MGSC Exam 2 7-8, 10-11
If an initial stock issuance is $800,000, what would be the expected cost paid to lawyers, accountants, and underwriters, based on the average for IPOs in this range?
$200,000
Goodwill on the balance sheets of S&P 500 firms changed from $1.7 trillion in 2007 to how much in 2017?
$3 trillion
The top national statutory corporate tax rates in 2018 among sample countries ranged from ______ percent in Bermuda to ______ percent in the United Arab Emirates (UAE).
0; 55
What percent tax on foreign earnings held offshore in cash accounts was imposed by new U.S. federal tax law in 2018?
15.5
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.
25
Whistle blowers in the corporate world receive up to ________ percent of the proceeds of legal proceedings against firms for wrongdoing.
25
About how many African countries are considered democracies?
30
A seven-year study by Fred Kiel, author of Return on Character, followed 8,000 employees and 84 top executives of Fortune 500 companies; the study indicated that character-driven leaders deliver ______ times greater profitability results than self-focused leaders.
5
Regarding corporate valuation, a conservative rule of thumb is to establish a business's worth as ______ times the firm's current annual profit.
5
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.
5; 80
How many basic types of organizational structure are discussed in the chapter?
7
Production processes typically constitute more than ________ percent of a firm's total assets.
70
What percent of cash repatriated by U.S. companies in going towards stock buybacks and dividend payouts, as opposed to investments in employees and company infrastructure?
70
With the merger and acquisition boom this decade, S&P 500 firms experienced a _________ percent increase in goodwill.
70
Oceans cover more than ______ percent of the earth.
71
There is great variation across Europe with regard to levels of union membership, ranging from ______ percent of employees in Finland to ______ percent in France.
74, 8
Which term(s) below would not be a good annual objectives?
Add new suppliers as soon as possible.
In developing projected financial statements, how are retained earnings calculated on the balance sheet?
Add the net income less dividends to the prior year's retained earnings.
Which of the following statements are TRUE?
Although the exponential increase in social-media engagement has created huge opportunities for marketers, it also has produced severe threats; any kind of negative publicity travels fast online.
Theoretically, how much debt should a company carry on its balance sheet?
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.
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.
CEO of JPMorgan Jamie Dimon
Which statement below is FALSE?
Changes in structure often require changes in an organization's strategies.
What country ranks about 90th out of 190 countries in terms of doing business due to human-rights' issues and substantial disregard for copyright, patent, and trademark rules of law?
China
What country's strategic plan is to develop and use quantum computers to gain world dominance and superiority in information technology, financial systems, power grids, and military weapons?
China
______ requires many firms to share their technological knowledge as a condition of doing business there; this is a growing problem for U.S. firms and America in general.
China
What formula below is correct for valuing a company using the price-earnings ratio method?
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.
Which statement below is FALSE?
Donald Palmer recently reported that misconduct is most often done by people who party weekly.
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?
Firms should be careful not to venture into areas outside their corporate strategy.
Who is featured at the beginning of the chapter as a most "exemplary strategist?"
Former CEO of PepsiCo, Indra Nooyi
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.
ISO 14000
All of the following statements are true EXCEPT
ISO has legal authority to enforce its regulations' implementation.
In what way mentioned below would retained earnings on the balance sheet decrease from one year to the next?
If the firm had positive net income for the year but pays out dividends greater than the net income
Which of the following is NOT a typical characteristic of most Japanese managers?
Impulsive
According to statistics from the United Nations, the rate of female participation in the labor force of ______ is 35 percent; this is quite low, especially because women make up 42 percent of college graduates in that country. But women in this country with a college degree are expected to let their careers take a back seat to caring for their husband, children, and elderly parents. According to Sylvia Ann Hewlett, president of the Center for Work-Life Policy, a Manhattan think tank, "The measures of daughterly guilt are much higher in women in this country than in other countries."
India
What country's rate of female participation in the labor force is about 35 percent even though women make up about 42 percent of college graduates in this country?
India
_____ 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.
India
What country does the following describe? This country is a democratic Pacific archipelago comprised of thousands of islands. Its currency is the rupiah and its economy is one of the fastest-growing in Asia. This country's s GDP growth was 5 percent in 2017 and it continues to grow. Exports are surging. This country has a large population and densely populated regions. It has the world's second-highest level of biodiversity, with vast areas of wilderness and abundant natural resources.
Indonesia
Americans tend to use first names instantly in business dealings with foreigners, but foreigners find this presumptuous. In what country are first names used only among family members and intimate friends, with even longtime business associates and coworkers shying away from the use of first names?
Japan
Due to its dwindling workforce and aging population, what country is increasingly promoting women into managerial positions?
Japan
Which statement below is not a guideline for developing an organizational chart?
Make sure only presidents of divisions report to the CEO.
Which statement below is FALSE?
Many companies illegally monitor the social media activities of employees and prospective employees.
Which of the following sequences of marketing activities is correct?
Market segmentation, target marketing, product positioning
What country is an authoritarian society in terms of schools, churches, businesses, and families where employers seek workers who are agreeable, respectful, and obedient rather than innovative, creative, and independent?
Mexico
What country is especially attractive for manufacturing products that are bulky or costly to transport, such as automobiles? A key variable hurting this country is drug-related violence since its homicide rate exceeds 15 people per 100,000, compared with a per-capita rate of about 5.0 in the United States and 1.1 in China.
Mexico
______ is an authoritarian society in terms of schools, churches, businesses, and families. In general, employers seek workers who are agreeable, respectful, and obedient, rather than innovative, creative, and independent. Workers tend to be activity-oriented rather than problem solvers.
Mexico
__________ asserts that organizations have no obligation to do any more for society than is legally required.
Milton Friedman
The World Bank and the International Finance Corporation annually rank 189 countries in terms of their respective ease of doing business. The index ranks nations from 1 (best) to 189 (worst). What country is #1?
New Zealand
The top 20 most valuable college football programs are listed in the chapter in terms of their monetary value. What team is most valuable?
Ohio State Buckeyes
A full-blown example of a projected financial statement analysis is worked out and presented in Chapter 8 for _____.
P&G
Which factor below commonly prohibits effective resource allocation?
Placing too great an emphasis on short-run financial criteria
______ refers to countries imposing tariffs, taxes, and regulations on firms outside the country to favor their own companies and people. Most economists argue that engaging in this activity harms the world economy because it inhibits trade among countries and invites retaliation.
Protectionism
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?
Provide people a platform to which they can contribute.
Which statement below is FALSE?
Reengineering is an analogous term for benchmarking.
Which is NOT a characteristic of policies?
Represent the basis for allocating resources
Which statement below is not a guideline for developing an organizational chart?
Reserve the title president for the CEO of the firm.
Which statement(s) below is FALSE?
Restructuring is concerned primarily with employee well-being rather than shareholder well-being.
Who said, "When wealth is lost, nothing is lost; when health is lost, something is lost; when character is lost, all is lost."
Rev. Billy Graham
Which statement(s) below is TRUE?
Seeing Goodwill regularly increasing on a balance sheet is not a good thing.
Which statement(s) is TRUE?
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".
According to Chapter 10, a country with one of the lowest bribery rates is ______ and a country with one of the highest bribery rates is ______.
South Korea; India
Which organizational structure has the disadvantage of ambiguous roles for some senior executives?
Strategic Business Unit (SBU)
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?
TOMS Shoes, Inc.
Who is the exemplary strategist who is trying to convert all smokers globally to a new smokeless tobacco product that is much safer even than e-cigarettes?
The CEO of Philip Morris
Which statement(s) below is FALSE?
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.
Which of the following statements is TRUE regarding the issuance of corporate bonds in the United States?
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.
Which statement below is FALSE?
There are more female CEOs in the United States than male CEOs.
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?
They all were implicated in sexual harassment allegations.
Which of the following is NOT true about objectives?
They should use terms like "maximize," "minimize," and "as soon as possible."
T/F: An increasing number of U.S. companies are reincorporating in foreign countries to reduce their tax burden and doing this typically involves acquiring a foreign firm.
True
Which is NOT a major factor that commonly prohibits effective resource allocation?
Underprotection of resources
As of 2018 which of the following countries had the highest corporate tax rate?
United Arab Emirates
What university in the USA leads all universities in annual usage of green power?
University of Tennessee
In performing EPS/EBIT analysis, how is the first row (EBIT) determined?
Use the most recent year EBIT number plus or minus the impact of recommendations to determine a range.
In EPS/EBIT analysis, from where does the tax rate percentage come?
Use the company's prior year tax rate as revealed by dividing income before taxes by taxes paid off the firm's income statement.
Which statement below is FALSE?
Workplace romances actually decrease work performance, adding a dynamism and energy that translates into decreased morale, communication, creativity, and productivity.
The amount by which retained earnings changes is obtained by subtracting
any dividends to be paid for that year from net income.
According to Schein, what statement below is not included as a useful element in linking culture to strategy?
benchmarking
The U.S. Foreign Corrupt Practices Act (FCPA) governs ______ in the United States and has stepped up enforcement.
bribery
______ is defined by Black's Law Dictionary as the offering, giving, receiving, or soliciting of any item of value to influence the actions of an official or other person in discharge of a public or legal duty.
bribery
What statement below is FALSE?
conflict is always bad
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.
consistently
The term "corporate wellness" has largely been replaced by what new term?
corporate well being
Mass communication and high technology have ________ in diverse cultures worldwide.
created similar patterns of consumption
Communication between domestic headquarters and overseas operations is often made difficult by
cultural differences
What is another term for profits?
earnings
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.
enviornment
According to the ISO 14001 standard, a community or organization is required to put in place and implement a series of practices and procedures that, when taken together, result in a/an ______.
environmental management system (EMS)
American managers in China have to be careful about how they arrange office furniture because Chinese workers believe in ______, the practice of harnessing natural forces. Also, U.S. managers in Japan have to be careful about ______, whereby Japanese workers expect supervisors to alert them privately of changes rather than informing them in a meeting.
feng shui; nemaswashio
What change strategy involves giving orders and enforcing those orders?
force
All of the following are potential disadvantages to initiating, continuing, or expanding business across national borders EXCEPT
foreign operations can absorb excess capacity, reduce unit costs, and spread economic risks over a wider number of markets.
According to Chapter 10, which of the following actions is unethical?
insider trading and overpricing
Which element in the projected income statement CANNOT be forecasted using the percentage-of-sales method?
interest expense
Simply having a code of ethics
is insufficient to guarantee that employees behave in an ethical manner.
When a firm buys more of its own common stock, what is the effect on the firm's earnings per share (EPS) value?
it goes up
A disadvantage of a functional structure is it____.
leads to poor delegation of authority.
What type of structure is the most complex of all the organizational designs or structures?
matrix
In contrast to strategy formulation, strategy implementation focuses more on _____.
motivation skills rather than analytical skills
Generally speaking, in Europe, the farther ______ on the continent, the more participatory the management style.
north
__________ involves companies hiring other companies to take over various parts of their functional operations, such as human resources, information systems, payroll, accounting, customer service, and even marketing.
outsourcing
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").
policies
For the first time ever in the United States, cars, trucks, planes, and trains have displaced _____ as the biggest USA polluter.
power plants
The divisional structure can be organized by ____.
process or customer
Perceptual mapping is a marketing tool associated with _____.
product positioning
Policies help an organization in all of the following ways EXCEPT
reduce work load of employees.
__________ refers to U.S. companies moving a portion of their manufacturing back to the United States.
reshoring
According to the chapter, "______ may be the single-greatest threat to successful strategy implementation."
resistance to change
In developing projected financial statements, with what row item does one start?
revenues
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.
sexual harassment
The denominator of EPS is
shares outstanding
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.
sustainability report
Limitations of EPS/EBIT analysis include ______.
timing and control
The corporate valuation formula for the net worth method is _____.
total shareholders' equity (SE) minus (goodwill + intangibles).
The shares of stock of a firm that are owned by the firm itself are called _____.
treasury stock
Is it true or false that the free Excel strategic planning template at www.strategyclub.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.
true
______ refers to employees reporting any unethical violations they discover or see in the firm.
whistle-blowing
Responsibility for encouraging ethical decision making and ensuring ethical behavior in a firm lies
with both a firm's strategists and its managers.
Which statement below is TRUE?
"Going public" means selling off a percentage of a company to others to raise capital; consequently, it dilutes the owners' control of the firm.
Exports of goods and services from the United States account for what percent of U.S. gross domestic product (GDP)? In contrast, as a percent of gross domestic product, exports comprise what percent of the German economy?
13.0; 46.0
What are the corporate tax rate percentages in the United States, Mexico, and Canada, respectively?
21; 30; 26.5
Fully ___ percent of the world's population lives outside the United States, and this group is growing ___ percent faster than the U.S. population.
95; 70
What are the three categories of approaches for managing and resolving conflict?
Avoidance, defusion, and confrontation
What three retailers are discussed in the chapter as being the top 3 Green Power-Use retailers in 2017.
Kohl's Department Stores, Starbucks (company-owned café retail stores), IKEA
The marketing mix variables include what aspects of a product offerings?
Product, place, promotion, price
According to Table 8-5 in Chapter 8, what are the three most corrupt countries in the world?
Somalia, South Sudan, North Korea
In Japan, business relations operate within the context of ______, which stresses group harmony and social cohesion. In China, business behavior revolves around ______, or personal relations. In South Korea, activities involve concern for ______, or harmony based on respect of hierarchical relationships, including obedience to authority.
Wa; Guanxi; Inhwa
The Omega Company sells two very different types of products, each of which needed special emphasis. The type of structure that would best suit the Omega Company is the _________ structure.
divisional-by-product
Green power is _____.
renewable, such as wind, solar, and water
