Which of the Following Statements Is CORRECT

question 7

Multiple Choice

Which of the following statements is CORRECT?

• A) Corporations generally are subject to more favorable tax treatment and fewer regulations than partnerships and sole proprietorships, which is why corporations do most of the business in the United States.
• B) Managers who face the threat of hostile takeovers are less likely to pursue policies that maximize shareholder value than are managers who do not face the threat of hostile takeovers.
• C) One advantage of the corporate form of organization is that liability of the owners of the firm is limited to their investment in the firm.
• D) Because of their simplified organization, it is easier for sole proprietorships and partnerships to raise large amounts of outside capital than it is for corporations.
• E) Bond covenants are an effective way to resolve conflicts between shareholders and managers.

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Definitions:

Political Change

A shift in the governance system, policies, or political leadership within a country, often as a result of social movements, elections, or revolutions.

Hays Code

A set of industry moral guidelines that governed the production of most United States motion pictures released by major studios from 1930 to 1968.

Nudity

The state of being without clothes, which can be a natural human condition or used in specific social, cultural, or artistic contexts.

Criminals Sympathetically

Refers to the perception or portrayal of criminals in a manner that evokes sympathy or understanding for their circumstances.