Which one of the following is least apt to help convince managers to work in the best interest of the stockholders? Assume there are no golden parachutes.
A) Compensation based on the value of the stock
B) Stock option plans
C) Threat of a company takeover
D) Threat of a proxy fight
E) Increasing managers' base salaries

Question

Quizplus · Accepted Answer

Increasing managers' base salaries may make them less dependent on stock performance and less motivated to work in the best interest of the stockholders. The other options provide incentives for the managers to increase stock value or mitigate the risk of losing control of the company.

Which One of the Following Is Least Apt to Help