One Means That Is Considered to Improve the Effectiveness of Outside

question 78

Multiple Choice

One means that is considered to improve the effectiveness of outside directors is:

• A) mandating that all outside directors be drawn from government or academia rather than industry.
• B) requiring that outside directors be former executives of the firm.
• C) requiring outside directors to own significant equity stakes in the firm.
• D) requiring that outside directors act objectively and have no ownership interest in the firm.

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Definitions:

Scheduled

Planned or arranged for a specific time or sequence of events.

Two-Month Intervals

Time periods that occur or are calculated every two months.

Floating Rate

An interest rate that changes over time with the market or along with another interest rate index.

Interest

The expense incurred from borrowing funds or the income earned by lending funds, typically represented as a percentage of the principal amount.