To Keep Employees from Shirking,you Can Invest in Greater Monitoring

question 14

Multiple Choice

To keep employees from shirking,you can invest in greater monitoring

• A)even though monitoring is expensive
• B)especially when monitoring is not very efficient
• C)when employees respond well to incentive contracts
• D)when incentives fail to solve either moral hazard and adverse selection problems with employees

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Definitions:

Investing

The process of distributing funds with the aim of achieving returns or financial gain.

Form

A specific type of document or report required by regulatory agencies for various financial filings and disclosures.

CAPM

The Capital Asset Pricing Model, a theory used to determine the expected return on investment by correlating the risk and the non-diversifiable risk of the market.

Treynor Measures

A performance metric that assesses the returns earned on a portfolio in excess of the risk-free rate, adjusted for market risk.