MGT 498 Strategic Management Week 2 Questions
And Answers New Tests
The mechanism used to guide a company toward meeting its strategic goals within the bounds of the law is
known as Blank______. ANS✅ corporate governance
The idea that a corporation is simply a collection of legal contracts is known as Blank______. ANS✅ agency
theory
A board of directors is elected to represent the interests of Blank______. ANS✅ shareholders
An executive can legally earn a significant profit from stock options if Blank______. ANS✅ the firm
performs well and the actual price per share exceeds the negotiated strike price
The ratio of CEO to average employee pay in the United States is about Blank______. ANS✅ 350 to 1
Corporate governance is a system of Blank______. ANS✅ checks and balances
One of the key characteristics of a leveraged buyout (LBO) is that it Blank______. ANS✅ changes the
ownership structure of a company from public to private
According to agency theory, conflicts such as the principal-agent problem are considered Blank______ issues.
ANS✅ legal
In a public stock company, the centerpiece of corporate governance is the Blank______. ANS✅ board of
directors
Following the rise of institutional investors, the use of poison pills to avoid hostile takeover has Blank______.
ANS✅ become rarer
Which of the following statements about stock options is true? ANS✅ The recipient is given the right to
purchase stock at a predetermined price sometime in the future.
And Answers New Tests
The mechanism used to guide a company toward meeting its strategic goals within the bounds of the law is
known as Blank______. ANS✅ corporate governance
The idea that a corporation is simply a collection of legal contracts is known as Blank______. ANS✅ agency
theory
A board of directors is elected to represent the interests of Blank______. ANS✅ shareholders
An executive can legally earn a significant profit from stock options if Blank______. ANS✅ the firm
performs well and the actual price per share exceeds the negotiated strike price
The ratio of CEO to average employee pay in the United States is about Blank______. ANS✅ 350 to 1
Corporate governance is a system of Blank______. ANS✅ checks and balances
One of the key characteristics of a leveraged buyout (LBO) is that it Blank______. ANS✅ changes the
ownership structure of a company from public to private
According to agency theory, conflicts such as the principal-agent problem are considered Blank______ issues.
ANS✅ legal
In a public stock company, the centerpiece of corporate governance is the Blank______. ANS✅ board of
directors
Following the rise of institutional investors, the use of poison pills to avoid hostile takeover has Blank______.
ANS✅ become rarer
Which of the following statements about stock options is true? ANS✅ The recipient is given the right to
purchase stock at a predetermined price sometime in the future.
