Quiz Ch 01 – Principal-Agent Framework
Principles of Corporate Finance
Brealey, Myers, and Allen
13th Edition
In the context of the principal-agent framework, who are the principals, and who are the agents?
In the context of the principal-agent framework, who are the principals, and who are the agents?
Who may be shareholders of a corporation?
What is the slope of the line connecting the maximum consumption for the current year (now, on the horizontal axis) and the maximum consumption for the next year?
Who are commonly recognized as stakeholders?
True or false: The formation of a corporation is built upon the articles of incorporation.
True or false: The real assets of a corporation represent claims on their financial assets.
True or false: Managers, shareholders, and the firm’s debtholders all possess the same information about the firm’s value.
True or false: The complete asset value of a firm is wholly owned by the shareholders.
True or false: The board of directors has the primary responsibility for major investment decisions.
What is the term used to describe the choice of the proper mixture of debt and equity to finance a corporation?