Which of the Following Will Help Shareholders Mitigate Agency Problems

question 50

Multiple Choice

Which of the following will help shareholders mitigate agency problems?
I.Shareholders can elect directors.
II.Shareholders can challenge management through proxy fights.
III.Shareholders can tender their shares to outsiders in a hostile takeover.
IV.Shareholders can sell their shares on the stock market.

• A)I, II, and IV
• B)II, III, and IV
• C)I, II, and III
• D)I, II, III, and IV

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Definitions:

Unilateral Mistake

An error made by one party in a contract, which may not automatically void the contract unless certain criteria are met.

Material Term

An essential clause or provision in a contract that significantly affects the rights and obligations of the parties involved.

Fraudulent Misrepresentation

A false statement made knowingly or recklessly with the intent to deceive and induce another to part with something of value or to surrender a legal right.

Deceit

A tort that arises when a party suffers damage by acting upon a false representation made by a party with the intention of deceiving the other.