This Is the Set of Laws, Policies, Incentives, and Monitors

question 30

Multiple Choice

This is the set of laws, policies, incentives, and monitors designed to handle the issues arising from the separation of ownership and control.

• A)Agency theory
• B)Corporate governance
• C)Defined benefit plan
• D)Invisible hand

---

Definitions:

Times Interest Earned

A financial ratio that measures a company's ability to meet its debt obligations based on its operating income.

Income Before Tax

A company's earnings before any taxes are applied, reflecting the profitability of the business from its operations.

Interest Expense

The cost incurred by an entity for borrowed funds, typically stated as an annual rate.

Inventory Turnover

A financial ratio that measures the number of times inventory is sold or used over a given period, indicating the efficiency of inventory management.