SEVI final

NoRu Inc. is a publicly traded firm that does not wish to be acquired by FRESHPoP Corporation, a much larger publicly traded firm, who is planning an acquisition of NoRu Inc. This is an example of a A) hostile takeover. B) friendly takeover. C) joint venture. D) strategic alliance.

A) hostile takeover.

When does a merger between companies typically occur? A) when two firms of comparable size join to form a combined entity B) when large, incumbent firms buy start-up companies C) when a target firm does not want to be acquired D) when two or more firms enter a temporary vertical strategic alliance

A) when two firms of comparable size join to form a combined entity

Dana wishes to strengthen her firm's marketing department by partnering with a large marketing firm that can complement her existing value chain. However, she fears potential legal repercussions including potential lawsuits filed by U.S. federal agencies such as the Federal Trade Commission (FTC). Which of the following strategic options should Dana pursue? A) Dana should implement green field operations with the marketing firm to strengthen her interanion reach. B) Dana should consider forming a strategic alliance with the marketing firm. C) Dana should move forward with a hostile takeover of the marketing firm. D) Dana should purchase the marketing firm outright via an acquisition.

B) Dana should consider forming a strategic alliance with the marketing firm.

What causes the winner's curse? A) buying a firm with principal-agent problems B) overpaying for an acquisition C) buying a firm with a competitive disadvantage D) underpaying for an acquisition

B) overpaying for an acquisition

The Konex Hotel Group purchased Green-Plus Hotels for an estimated value of $120 billion. All the hotels previously owned by Green-Plus Hotels are now managed by the Konex Hotel Group and are known as Konex hotels. What does this scenario best illustrate? A) a merger B) a joint venture C) an acquisition D) an equity alliance

C) an acquisition

_____ is best described as the process of merging with a competitor at the same stage of the value chain. A. Backward integration B. Forward integration C. Horizontal integration D. Taper integration

C. Horizontal integration

Which of the following statements is true of an equity alliance?

In an equity alliance, the partners frequently exchange personnel to make the acquisition oftacit knowledge possible.

________, which captures the cultural fit between different firms, is one key element needed when selecting an alliance partner.

Partner compatibility

In order to minimize the temptation for managers to act in their own self-interest, governance mechanisms exist for implementation consideration. Which of the following is not a primary means for monitoring managerial behavior? a)a board of directors that acts in the best interests of shareholders to create short-term value b)shareholder activism in which owners view themselves as shareowners c)a board of directors that acts in the best interests of shareholders to create long-term value d)managerial incentives to align management interests with those of the stockholders

a) a board of directors that acts in the best interests of shareholders to create short-term value

The traditional approach to strategic control is sequential. Which of the following is not one of the steps in the sequence? a)Action plans are submitted by lower level managers. b)Performance is measured against the predetermined goal. c)Strategies are implemented. d)Strategies are formulated and top management sets goals.

a)Action plans are submitted by lower level managers.

Which of the following is not one of the characteristics of reward and incentive systems? a)They represent a poor means of influencing the culture of an organization. b)They focus efforts on high priority tasks. c)They motivate high levels of individual and collective task performance. d)They represent an effective control mechanism.

a)They represent a poor means of influencing the culture of an organization.

Behavioral controls are aspects of strategic change that involve finding the appropriate ________ and ________ among the culture, rewards, and boundaries of the firm. a)balance; alignment b)measure; balance c)alignment; balance d)measure; outcome

a)balance; alignment

Informational control systems are concerned with which of the following questions? a)Is the organization doing things right? b)Is the organization doing the right things? c)Are rules and regulations being followed as information is processed? d)Is the environment of the organization a necessary and sufficient condition for success?b)

b)Is the organization doing the right things?

Top managers at ABC Company meet every Friday to review daily operational reports and year to date data. This is an example of a)behavioral control. b)informational control. c)strategy formulation. d)strategy implementation.

b)informational control.

Which of the following is not one of the characteristics of a contemporary control system? a) It is a key catalyst for an ongoing debate about underlying data, assumptions, and action plans. b)It must focus on constantly changing information that is strategically important. c)It circumvents the need for face-to-face meetings among superiors, subordinates, and peers. d)It generates information that is important enough to demand regular and frequent attention.

c)It circumvents the need for face-to-face meetings among superiors, subordinates, and peers.

Agency theory is concerned with resolving two problems that can occur in agency relationships. Which of the following is not one of those problems? a)Goals conflict between principals and agents. b)Verification of actual agency activity is expensive and difficult to obtain. c)Principals and agents have differing attitudes toward risk. d)Stockholders and management align with external stakeholders.

d)Stockholders and management align with external stakeholders.

In addition to an annual base salary of 1.3 million USD and 10.4 million USD in stock compensation and bonuses, Heather Bresch, CEO of Mylan Pharmaceuticals, also received 6.4 million USD in other compensation in 2015. This included 19,200 USD for the use of a company-provided automobile and 310,000 USD in personal use of the company jet. Which of the following statements is true regarding this situation? a)Shareholders favor diversification. b)Executives favor diversification. c)Top-level managers always act in the shareholder interest. d)Top-level managers may pursue their own interests over that of the company.

d)Top-level managers may pursue their own interests over that of the company.