Which of the following statements is FALSE?

A.

Managers level of risk aversion affects the optimal level of sensitivity of managers compensation to the performance of their firms.

B.

While the SECs enforcement powers are extensive and carry with them the weight of criminal prosecution, its detection resources are limited.

C.

The conflict of interest between managers and investors derives from the separation of ownership and control in a corporation.

D.

Hiring the executive team and dismissing executives are typically done by institutional investors.