Outside Directors Are Supposed to Be Elected Yet Many Are

question 74

Multiple Choice

Outside directors are supposed to be elected yet many are handpicked by the CEO, creating the directors' lack of

• A) interest in company matters.
• B) corporate social responsibility.
• C) focus on profits.
• D) independence from the CEO.
• E) a written ethical code.

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Definitions:

Incremental Annual Net Cash Inflows

The additional cash flow a business expects to receive over a year as a result of a specific decision or investment, net of expenses.

Contribution Margin

The amount of revenue remaining after deducting variable costs, which can be used to cover fixed costs and contribute to profit.

Operating Costs

Expenses associated with the operation of a business, including costs of goods sold and administrative expenses.

Annual Cash Inflows

The total amount of money, often from sales, investments, or financing, that flows into a company over a year.