28. Which one is true regarding risk tolerance (avoyn piakou) between a firm's managers versus a firm's shareholders

I. Managers are in a riskier position because their employment and reputation is at risk if the company fails II. Managers can find employment in another firm if the company fails, but the shareholders will lose their wealth Ill. Shareholders are in a riskier position because they are the owners of the company. Their wealth will depend on the company and they spent precious time for electing the Board of Directors to ensure that the performance of managers is monitored. IV. Managers and shareholders face the same risks if the company fails. At the end of the day there is one and only risk, which is bankruptcy

O a. I only O b. ll and Ill only O c. none of the answers is true O d. IV only O e. Ill only