Which of the following would be most likely to align the interests of managers and shareholders?
A)Fixed but high salaries
B)Large bonuses
C)Stock options
D)All of the above
E)None of the above

Question

Quizplus · Accepted Answer

Stock options align the interests of managers and shareholders because managers benefit financially from an increase in the company's stock price, which is also beneficial for shareholders. In contrast, fixed salaries and large bonuses provide managers with a set amount of money regardless of company performance, which may not incentivize them to act in the best interest of shareholders.

Which of the Following Would Be Most Likely to Align