Issuing Debt Provides Incentives for Managers to Run the Firm

question 24

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.
• E)managers will be obligated to run the firm in the interests of bondholders.

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Definitions:

Nursing Diagnosis

A clinical judgment about individual, family, or community experiences/responses to actual or potential health problems/life processes, providing the basis for selecting nursing interventions.

Blood Pressure

The force exerted by circulating blood on the walls of blood vessels, a critical indicator of cardiovascular health.

Care Plan

A customized, comprehensive plan outlining a patient's healthcare goals, the strategies to achieve them, and the roles of various healthcare providers.

Expected Outcome

A predicted result or effect that is aimed for after a treatment, procedure, or program.