Which of the Following Governance Mechanisms Is Regarded as the Option

question 37

Multiple Choice

Which of the following governance mechanisms is regarded as the option of last resort?

• A) Strategic control system
• B) Takeover constraint
• C) Board of Directors
• D) Stock-based compensation system
• E) Financial statements and auditors

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Definitions:

Debt Policies

Guidelines or strategies that govern how a company or government manages its debt, including borrowing practices and repayment schedules.

Financial Plan

A document detailing an individual's or organization's current financial status and long-term monetary goals, along with strategies to achieve those goals.

Dividend Payout Ratio

A financial metric that shows what percentage of a company's net income is distributed to its shareholders as dividends.

Retention Ratio

A financial metric that shows the percentage of a company's earnings that are not distributed as dividends but are reinvested in the business.