Multiple Choice
When company ownership is diffuse,
A) a "free rider" problem encourages shareholder activism.
B) the large number of shareholders ensures strong monitoring of managerial behavior because with a large enough group,there's almost always someone who will to incur the costs of monitoring management.
C) most shareholders will have a strong enough incentive to incur the costs of monitoring management.
D) a "free rider" problem discourages shareholder activism and few shareholders have a strong enough incentive to incur the costs of monitoring management.
Correct Answer:
Verified
Correct Answer:
Verified
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