Multiple Choice
What is the difference between control rights and cash flow rights?
A) Since all shareholders benefit only from pro-rata cash flows, control rights and cash flow rights are the same thing.
B) Large investors may be able to derive private benefits from control, thus control rights can exceed cash flow rights.
C) Cash flow rights are more important than control rights since the only reason to invest in anything is to generate cash.
D) None of the above
Correct Answer:
Verified
Correct Answer:
Verified
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