Motivate managers to act in the interest of shareholders

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Reference no: EM131599931

1. Which of the following mechanisms is used to motivate managers to act in the interest of shareholders?

Pressure from the board of directors

Two statements are correct.

Threat of a takeover.

Bond covenants.

All of the statements above are correct.

2. What is the difference in the future value between a 5-year ordinary annuity and a 5-year annuity due? Both have annual payments of $200, evaluated at a 15% annual interest rate?

$262.82

$296.64

$202.27

$198.14

$245.16

Reference no: EM131599931

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