Which of the Following Statements Is True Regarding Shareholders

question 3

Multiple Choice

Which of the following statements is true regarding shareholders?

• A) The shareholders have fiduciary duties to the board of directors.
• B) The board is an agent for the shareholders.
• C) The shareholders elect the board of directors.
• D) The shareholders are delegated the day-to-day management of the corporation.

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Definitions:

Financial Managers

Professionals responsible for managing the financial health of an organization, including planning, organizing, controlling, and monitoring financial resources.

Interest Income

Earnings from interest-bearing financial assets, such as loans, bonds, and savings accounts.

Capital Gains

The earnings obtained from an asset or investment when the sale price is higher than the initial buying price.

Marginal Tax Rates

The amount of tax paid on an additional dollar of income, which varies according to the income bracket of the taxpayer.