Which of the Following Statements Is False

question 44

Multiple Choice

Which of the following statements is false?

• A) A board is said to be classified when its monitoring duties have been compromised by connections or perceived loyalties to management.
• B) Even the most active independent directors spend only one or two days per month on firm business, and many independent directors sit on multiple boards, further dividing their attention.
• C) On a board composed of insider, gray, and independent directors, the role of the independent director is really that of a watchdog.
• D) Because independent directors' personal wealth is likely to be less sensitive to performance than that of insider and gray directors, they have less incentive to closely monitor the firm.

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Definitions:

Information Processing Errors

Mistakes or biases that occur when individuals interpret or analyze information, leading to incorrect conclusions or decisions.

Risk-Adjusted Returns

Performance measures that evaluate the risk taken to achieve a financial return, accounting for the volatility of returns.

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Companies that are highly regarded and respected by their peers, employees, and industry analysts for their management quality and operational performance.

Confidence Index

A measure or indicator that reflects the degree of optimism or pessimism in the economy or financial markets, often derived from survey data.