In Performing Evaluations of Your Staff Members,it Is Best to Use

question 5

Multiple Choice

In performing evaluations of your staff members,it is best to use a system:

• A)that remains secret.
• B)that the staff vote on together
• C)that lets the staff members do their own evaluations.
• D)that the staff are able to review in advance

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Definitions:

Moral Hazard

A situation in which one party is more willing to take risks because the costs that may result will not be borne by them.

Adverse Selection

A situation in which asymmetric information leads to the market being dominated by inferior products or by participants who are at a disadvantage.

Moral Hazard

A situation where one party in a transaction has the opportunity to take risks because the costs that those risks entail will not be borne by that party.

Portfolio Risk

The variability of returns from a portfolio of investments.