The failure of managers to release bad news is a version of the adverse selection problem. Such

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The failure of managers to release bad news is a version of the adverse selection problem. Such failure indicates that the securities market is not working well. Required

a. Why might a manager withhold bad news?

b. To what extent does the disclosure principle operate to reduce the incentive of a manager to withhold bad news? Explain.

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Financial Accounting Theory

ISBN: 9780132072861

5th Edition

Authors: William R Scott

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Question Posted: Jun 11, 2024 01:00 AM

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The failure of managers to release bad news is a version of the adverse selection problem. Such

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Financial Accounting Theory

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