Which of the following is the best measure to ensure that management decisions a
ID: 2774037 • Letter: W
Question
Which of the following is the best measure to ensure that management decisions are in the best interest of the stockholders?
A. tie management compensation to the level of dividend per share
B. fire managers who are inefficient
C. tie management compensation to the performance of the company's common stock price
D. remove management's perquisites
As a key participant in financial transactios, individuals are:
A. net demanders of funds because they save more money than they borrow
B. net users of funds because they save less money than they borrow
C. net purchasers of funds because they save more money than they borrow
D. net supplieres of funds because they save more money than they borrow
Explanation / Answer
1. Correct answer(C) is tie management compensation to the performance of the company's common stock price.
2. Correct answer option(D)net supplieres of funds because they save more money than they borrow.
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