Mgmt 5590 Final

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MNGT 5590 Fall2, 2010 Final Exam Even though this is a take-home final exam, it is not an open book/open note exam. Please complete it using only the vast knowledge you have acquired from class/studying and retained in your brain. This stuff means something only if you have cognitively processed it and absorbed it. There are 2 parts to the exam – a case with questions and some general questions. Remember: • there is no credit given for filler • lots of credit for organized concise thought • legible typing (no fancy fonts) • proper grammar and sentence structure counts • and (of course) use of stuff we learned in class (books or class discussion) Also remember, repeating the question in the answer to make…show more content…
Enron’s annual stockholder meeting in January 2001 was a study in corporate egotism. Executives met at a San Antonio, Texas hill country resort, and champagne and cigars were free for the taking. At this meeting, Lay boldly asserted that he expected Enron to become “the world’s greatest company.” On February 5, special bonus checks worth tens of millions of dollars were prepared for Enron executives. However, in what might have been the first outward sign of the trouble to come, Lay resigned as CEO in February 2001, keeping his position as chairman of the board, while Skilling was tapped to be his replacement. On the surface, Enron had the appearance of assured success, but underneath, a tangled web of deceit was slowly emerging. Fortune writer Bethany McLean, who has covered Enron extensively, prepared an article titled “ Is Enron Overpriced?” in March 2001, when the stock was valued at $80 per share, near its $90 per share high. The article, in part, noted, “The company remains largely impenetrable to outsiders, as even some of its admirers are quick to admit. Start with a pretty straightforward question: How exactly does Enron make its money? Details are hard to come by because Enron keeps many of the specifics confidential for what it terms ‘competitive’ reasons. The numbers that Enron does present are often extremely complicated. Even quantitatively minded Wall Streeters who scrutinize the company for a living think so.”

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