CEOs Naming Friends to the Board of Directors and Paying

question 21

Multiple Choice

CEOs naming friends to the board of directors and paying them more than the norm is an example of the

• A) agency problem.
• B) preemptive right.
• C) majority voting feature.
• D) proxy fights.

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Definitions:

Comparative Advantage

The ability of an entity to produce goods or services at a lower opportunity cost than others, leading to more efficient trading possibilities.

India

A country in South Asia, known for its diverse culture, historical heritage, and as the world's largest democracy.

Foreign Licensing

Involves a company granting a foreign entity the rights to produce and market its product or use its technology in a foreign country.

U.S. Clothing Manufacturer

A company based in the United States that produces clothing and apparel items for distribution and sale.