Although IRP Tends to Hold, It May Not Hold Precisely

question 48

Multiple Choice

Although IRP tends to hold, it may not hold precisely all the time

• A)due to transactions costs, like the bid ask spread.
• B)due to asymmetric information.
• C)due to capital controls imposed by governments.
• D)both a and c

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Definitions:

Proprietorship

A business entity owned and operated by a single individual, with no distinction between the business and the owner.

Personal Liability

The responsibility of individuals to repay debt or fulfill obligations from their own assets, distinct from corporate or shared liabilities.

Limited Liability

A legal structure where a company's owners are protected from personal responsibility for its debts or liabilities beyond their investment in the company.

Stakeholder Theory

A concept in organizational management and business ethics that emphasizes the importance of considering the interests of all parties affected by business activities, not just shareholders.