An Objection to Managing a Firm on Behalf of Stakeholders

question 7

Multiple Choice

An objection to managing a firm on behalf of stakeholders rather than shareholders is that ________.

• A)stakeholders have no economic interest in the firm
• B)stakeholders have an interest only in short-term outcomes
• C)there is no clear way to satisfy all stakeholders whose economic interests may be at odds with each other
• D)the goal of managing on behalf of stakeholders is too narrow

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Definitions:

Natural

Existing in or derived from nature; not made or caused by humankind.

Analogue

Something that is similar or comparable to another thing, particularly in function or features.

Natural Experiment

An empirical study in which individuals are exposed to experimental and control conditions that are determined by nature or by other factors outside the control of the investigators.

Analogue Experiment

An experimental design used to study a particular phenomenon by replicating it or simulating it in a controlled environment, especially when direct experimentation is not possible.