Using the PAT Perspective of Managers' Behaviour,the Effect of Paying

question 4

Multiple Choice

Using the PAT perspective of managers' behaviour,the effect of paying managers a fixed income salary is that:

• A) They will feel secure enough to accept risky projects for the organisation.
• B) They will prefer not to have the organisation take on debt.
• C) They will be free to consider the optimal investment options for the organisation from the perspective of the principals.
• D) They will feel secure enough to accept risky projects for the organisation and they will be free to consider the optimal investment options for the organisation from the perspective of the principals.
• E) None of the given Answers.

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Definitions:

Functional Currency

The form of monetary exchange prevalent in the primary economic zone where an organization engages and creates cash flow.

Exchange Rate

The rate at which one currency can be exchanged for another currency, affecting international trade and investments.

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period, resulting in a net income or loss.

Temporal Method

An exchange rate conversion method used in translating foreign currency financial statements, where monetary items are converted at the current exchange rate and non-monetary items at historical rates.