Which of the Following Is NOT an Advantage of Setting

question 37

Multiple Choice

Which of the following is NOT an advantage of setting "stretch" objectives?

• A) helping to avoid mediocre results
• B) pushing company personnel to be more inventive and innovative
• C) helping clarify the company's strategic vision and strategic intent
• D) helping a company be more focused and intentional in its actions
• E) spurring exceptional performance and helping build a firewall against contentment with modest performance gains

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Definitions:

Real Risk-free Rate

The return on an investment with no risk of financial loss, adjusted for inflation.

Inflation Premium

The part of the nominal interest rate that represents compensation to the lender for the loss of purchasing power due to inflation.

Maturity Risk Premium

The additional return that investors demand for holding a bond until its maturity due to the potential for a change in the value over time.

Par Value

The face value of a bond or the stock value stated in the corporate charter, which is the minimum at which shares can be issued.