Discuss the Pros and Cons of Using Punishment

question 2

Essay

Discuss the pros and cons of using punishment. If managers use punishment, how should they minimize the negative side effects?

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Definitions:

Previous Debt

An obligation or a financial liability that was incurred before the current period or transaction being considered.

Illusory Promise

A statement that appears to assure a commitment but lacks the essential elements to bind the promisor legally.

Option to Cancel

A clause in a contract that allows one or more parties to terminate the agreement under certain conditions.

Legally Sufficient Consideration

refers to something of value or a promise exchanged between parties in a contract that is recognized by law as adequate to establish a binding agreement.