A Complete Contract Between Shareholders and Managers

question 50

Multiple Choice

A complete contract between shareholders and managers

• A)would specify exactly what the manager will do under each of all possible future contingencies.
• B)would be an expensive contract to write and a very expensive contract to monitor.
• C)would eliminate any conflicts of interest (and managerial discretion).
• D)all of the above

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Definitions:

Information Resource

Any data, information, or knowledge that can be utilised to inform, guide, or decide actions within an organization.

Exposure

The harm, loss, or damage that can result if a threat compromises an information resource.

Human Error

Mistakes made by people, often resulting in problems or accidents, which can occur in various contexts like workplaces and technology use.

Unintentional

Not done on purpose or without intending to cause a particular result, often leading to unintended consequences.