Which of the Following Statements Is True with Regards to the Political

question 9

Multiple Choice

Which of the following statements is true with regards to the political cost hypothesis?

• A) Political costs arise as a result of an entity's relationships with shareholders and lenders.
• B) Managers of financial institutions may prefer to increase profits to reduce government pressure to pass on interest rate cuts.
• C) Smaller entities are more likely to be the target of environmental groups.
• D) Managers of entities that are more politically visible are expected to choose accounting policies that reduce profit in order to avoid political costs.

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Definitions:

Conflicting Expectations

Situations where there are discrepancies between what is anticipated or desired by different individuals or groups.

All-channel Networks

Communication networks within organizations or groups where information flows freely and equally among all members.

Star Communication

Exceptional or highly effective communication practices characterized by clarity, purposefulness, engagement, and adaptability, often seen in successful leaders and organizations.

Team Cohesiveness

The extent to which team members are bonded together and committed to their common goals, leading to increased productivity and morale.