A Virtually Exclusive Reliance on Financial Controls May Occur When

question 54

Multiple Choice

A virtually exclusive reliance on financial controls may occur when outsider-dominated boards exist.This may lead to all of the following EXCEPT:

• A) high executive turnover.
• B) increased diversification of the firm.
• C) excessive management compensation.
• D) a reduction in R&D expenditures.

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Definitions:

Competition

The rivalry between businesses or individuals for resources, market share, or superiority in a particular field.

Power Avoidance

A cultural value indicating a society's tolerance for unequal distribution of power, and its members' behavioral response to minimize or avoid such inequalities.

Ambiguity

Ambiguity is the quality of being open to more than one interpretation, lacking clarity, and leading to uncertainty or confusion.

Unpredictability

The extent to which events or behaviors cannot be anticipated due to a lack of consistent patterns or information.