cooperative strategy

Question 1

What do firms use cooperative strategy for

Answer 1

Create value
Create competitive advantage
outperform rivals
earn above average returns

Question 2

What are the three types of strategic alliances

Answer 2

Joint venture, equity strat alliance, non-equity strat. alliance

Question 3

What are the three stakeholder groups

Answer 3

Capital market (shareholders and lenders)
Product market (#1 customers, suppliers, host communities, unions)
Organizational (employees, managers, nonmanagers)

Question 4

What are the agency relationship problems

Answer 4

Principal agent relationships
non-aligned incentives
information asymmetry
outcome

Question 5

What are the solutions to agency problems

Answer 5

1. Ownership concentration
2. Board of directors
3. Executive compensation
4. Market for Corporate Control