Exam 14: Stockholder Rights and Corporate Governance

In U.S. vs. O'Hagen, the court ruled that someone who traded on the basis of inside information when he or she knew the information was confidential was guilty of misappropriation.

Investors may receive an economic benefit from the ownership of stock by receiving:

Which of the following is not an argument for high executive compensation?

Which of the following is not an example of fulfilling social objectives through stock ownership?

A corporation's stockholders have a right to inspect the company's books for any reason.

Which of the following arguments opposes the idea of high executive pay?

Do you think U.S. executives are compensated too highly? Why or why not?

What was a major contributor to the collapse of Enron in 2001?

Eighty-four percent of large company boards now have an independent lead director, a sharp decrease in the past decade.

The activism of institutional shareholders has often worsened company performance.

Which of the following statements is not true about stockholders?

What is insider trading? Explain how the courts have defined this practice.

Which of the following is not a legal right of stockholders?

In 2007, median compensation for directors at the largest U.S. corporations was (rounded to the nearest $10):

Describe a current trend in corporate governance, providing a real example.

In response to concerns about the lack of transparency in financial accounting, Congress passed a new law called the:

The main reason that American executives are paid so much is:

In 2005, the Securities and Exchange Commission approved new rules that for the first time required companies to include the cost of stock options in their earnings.

Why have U.S. institutions become more active as investors? How has this trend spread to other countries?

A reason for institutions becoming more assertive in promoting the interests of their member investors is: