Which of the Following Is Most Likely to Reduce the Incidence

question 170

Multiple Choice

Which of the following is most likely to reduce the incidence of employee shirking?

• A) use of the corporate business structure, rather than an individual proprietorship
• B) closely relating the pay of workers to their productive contribution
• C) payment of identical wage rates to all workers
• D) providing workers with a year-end bonus if the business firm loses money during the year

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Definitions:

Return on Common Stockholders' Equity

A measure of the profitability and efficiency with which a company's common equity is employed, derived from net income divided by common stockholders' equity.

Net Income Before Taxes

The amount of profit a company has earned before any taxes have been deducted.

Equity for Common Stockholders

The portion of a company’s equity capital that is attributable to holders of common stock, representing their ownership interest.

Return on Total Assets

A financial ratio that measures the net income produced by total assets during a period by comparing net income to the average total assets, indicating how efficiently a company uses its assets to generate earnings.