Which of the Following Occur When Managers Undertake Growth-Oriented Investments

question 16

Multiple Choice

Which of the following occur when managers undertake growth-oriented investments to increase an FI's size that may be inconsistent with stockholders' value-maximizing objectives?

• A)Technology risk.
• B)Operational efficiency.
• C)Agency conflicts.
• D)Diseconomies of scale.
• E)Diseconomies of scope.

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Definitions:

Potential GDP

The maximum output an economy can achieve when utilizing all its resources efficiently, without causing inflation.

Fiscal Policy

Fiscal Policy involves government spending and taxation decisions intended to influence economic activity, targeting issues like unemployment and inflation.

Economic Stabilization

Economic stabilization refers to government or central bank policies aimed at maintaining steady economic growth, minimizing unemployment, and stabilizing prices to prevent excessive inflation or deflation.

Lags

Delays between the time a policy is enacted and the time when its effects are felt in the economy.