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  • Intermediate Financial Management 12th Edition Brigham Test Bank

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    This document contains a test bank with questions and answers about Chapter 10 on corporate governance from the 12th Edition of the textbook "Intermediate Financial Management" by Brigham. The test bank covers topics like the rules governing a board's ability to fire the CEO, poison pills, stock options, ESOPs (Employee Stock Ownership Plans), and barriers to hostile takeovers. Each question is multiple choice format and includes the answer, point value, difficulty level, learning objectives, and standards it aligns with.

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    This document contains a test bank with questions and answers about Chapter 10 on corporate governance from the 12th Edition of the textbook "Intermediate Financial Management" by Brigham. The test bank covers topics like the rules governing a board's ability to fire the CEO, poison pills, stock options, ESOPs (Employee Stock Ownership Plans), and barriers to hostile takeovers. Each question is multiple choice format and includes the answer, point value, difficulty level, learning objectives, and standards it aligns with.

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    © All Rights Reserved
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    219 views4 pages

    Intermediate Financial Management 12th Edition Brigham Test Bank

    Uploaded by

    calanthalovelloa5
    This document contains a test bank with questions and answers about Chapter 10 on corporate governance from the 12th Edition of the textbook "Intermediate Financial Management" by Brigham. The test bank covers topics like the rules governing a board's ability to fire the CEO, poison pills, stock options, ESOPs (Employee Stock Ownership Plans), and barriers to hostile takeovers. Each question is multiple choice format and includes the answer, point value, difficulty level, learning objectives, and standards it aligns with.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    of 4

    Intermediate Financial Management

    12th Edition Brigham Test Bank


    Visit to download the full and correct content document: https://testbankdeal.com/dow
    nload/intermediate-financial-management-12th-edition-brigham-test-bank/
    CHAPTER 10—CORPORATE GOVERNANCE
    1. Two important issues in corporate governance are (1) the rules that cover the board's ability to fire the CEO and (2) the
    rules that cover the CEO's ability to remove members of the board.
    a. True
    b. False
    ANSWER: False
    POINTS: 1
    DIFFICULTY: Difficulty: Easy
    LEARNING OBJECTIVES: INTE.GENE.16.67 - LO: 10-2
    NATIONAL STANDARDS: United States - BUSPROG: Reflective Thinking
    STATE STANDARDS: United States - AK - DISC: Financial statements, anal - DISC: Financial statements, analysis,
    forecasting, and cash flows
    LOCAL STANDARDS: United States - OH - Default City - TBA
    TOPICS: Corporate governance
    KEYWORDS: Bloom’s: Knowledge

    2. A poison pill is also known as a corporate restructuring.


    a. True
    b. False
    ANSWER: False
    POINTS: 1
    DIFFICULTY: Difficulty: Moderate
    LEARNING OBJECTIVES: INTE.GENE.16.67 - LO: 10-2
    NATIONAL STANDARDS: United States - BUSPROG: Reflective Thinking
    STATE STANDARDS: United States - AK - DISC: Financial statements, anal - DISC: Financial statements, analysis,
    forecasting, and cash flows
    LOCAL STANDARDS: United States - OH - Default City - TBA
    TOPICS: Corporate governance
    KEYWORDS: Bloom’s: Comprehension

    3. The CEO of D'Amico Motors has been granted some stock options that have provisions similar to most other executive
    stock options. If D'Amico's stock underperforms the market, these options will necessarily be worthless.
    a. True
    b. False
    ANSWER: False
    POINTS: 1
    DIFFICULTY: Difficulty: Moderate
    LEARNING OBJECTIVES: INTE.GENE.16.67 - LO: 10-2
    NATIONAL STANDARDS: United States - BUSPROG: Reflective Thinking
    STATE STANDARDS: United States - AK - DISC: Financial statements, anal - DISC: Financial statements, analysis,
    forecasting, and cash flows
    LOCAL STANDARDS: United States - OH - Default City - TBA
    TOPICS: Stock options
    KEYWORDS: Bloom’s: Comprehension

    4. ESOPs were originally designed to help improve worker productivity, but today they are also used to help prevent
    Cengage Learning Testing, Powered by Cognero Page 1
    CHAPTER 10—CORPORATE GOVERNANCE
    hostile takeovers.
    a. True
    b. False
    ANSWER: True
    POINTS: 1
    DIFFICULTY: Difficulty: Moderate
    LEARNING OBJECTIVES: INTE.GENE.16.68 - LO: 10-3
    NATIONAL STANDARDS: United States - BUSPROG: Reflective Thinking
    STATE STANDARDS: United States - AK - DISC: Financial statements, anal - DISC: Financial statements, analysis,
    forecasting, and cash flows
    LOCAL STANDARDS: United States - OH - Default City - TBA
    TOPICS: ESOP
    KEYWORDS: Bloom’s: Comprehension

    5. Which of the following is NOT normally regarded as being a barrier to hostile takeovers?
    a. Targeted share repurchases.
    b. Shareholder rights provisions.
    c. Restricted voting rights.
    d. Poison pills.
    e. Abnormally high executive compensation.
    ANSWER: e
    POINTS: 1
    DIFFICULTY: Difficulty: Moderate
    LEARNING OBJECTIVES: INTE.GENE.16.67 - LO: 10-2
    NATIONAL STANDARDS: United States - BUSPROG: Analytic
    STATE STANDARDS: United States - AK - DISC: Financial statements, anal - DISC: Financial statements, analysis,
    forecasting, and cash flows
    LOCAL STANDARDS: United States - OH - Default City - TBA
    TOPICS: Corporate governance
    KEYWORDS: Bloom’s: Analysis
    OTHER: TYPE: Multiple Choice: Conceptual

    6. Which of the following is NOT normally regarded as being a good reason to establish an ESOP?
    a. To enable the firm to borrow at a below-market interest rate.
    b. To make it easier to grant stock options to employees.
    c. To help prevent a hostile takeover.
    d. To help retain valued employees.
    e. To increase worker productivity.
    ANSWER: b
    RATIONALE: Statement b is the correct answer, because firms can easily grant stock options to employees
    without an ESOP.
    POINTS: 1
    DIFFICULTY: Difficulty: Moderate
    LEARNING OBJECTIVES: INTE.GENE.16.68 - LO: 10-3

    Cengage Learning Testing, Powered by Cognero Page 2


    CHAPTER 10—CORPORATE GOVERNANCE
    NATIONAL STANDARDS: United States - BUSPROG: Analytic
    STATE STANDARDS: United States - AK - DISC: Financial statements, anal - DISC: Financial statements, analysis,
    forecasting, and cash flows
    LOCAL STANDARDS: United States - OH - Default City - TBA
    TOPICS: ESOP
    KEYWORDS: Bloom’s: Analysis
    OTHER: TYPE: Multiple Choice: Conceptual

    Cengage Learning Testing, Powered by Cognero Page 3

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