Why Are Managers Thought to Engage in Empire Building

question 64

Multiple Choice

Why are managers thought to engage in empire building?

• A) Companies that do not grow stagnate
• B) The pursuit of growth represents the best way of maximizing the long-run profitability of the company.
• C) Growth is designed to increase market share, which in turn increases company profits.
• D) Growth results in large company size, and large size satisfies managers' needs for power, status, income, and job security.
• E) Stockholders would rather invest in large companies than in small ones.

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Definitions:

Economic Growth

An increase in the production of goods and services in an economy over a period, often measured by the rise in Gross Domestic Product (GDP).

Environmental Preservation

The practice of safeguarding natural resources and ecosystems to maintain biodiversity and ecological health, often involving protection from pollution and overexploitation.

Neoclassical

pertains to an economic theory that focuses on supply and demand as driving forces behind the production, pricing, and consumption of goods and services.

Netherlands' Green Plan

An environmental policy initiative by the Dutch government aimed at reducing greenhouse gas emissions, promoting sustainable development, and implementing green technology.