Exam 11: Corporate Performance, Governance, and Business Ethics

A) shares of the company's stock at the stock's current price.
B) shares of the company's stock at half the stock's current price.
C) shares of the company's stock at a predetermined price at some point in the future.
D) bonds issued by the company.
E) stock in an underperforming company.

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A) On-the-job consumption 
B) Opportunistic exploitation
C) Environmental degradation
D) Self-dealing
E) Substandard working conditions

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A) They are underperforming corporations that have been acquired by other companies.
B) They are government-funded organizations that help underperforming companies recover.
C) They may purchase stock in a company to take over the business and run it more efficiently.
D) They lack power to interfere with the top management decisions.
E) They discourage companies from pursuing strategies that help maximize stockholder wealth.

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A) Attaining future profit growth may require investments that reduce the current rate of profitability.
B) Managers must find the right balance between profitability and profit growth.
C) Too much emphasis on current profitability at the expense of profit growth can make an enterprise less attractive to shareholders.
D) Satisfying the claims of other key stakeholder groups happens at the risk of decreased profitability and profit growth.
E) Too much emphasis on profit growth can reduce profitability and make an enterprise less attractive to shareholders.

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A) They are usually set by government regulators and require top management to follow them.
B) Their primary purpose is to foster on-the-job consumption.
C) Their purpose is to ensure that the wealth of stockholders is maximized.
D) They relieve employees and management of legal and ethical constraints.
E) They are designed to encourage information asymmetry.

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