Legitimate Power Is Directly Based on ________

question 22

Multiple Choice

Legitimate power is directly based on ________.

• A) charisma of the leader
• B) interpersonal trust and commitment of the manager
• C) structural position of the manager in the organization
• D) personality traits of the manager
• E) ability of the manager to serve his subordinates

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Definitions:

Price of Money

Often refers to the interest rate, reflecting the cost of borrowing money or the return on savings, generally influenced by inflation, supply and demand for credit, and monetary policy.

Anticipated Inflation

Expected inflation, the general rise in prices forecasted by consumers, businesses, and investors, affecting economic decisions.

Market Risk Premium

The extra return expected by investors for holding a risky market portfolio instead of risk-free assets.

Beta

A measure of a stock's volatility in relation to the overall market; a beta greater than 1 indicates the stock is more volatile than the market.