Question

Under which of the schools is the corporation best served by serving only the shareholders?

a. inherence school
b. enlightened self-interest school
c. invisible hand school
d. social responsibility school

Answer 1

This is the inherence school (choice A). This type of thinking holds that the shareholders are the number one group that a business or manager answers to, and that any political or social decision has to keep their best interests in mind first and foremost, at the cost of any other groups or outcomes.