As the Closing Case Points Out, the Positive Side Private

question 4

Short Answer

As the closing case points out, the positive side private equity firms excel in all the following ways except:
a. They always send experts to sit on the board and are hands-on in managing.
b. They use a high level of debt that imposes strong financial discipline.
c. Private equity turns managers from agents to principals with substantial equity, thus providing a powerful incentive to them.
d. They pay managers more generously, but also punish failure more heavily.
e. They reduce income inequality between financiers and the rest of us.

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Definitions:

Social Responsibility

The responsibility to profitably serve employees and customers in an ethical and lawful manner.

Reciprocal Interaction

A mutual exchange where both parties engage in an active back-and-forth dialogue or action, often leading to beneficial outcomes for both.

Termination-At-Will

An employment principle that allows either the employer or the employee to end the employment relationship at any time, without cause or warning.

Judicial Term

A period during which a judge serves in their judicial capacity, or a specific duration of a court or legal system's session.