Question 1

In an M-form organization, the management of day-to-day operations is delegated to

Accepted Answer

A)  divisional general managers and corporate staff managers. 
B)  corporate staff managers and functional managers who report to corporate staff managers. 
C)  divisional general managers and functional managers who report to division general managers. 
D)  the board of directors and corporate staff managers who report to the board of directors. 
A)  divisional general managers and corporate staff managers. 
B)  corporate staff managers and functional managers who report to corporate staff managers. 
C)  divisional general managers and functional managers who report to division general managers. 
D)  the board of directors and corporate staff managers who report to the board of directors.

Question 2

In zero-based budgeting, each project has to stand on its own merits each year by being included among the important projects that a firm can afford to fund and no project receives funding for the future simply because it received funding in the past.

Accepted Answer

A) True 
 B)False

Question 3

The senior executive (the president or CEO) in an M-form organization has two responsibilities:

Accepted Answer

A)  budgeting and accounting. 
B)  budgeting and mission setting. 
C)  strategy formulation and strategy implementation. 
D)  strategy formulation and budgeting. 
A)  budgeting and accounting. 
B)  budgeting and mission setting. 
C)  strategy formulation and strategy implementation. 
D)  strategy formulation and budgeting.

Question 4

When compared to the strategy implementation responsibilities of senior executives in U-form organizations, when implementing strategy, division general managers in M-form organizations

Accepted Answer

A)  tend to have to deal with less conflict. 
B)  have to compete for external capital funding. 
C)  tend to have to deal with substantially more conflict. 
D)  must cooperate with other divisions to exploit corporate economies of scope. 
A)  tend to have to deal with less conflict. 
B)  have to compete for external capital funding. 
C)  tend to have to deal with substantially more conflict. 
D)  must cooperate with other divisions to exploit corporate economies of scope.

Question 5

Which organizational structure is SpandoCorp using?

Accepted Answer

A)  U-form 
B)  Matrix 
C)  M-form 
D)  Functional 
A)  U-form 
B)  Matrix 
C)  M-form 
D)  Functional

Question 6

One common agency problem occurs when managers decide to take some of a firm's capital and invest it in managerial perquisites that do not add economic value to the firm but that do directly benefit those managers.

Accepted Answer

A) True 
 B)False

Question 7

By adjusting for a division's earning and accounting for the cost of investing in a division, economic value added is a much more accurate estimate of a division's economic performance than are traditional accounting measures of performance.

Accepted Answer

A) True 
 B)False

Question 8

Research has shown that separating the roles of CEO and board chair is positively correlated with firm performance when firms operated in high-growth and very complex environments.

Accepted Answer

A) True 
 B)False

Question 9

Describe the multidivisional, or M-form structure, and how it is used to implement a corporate diversification strategy.

Accepted Answer

The most common organizational structure

Question 10

Two common agency problems include

Accepted Answer

A)  managers investing some of a firm's capital in managerial perquisites that do not add economic value to a firm and managerial risk aversion. 
B)  managers not investing enough of a firm's capital in managerial perquisites and managerial risk aversion. 
C)  managers investing some of a firm's capital in managerial perquisites that do not add economic value to a firm and managerial risk seeking. 
D)  managers not investing enough of a firm's capital in managerial perquisites and managerial risk seeking. 
A)  managers investing some of a firm's capital in managerial perquisites that do not add economic value to a firm and managerial risk aversion. 
B)  managers not investing enough of a firm's capital in managerial perquisites and managerial risk aversion. 
C)  managers investing some of a firm's capital in managerial perquisites that do not add economic value to a firm and managerial risk seeking. 
D)  managers not investing enough of a firm's capital in managerial perquisites and managerial risk seeking.

Question 11

The divisions in an M-form organization are true profit-and-loss centers.

Accepted Answer

A) True 
 B)False

Question 12

Research on outside members of boards of directors tends to show that outside directors, as compared to insiders, tend to focus less on monitoring a firm's economic performance than on other measures of firm performance.

Accepted Answer

A) True 
 B)False

Question 13

When adjusting a division's accounting earnings for use in the economic value added calculations, R&D spending is usually

Accepted Answer

A)  subtracted from the division's performance. 
B)  depreciated over the life of the average R&D projected and subtracted from the division's performance. 
C)  amortized over the life of the average R&D projected and added back to the division's performance. 
D)  added back into the division's performance. 
A)  subtracted from the division's performance. 
B)  depreciated over the life of the average R&D projected and subtracted from the division's performance. 
C)  amortized over the life of the average R&D projected and added back to the division's performance. 
D)  added back into the division's performance.

Question 14

The primary responsibility of the ________ is to provide information about the firm's external and internal environments to the firm's senior executive.

Accepted Answer

A)  corporate staff 
B)  board of directors 
C)  division general managers 
D)  shared activity managers 
A)  corporate staff 
B)  board of directors 
C)  division general managers 
D)  shared activity managers

Question 15

Only accounting measures of performance can be used in accurately measuring the performance of divisions within a diversified firm.

Accepted Answer

A) True 
 B)False

Question 16

In a multidivisional company, one division "sells" its products or services to a second division for a(n) ________, which is set by a firm's corporate management to accomplish corporate objectives.

Accepted Answer

A)  allocation price 
B)  transfer cost 
C)  market price 
D)  transfer price 
A)  allocation price 
B)  transfer cost 
C)  market price 
D)  transfer price

Question 17

In an M-form organization the role of the board of directors is to formulate corporate strategies consistent with equity holders' interests and to assure strategy implementation.

Accepted Answer

A) True 
 B)False

Question 18

Kelly Rae's position is SpandoCorp is best described as a(n)

Accepted Answer

A)  institutional investor. 
B)  senior executive. 
C)  division general manager. 
D)  member of the board of directors. 
A)  institutional investor. 
B)  senior executive. 
C)  division general manager. 
D)  member of the board of directors.

Question 19

In an M-form organization, the chief executive officer is solely responsible for strategy implementation.

Accepted Answer

A) True 
 B)False

Question 20

IPO stands for

Accepted Answer

A)  internal product offering. 
B)  internal price orders. 
C)  international product orders. 
D)  initial public offering. 
A)  internal product offering. 
B)  internal price orders. 
C)  international product orders. 
D)  initial public offering.

In an M-form organization, the management of day-to-day operations is delegated to

In zero-based budgeting, each project has to stand on its own merits each year by being included among the important projects that a firm can afford to fund and no project receives funding for the future simply because it received funding in the past.

The senior executive (the president or CEO) in an M-form organization has two responsibilities:

When compared to the strategy implementation responsibilities of senior executives in U-form organizations, when implementing strategy, division general managers in M-form organizations

Which organizational structure is SpandoCorp using?

One common agency problem occurs when managers decide to take some of a firm's capital and invest it in managerial perquisites that do not add economic value to the firm but that do directly benefit those managers.

By adjusting for a division's earning and accounting for the cost of investing in a division, economic value added is a much more accurate estimate of a division's economic performance than are traditional accounting measures of performance.

Research has shown that separating the roles of CEO and board chair is positively correlated with firm performance when firms operated in high-growth and very complex environments.

Describe the multidivisional, or M-form structure, and how it is used to implement a corporate diversification strategy.

Two common agency problems include

The divisions in an M-form organization are true profit-and-loss centers.

Research on outside members of boards of directors tends to show that outside directors, as compared to insiders, tend to focus less on monitoring a firm's economic performance than on other measures of firm performance.

When adjusting a division's accounting earnings for use in the economic value added calculations, R&D spending is usually

The primary responsibility of the ________ is to provide information about the firm's external and internal environments to the firm's senior executive.

Only accounting measures of performance can be used in accurately measuring the performance of divisions within a diversified firm.

In a multidivisional company, one division "sells" its products or services to a second division for a(n) ________, which is set by a firm's corporate management to accomplish corporate objectives.

In an M-form organization the role of the board of directors is to formulate corporate strategies consistent with equity holders' interests and to assure strategy implementation.

Kelly Rae's position is SpandoCorp is best described as a(n)

In an M-form organization, the chief executive officer is solely responsible for strategy implementation.

IPO stands for

What Is Strategy and the Strategic Management Process

Evaluating a Firms External Environment

Evaluating a Firms Internal Capabilities

Cost Leadership

Product Differentiation

Vertical Integration

Corporate Diversification

Strategic Alliances

Mergers and Acquisitions

International Strategies

Filters

Exam 8: Organizing to Implement Corporate Diversification

In an M-form organization, the management of day-to-day operations is delegated to

In zero-based budgeting, each project has to stand on its own merits each year by being included among the important projects that a firm can afford to fund and no project receives funding for the future simply because it received funding in the past.

The senior executive (the president or CEO) in an M-form organization has two responsibilities:

When compared to the strategy implementation responsibilities of senior executives in U-form organizations, when implementing strategy, division general managers in M-form organizations

Which organizational structure is SpandoCorp using?

One common agency problem occurs when managers decide to take some of a firm's capital and invest it in managerial perquisites that do not add economic value to the firm but that do directly benefit those managers.

By adjusting for a division's earning and accounting for the cost of investing in a division, economic value added is a much more accurate estimate of a division's economic performance than are traditional accounting measures of performance.

Research has shown that separating the roles of CEO and board chair is positively correlated with firm performance when firms operated in high-growth and very complex environments.

Describe the multidivisional, or M-form structure, and how it is used to implement a corporate diversification strategy.

Two common agency problems include

The divisions in an M-form organization are true profit-and-loss centers.

Research on outside members of boards of directors tends to show that outside directors, as compared to insiders, tend to focus less on monitoring a firm's economic performance than on other measures of firm performance.

When adjusting a division's accounting earnings for use in the economic value added calculations, R&D spending is usually

The primary responsibility of the ________ is to provide information about the firm's external and internal environments to the firm's senior executive.

Only accounting measures of performance can be used in accurately measuring the performance of divisions within a diversified firm.

In a multidivisional company, one division "sells" its products or services to a second division for a(n) ________, which is set by a firm's corporate management to accomplish corporate objectives.

In an M-form organization the role of the board of directors is to formulate corporate strategies consistent with equity holders' interests and to assure strategy implementation.

Kelly Rae's position is SpandoCorp is best described as a(n)

In an M-form organization, the chief executive officer is solely responsible for strategy implementation.

IPO stands for

What Is Strategy and the Strategic Management Process

Evaluating a Firms External Environment

Evaluating a Firms Internal Capabilities

Cost Leadership

Product Differentiation

Vertical Integration

Corporate Diversification

Strategic Alliances

Mergers and Acquisitions

International Strategies

Filters