Preston Works in the Communications Division of a Large Toy

question 213

Multiple Choice

Preston works in the communications division of a large toy manufacturer. Recently, his company was forced to issue a nationwide recall after it was discovered that lead paint had been used on some of the toys. The news has spread like wildfire, and rumors have begun to replace facts. Preston has been constantly busy answering questions from the media, assuring the public that it was taking appropriate action, fielding calls from government officials, and more. He has come up with a statement acknowledging the incident on the corporate Facebook page and its website. He is also helping the CEO craft a response. Preston has learned the difficult lesson that

• A) government regulators always fine firms when they have to issue a massive recall.
• B) managers spend more resources responding to negative word of mouth than positive word of mouth.
• C) it is impossible for managers to develop an adequate response to a major crisis event.
• D) the company's response will not be able to quell the misinformation regarding a crisis event.
• E) it is impossible to develop a crisis management plan because nobody knows what crisis is going to hit.

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Definitions:

Economic Hierarchy

A ranking of individuals or groups according to economic power, wealth, or status, affecting their access to resources and opportunities.

Political Hierarchy

A structured ranking system within a political entity or organization, where power and authority are distributed among different levels.

Modernization Theory

A theory which suggests that as societies undergo economic development, they will also experience cultural and social changes that lead them towards becoming more 'modern' or industrialized.

Industrialized Nations

Countries that have highly developed industries, infrastructure, and advanced technological capabilities, resulting in a high standard of living.