A Major Conflict of Interest Between Top Executives and Owners

question 135

Multiple Choice

A major conflict of interest between top executives and owners, is that top executives wish to diversify the firm in order to ____, while owners wish to diversify the firm to ____.

• A) generate free cash flows, reduce the risk of total firm failure
• B) increase the price of the firm's stock, increase the dividends paid out from free cash flows
• C) reduce the risk of total firm failure, reduce their total portfolio risk
• D) reduce their employment risk, increase the company's value

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Definitions:

Passion

Intense, driving, or overmastering feeling or conviction towards an activity, object, or concept.

Relationship

A connection, association, or involvement between two or more entities.

Abusive Spouses

Partners who engage in behaviors that physically, sexually, or emotionally harm their significant other.

Victims Of Physical Abuse

Individuals who have suffered harm or injury due to deliberate use of physical force by another person or group.