Which of the Following Statements Is False

question 28

Multiple Choice

Which of the following statements is false?

• A) The conflict of interest between managers and investors derives from the separation of ownership and control in a corporation.
• B) Any discussion of corporate controls-the system of controls, regulations, and incentives designed to prevent fraud-is a story of conflicts of interest and attempts to maximize them.
• C) Once control and ownership are separated a conflict of interest arises between the owners and the people in control of a corporation.
• D) The separation of ownership and control is perhaps the most important reason for the success of the corporate organizational form. Because any investor can hold an ownership stake in a corporation, investors are able to diversify and thus, with no costs, reduce their risk exposures.

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Definitions:

Human Cell

The basic structural, functional, and biological unit of all known living organisms in the human body.

Chromosomes

Structures within cells that contain DNA and protein and carry genetic information.

Inherited

Passed down from ancestors or parents to offspring, referring to genetic traits or inherited diseases.