Goals and Governance of the Corporation Problem Solutions

Which of the following are correct descriptions of large corporations? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)

  • Managers no longer have the incentive to act in their own interests.
  • The corporation survives even if managers are dismissed.
  • Shareholders can sell their holdings without disrupting the business.
  • Corporations, unlike sole proprietorships, do not pay tax; instead, shareholders are taxed on any dividends they receive.

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