Issuing Debt Provides Incentives for Managers to Run the Firm

question 90

Multiple Choice

Issuing debt provides incentives for managers to run the firm efficiently because:

• A)Debt increases the funds available to managers to run the firm.
• B)Ownership may remain more concentrated,improving monitoring of management.
• C)Managers may take actions that benefit shareholders but harm creditors and lower the value of the firm.
• D)Shareholders prefer to decline new projects to save cash,even if their NPVs are positive.

Distinguish between the uses of measures of central tendency for different data types (nominal, ordinal, interval, ratio).

Interpret the implications of statistical findings within real-world contexts, such as salary negotiations or opinions surveys.

Analyze the distribution characteristics, including shape and the relationship between mean and median.

Differentiate between the statistical terms used to describe sample and population characteristics.

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Definitions:

UCC

In the United States, the Uniform Commercial Code serves as a full set of rules that direct every commercial transaction.

Merchants

Individuals or enterprises engaged in the wholesale or retail sale of goods or services.

Nonmerchants

Nonmerchants refer to individuals or entities that do not regularly engage in commercial transactions or business practices related to the sale of goods.

National Conference

A large meeting for people from across the nation to discuss specific topics, share information, or make decisions related to a particular field or interest.