If the CEO of a Large, Diversified, Firm Were Filling

question 97

Multiple Choice

If the CEO of a large, diversified, firm were filling out a fitness report on a division manager (i.e., "grading" the manager) , which of the following situations would be likely to cause the manager to receive a better grade? In all cases, assume that other things are held constant.

• A) The division's DSO (days' sales outstanding) is 40, whereas the average for its competitors is 30.
• B) The division's basic earning power ratio is above the average of other firms in its industry.
• C) The division's total assets turnover ratio is below the average for other firms in its industry.
• D) The division's debt ratio is above the average for other firms in the industry.
• E) The division's inventory turnover is 6, whereas the average for its competitors is 8.

---

Definitions:

Management Philosophy

A set of beliefs or principles that guide how an organization is managed and how decisions are made.

Organizational Myths

Widely held but false beliefs within an organization that influence its culture and decisions.

Social System

An organized collection of roles and norms that regulate the behavior and expectations of individuals within a group.

Rituals

Are formal, often repeated behaviors and practices that carry symbolic meaning within a culture or organization.