Question 1

The market for corporate control enables the "wholesale" removal of entrenched managers.

Accepted Answer

A) True 
 B)False  True

Question 2

Which of the following statements about governance mechanisms is misleading?

Accepted Answer

A)  Governance mechanisms can be classified as voice-based and exit-based mechanisms. 
B)  As an external governance mechanism, private equity utilizes the stock market to discipline managers. 
C)  In general, boards are likely to use "carrots" before considering "sticks." 
D)  Product market competition complements the market for corporate control and the market for private equity. 
A)  Governance mechanisms can be classified as voice-based and exit-based mechanisms. 
B)  As an external governance mechanism, private equity utilizes the stock market to discipline managers. 
C)  In general, boards are likely to use "carrots" before considering "sticks." 
D)  Product market competition complements the market for corporate control and the market for private equity. B

Question 3

_____ is the relationship among various participants in determining the direction and performance of corporations.

Accepted Answer

A)  Corporate citizenship 
B)  Corporate social responsibility 
C)  Corporate conscience 
D)  Corporate governance 
A)  Corporate citizenship 
B)  Corporate social responsibility 
C)  Corporate conscience 
D)  Corporate governance D

Question 4

Executives on the top management team (TMT)are led by the _____.

Accepted Answer

A)  chief executive officer (CEO) 
B)  chief financial officer (CFO) 
C)  board of directors 
D)  chief operating officer (COO) 
A)  chief executive officer (CEO) 
B)  chief financial officer (CFO) 
C)  board of directors 
D)  chief operating officer (COO)

Question 5

Agency relationship refers to the relationship between different shareholders.

Accepted Answer

A) True 
 B)False

Question 6

Explain the role of the Board of Directors.

Accepted Answer

Boards of directors perform control,serv

Question 7

The costs associated with principal-agent relationships are called _____.

Accepted Answer

A)  principal costs 
B)  opportunity costs 
C)  agency costs 
D)  actual costs 
A)  principal costs 
B)  opportunity costs 
C)  agency costs 
D)  actual costs

Question 8

The board of directors oversees and ratifies strategic decisions and evaluates,rewards,and,if necessary,penalizes top managers.

Accepted Answer

A) True 
 B)False

Question 9

Elaborate on the external governance mechanisms.

Accepted Answer

There are three external governance mech

Question 10

____ are persons to whom authority is delegated.

Accepted Answer

A)  Agents 
B)  Principals 
C)  Shareholders 
D)  Acquirers 
A)  Agents 
B)  Principals 
C)  Shareholders 
D)  Acquirers

Question 11

Elaborate on the principal-principal conflicts.

Accepted Answer

Principal-principal conflicts are the pr

Question 12

The minimization of principal-agent conflicts through concentration of ownership and control,unfortunately,introduces more principal-principal conflicts.

Accepted Answer

A) True 
 B)False

Question 13

Shareholders purchase stock both for dividends and for the growth potential of the stock.

Accepted Answer

A) True 
 B)False

Question 14

_____ is a means by which investors,often in partnership with incumbent managers,issue bonds and use the cash raised to purchase the firm's stock.

Accepted Answer

A)  Hedged tender 
B)  Flat trade 
C)  Adjustable-rate mortgage 
D)  Leveraged buyout 
A)  Hedged tender 
B)  Flat trade 
C)  Adjustable-rate mortgage 
D)  Leveraged buyout

Question 15

Corporations in _____ are bank-oriented,network-based systems.

Accepted Answer

A)  China 
B)  continental Europe 
C)  the United States 
D)  the United Kingdom 
A)  China 
B)  continental Europe 
C)  the United States 
D)  the United Kingdom

Question 16

Corporations in continental Europe and Japan rely mostly on _____.

Accepted Answer

A)  voice-based, internal mechanisms 
B)  market-oriented, network-based systems 
C)  market-oriented, high-tension systems 
D)  exit-based, external mechanisms 
A)  voice-based, internal mechanisms 
B)  market-oriented, network-based systems 
C)  market-oriented, high-tension systems 
D)  exit-based, external mechanisms

Question 17

In firms with separation of ownership and control,ownership is concentrated with a few owners.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following statements about the board of directors is untrue?

Accepted Answer

A)  Boards advise the CEO. 
B)  Boards carry out resource acquisition for the focal firm. 
C)  Affiliated directors are independent directors. 
D)  Boards' effectiveness stems from norms. 
A)  Boards advise the CEO. 
B)  Boards carry out resource acquisition for the focal firm. 
C)  Affiliated directors are independent directors. 
D)  Boards' effectiveness stems from norms.

Question 19

The vast majority of large firms throughout continental Europe,Asia,Latin America,and Africa feature _____ ownership.

Accepted Answer

A)  concentrated state 
B)  concentrated family 
C)  diffused family 
D)  diffused state 
A)  concentrated state 
B)  concentrated family 
C)  diffused family 
D)  diffused state

Question 20

Managers need to develop firm-specific capabilities to differentiate a firm on governance dimensions and corporate finance.

Accepted Answer

A) True 
 B)False

The market for corporate control enables the "wholesale" removal of entrenched managers.

Which of the following statements about governance mechanisms is misleading?

_____ is the relationship among various participants in determining the direction and performance of corporations.

Executives on the top management team (TMT)are led by the _____.

Agency relationship refers to the relationship between different shareholders.

Explain the role of the Board of Directors.

The costs associated with principal-agent relationships are called _____.

The board of directors oversees and ratifies strategic decisions and evaluates,rewards,and,if necessary,penalizes top managers.

Elaborate on the external governance mechanisms.

____ are persons to whom authority is delegated.

Elaborate on the principal-principal conflicts.

The minimization of principal-agent conflicts through concentration of ownership and control,unfortunately,introduces more principal-principal conflicts.

Shareholders purchase stock both for dividends and for the growth potential of the stock.

_____ is a means by which investors,often in partnership with incumbent managers,issue bonds and use the cash raised to purchase the firm's stock.

Corporations in _____ are bank-oriented,network-based systems.

Corporations in continental Europe and Japan rely mostly on _____.

In firms with separation of ownership and control,ownership is concentrated with a few owners.

Which of the following statements about the board of directors is untrue?

The vast majority of large firms throughout continental Europe,Asia,Latin America,and Africa feature _____ ownership.

Managers need to develop firm-specific capabilities to differentiate a firm on governance dimensions and corporate finance.

Globalizing Business

Understanding Formal Institutions: Politics, Laws, and Economics

Emphasizing Informal Institutions: Cultures, Ethics, and Norms

Leveraging Resources and Capabilities

Trading Internationally

Investing Abroad Directly

Dealing with Foreign Exchange

Capitalizing on Global and Regional Integration

Growing and Internationalizing the Entrepreneurial Firm

Entering Foreign Markets

Managing Global Competitive Dynamics

Making Alliances and Acquisitions Work

Strategizing,Structuring,and Learning around the World

Competing on Marketing and Supply Chain Management

Managing Human Resources Globally

Managing Corporate Social Responsibility Globally

Filters

Exam 16: Financing and Governing the Corporation Globally

The market for corporate control enables the "wholesale" removal of entrenched managers.

Which of the following statements about governance mechanisms is misleading?

_____ is the relationship among various participants in determining the direction and performance of corporations.

Executives on the top management team (TMT)are led by the _____.

Agency relationship refers to the relationship between different shareholders.

Explain the role of the Board of Directors.

The costs associated with principal-agent relationships are called _____.

The board of directors oversees and ratifies strategic decisions and evaluates,rewards,and,if necessary,penalizes top managers.

Elaborate on the external governance mechanisms.

____ are persons to whom authority is delegated.

Elaborate on the principal-principal conflicts.

The minimization of principal-agent conflicts through concentration of ownership and control,unfortunately,introduces more principal-principal conflicts.

Shareholders purchase stock both for dividends and for the growth potential of the stock.

_____ is a means by which investors,often in partnership with incumbent managers,issue bonds and use the cash raised to purchase the firm's stock.

Corporations in _____ are bank-oriented,network-based systems.

Corporations in continental Europe and Japan rely mostly on _____.

In firms with separation of ownership and control,ownership is concentrated with a few owners.

Which of the following statements about the board of directors is untrue?

The vast majority of large firms throughout continental Europe,Asia,Latin America,and Africa feature _____ ownership.

Managers need to develop firm-specific capabilities to differentiate a firm on governance dimensions and corporate finance.

Globalizing Business

Understanding Formal Institutions: Politics, Laws, and Economics

Emphasizing Informal Institutions: Cultures, Ethics, and Norms

Leveraging Resources and Capabilities

Trading Internationally

Investing Abroad Directly

Dealing with Foreign Exchange

Capitalizing on Global and Regional Integration

Growing and Internationalizing the Entrepreneurial Firm

Entering Foreign Markets

Managing Global Competitive Dynamics

Making Alliances and Acquisitions Work

Strategizing,Structuring,and Learning around the World

Competing on Marketing and Supply Chain Management

Managing Human Resources Globally

Managing Corporate Social Responsibility Globally

Filters