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Which of the following actions would be most likely to reduce potential conflicts of interests between stockholders and managers? The use of covenants in bond

Which of the following actions would be most likely to reduce potential conflicts of interests between stockholders and managers?

The use of covenants in bond agreements that limit the firm's use of additional debt and constrain managers actions

Financing risky projects with additional debt

Reduced monitoring by financial markets

Reducing the threat of hostile takeovers

Compensating managers with stock options

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