Which of the Following Statements Is Correct

Multiple Choice

Which of the following statements is correct?

A) The major disadvantage of organizing as a corporation is that it does not provide its owners with limited liability.
B) Bond covenants,or restrictions on debt,are an important device to reduce agency conflicts between stockholders and bondholders.
C) The threat of a hostile takeover serves to reduce agency conflicts between stockholders and bondholders.
D) Compensation packages are designed,in part,to reduce agency conflicts between shareholders and managers.
E) Both answers b and d are correct.