Which of the Following Statements Is CORRECT

question 59

Multiple Choice

Which of the following statements is CORRECT?

• A) The ability of firms in competitive industries to voluntarily undertake socially beneficial but costly projects is constrained by competition and the need to attract capital.
• B) Any action that would maximize a firm's stock price must be consistent with the maximization of social welfare.
• C) Decisions regarding social and ethical behavior have no effect, either positive or negative, on firms' stock prices.
• D) In a competitive industry, if one group of firms is "socially conscious" and takes costly actions designed to improve social welfare, but other firms do not, then most investors will flock to the socially conscious firms, thus enhancing their ability to attract capital. Eventually, these firms must dominate the industry.
• E) Even if the government did not mandate some actions deemed to be socially responsible, such as those relating to fair hiring and environmentally sound practices, most firms in competitive markets would still pursue these policies.

---

Definitions:

Proton Gradient

A gradient formed by the difference in proton concentrations across a membrane, often used to generate ATP in cellular respiration and photosynthesis.

Mitochondrial Membrane

The membrane that encloses the mitochondrion, consisting of an outer membrane and an inner membrane with folds known as cristae, where energy production occurs.

Citric Acid Cycle

A key component of cellular respiration, this cycle processes acetyl-CoA to produce energy, NADH, FADH2, and carbon dioxide.

Mitochondrial Matrix

The innermost compartment of the mitochondrion, enclosed by the inner membrane, containing enzymes, DNA, and ribosomes.