List Any Two Hidden Costs of Rewards

question 15

Essay

List any two hidden costs of rewards. Explain why extrinsic rewards produce these two hidden costs.

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Definitions:

Stock Split

A corporate action in which a company divides its existing shares into multiple shares to boost the liquidity of the shares, though the overall market capitalization remains the same.

Market Price

The present cost at which a service or asset is available for purchase or sale in the open market.

Paid-In Capital

The amount of capital provided by shareholders in exchange for shares of a company's stock.

Stock Split

A corporate action that increases the number of a corporation's outstanding shares by dividing each share, which in turn reduces the price per share.