Urban Legends The Concept of "Urban Legends" (A Story That Appears Mysteriously

question 40

Multiple Choice

Urban Legends
The concept of "urban legends" (a story that appears mysteriously and spreads spontaneously in various forms and is usually false posted on the Internet) and Internet scams are a real problem for some businesses. Gerber Baby Foods was flooded with 1 million letters and 80,000 phone calls from parents responding to an e-mail about a phony class-action lawsuit. Another urban legend about Costa Rican flesh-eating bacteria that affected banana shipments cost that industry more than $30 million. Procter & Gamble had to deal with claims that its Febreeze product contained Agent Orange, a dangerous chemical. Many companies choose to ignore these myths created by angry customers or rabble-rousers, but experts believe this is the worst possible action to take. Companies should instead do everything possible to reassure its customers.
-Refer to Urban Legends. Top managers who encouraged subordinates to do everything in their power to assure customers that Internet myths about their companies were false engaged in_____ .

• A) downward communication
• B) information diffusion
• C) upward communication
• D) establishing a grapevine
• E) horizontal communication

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Definitions:

Equity Method

An accounting technique used to record investments in other companies, where the investment is initially recorded at cost and adjusted thereafter for the investor's share of the investee's income or losses.

Investment Revenue

Income generated from the holding of investments like stocks, bonds, real estate, and other assets.

Fair Value

An estimate of the market value of an asset or liability, based on current prices or valuations in an orderly transaction between market participants.

Equity Investment Portfolio

A collection of equity securities owned by an individual or institution, often diversified across various sectors.