Which of the Following Statements Is CORRECT

question 17

Multiple Choice

Which of the following statements is CORRECT?

• A)Corporations generally are subject to fewer regulations and more favorable tax treatment than sole proprietorships and partnerships.This 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.

---

Definitions:

Positive Feedback

A process in which the effects of a small disturbance on a system include an increase in the magnitude of the perturbation.

Innate Talent

Natural abilities or proficiency in certain activities or fields present from birth or without the need for learning.

Secretly Hates

A condition where an individual harbors negative feelings or animosity towards someone or something, but does not openly express it.

Conclusion

The final part or summing up of an argument, research study, or discussion, often reflecting the results or the main points made.