When Company Ownership Is Diffuse

question 81

Multiple Choice

When company ownership is diffuse,

• A)a "free rider" problem discourages shareholder activism.
• B)the large number of shareholders ensures strong monitoring of managerial behavior because with a large enough group, there's almost always someone who will to incur the costs of monitoring management.
• C)few shareholders have a strong enough incentive to incur the costs of monitoring management.
• D)both a and c are correct

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Definitions:

AFL-CIO

The American Federation of Labor and Congress of Industrial Organizations, a national trade union center and the largest federation of unions in the United States.

American Federation of Labor and Congress of Industrial Organizations

The American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) is a national trade union center, the largest federation of unions in the United States, representing more than 12 million workers across various sectors.

National Unions

Labor organizations that represent workers from various industries at a national level, advocating for worker's rights, wages, and working conditions.

Shared Interests

Common goals or concerns that unite individuals or groups, often leading to collaboration or collective action.