Which of the Following Statements Is FALSE

question 11

Multiple Choice

Which of the following statements is FALSE?

• A)Increasing the pay-for-performance sensitivity comes with the added benefit of reducing manager's risk.
• B)Stock and option grants give managers a direct incentive to increase the stock price to make their stock or options as valuable as possible.
• C)By tying compensation to performance,the shareholders effectively give the manager an ownership stake in the firm.
• D)During the 1990s,most companies adopted compensation policies that more directly gave managers an ownership stake by including grants of stock or stock options to executives.

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Definitions:

Economic Activity

Actions that involve the production, distribution, and consumption of goods and services within an economy.

Self-Esteem

An individual's subjective evaluation of their own worth, characterized by attitudes of approval or disapproval about oneself.

Persuaded

The act of being convinced to do or believe something through reasoning or argument.

Influenced

The capacity or power of persons or things to be a compelling force on the actions, behavior, opinions, etc., of others.