Tying the salaries of top managers to the firm's stock price or to the profitability of the firm allows a firm's board of directors to
A) avoid disclosing financial statements to investors.
B) eliminate moral hazard.
C) increase asymmetric information.
D) reduce the principal-agent problem.
D
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Which of the following statements is true?
A) A worker who shirks work is not an economic agent. B) All economic agents are necessarily individuals. C) A government is an example of an economic agent. D) A street gang is not an economic agent.
There is greater support for active policymaking when
A) price flexibility is common. B) wage flexibility is common. C) pure competition is widespread. D) none of the above.
An initial leftward shift in labor demand often creates a cascading chain of events, amplifying the impact of the initial shock. This is known as the ________ effect
A) Veblen B) multiplier C) cluster D) rebound
Describe the effects, in both the short run and the long run, of an increase in the money supply. Explain what happens to real output and the price level
What will be an ideal response?