Which One of the Following Statements Is TRUE

question 32

Multiple Choice

Which one of the following statements is TRUE?

• A) Management is said to be entrenched when senior managers are unlikely to be fired.
• B) A company's matching contribution to a retirement plan is a nonpecuniary benefit.
• C) Company sponsorship of a local charity is an example of a nonpecuniary benefit.
• D) A manager/shareholder agency conflict arises when shareholders sell their stock even though management says the stock is undervalued.
• E) A manager/shareholder agency conflict arises when the board of directors pays a larger dividend than the firm's earnings could support.

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Definitions:

Explicit Rules

Clearly defined codes of conduct, procedures, or guidelines that are formally established and communicated.

Convergent Thinking

A thought process that aims at deriving the best possible answer to a problem from a set of potential solutions, focusing on logical and systematic approaches.

Divergent Thinking

A method of thinking that explores multiple possible solutions in order to generate creative ideas.

Janusian

Characterized by the simultaneous consideration of contrary or opposing ideas or concepts, often resulting in novel solutions or insights.