Which of the Following Would Be Required If We Accepted

question 26

Multiple Choice

Which of the following would be required if we accepted the private contracting argument that managers' interests can be aligned with the maximisation of the wealth of the firm,through contracting arrangements that reward or constrain their behaviour?

• A) Credible financial accounting numbers to measure performance
• B) Independent audit to monitor and check that the accounting numbers are properly measured
• C) Regulation that restricts the choice of accounting methods
• D) All of the given options are correct.

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Definitions:

Conclusion

Conclusion is the final part of something, or in logic, the statement that logically follows from the premises in an argument.

Introduces

To present or bring to notice something for the first time, or to make something known that was previously unknown.

Consequently

A term indicating that as a result of something previously stated, a logical conclusion or outcome follows.

Explanation

A statement or account that makes something clear or understandable by describing the relevant structure, mechanisms, reasons, or context.