The "Risk-Averse" Manager Will Be Improperly Biased To

question 24

Multiple Choice

The "risk-averse" manager will be improperly biased to:

• A) Seek out decisions with uncertain outcomes.
• B) Make risky decisions.
• C) Avoid decisions with uncertain outcomes.
• D) Maximize his or her own risk and minimize the company's risk.
• E) Use resources beyond his/her control.

---

Definitions:

Shareholder Goals

The objectives or desired outcomes of individuals or entities that own shares in a corporation, usually focused on value appreciation, dividends, and company governance.

Equity

Refers to the ownership interest held by shareholders in a corporation, represented by the company's common and preferred stock.

Call Option

A financial contract that gives the holder the right, but not the obligation, to buy a stock or another security at a specified price before the contract expires.