Corporations are able to raise large amounts of financial capital because
A) of the tax breaks corporations are given relative to partnerships or proprietorships.
B) of the elimination of the problem of separation of ownership and control.
C) of limited liability and the treatment of a corporation as an individual entity.
D) of their greater ability to monitor the performance of decision makers.
C
You might also like to view...
Refer to Figure 9.2. At price 0H and quantity Q1, consumer surplus is the area
A) EDGF. B) 0FGQ1. C) HFGB. D) EFC. E) none of the above
When buying a used car from a dealer, showing up in cheap clothing and ungroomed is an example of:
A. screening. B. signaling. C. statistical discrimination. D. building a reputation.
Which of the following items is (are) not considered as part of the net investment calculation?
a. installation and shipping charges b. acquisition cost of new asset c. salvage value of old equipment that is being replaced d. first year's net cash flow e. c and d
In a market characterized by many sellers, if an outsider devises a way to reduce transaction costs it will:
a. benefit both buyers and sellers. b. cause both buyers and sellers to lose. c. benefit the buyers but cause the sellers to lose. d. benefit the sellers but cause the buyers to lose.