Which of the Following Statements Is False

question 10

Multiple Choice

Which of the following statements is false?

• A) Recently, shareholders have started organizing "no" votes. That is, when they are dissatisfied with a board, they simply refuse to vote to approve the slate of nominees for the board.
• B) One early study of proxy contests found that the announcement of a contest increased firm stock price by 8% on average, even if the challenge was eventually unsuccessful and the incumbents won reelection.
• C) Shareholders' only real role in governance is in electing the directors of the company.
• D) Perhaps the most extreme form of direct action that disgruntled shareholders can take is to hold a proxy contest and introduce a rival slate of directors for election to the board.

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Definitions:

Reportable Segments

Distinct parts of a business that are specifically identified for reporting purposes due to their operations’ financial results being regularly reviewed by the company's decision-makers.

Debt Ratio

A financial ratio that measures the extent of a company's leverage, calculated by dividing total liabilities by total assets.

Inventory Turnover

A measure of how many times a company's inventory is sold and replaced over a period, indicating the efficiency of the company in managing and selling its stock.

Quick Ratio

A liquidity ratio that measures a company's ability to meet its short-term obligations with its most liquid assets, excluding inventory.