Answer Happy

9) Which of the following statements regarding economies of scale and scope is FALSE? A. Cost-reduction synergies are hard to predict and achieve. B. Because the CEOs of small firms receive information so quickly, small firms are often able to react in a timely way to changes in the economic environment. C. Synergies usually fall into two categories: cost reductions and revenue enhancements. D. There may also be costs associated with the size of large enterprises. 10) Which of the following statements regarding incentives to mitigate the conflicts of interest in a corporation is FALSE? A. The incentives come from owning stock in the company and from compensation that is sensitive to performance. B. The role of the corporate governance system is to mitigate the conflict of interest that results from the combination of ownership and control without unduly burdening managers with the risk of the firm. C. Punishment comes when a board fires a manager for poor performance or fraud, or when, upon failure of the board to act, shareholders or raiders launch control contests to replace the board and management. D. The corporate governance system attempts to align interests by providing incentives for taking the right action and punishments for taking the wrong action.