Which of the Following Descriptions of the Succession Problem in Family

question 72

Multiple Choice

Which of the following descriptions of the succession problem in family businesses is INCORRECT?

• A) The vast majority of family businesses with succession plans will survive well beyond the second generation.
• B) The key management issue in the succession problem concerns how the assets will be distributed and who will run the business when the current head leaves.
• C) The succession problem should be handled ahead of time with a succession plan.
• D) The succession problem involves transferring leadership from one generation to the next.
• E) Since not all family businesses have succession plans, many will not survive beyond the first generation.

---

Definitions:

Groupthink

A psychological phenomenon where the desire for harmony and conformity in a group leads to irrational and dysfunctional decision-making outcomes.

Stereotyping

The act of categorizing individuals into groups and attributing specific characteristics to them without acknowledging individual differences, often leading to oversimplified perceptions.

Groupthink

An occurrence within groups where the suppression of dissenting viewpoints and the pressure to conform lead to a decrease in critical evaluation of decisions.

Rational Decision

The process of making choices based on logical reasoning, often involving weighing the benefits and drawbacks of different options.