Section A: Answer All Questions 20 Marks 1. This demand aggressive advertising A, Stars B. Dogs C. Question marks D, Cash cows 2, This specifies the market(s), the products or services that a firm offers, its customers, and how it will compete in its market, ‘A. Funetional strategy B. Corporate strategy C. Business level strategy D, None of the above 3, Eating ata restaurant in your home town isa repeated game because ‘A. The waiter will serve you better B. You will get your favorite meal C. The waiter may delay or deny you of your favorite meal D, Meals are always available 4. Inmanagement, game theory is used for ‘A, Employee monitoring B. Strategic interaction C. Setting prices D. All the above 5. Anexample ofa one shot game is A. Eating at your home town restaurant B. Eating at rest stop restaurant C. Eating at your favorite restaurant D. Eating at a rest stop restaurant regularly Use the following case to answer questions 6 to 10 Ins one-shot game, if you advertise and your rival advertises, you will each earn $5 million in profits, If nether of you advertise, your rival will make $4 million and you will make $2 millon. If you advertise and your rival does not, you will make $10 million and your rival Will make 33 million. If your rival advertises and you do not, you will make $1 million and ‘your rival will make $3 million. 6. Do you have a dominate strategy? A. Yes B. May be yes C. No D. May be no 7. Does your rival have a dominate strategy’? A. Yes B. May be yes C. No D. May be no 8. Does your rival have a secure strategy? Page 2 0f91 Whereas corporal 8 at the functional | : ih ing ie Pe ngs doing things Bh ing best things ‘A, Doing things ‘B, Daing ight things Doing things bes do ings; doing 023 HINES consistently cvrat go we want 1° D. Doing best 13. The ancwers the question whereas ‘hat is ou ‘A. Value statements; 1 business?” answers the question ‘mission statement B, mission; vision . short-term objectives D. objectives: strategies vision; mission 14, What we do ahead checks are —--~ controls [A feedback; feedforward B. concurrent; feedforward CC. feedforward: concurrent D. concurrent; feedback 15, Directives given to employees to ge thin n f ee fae e get things done are examples of B, People-oriented leadership . Paternal leadership D. Appreciative leadership 5s; long-term objectives af ime to help our pan succeed 8 rm ‘control but real-time Page 3 of 9a Use the following figure to answer questions 16022 16, What does A stand for? ‘A. Cash cow B, Star C, Question mark D. Dog Relative competitive. Postion (market share) Low ‘igh igh CG'S grow/share matrix 17. What is B? A. Cash cow B. Star C. Question mark D. Dog 18. What is C? A. Cash cow B. Star C. Question mark D. Dog 19. What is D? A. Cash cow B, Star C. Question mark D. Dog Page 4 of 9¥ 20, What isthe strategy for deating with dogs? A. Mold 1B. Mawvest , Build 1D. None of the above DV. Whats the strategy for dealing with stars? A. Hold 1B, Harvest C. Build 1D. None ofthe above 22. What isthe strategy for dealing with question marks? A. Hold B. Harvest C. Build D, Divest 23, Which ONE of the following statements is untrue? ‘A. Remuneration committees shoul. 1d consist of at least three directors, although in smaller companies, this may be reduced to two. B. The directors should not be permitted to determine their own levels of remuneration. . Listed companies have better governance systems than unlisted firms. D. None ofthe above 124, Factors that more diretly influence a firm's prospects originate in the em industry including the following except A. Entry barriers 'B. Competitor rivalry . Substitutes availabilty 1D. Bargaining powers of buyers and suppliers E. Employees skil sets If ts lawful but awful, then it isan issue of A. Morality B, Ethies C. Governance D. strategy 26. Corporate strategic change requires a ~ ‘A. Sprint; marathon B. Marathon; sprint CC. Endurance; speed D. Speed; endurance 27. Whereas fonment of fs 28, is concerned with the overall purpose and scope of the firm; about how to compete successfully in particular markets. A, Business-level strategy; corporate-level strategy B. Corporate-level strategy; functional-level strategy C. Comporate-level strategy; business-level strategy Page S of 85; operational-levelstrstegy Ce level strate} oo a ' to which the strategy is achieving 28, Strategie - involves monitoring the exte ihe objectives and suggesting corrective ations. A. Plans, B. Direction C. Control D. Objectives 29. What business are we in i a question of ~ A. Vision B. Mission C. Values D. Direction 30. Which of the following is incorreet? A. Ethical failures diminish reputation. B. Articulating ethical standards now makes it easier to respond to criticism later. CC. Adoption of ethical standards is a hallmark ofa profession. D. None of the above 31. Which of the following does not fall under the ethical issue of abusive behaviour? ‘A. Diserediting others’ ideas and opinions B. Using emails to demean others C. Failing to communicate or return communication D. Lying by commission 32. Joking without malice is an example of ‘A. Abusive behavior B. Lying C. Conflict of interest D. None of the above 33, Deliberately hiding material facts to influence a decision or conduct is an example of ‘A. Failing to communicate or return communication B. Lying by commission . Joking without malice D. Lying by omission. E 34. This refers 0 the intentional mistepresentation or deceit during the process of creating, distributing, promoting and pricing products. A. Accounting fraud B. Consumer fraud CC. Marketing fraud D. All the above 35. This refers to the monitoring role of the board so as to control the agency contflict between shareholders and management. ‘A. Management oversight B. Financial Quality C. Equity control Page 6 of 9D. All the above 36. The presence of independent directors on the board has been found to ‘A, Mitigate agency costs B. Fraud C. Promote disclosure D. Allthe above 37.’The remuneration committee should primarily comprise outside directors. A, Yes B. No C. Not necessarily D. None of the above 38, The agency problem that owners have access to only a relatively small portion of the information that is available to executives about the performance of the firm and cannot afford to monitor every executive decision or action is called A. Agency conflict B. Conflict of interest C. Adverse selection D. Moral hazard 39. The audit committee should be made up of A. Non-executive directors B. Internal audit unit C. Very good directors D. All the above 40. The separation of ownership from control gives room for A. Stakeholders engagement B. Shareholders engagement C. Agency challenges D. Democracy Section B: Answer Just One Question 30 Marks Question 1 “The board of firm wanted to get value for money by employing the right number of workers, ‘Thus it hired an economist to estimate the firm's production function. Based on the economist’s report, the board now knows that the firm's produetion function is given by: Q= KUL? Page 7 of5 per hour and capital i fixed at 9 unit. SUPP the firm can hire labor at a WaBe of GHSIS P output ean be soldat & Price Pre iHss00 per unit Determine the profit-maximizing levels of 30 marks labor and output. jmultaneously decide what prieé rach earn zero profits. different prices tl ve makes $5. 10 marks and a rival must s! Question 2 Querperate in a duopoly in which 30 Irs weekly newspaper. iFyou each charge a low price, you e advertise int tryou each charge a high price, You year profits of $3. If you charge ryet arg te higher price Loses SS ind the one charging the lower pri le chars above game inthe normal Form. equilibrium for a oF .-shot vers ated. Ifthe interest y of the game? Explain. 15 marks 2 mark ion of this game: Find the Nash rate is 15 percent, can You me ly repe wuld in a one-shot pla Now suppose the ga do better than you co Explain how “history” affects the ability of firms in this game to achieve 2" outcome uperior to that ofthe one-shot version of the game. 3 marks Section C: Answer Just One Question 10 Marks Question 3(2) What is managerial preference? 2 marks Question 3 (b) Explain the three types of managerial preference. USe aPProt iat ae propriate diagrams a your Question 3 (¢) Discuss how the remuneration committee of a board can structure remuneration to ind : luce aid your explanations. 2 marks maximum firm value. Use appropriate diagram to Question 4 (a) following ethical issues in a business entity Explain each of the a. Agency conflict b. Self-dealing I mark I mark I mark c. Family interest Page 8 of 94d, Accounting fraud 1 mark Question 4 (b) Discuss how each of the following corporate governance structures can be used to promote internal controls and manage cach of the above ethical issues in Question 4 (a) in either a financial institution or any institution of your choice. a Independent non-executive directors 2 marks 'b. Nomination committee 1 mark J mark c. Remuneration committee , Audit committee 2 marks J. 0. Akotey page 90f9