Isidore Crocker, CEO of Gotham Engines, Is Strongly in Favor

question 140

Multiple Choice

Isidore Crocker, CEO of Gotham Engines, is strongly in favor of acquiring Carolina Textiles, a firm in an unrelated industry. Some members of the Board of Directors are questioning Crocker's motives for the acquisition. They argue that it is not uncommon for CEOs to push for acquisitions because:

• A) a successful acquisition will increase the CEO's power over the Board of Directors.
• B) making an acquisition is an easier route to increased firm value than is improving the firm's core competencies.
• C) higher CEO pay is related to larger organization size.
• D) CEOs nearing retirement seek to create empires to continue their legacy.

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Definitions:

Descending Limb

A portion of the loop of Henle in the nephron of the kidney, which is involved in the reabsorption of water back into the body.

Aldosterone

A hormone produced by the adrenal glands which regulates sodium and potassium levels in the blood, influencing blood pressure.

Sodium

A chemical element with symbol Na, a soft, silvery-white, highly reactive metal and an essential electrolyte in biological systems.

Urethra

The tube that conducts urine from the bladder to the outside of the body in both males and females, and also serves as a conduit for semen in males.