While the Sarbanes-Oxley Act Is an Internal Mechanism to Ensure

question 73

True/False

While the Sarbanes-Oxley Act is an internal mechanism to ensure ethical corporate governance, the Committee of Sponsoring Organizations (COSO) is an external mechanism.

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Definitions:

Overallocation of Resources

A situation where too many resources are devoted to a particular area of the economy, potentially leading to inefficiencies and waste.

Pigovian Taxes

Taxes levied on any market activity that generates negative externalities, intended to correct an undesirable or inefficient market outcome.

Negative Externalities

These are the adverse effects experienced by a third party or society as a whole due to an economic transaction they are not directly involved in.

Government Funding

Financial support provided by the government for various programs, projects, or sectors to achieve economic or social objectives.