Reinvest profits into expanding the company and creating more jobs.
Reward the CEO with a significant bonus payment.
Save the excess cash as a precaution against black swan events.
Buy out the leading competitor to reduce competition and maintain price stability.
Stakeholders are any organizations, groups, or individuals that can affect or be affected by a firm’s
actions. By reinvesting profits in growing the company, Better Capsules can provide more
opportunities for employment and create value for society. This is turn lays the foundation for the
benefits that successful economies can provide: education, infrastructure, public safety, health care,
clean water and air, among others.
References
Multiple Choice Difficulty: 2 Medium Learning Objective: 01-03 Assess the
relationship between stakeholder
strategy and sustainable competitive
advantage.
37.
Award: 1.00 point
38.
Award: 1.00 point
The first step in stakeholder impact analysis involves
formulating a stakeholder strategy to balance the different needs of various stakeholders.
identifying the opportunities and threats the stakeholders present.
describing the economic, legal, ethical, and philanthropic responsibilities of the firm toward
society.
identifying the stakeholders that currently have, or potentially can have, a material effect
on a company.
In the first step of stakeholder impact analysis, the firm focuses on stakeholders that currently have,
or potentially can have, a material effect on a company. This prioritization identifies the most
powerful stakeholders (both internal and external) and their needs.
References
Multiple Choice Difficulty: 2 Medium Learning Objective: 01-04 Conduct a
stakeholder impact analysis.
After a firm has identified its key stakeholders in stakeholder impact analysis, the immediate next
step is to
recognize the opportunities and threats the stakeholders present.
identify stakeholders’ interests and claims.
formulate a stakeholder strategy.
address the stakeholders’ concerns.
In step 1 of stakeholder impact analysis, the firm focuses on stakeholders that currently have, or
potentially can have, a material effect on a company. In step 2, the firm asks, “What are our
stakeholders’ interests and claims?” Managers need to specify and assess the interests and claims
of the pertinent stakeholders using the power, legitimacy, and urgency criteria.
References
Multiple Choice Difficulty: 2 Medium Learning Objective: 01-04 Conduct a
stakeholder impact analysis.
39.
Award: 1.00 point
40.
Award: 1.00 point
As the legal owners, ________ have the most legitimate claim on a company’s profits.
creditors
employees
shareholders
board members
As the legal owners, shareholders have the most legitimate claim on a company’s profits. A firm has
to ensure that its primary stakeholders—the firm’s shareholders and other investors—achieve their
objectives.
References
Multiple Choice Difficulty: 1 Easy Learning Objective: 01-04 Conduct a
stakeholder impact analysis.
Which of the following is typically an economic responsibility of a firm?
sourcing raw materials from highly developed countries
paying adequate returns to the firm’s stockholders on the capital invested by them
donating resources, in terms of money and time, toward community development
helping a nation increase its import of goods and services
The business enterprise is first and foremost an economic institution. Investors expect an adequate
return for their risk capital. Consumers expect safe products and services at appropriate prices and
quality. Suppliers expect to be paid in full and on time.
References
Multiple Choice Difficulty: 2 Medium Learning Objective: 01-04 Conduct a
stakeholder impact analysis.
41.
Award: 1.00 point
The minimum wage in the country of Hanns is $8 an hour. Delish, a restaurant in Hanns’ capital city,
pays its servers $8 per hour. However, the management of the restaurant feels that this amount is
excessive for workers whose only job is to clear tables. By continuing to adhere to the rules set by
the government of Hanns, which of the following responsibilities is Delish satisfying?
legal responsibilities
philanthropic responsibilities
ethical responsibilities
demographic responsibilities
By adhering to the rules set by the government of Hanns, Delish is satisfying its legal