Question 1

What is the difference between EVA and MVA?

Accepted Answer

Economic value added (EVA)has become an extremely popular shareholder value method of measuring corporate and divisional performance and may be on its way to replacing ROI as the standard performance measure.EVA measures the difference between the pre-strategy and post-strategy value for the business.EVA is after-tax operating income minus the total annual cost of capital.Market value added (MVA)is the difference between the market value of a corporation and the capital contributed by shareholders and lenders.It measures the stock market's estimate of the net present value of a firm's past and expected capital investment projects.MVA is the present value of future EVA.

Question 2

The long-term evaluation method encourages executives to look at developmental expenses as being different from expenses required for current operations.

Accepted Answer

A) True 
 B)False  False

Question 3

Which type of control specifies how something is to be done through policies, rules, standard operating procedures, and orders from a superior?

Accepted Answer

A)  tactical control 
B)  strategic control 
C)  output control 
D)  behavior control 
E)  functional control 
A)  tactical control 
B)  strategic control 
C)  output control 
D)  behavior control 
E)  functional control D

Question 4

What is the balanced scorecard? What are the four areas to be addressed?

Accepted Answer

The balanced scorecard combines financia

Question 5

Which of the following is NOT a guideline for proper control?

Accepted Answer

A)  Control should involve only a minimum amount of information. 
B)  Long-term as well as short-term controls should be used. 
C)  Controls should be timely so that corrective actions can be taken before it is too late. 
D)  Controls should measure all activities in order to be comprehensive. 
E)  Controls should emphasize the reward of meeting or exceeding standards rather than punishment for failing to meet standards. 
A)  Control should involve only a minimum amount of information. 
B)  Long-term as well as short-term controls should be used. 
C)  Controls should be timely so that corrective actions can be taken before it is too late. 
D)  Controls should measure all activities in order to be comprehensive. 
E)  Controls should emphasize the reward of meeting or exceeding standards rather than punishment for failing to meet standards.

Question 6

Which method of matching rewards to the accomplishment of strategic objectives encourages executives to look at developmental expenses as being different from those expenses required for current operations?

Accepted Answer

A)  strategic-funds method 
B)  segmentation method 
C)  long-term evaluation method 
D)  individual evaluation method 
E)  weighted-factor method 
A)  strategic-funds method 
B)  segmentation method 
C)  long-term evaluation method 
D)  individual evaluation method 
E)  weighted-factor method

Question 7

One example of a steering control used by retail stores is the inventory turnover ratio, which shows how hard an investment in inventory is working.

Accepted Answer

A) True 
 B)False

Question 8

A study of 79 MNCs revealed that international transfer pricing from one country unit to another is primarily used to

Accepted Answer

A)  evaluate performance. 
B)  minimize taxes. 
C)  increase profits. 
D)  improve communication. 
E)  all of the above 
A)  evaluate performance. 
B)  minimize taxes. 
C)  increase profits. 
D)  improve communication. 
E)  all of the above

Question 9

People tend to substitute behaviors that are recognized and rewarded for those behaviors that are ignored, without regard to their contribution to goal accomplishment.

Accepted Answer

A) True 
 B)False

Question 10

The over-billing of customers in Sears's auto repair shops was an example of suboptimization.

Accepted Answer

A) True 
 B)False

Question 11

A type of responsibility center which is typically established whenever an organizational unit has control over both its resources and its products or services is a(n)

Accepted Answer

A)  investment center. 
B)  revenue center. 
C)  expense center. 
D)  profit center. 
E)  standard cost center. 
A)  investment center. 
B)  revenue center. 
C)  expense center. 
D)  profit center. 
E)  standard cost center.

Question 12

What percent of U.S.companies actively monitored their workers' website visits according to an American Management Association study?

Accepted Answer

A)  0% 
B)  25% 
C)  33% 
D)  50% 
E)  66% 
A)  0% 
B)  25% 
C)  33% 
D)  50% 
E)  66%

Question 13

A study by Bain & Company revealed what percentage of companies using benchmarking in some manner?

Accepted Answer

A)  10% 
B)  30% 
C)  50% 
D)  65% 
E)  90% 
A)  10% 
B)  30% 
C)  50% 
D)  65% 
E)  90%

Question 14

The union of all of a company's major business activities from order processing to production within a single family of software modules is known as

Accepted Answer

A)  enterprise resource planning. 
B)  enterprise strategic planning. 
C)  information system planning. 
D)  united resource planning. 
E)  united strategic planning. 
A)  enterprise resource planning. 
B)  enterprise strategic planning. 
C)  information system planning. 
D)  united resource planning. 
E)  united strategic planning.

Question 15

The ISO 9000 and 14000 Standards Series as a way to objectively document a company's high level of quality operations are examples of

Accepted Answer

A)  tactical control. 
B)  strategic control. 
C)  output control. 
D)  functional control. 
E)  behavior control. 
A)  tactical control. 
B)  strategic control. 
C)  output control. 
D)  functional control. 
E)  behavior control.

Question 16

EVA may eventually replace ROI as the standard performance measure.

Accepted Answer

A) True 
 B)False

Question 17

One of the obstacles to effective control is the difficulty in developing appropriate measures of important activities and outputs.

Accepted Answer

A) True 
 B)False

Question 18

What term describes when activities originally intended to help managers attain corporate objectives become ends in themselves or are adapted to meet ends other than those for which they were intended?

Accepted Answer

A)  economic rationality 
B)  minimal acceptable behavior 
C)  goal displacement 
D)  closed system thinking 
E)  Machiavellianism 
A)  economic rationality 
B)  minimal acceptable behavior 
C)  goal displacement 
D)  closed system thinking 
E)  Machiavellianism

Question 19

Which of the following is NOT descriptive of responsibility centers?

Accepted Answer

A)  They are used to the extent that they can isolate specific functional units such as R&D. 
B)  Each responsibility center has its own budget and is evaluated on its use of budgeted resources. 
C)  The responsibility center coordinates all the functional areas and project developments to implement the strategic decision plan. 
D)  The center uses resources to produce a service or a product. 
E)  A responsibility center is headed by the manager responsible for the center's performance. 
A)  They are used to the extent that they can isolate specific functional units such as R&D. 
B)  Each responsibility center has its own budget and is evaluated on its use of budgeted resources. 
C)  The responsibility center coordinates all the functional areas and project developments to implement the strategic decision plan. 
D)  The center uses resources to produce a service or a product. 
E)  A responsibility center is headed by the manager responsible for the center's performance.

Question 20

ERP software provides instant access to critical information to everyone in the organization from the CEO to the factory floor worker.

Accepted Answer

A) True 
 B)False

What is the difference between EVA and MVA?

The long-term evaluation method encourages executives to look at developmental expenses as being different from expenses required for current operations.

Which type of control specifies how something is to be done through policies, rules, standard operating procedures, and orders from a superior?

What is the balanced scorecard? What are the four areas to be addressed?

Which of the following is NOT a guideline for proper control?

Which method of matching rewards to the accomplishment of strategic objectives encourages executives to look at developmental expenses as being different from those expenses required for current operations?

One example of a steering control used by retail stores is the inventory turnover ratio, which shows how hard an investment in inventory is working.

A study of 79 MNCs revealed that international transfer pricing from one country unit to another is primarily used to

People tend to substitute behaviors that are recognized and rewarded for those behaviors that are ignored, without regard to their contribution to goal accomplishment.

The over-billing of customers in Sears's auto repair shops was an example of suboptimization.

A type of responsibility center which is typically established whenever an organizational unit has control over both its resources and its products or services is a(n)

What percent of U.S.companies actively monitored their workers' website visits according to an American Management Association study?

A study by Bain & Company revealed what percentage of companies using benchmarking in some manner?

The union of all of a company's major business activities from order processing to production within a single family of software modules is known as

The ISO 9000 and 14000 Standards Series as a way to objectively document a company's high level of quality operations are examples of

EVA may eventually replace ROI as the standard performance measure.

One of the obstacles to effective control is the difficulty in developing appropriate measures of important activities and outputs.

What term describes when activities originally intended to help managers attain corporate objectives become ends in themselves or are adapted to meet ends other than those for which they were intended?

Which of the following is NOT descriptive of responsibility centers?

ERP software provides instant access to critical information to everyone in the organization from the CEO to the factory floor worker.

Basic Concepts in Strategic Management

Corporate Governance

Ethics and Social Responsibility in Strategic Management

Environmental Scanning and Industry Analysis

Internal Scanning and Organizational Analysis

Strategy Formulation: Situation Analysis and Business Strategy

Strategy Formulation: Corporate Strategy

Strategy Formulation: Functional Strategy and Strategic Choice

Strategy Implementation: Organizing for Action

Strategy Implementation: Staffing and Directing

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Exam 11: Evaluation and Control

What is the difference between EVA and MVA?

The long-term evaluation method encourages executives to look at developmental expenses as being different from expenses required for current operations.

Which type of control specifies how something is to be done through policies, rules, standard operating procedures, and orders from a superior?

What is the balanced scorecard? What are the four areas to be addressed?

Which of the following is NOT a guideline for proper control?

Which method of matching rewards to the accomplishment of strategic objectives encourages executives to look at developmental expenses as being different from those expenses required for current operations?

One example of a steering control used by retail stores is the inventory turnover ratio, which shows how hard an investment in inventory is working.

A study of 79 MNCs revealed that international transfer pricing from one country unit to another is primarily used to

People tend to substitute behaviors that are recognized and rewarded for those behaviors that are ignored, without regard to their contribution to goal accomplishment.

The over-billing of customers in Sears's auto repair shops was an example of suboptimization.

A type of responsibility center which is typically established whenever an organizational unit has control over both its resources and its products or services is a(n)

What percent of U.S.companies actively monitored their workers' website visits according to an American Management Association study?

A study by Bain & Company revealed what percentage of companies using benchmarking in some manner?

The union of all of a company's major business activities from order processing to production within a single family of software modules is known as

The ISO 9000 and 14000 Standards Series as a way to objectively document a company's high level of quality operations are examples of

EVA may eventually replace ROI as the standard performance measure.

One of the obstacles to effective control is the difficulty in developing appropriate measures of important activities and outputs.

What term describes when activities originally intended to help managers attain corporate objectives become ends in themselves or are adapted to meet ends other than those for which they were intended?

Which of the following is NOT descriptive of responsibility centers?

ERP software provides instant access to critical information to everyone in the organization from the CEO to the factory floor worker.

Basic Concepts in Strategic Management

Corporate Governance

Ethics and Social Responsibility in Strategic Management

Environmental Scanning and Industry Analysis

Internal Scanning and Organizational Analysis

Strategy Formulation: Situation Analysis and Business Strategy

Strategy Formulation: Corporate Strategy

Strategy Formulation: Functional Strategy and Strategic Choice

Strategy Implementation: Organizing for Action

Strategy Implementation: Staffing and Directing

Suggestions for Case Analysis

Filters