MGMT 478 Exam 2 | Verified Answers, Complete Solutions

MGMT 478 Exam 2 | Verified Answers, Complete Solutions What percent tax on foreign earnings held offshore in cash accounts was imposed by new U.S. federal tax law in 2018? A. 5.5 B. 10.5 C. 25.5 D. 15.5 E. 20.5 According to the chapter, "______ may be the single-greatest threat to successful strategy implementation." A. Social media rumor versus fact B. Resistance to change C. Data breaches D. Low customer loyalty E. Ineffective organizational structure "All of our locations will be open at least two evenings per week until 8:30 p.m." is an example of a(n) A. objective. B. administration. C. procedure. D. policy. E. goal. Who is featured at the beginning of the chapter as a most "exemplary strategist?" A. Former CEO of GE, Jack Welch B. Albert Einstein C. Former CEO of PepsiCo, Indra Nooyi D. President Donald Trump E. Revered Billy Graham Which statement below is not a guideline for developing an organizational chart? A. Make sure the chair of the board is not also the CEO or president of the company. B. Make sure the CEO of the firm does not also carry the title of President. C. Make sure every executive has one boss; lines in the chart should be drawn accordingly, assuring unity of command. D. Avoid a functional-type structure for all but the smallest firms. E. Make sure only presidents of divisions report to the CEO. Which statement(s) below is FALSE? A. Organizational structure is more a strategy implementation than a strategy formulation issue. B. A recommended guideline in developing an organizational structure is to avoid letting a single individual be both chairman of the board and CEO of a company. C. Organizational structure is important for gaining and sustaining competitive advantage. D. The percentage of large companies in the United States with a chief operating officer (COO) has declined almost every year for a decade, to about 60 percent today. E. A recommended guideline in developing an organizational structure is to avoid having a particular person reporting to more than one person in the chain of command. Perceptual mapping is a marketing tool associated with _____. A. portfolio analysis B. target marketing C. product positioning D. value chain analysis E. market segmentation When developing an organizational chart, you should A. recommend dual titles for executives. B. make sure that the chief financial officer is not at the same level as the chief operating officer (COO). C. have employees report to more than one person in the chain of command. D. have division presidents report to a chief operating officer (COO). E. use the title "president" for the top executive of the firm. When developing an organizational chart, you should A. recommend dual titles for executives. B. make sure that the chief financial officer is not at the same level as the chief operating officer (COO). C. have employees report to more than one person in the chain of command. D. have division presidents report to a chief operating officer (COO). E. use the title "president" for the top executive of the firm. What statement below is FALSE? A. Conflict can be managed. B. Conflict can arouse emotions. C. Conflict can serve to energize opposing groups into action. D. Conflict may help managers identify problems. E. Conflict is always bad. The term "corporate wellness" has largely been replaced by what new term? A. Corporate vitality B. Corporate healthiness C. Sustainability D. Corporate fitness E. Corporate well-being According to Schein, what statement below is not included as a useful element in linking culture to strategy? A. Designing of physical spaces, facades, and buildings B. Deliberate role modeling, teaching, and coaching by leaders C. How the organization is designed and structured D. Explicit reward and status system and promotion criteria E. Benchmarking The divisional structure can be organized by ____. A. customer or technology B. process or customer C. geographic area or human resource function D. region or factory E. customer or creditor The divisional structure can be organized by ____. A. customer or technology B. process or customer C. geographic area or human resource function D. region or factory E. customer or creditor Which statement below is FALSE? A. Reengineering is characterized by many tactical (short-term, business function-specific) decisions. B. Reengineering does not usually affect an organizational chart. C. Reengineering does not usually affect the organizational structure. D. Reengineering does not usually imply job loss or employee layoffs. E. Reengineering is an analogous term for benchmarking. Which is NOT a characteristic of policies? A. Reduce the amount of time managers spend making decisions B. Let both employees and managers know what is expected of them C. Allow coordination across organizational units D. Represent the basis for allocating resources E. Provide a basis for management control What type of structure is the most complex of all the organizational designs or structures? A. Conglomerate B. Functional C. Strategic business unit (SBU) D. Division by process E. Matrix Which statement below is FALSE? A. Among 342 professions in the United States, women earn more than men in only nine. B. On average, women, earn 25 percent less than men in the United States. C. In the United States today, the average age for women to get married is 30 years old for those with a college degree, and 26 years old for those with only a high school degree. D. More women than men earn both undergraduate and graduate degrees in the United States. E. There are more female CEOs in the United States than male CEOs. What is the broad term that refers to all other terms listed below. The term can apply to all divisions and departments (such as "We are an equal opportunity employer"), or to a single department ("Employees in this department must take at least one training and development course each year"). A. Rules B. Procedures C. Methods D. Policies E. Guidelines Which statement below is FALSE? A. Structure dictates how an organization's resources will be allocated. B. Changes in structure often require changes in an organization's strategies. C. Symptoms of an ineffective organizational structure include too many meetings being attended by too many peoplE. D. Consumer goods companies tend to emulate the divisional structure-by-product form of organization. E. Changes in strategy often require changes in an organization's structure. How many basic types of organizational structure are discussed in the chapter? A. 9 B. 11 C. 3 D. 7 E. 5 Which term(s) below would not be a good annual objectives? A. Reduce costs 10%. B. Add 50 new sales representatives in Europe. C. Reduce long-term debt by 30%. D. Add new suppliers as soon as possiblE. E. Increase revenues 10%. Which of the following sequences of marketing activities is correct? A. Product positioning, market segmentation, target marketing B. Market segmentation, product positioning, target marketing C. Target marketing, product positioning, market segmentation D. Market segmentation, target marketing, product positioning E. Product positioning, target marketing, market segmentation Which factor below commonly prohibits effective resource allocation? A. Retrenchment B. Benchmarking C. Reshoring D. Placing too great an emphasis on short-run financial criteria E. Reengineering Which is NOT a major factor that commonly prohibits effective resource allocation? A. A reluctance to take risks B. Organizational politics C. A lack of sufficient knowledge D. Underprotection of resources E. Having vague strategy targets The marketing mix variables include what aspects of a product offerings? A. Positioning, segmenting, targeting B. Product, place, promotion, price C Perceptual mapping, promotion, and price D. Price, positioning, promoting, and distributing E. Product, positioning, place, promotion, pricing The marketing mix variables include what aspects of a product offerings? A. Positioning, segmenting, targeting B. Product, place, promotion, price C. Perceptual mapping, promotion, and price D. Price, positioning, promoting, and distributing E. Product, positioning, place, promotion, pricing Which statement below is not a guideline for developing an organizational chart? A. Decentralize, using some form of divisional structure, whenever possible. B. Make sure span of control is reasonable, probably no more than 10 persons reporting to any other person. C. Use an SBU type structure for large, multidivisional firms. D. Make sure functional executives such as CFO, CIO, CMO, CSO, R&D, CLO, CTO, and HRM report to the CEO, not to the COO. E. Reserve the title president for the CEO of the firm. Which statement(s) below is FALSE? A. Restructuring is concerned primarily with shareholder well-being rather than employee well-being. B. Restructuring is concerned primarily with employee well-being rather than shareholder well-being. C. Reengineering does not usually affect the organizational structure. D. The primary benefit sought from restructuring is cost reduction. E. Reengineering does not usually affect an organizational chart. In contrast to strategy formulation, strategy implementation focuses more on _____. A. BCG analysis B. effectiveness rather than efficiency C. SWOT analysis D. vision and mission statement assessment E. motivation skills rather than analytical skills In projected financial statements, what is used as a plug figure? A. Long-term liabilities B. Fixed assets C. The Cash Account D. Stockholders' equity E. Retained earnings Is it true or false that the free Excel strategic planning template at egycluB. com will automatically balance your projected balance sheets, but 1) you likely will need to make adjustments to the cash account, and 2) the template does not automatically balance your existing balance sheets, i.e. once you enter your firm's financial statements into the template format, you will need to make adjustments as needed. A. Sometimes true B. True C. False D. Sometimes false E. This issue varies for profit versus nonprofit organizations Chapter 8's exemplary strategist, Jamie Dimon, CEO of JP Morgan, is a big advocate for economies of scale. What does Dimon advice regarding this? A. Firms should be careful not to venture into areas outside their corporate strategy. B. Growth for the sake of growth is a good strategy. C. Firms should deploy resources into areas that hold economies of scale steady because this is often more advantageous to customers, shareholders, and ultimately for the entire economy. D. Rising economies of scale produce rising stock prices. E. Economies of scale are less important than benchmarking. The denominator of EPS is A. shares outstanding. B. average number of shares. C. shares authorized. D. treasury stock. E. preferred shares. Which item is included in net worth? A. Retained earnings and common stock. B. Common stock C. Additional paid-in-capital D. Retained earnings E. Retained earnings, common stock, and additional paid-in capital. When a firm buys more of its own common stock, what is the effect on the firm's earnings per share (EPS) value? A. There is no effect. B. It goes up. C. The effect varies by size of firm. D. The effect varies by industry. E. It goes down. The shares of stock of a firm that are owned by the firm itself are called _____. A. convertible stock B. goodwill C. retained earnings D. preferred stock E. treasury stock What formula below is correct for valuing a company using the price-earnings ratio method? A. Divide the market price of the firm's common stock by the annual earnings per share (EPS) and multiply this number by the firm's average revenue for the past 5 years. B. Divide the market price of the firm's common stock by the firm's current ratio and multiply this number by the firm's average net income for the past 5 years. C. Divide the market price of the firm's common stock by the annual earnings per share (EPS) and multiply this number by the firm's average net income for the past 5 years. D. Divide the market price of the firm's common stock by the annual earnings per share (EPS) and multiply this number by the firm's average sales for the past 5 years. E. Divide the market price of the firm's common stock by the firm's debt-to-equity ratio and multiply this number by the firm's average net income for the past 5 years. Limitations of EPS/EBIT analysis include ______. A. continuity and ratio analysis B. timing and control C. dividends and EPS ranges D. lack of control E. lack of diversity According to Table 8-5 in Chapter 8, what are the three most corrupt countries in the world? A. Vietnam, Thailand, Somalia B. Congo, Somalia, Libia C. Iraq, Iran, Syria D. Syria, Somalia, Libya E. Somalia, South Sudan, North Korea Goodwill on the balance sheets of S&P 500 firms changed from $1.7 trillion in 2007 to how much in 2017? A. $5 trillion B. $3 trillion C. $25 trillion D. $10 trillion E. $1 trillion The top 20 most valuable college football programs are listed in the chapter in terms of their monetary value. What team is most valuable? A. Michigan Wolverines B. Texas longhorns C. Ohio State Buckeyes D. Alabama Crimson Tide E. Notre Dame Fighting Irish In EPS/EBIT analysis, from where does the tax rate percentage come? A. Use the company's prior year tax rate as revealed by dividing income before taxes by taxes paid off the firm's income statement. B. Estimate the company's future tax rate based on the company's strategies. C. Just use 10 percent for all financing options to better examine impact of debt versus stock options for raising capital. D. Use the respective country's federal income tax rate. E. Use the company's prior year tax rate as revealed by dividing income before taxes by taxes paid off the firm's cash flow statement. Which statement(s) is TRUE? A. New equity issued in a given year goes on the treasury stock row on a balance sheet. B. Another name for the balance sheet account—additional-paid-in-capital—is treasury stock. C. In developing projected financial statements, the retained earnings row is used as the plug figure. D. Balance sheets will not balance if retained earnings are negative. E. Sometimes firms will increase their Treasury Stock near the end of the quarter, or near the end of the year, to inflate their EPS "artificially". Who is a big advocate for economies of scale, arguing that growth for the sake of growth is a misguided strategy? He suggests firms should be careful not to venture into areas outside their corporate strategy; instead, they should deploy resources into areas that will build economies of scale. A. CEO of JPMorgan Jamie Dimon B. CEO of Tesla Elon Musk C. Economist Milton Friedman D. President Donald Trump E. CEO of Apple Tim Cook Theoretically, how much debt should a company carry on its balance sheet? A. An enterprise should carry enough debt in its capital structure to boost its return on investment in projects earning more than the cost of the debt. B. An enterprise should carry enough debt in its capital structure to keep its debt total lower than its net income. C. An enterprise should carry enough debt in its capital structure to keep its debt total lower than its cash total. D. An enterprise should carry enough debt in its capital structure to keep its debt total lower than its retained earnings total. E. An enterprise should carry enough debt in its capital structure to keep its debt total lower than its equity total. Which statement below is TRUE? A. In some income statements, another name for earnings is revenues. B. "Going public" means selling off a percentage of a company to others to raise capital; consequently, it dilutes the owners' control of the firm. C. "Going public" is not recommended for companies with less than $100 million in sales because the initial costs can be too high for the firm to generate sufficient cash flow to make going public worthwhile. D. Increasingly, companies are using treasury stock to buy back their own stock and to pay cash dividends to shareholders. This has become a concern. E. Many firms prefer to leave their cash outside in Bermuda banks if it was earned outside the United States. To use those funds to pay dividends or purchase treasury stock, for example, would trigger a big U.S. corporate income tax payment. In performing EPS/EBIT analysis, how is the first row (EBIT) determined? A. Use the most recent year EBIT number plus or minus the impact of recommendations to determine a range. B. Use the most recent year Revenues number plus or minus the impact of recommendations to determine a range. C. Use the most recent year Cash number plus or minus the impact of recommendations to determine a range. D. Use the most recent year Retained Earnings number plus or minus the impact of recommendations to determine a range. E. Use the most recent year EPS number plus or minus the impact of recommendations to determine a range. Which element in the projected income statement CANNOT be forecasted using the percentage-of-sales method? A. Interest expense B. Administrative expense C. Cost of goods sold D. Selling expense E. Operating expenses Regarding corporate valuation, a conservative rule of thumb is to establish a business's worth as ______ times the firm's current annual profit. A. 5 B. 12 C. 10 D. 6 E. 3 Which statement(s) below is TRUE? A. Goodwill is the same term often used for intangibles. B. Seeing Goodwill regularly increasing on a balance sheet is not a good thing. C. FASB Rule 16 requires companies to admit once a year whether the premiums they paid for acquisitions, called goodwill, were a waste of money. D. Intangibles increase when treasury stock increases. E. Goodwill cannot decrease on balance sheet from one year to the next. In developing projected financial statements, how are retained earnings calculated on the balance sheet? A. Add the net income less dividends to the prior year's retained earnings. B. Use a percentage of sales method based on the prior 3 years coupled with the company's strategies. C. Add the net income to the prior year's retained earnings. D. Use retained earnings as the plug figure to make the balance sheet balance. E. Use a percentage of sales methods based on the prior 3 years. In developing projected financial statements, with what row item does one start? A. Cost of Goods Stole B. Revenues C. Cost of Goods Sold D. Earnings E. Cash A full-blown example of a projected financial statement analysis is worked out and presented in Chapter 8 for _____. A. 3M Corp B. P&G C. LinkedIn D. BB&T E. Facebook Which of the following statements is TRUE regarding the issuance of corporate bonds in the United States? A. The practice of firms issuing bonds to buy back their own stock and to pay cash dividends to shareholders is illegal. B. A large recent bond transaction was Anheuser-Busch InBev's $4 billion bond issuance to purchase SAB Miller. C. Firms issue bonds to finance acquisitions, to buy back their own stock (called preferred stock), and to refinance old debt. D. The year 2017 was the seventh straight year that a record dollar value of bonds was sold in the United States, totalling more than $1.5 trillion. E. Bonds were discontinued for use in the United States. What is another term for profits? A. Future income B. Earnings C. Revenue D. Net revenue E. Past income In what way mentioned below would retained earnings on the balance sheet decrease from one year to the next? A. If the firm has cash or liquidity problems B. If the firm had positive net income for the year but pays out dividends greater than the net income C. If the firm had zero net income for the year and pays no dividends D. If the firm has negative paid-in-capital E. If the firm has a negative capital surplus Chapter 8's exemplary strategist, Jamie Dimon, CEO of JP Morgan, says successful strategic planning has more to do with heart than mind. What does Dimon say this means? A. Applaud people for preserving harmony by not speaking. B. Value your own expertise and experiences more than the expertise and experiences of others. C. Recognize people; admit they have all the answers. D. Provide people a platform to which they can contributE. E. Employees are the backbone of all firms. Financial ratios are an important tool used to access a firm's financial situation A. at one point in time. B. over time. C. on a monthly basis. D. on a yearly basis. E. over a period of time. The corporate valuation formula for the net worth method is _____. A. additional paid in capital plus retained earnings minus (goodwill + intangibles) B. total shareholders' equity (SE) minus (goodwill + intangibles). C. total owners' equity (SE) plus (goodwill + intangibles) D. net worth plus retained earnings plus (goodwill + intangibles). E. additional paid in capital plus retained earnings minus (goodwill - intangibles) What university in the USA leads all universities in annual usage of green power? A. Northwestern University B. University of Tennessee C. Wake Forest university D. Stanford University E. Auburn University Who said, "When wealth is lost, nothing is lost; when health is lost, something is lost; when character is lost, all is lost." A. Rev. Martin Luther King, Jr. B. Rev. Billy Graham C. President Obama D. Albert einstein E. President Kennedy _____ generates about 62 million tons of solid waste every year, and that amount is expected to increase fivefold by 2051. Currently only about 28 percent of the country's garbage is treated and processed. A. Nigeria B. Russia C. Indonesia D. Vietnam E. India For the first time ever in the United States, cars, trucks, planes, and trains have displaced _____ as the biggest USA polluter. A. power plants B. cities C. households D. companies As discussed in Chapter 10, what do the following people have in common: Harvey Weinstein, Kevin Spacey, C. K. Louis, Mark Halperin, Charlie Rose, Matt Lauer, and Garrison Keillor? A. They all were recently found guilty of insider trading of company stock. B. They all were implicated in sexual harassment allegations. C. They all are CEO's of companies. D. They all were recently accused of bribery E. They all are exemplary strategists. All of the following business actions are considered to be unethical EXCEPT A. dumping banned or flawed products in foreign markets. B. overpricing. C. insider trading. D. preventing environmental harm. E. sexual harassment. Which statement below is FALSE? A. Prior research suggests that being unethical is abnormal, rare, and aberrant behavior perpetrated by people who are abhorrent. B. Donald Palmer recently reported that wrongdoing is as prevalent as rightdoing. C. Donald Palmer recently reported that misconduct is a normal phenomenon. D. Donald Palmer recently reported that misconduct is most often done by people who party weekly. What company is featured in Ethics Capsule 10 as being exemplary in the shoe business, aiming to put shoes on every child on the planet and donating a pair of shoes for every pair it sells? A. Nike, Inc B. TOMS Shoes, InC. C. Adidas, InC. D. Reebok, InC. E. Foot Locker, InC. According to Chapter 10, which of the following actions is unethical? A. Engaging in workplace romance B. Buying treasury stock C. Advertising of labeling D. Insider trading and overpricing The Equal Employment Opportunity Commission (EEOC) defines ______ broadly as unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature. A. sexual discrimination B. sexual harassment C. prostitution D. workplace romance E. flirting According to the International Standards Organization, the word _____ is defined a surrounding in which an organization operates, including air, water, land, natural resources, flora, fauna, humans, and their interrelations. A. resource B. ecological C. sustainability D. business E. environment A Wall Street Journal article recapped U.S. standards regarding boss-and-subordinate love affairs at work. Only ______ percent of all firms sampled had no restrictions on such relationships; ______ percent of firms have policies that prohibit relationships between a supervisor and a subordinate. A. 5; 30 B. 80; 30 C. 5; 80 D. 80; 5 E. 30; 80 __________ asserts that organizations have no obligation to do any more for society than is legally required. A. Scott Pruitt B. Milton Friedman C. Ralph Nader D. Carl Icahn E. Satya Nadella In the corporate world, employees reporting any unethical violations they discover or see in the firm receive up to ______ percent of the proceeds of legal proceedings against firms for wrongdoing. A. 45 B. 25 C. 55 D. 15 E. 35 The ______ family of standards concerns the extent to which a firm minimizes harmful effects on the environment caused by its activities and continually monitors and improves its own environmental performance. A. Environmental management system (EMS) B. Environmental Protection Agency (EPA) C. OSHA D. Sustainability report standard E. ISO 14000 A(n) ______ reveals how a firm's operations impact the natural environment. This document discloses to shareholders information about the firm's labor practices, product sourcing, energy efficiency, environmental impact, and business ethics practices. A. form 10K B. form 8K C. Annual Report D. environmental report card E. sustainability report ______ refers to employees reporting any unethical violations they discover or see in the firm. A. Whistle-blowing B. Eavesdropping C. Tattle-telling D. Regurgitating E. Snooping Workplace romance A. is an intimate relationship between two employees, one of whom is not consenting. B. should be strictly forbidden by organizations. C. is defined as unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature. D. simply happens so organizations should determine how to best manage the phenomenon. E. is defined as illegal by the Equal Employment Opportunity Commission. A recent study by The Institute of Business Ethics (IBE) titled, "Does Business Ethics Pay?" concluded that companies that display a "clear commitment to ethical conduct" ______ outperform companies that do not display ethical conduct. A. usually B. consistently C. always D. sometimes E. rarely The U.S. Foreign Corrupt Practices Act (FCPA) governs ______ in the United States and has stepped up enforcement. A. lobbying B. scamming C. seduction D. solicitation E. bribery Which statement below is FALSE? A. Workplace romance can be detrimental to workplace morale and productivity for a number of reasons. B. Some workplace romances actually improve work performance. C. An organization probably should not strictly forbid workplace romance, because such a policy could be construed as an invasion of privacy, overbearing, or unnecessary. D. Workplace romances actually decrease work performance, adding a dynamism and energy that translates into decreased morale, communication, creativity, and productivity. E. In some states, such as California, managers can be held personally liable for damages that arise from workplace romance. Friedman may contend that it is irresponsible for a firm to give monies to A. employees. B. charities. C. government agencies. D. suppliers. E. managers. What three retailers are discussed in the chapter as being the top 3 Green Power-Use retailers in 2017.