Independent directors in family firms should be:

1. Any person with an MBA and a good understanding of accounting and management.
2. A person not directly related to the CEO of the company, but may be a shareholder in the company.
3. Any person with no relations to the owning family either by blood or marriage.
4. A person with sufficient experience and qualifications, who has no direct interest in ownership of the company.

2-If your father requests you to quit your job and join the family business, then you agree to do so to be an obedient child and to make him happy. Then your motive for joining the family firm is based on:

A.Normative reasons.

B.Affective reasons

Correct reasons.

Calculative reasons

3-The practice of inclusive decision making and transparency in dealings are vital for maintaining harmony and unity among owners of a family business especially during the sibling generation onwards. This statement means that:

1. The CEO (family business leader) should hold democratic votes on all major decisions, and follow the decision of the majority at all times. P Flag question
2. The CEO (family business leader) should not keep secrets from the other co-owners of the company, and should keep them informed and involved regarding major decisions in the company.
3. The CEO (family business leader) should maintain unity of the family even if he has to take some decisions that are not in the best interest of the company.
4. The CEO (family business leader) should consult all the family members before taking any decisions.

4-A major reason for conflicts among siblings who inherit a family business is:

1. Lack of sufficient and frequent updates about the business from the family business leader to others.
2. High levels of emotional intelligence of the CEO.
3. Not keeping business information secret.
4. All the siblings not being properly educated.

5-Which of these statements is true about family controlled businesses?

1. They are different from nonfamily firms because they parallely pursue familygoals and businessgoals.
2. Family firm owners give priority to the goals of the nonfamily stakeholders.
3. They are more professionally managed than non-family firms.
4. They do not prioritise economic wealth.

6) Heirs of the family firm should learn early that family business means stewardship and responsibility. The word stewardship is best resembled by which of the following?

1. Stewards encourage nepotism in the selection and recruitment of employees.

2 . Stewards see themselves as trustees and protectors of the family and the business organization.

3. Stewards sacrifice their own needs in order to make other family members happy.

4. Stewards agree to give priority to family members in terms of compensation and promotions compared to non-family employees.