The Informativeness Principle Tells Us That

question 12

Multiple Choice

The informativeness principle tells us that:

• A) information is overrated because employees can always lie about their performance, and detecting is costly and counter productive.
• B) you must use as much information as possible to develop compensation contracts, evenif the cost of obtaining the information is unreasonable.
• C) you must use just sufficient information as possible to develop compensation contracts, as long as the cost of obtaining the information is reasonable.
• D) you must use as much information as possible to develop compensation contracts, as long as the cost of obtaining the information is reasonable.

---

Definitions:

Multiunit

Referring to a type of smooth muscle arrangement where each muscle cell operates independently, requiring neural input for activation.

Gastrocnemius

A major calf muscle that is involved in running, jumping, and other actions requiring lower leg movements.

GI Tract

The gastrointestinal tract, a system of organs responsible for digestion and absorption of food, extending from the mouth to the anus.

Autonomic Nervous System

The part of the nervous system that controls involuntary actions of the body, including heartbeat, digestion, and respiratory rate.