Summer, the Owner of a Music Box Company, Subscribes to Equity

question 58

Multiple Choice

Summer, the owner of a music box company, subscribes to equity theory. It is likely that she will be especially concerned that

• A) she maximizes employees' participation in the making of company decisions.
• B) people who put maximum efforts into the company earn the highest salaries.
• C) she provides for a variety of different kinds of rewards.
• D) salaries are based on objective measures of performance.

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Definitions:

M1

A category of the money supply that includes all physical money like coins and currency, as well as demand deposits, and other liquid assets quickly convertible to cash.

M2

A measure of the money supply that includes cash, checking deposits, and easily convertible near money such as savings deposits, money market securities.

Savings Account

A deposit account held at a financial institution that provides principal security and a modest interest rate.

Traveler's Checks

A preprinted, fixed-amount check designed to allow the person signing it to make an unconditional payment to someone else as a result of its being counter-signed.