The free cash flow hypothesis supports: reducing a firm's level of debt to save the cash currently being spent on interest payments. increasing the debt portion of a firm's capital structure. hiring managers with little or no stock ownership in the firm. decreasing stockholder dividends to retain more cash within the firm. the idea that firms with high levels of free cash flow are more apt to make good acquisitions than firms with low levels.

Ethics refers to fundamental principles of right and wrong; ethical behavior is behavior that is consistent with those principles. hrm decisions should be ethical, but the evidence suggests that is not always the case. many ethical issues in the workplace involve hrm. in the context of ethical human resource management, hr managers must view employees as having basic rights. in this activity, you will look at the four principles for ethical behavior and the basic rights employees should expect in the work environment. hr managers must view employees as having basic rights, for such a view reflects ethical principles embodied in the u.s. constitution and bill of rights. organizations often face situations in which the rights of employees are affected. ethical, successful companies act according to four principles: emphasizing mutual benefits, employees assuming responsibility for the actions of the company, companies having a sense of purpose or vision that employees value, and emphasizing fairness.