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Practice Quiz
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1
Behavioral controls involve the appropriate balance and alignment among the culture, rewards, and management of a firm.
A)True
B)False
2
For firms competing in highly stable industries, non-traditional strategic controls are most appropriate.
A)True
B)False
3
Single-loop learning enhances the ability of the organization to respond with speed and flexibility.
A)True
B)False
4
The collective sum of individual behaviors of the employees of an organization always resulted in what is best for the organization.
A)True
B)False
5
Central to agency theory is the concern that the goals of the principals and agents can conflict and that it is difficult for the principal to verify what the agent is actually doing.
A)True
B)False
6
In the contemporary approach to control systems, benefits of continuous monitoring include ___________.
A)late detection of changes in the competitive environment
B)time lags are dramatically shortened
C)organizational flexibility is not considered
D)organization response time is lengthened
7
As firms simultaneously _________ and face the need for increased coordination across organizational boundaries, a control system based primarily on boundaries and constraints would be dysfunctional.
A)grow
B)flatten
C)downsize
D)expand
8
Primary participants in corporate governance are management (led by the CEO), _________, and __________.
A)stakeholders; community
B)shareholders; board of directors
C)employees; board of directors
D)outside stakeholders; board of directors
9
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 a primary means for monitoring managerial behavior?
A)stakeholder activism in which participants view themselves as employees
B)a CEO that acts in the best interests of shareholders to create short-term value
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 CEO
10
External governance control mechanisms do not include _______________.
A)auditors
B)governmental regulatory bodies
C)media
D)employees





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