Amos Ball, Inc., is a printing company in Iowa that has been family owned and managed for three generations. Which of the following statements is most likely to be TRUE?

Question

Quizplus · Accepted Answer

The statement suggests that Amos Ball, Inc., is a family-owned and managed printing company. Thus, if research findings are valid, Amos Ball, Inc., will perform better if a family member is CEO than if an outsider is CEO due to the family's increased knowledge of the company's culture and values. Option A is incorrect because high agency costs imply a conflict of interest between the manager and the shareholders, which is not mentioned in the question. Option C is also incorrect because managerial opportunism is not discussed. Finally, option D is incorrect because the functions of risk-bearing and decision making are typically combined in most organizations.