEPT:

Family ownership and control of large firms may:

Most large, publicly traded UK corporations are now characterized by all of the following except:

The ability to successfully list a foreign firm on a high-profile exchange such as NYSE leads to a higher valuation for that firm as opposed to domestic firms.

Because of the market for corporate control, the long-term profitability of postmerger firms is impressively high.

Are there potential issues involving economic power and national sovereignty in the dominant stock ownership position of institutional investors?

Inside directors are top executives of the firm.

Can interlocking directorates lead to unfair market advantages and investor exploitation? How?

In industries experience significant turbulence, the agency costs of CEO duality outweigh the benefits.

FPI investors demand less protection.

Formal legal protection encourages founding families and their heirs to dilute their equity.

In corporate governance, most small shareholders:

The relationship between shareholders and professional managers is a relationship between principals and agents.

The primary reason that agency problems persist is:

CEO duality presents a significant agency issue.

As the opening case pointed out, on the positive side private, equity firms excel in all the following ways EXCEPT:

Outside directors of a board are not always independent.

Outside of the Anglo-American world, most large firms:

Recently, stewardship theory suggests that by and large managers can be viewed as stewards of owners' interests.

Strategizing Around the Globe

Managing Industry Competition

Leveraging Resources and Capabilities

Emphasizing Institutions, Cultures, and Ethics

Growing and Internationalizingthe Entrepreneurial Firm

Entering Foreign Markets

Making Strategic Alliancee and Networks Work

Managing Global Competitive Dynamics

Diversifying, Acquiring, and Restructuring

Strategizing, Structuring, and Learningaround the World

Strategizing With Corporate Social Responsibility

Filters