In general the role of board of directors is to:

a) Direct the day-to-day activities of the firm
b) Represent investor interests in management of the firm
c) Insure that the firm operates legally
d) Provide "staff" assistance to the CEO in strategic matters

What do YOU THINK the answer is and why? Let us know and someone here will comment on your thinking.

Try the process of elimination so that you can narrow down your choices to what you REALLY have to think about. For example, "a" is clearly off the mark, so cross it off. What else can you eliminate (cross off)? What's left?

The correct answer is b) Represent investor interests in management of the firm.

To arrive at this answer, let's break down the options:

a) Direct the day-to-day activities of the firm: This is generally not the role of the board of directors. Day-to-day activities are usually managed by the company's executive management team.

c) Insure that the firm operates legally: While the board of directors may play a role in ensuring compliance with legal requirements, it is not their primary responsibility. This is typically handled by the company's legal and compliance departments.

d) Provide "staff" assistance to the CEO in strategic matters: While the board of directors may provide advice and guidance to the CEO on strategic matters, it is not their main responsibility.

Therefore, option b) "Represent investor interests in management of the firm" is the most accurate response. The board of directors is responsible for representing the interests of the shareholders and ensuring that managerial decisions align with these interests. They provide oversight, set company policies, approve major decisions, and appoint key executives, among other responsibilities.