Which of the following is Correct? Hostile takeovers are most likely to occur when a firm's stock is selling above its intrinsic value as a result of poor management. Corporate shareholders are exposed to unlimited liability. Financing risky projects with additional debt could likely reduce potential conflicts of interest between stockholders and bondholders. The mechanism, which is to increase the proportion of executive compensation that comes from stock options and reduce the proportion that is paid as cash salaries, could help motivate managers to act in the best interests of shareholders