A major problem with ESOPs is that

A) they carry a significant risk for employees.
B) employees are not allowed to participate in votes by shareholders.
C) the stocks within the trust are too widely diversified to earn high returns.
D) any earnings from the trust holdings are taxed at an extremely high rate.
E) they result in reduced profitability for the employees.

When is it best to use the indirect approach in creating a message?

A) When the message is likely to evoke a negative response from the reader
B) When the message requests for routine information
C) When the message informs the reader about good news
D) When the message is intended for an audience who prefers to get to the main point at the earliest
E) When the message is likely to evoke a neutral response

If a firm will use debt as well as equity funds next year, the ____ is the correct discount rate to use in the capital budgeting models (NPV, etc.)

A) component cost of equity
B) weighted average cost of capital
C) historical cost of funds
D) All of the above are correct

When deciding whether or not one entity controls another entity:

A) the controlling entity must be actively involved in the decision making of the other entity.
B) the controlling entity must have exercised its power to control.
C) it is sufficient that the controlling entity has the capacity to control.
D) the controlling entity must have exerted its control over the financing policies of the other entity.

Which is the smallest American labor union?

A) The International Brotherhood of Teamsters
B) The National Education Association
C) The Service Employees International Union
D) United Auto Workers

Which of the following statements about output contracts is false?

A) Output contracts are generally illusory because they fail to specify a quantity of goods to be produced or purchased.
B) A party's quantity needs must be made in good faith.
C) A party's quantity needs cannot be unreasonably disproportionate to any normal prior output.
D) A party may not use an output contract to exploit the other party.