Which of the Following Indicates Why the Role of Vigilant

question 139

Multiple Choice

Which of the following indicates why the role of vigilant investors and investment fund managers is important for the efficient operation of an economy?

• A) These investors generally serve on the boards of directors of corporations.
• B) These investors tend to buy and sell stocks in a way that rewards good management.
• C) These investors help allocate capital efficiently among firms and among investment projects.
• D) Both b and c are true.

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Definitions:

Unilateral Mistake

A situation where only one party to a contract is mistaken about the terms or subject-matter contained in that contract.

Voidable

A term describing a contract or agreement that can be legally declared invalid by one or more of the parties involved.

Unconscionable

Describes an agreement that is so unjust or overwhelmingly one-sided in favor of one party that it is deemed unenforceable under the law.

Rescind

As the word is applied to contracts, to terminate the contract as to future transactions or to annul the contract from the beginning.