Question
which one of the following statement is true? A: well-designed compensation plans for executives focus on risk and long-term incentives B: moral hazard describes contexts
which one of the following statement is true?
A: well-designed compensation plans for executives focus on risk and long-term incentives
B: moral hazard describes contexts in which, once risk is shared, the individual fails to make as much effort to avoid harm as when risk was not shared.
C: an important consideration is designing compensation arrangements is the trade-off between creating incentives, and reducing risk
D: good performance measures do not change significantly with the managers performance but change with factors that are beyond the managers control
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