Which of the following statements is true of the duty of cooperation?
A) It requires that a principal do nothing to interfere with an agent's conduct while the agent is discharging the duties agreed upon in the contract.
B) It requires that a principal draw up a written agreement designating an individual as the agent and enumerate the duties that the agent is expected to perform.
C) It mandates that the agent's fee be agreed upon before the agent starts discharging his or her duties.
D) It mandates that a principal compensate an agent for all the expenses that arise when the agent is acting on behalf of the principal.
A
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Which component of a firm's capital structure is the most difficult to estimate?
A) Preferred stock B) Equity C) Bank loans D) Bond-financed debt E) Private placements of debt
The modified internal rate of return corrects which problem inherent in IRR?
A) Adjustments for scale differences B) Difficulty in ranking projects C) Differing risk attributes of projects D) Incorporates the time value of money E) It allows for reinvestment of cash inflows from the project at the firm's cost of capital.