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:

Chicano Activists

Individuals of Mexican-American descent who advocate for political and social changes, often focusing on civil rights and education.

Southwest

A geographic region of the United States generally including Arizona, New Mexico, Texas, and parts of surrounding states, known for its distinct cultural heritage and arid climate.

Crusade for Justice

The Crusade for Justice was a Chicano civil rights and cultural organization founded by Rodolfo "Corky" Gonzales in Denver, Colorado in 1966, playing a crucial role in advocating for the rights and cultural pride of Mexican Americans.

Chicano Youth

Young individuals of Mexican American descent, often associated with cultural and political movements advocating for civil rights.