Some Corporate Governance Experts Believe That Serving on a Company's

question 196

Multiple Choice

Some corporate governance experts believe that serving on a company's board of directors for an extended length of time diminishes that member's independence from the company's CEO.If this is true, it would tend to

• A)reduce the principal-agent problem.
• B)increase the principal-agent problem.
• C)be in the best interest of shareholders.
• D)have no impact on the company's performance, since the CEO is only one member of top management.

Understand the concept of validity in deductive reasoning.

Recognize the structure of hypothetical and disjunctive syllogisms.

Distinguish between true premises and conclusions within deductive arguments.

Understand the characteristics of sound arguments.

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Definitions:

Per Capita GDP

The gross domestic product of a country divided by its population, indicating the average economic output per person.

Population

The total number of people inhabiting a specific area or the members of a particular species within an ecological community.

GDP Deflator

A method for measuring the price levels of all new, domestically originated, final goods and services in an economic framework.

Real GDP

Represents the value of all final goods and services produced within a country's borders in a specific time period, adjusted for inflation.