Which of the following is true of excessive compensation packages?
A. When huge amounts of compensation depend on quarterly earnings reports, there is a strong incentive to manipulate those reports in order to achieve the money.
B. Excessive compensation packages serve corporate interests when they provide an incentive that is not based on executive performance or accomplishments.
C. When executive compensation is tied to stock price, executives have a strong incentive to focus on long-term corporate interests rather than short-term stock value.
D. Economic fairness and personal morality always exists in executives receiving lofty compensation packages.
Answer: A
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