Cordova Has Been Involved in Negotiations with the Union Representing

question 21

Multiple Choice

Cordova has been involved in negotiations with the union representing her employees for over seven months. An agreement has not been reached on any issue, although Cordova has made concessions from her original position. She is unwilling to make further concessions. If no agreement is reached within a reasonable amount of time:

• A) Cordova will be liable for having committed an unfair labor practice, because the law presumes that an agreement must be reached if the parties bargain in good faith.
• B) the Norris-LaGuardia Act permits the union to impose terms and conditions substantially similar to those enjoyed by similarly situated workers.
• C) Cordova will not be liable for having committed an unfair labor practice, because the law does not require that an agreement be reached, only that the parties bargain in good faith.
• D) the National Labor Relations Act permits the National Labor Relations Board to impose terms and conditions substantially similar to those enjoyed by similarly situated workers.

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Definitions:

Equity Value

The value of a company’s shares; it represents the residual value to shareholders after debts and liabilities have been settled.

Sustainable Growth Rate

The maximum rate at which a company can grow its sales, earnings, and dividends without having to increase financial leverage or equity financing.

Return On Equity

A financial ratio that measures the profitability of a business in relation to the amount of equity, indicating how effectively management is using shareholders’ funds.

Payout Ratio

A financial metric showing the proportion of earnings a company pays to its shareholders in the form of dividends.