True 18 the disadvantages associated with a

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TRUE 18. The disadvantages associated with a proprietorship are similar to those under a partnership. One exception to this is due to the formal nature of the partnership agreement and the commitment of the partners' personal assets. As a result, partnerships do not have difficulty raising large amounts of capital. FALSE 19. The term multinational corporation is used to describe a firm that operates in two more countries. TRUE 20. Nations do not have the sovereignty to expropriate the assets of a firm without compensation. FALSE 21. Having the manager's compensation tied to the company's performance increases the agency problem that corporations face. FALSE 22. Managers of firms using accounting manipulations to inflate current earnings are likely to generate long- term benefits to the shareholders of the firm. FALSE 23. A proprietorship is an unincorporated business owned by one individual and the owner benefits from the limited liability for business which limits his losses to what he has invested in the company. FALSE
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24. The corporate charter is a document filed with the secretary of the state in which the firm is incorporated that provides information about the company, including its name, address, directors, and amount of capital stock. TRUE 25. Industrial groups are organizations comprised of companies in different industries with common ownership interests, which include firms necessary to sell and manufacture products. TRUE 26. The primary goal of a publicly-owned firm interested in serving its stockholders should be to A. Minimize the debt used by a firm. B. Maximize expected EPS. C. Minimize the chances of losses. D. Maximize the stock price per share. E. Maximize expected net income. 27. Which of the following mechanisms is not used by shareholders to get managers to act in shareholder's best interests? 28. Which of the following is a reason why companies move into international operations? 29. Which of the following should be the primary goal pursued by the financial manager of a firm?
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