1. Which of these results from the separation of ownership and management in large publicly traded corporations?

A. Corporate managers have weaker incentives to transfer control of the firm to more informed management teams.

B. Corporate managers have strong incentives to rather quickly transfer control of the firm to less informed management teams.

C. Corporate managers have a stronger incentives to rather quickly transfer control of the firm to more informed management teams.

D. Corporate managers have weaker incentives to transfer control of the firm to less informed management teams.

2. Based on a historical perspective, we can say that the architecture of publicly traded corporations:

A. Will continue to evolve and change over time.

B. Will continue operating in their current state and become stagnant.

C. Will become highly vulnerable to fraud and scandals.

D. Will soon become too powerful and unmanageable.

3. If a senior manager wishes to see her proposal when support, then she should:

A. Design a proposal that will yield high returns if successful.

B. Design a proposal that can be modified easily.

C. Wait for the CEO to change the organizational architecture.

D. Wait for senior management to ask for her proposal.

5. An individual can sometimes create power by developing a service or product that becomes important to other people within the organization. What is the source of organizational power for this individual?

A. Control over key resources.

B. Formal authority.

C. Control over specific information.

D. Nepotism.

6. To design an ethical and organizational architecture system we need:

A. A clear partition between assigning decision rights and evaluating performance from sanctioning an ethical behavior.

B. Internal consistency between assigning decision rights, evaluating performance, and sanctioning unethical behavior.

C. Internal consistency between assigning decision rights and evaluating performance while sanctioning unethical behavior must be left to top management.

D. Top management to assign decision rights, middle-management to evaluate performance, and an external agency to sanction unethical behavior.