Provide a Short Answer to Each of These Questions

question 6

Essay

Provide a short answer to each of these questions.Be sure to fully explain your answer.
Why are inside directors seen as problematic in corporate governance?

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Definitions:

Cumulative Dividends

Preferred stock dividends that accumulate if not paid as scheduled and must be paid out before dividends can be distributed to common shareholders.

Preferred Stock

A class of ownership in a corporation that has a higher claim on assets and earnings than common stock and typically doesn't have voting rights.

Income Earned

Revenue received from work performed or services provided, often used interchangeably with earned income.

Common Stock

A type of security that represents ownership in a corporation, entitling the holder to dividends and voting rights.