Oxford University Press | Online Resource Centre

Choose your answers from a-d by clicking the radio button next to each choice and then press 'Submit' to get your score.

Question 1

The 'principal-agent problem' refers to:

a) The power held by suppliers over prices

b) The power held by buyers over prices

c) The trust of employees

d) The separation of ownership from control in firms

Question 2

Friedman (1962) is a famous exponent of the view that:

a) Business is business

b) Business is society

c) Business is politics

d) Business is power

Question 3

Which measure of performance is arguably most useful to shareholders?

a) Economic value added

b) Wealth added index

c) Return on investment

d) Discounted cash flow

Question 4

Those who advocate the stakeholder view of organizations have the view that:

a) An organization's sole purpose is to create shareholder value

b) An organization's sole purpose is to make profits for the owners

c) An organization has more than one purpose - it also needs to consider the society within which it operates

d) An organization's sole purpose is to increase the quality of life of its employees

Question 5

Stakeholders can be defined as:

a) Individuals or groups that are affected by the organization

b) Individuals or groups that affect the organizations

c) Individuals or groups that affect and are affected by the organization

d) Individuals or groups that have invested money in the organization

Question 6

Mendelow (1991) has developed a model for prioritizing stakeholders using the two variables:

a) Power and influence

b) Power and interest

c) Influence and interest

d) Authority and interest

Question 7

Which two countries are most likely to give prominence to shareholders in their corporate governance framework?

a) Germany and France

b) Japan and South Korea

c) Sweden and Norway

d) UK and USA

Question 8

The balanced scorecard approach is a framework for measuring performance based on four factors. These are 'innovation and learning', 'the customer perspective', 'the internal perspective' and:

a) The key shareholder perspective

b) The external perspective

c) The financial perspective

d) The helicopter perspective

Question 9

The Balanced Scorecard approach has been criticized for leaving out certain measures. One of these is:

a) Financial measures

b) Employee satisfaction measures

c) Customer satisfaction measures

d) Technological innovation measures

Question 10

Benchmarking is a popular tool to measure performance. Benchmarking involves the continual process of comparing organizational performance against:

a) Industry standards

b) High achieving organizations

c) Rivals

d) Organizations within the same industry

Question 11

In Japan benchmarking is practiced through what is called:

a) Watashi

b) Shukko

c) Kaizen

d) Kanban

Question 12

How many measures do Kaplan and Norton recommend an organization should include when using the balanced scorecard approach?

a) 10-20

b) 20-30

c) 50-100

d) 80-120

Question 13

In the balanced scorecard approach quality would come under which perspective?

a) The internal perspective

b) The customer perspective

c) The financial perspective

d) The innovation and learning perspective

Question 14

The overall purpose of the balanced scorecard approach is to:

a) Help turn strategy into action

b) Benchmark against competitors

c) Measure financial performance

d) Measure product quality

Question 15

The problem with using financial measures alone to measure organizational performance is that:

a) They need to be compared with competitors to have any real meaning

b) They are only understood by accountants

c) There are many different measures available

d) The measures are usually contradictory

Oxford University Press, Online Resource Centre, Chapter 06.

Chapter 06

Instructions