Determining Firm Performance Is a Complex Interaction of Firm Effects

question 30

Multiple Choice

Determining firm performance is a complex interaction of firm effects and industry effects,with other factors also considered.Based on historical analysis,what do we know about firm and industry effects?

• A) Managerial actions rather than firm effects have a large role in firm performance.
• B) Macro environmental effects such as a recession have more impact than either firm or industry effects.
• C) Firm effects have more impact on performance than industry effects.
• D) Industry effects have more impact on performance than firm effects.

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Definitions:

Role Differentiation

The process by which a society or group divides and specializes roles based on characteristics such as sex, age, occupation, or skill.

Unity

The state of being united or joined as a whole, especially in a political context.

Social Construction

The theory that many aspects of society, including knowledge, are created through cultural and social practices and not inherently natural or universal.

Reality

Pertains to the state or quality of having existence or substance; the sum of all that is real or existent within a system, as opposed to that which is only imaginary.