Multiple Choice
Why is it rational to make shareholders "weak" by giving control to the managers of the firm?
A) This may be rational when shareholders may be neither qualified nor interested in making business decisions.
B) This may be rational since many shareholders find it easier to sell their shares in an underperforming firm than to monitor the management.
C) This may be rational to the extent that managers are answerable to the board of directors.
D) All of the options are explanations for the separation of ownership and control.
Correct Answer:
Verified
Correct Answer:
Verified
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