In order to reduce agency problems, managers may be provided compensat

In order to reduce agency problems, managers may be provided compensation that includes

A) a fixed salary so managers’ pay is not at risk, allowing managers to focus on the company’s
business.
B) an option to buy the company’s stock.
C) a bonus based on the level of profit achieved during the year.
D) incentive pay for achieving higher sales than last year.

ANSWER

B