A Virtually Exclusive Reliance on Financial Controls May Occur When

question 65

Multiple Choice

A virtually exclusive reliance on financial controls may occur when outsider-dominated Boards exist. This may lead to all of the following EXCEPT:

• A) high executive turnover.
• B) increased diversification of the firm.
• C) excessive management compensation.
• D) reduction in R&D expenditure.

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Definitions:

Organizational Socialization

The process by which new employees acquire the necessary knowledge, skills, and behaviors to become effective organizational members and insiders.

Accepted Insiders

Individuals or groups within an organization or community who are recognized and welcomed due to their status, contribution, or involvement.

Outsiders

Individuals who are not part of a specific group or organization, often viewed from the perspective of those within the group.

Effectiveness

The degree to which something is successful in producing a desired result or outcome.