Owners and managers:
A) must be the same people.
B) may be different people with different goals, and in the long run firms that do best are those in which the managers are allowed to pursue their own independent goals.
C) may be different people with different goals, but in the long run firms that do best are those in which the managers pursue the goals of the owners.
D) may be different people with different but exactly complementary goals.
E) may be different people with the same goals.

Question

Quizplus · Accepted Answer

Although owners and managers may have different goals, firms that do best in the long run are those in which the managers pursue the goals of the owners. This ensures that the interests of the owners, who have a financial stake in the success of the firm, are aligned with the actions and decisions of the managers who are responsible for the day-to-day operations of the firm. While managers may have some autonomy in decision-making, ultimately their actions must align with the interests of the owners.

Owners and Managers