Because Information Is Scarce

question 81

Multiple Choice

Because information is scarce,

• A) equity contracts are used much more frequently to raise capital than are debt contracts.
• B) monitoring managers gives rise to costly state verification.
• C) government regulations, such as standard accounting principles, can help reduce moral hazard.
• D) all of the above are true.
• E) only B and C of the above are true.

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Definitions:

Self-confident

Having belief in one's own abilities and qualities, enabling a person to face challenges with assurance.

Charismatic Leadership

A leadership style characterized by an individual's ability to inspire and motivate followers through their charm, persuasiveness, and compelling vision.

Organizational Citizenship Behaviour

Voluntary actions performed by employees that contribute to the overall positive functioning and environment of an organization beyond their formal job requirements.

Follower Satisfaction

The level of happiness and contentment that followers or subordinates feel regarding their leadership's direction and actions.