Which of the Following Mechanisms Would Be Most Likely to Help

question 36

Multiple Choice

Which of the following mechanisms would be most likely to help motivate managers to act in the best interests of shareholders?

• A) Decrease the use of restrictive covenants in bond agreements.
• B) Take actions that reduce the possibility of a hostile takeover.
• C) Elect a board of directors that allows managers greater freedom of action.
• D) Increase the proportion of executive compensation that comes from stock options and reduce the proportion that is paid as cash salaries.
• E) Eliminate a requirement that members of the board of directors have a substantial investment in the firm's stock.

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Definitions:

Babbling

A stage in child language acquisition during which an infant appears to be experimenting with uttering articulate sounds but does not yet produce any recognizable words.

Broca's Area

A region in the frontal lobe of the dominant hemisphere (usually the left) of the brain with functions linked to speech production.

Comprehend Language

The ability to understand and process spoken or written language.

Perceptual Scaffolding

The way in which a familiar word serves as an anchor for learning new words that come immediately before or after it.