Which of the Following Statements Is FALSE

question 38

Multiple Choice

Which of the following statements is FALSE?

• A) Controlling shareholders pay for their control rights because the firm effectively faces a higher cost of equity for outside capital.
• B) Most countries follow what is called the stakeholder model, giving explicit consideration to other stakeholders-in particular, rank-and-file employees.
• C) In a pyramid structure, a family first creates a company in which it owns more than 50% of the shares and therefore has a controlling interest.
• D) A conflict of interest arises because the family has an incentive to try to move profits (and hence dividends) down the pyramid-that is, toward companies in which it has few cash flow rights and away firms in which it has more cash flow rights.

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Definitions:

Computer's Screen

The display component of a computer where information is visually represented.

Visual Elements

Components such as images, colors, shapes, and layout that aesthetically enhance a document, presentation, or web page.

Background

Background is the part of a picture, scene, or design that forms a setting for the main figures or objects, or the circumstances or events that form the environment within which something exists or takes place.

Fill

A feature in graphic and spreadsheet applications that allows users to fill areas with colors, patterns, or series of data.