Which of the Following Statements Regarding Compensation Policies Is FALSE

question 37

Multiple Choice

Which of the following statements regarding compensation policies is FALSE?

• A)Increasing the pay-for-performance sensitivity comes with the added benefit of reducing managers' risk.
• B)Stock and option grants give managers a direct incentive to increase the stock price to make their stock or options as valuable as possible.
• C)By tying compensation to performance,the shareholders effectively give the manager an ownership stake in the firm.
• D)During the 1990s,most companies adopted compensation policies that more directly gave managers an ownership stake by including grants of stock or stock options to executives.

Grasping the basics of financial statement analysis related to share and dividend transactions.

Understanding the concept of financial leverage achieved through preference shares.

Differentiating between ordinary and preference shares in terms of rights, dividends, and financial implications.

Understand the purpose and application of recolor effects in adjusting picture hues.

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