Compared to managers, shareholders prefer:
A) safer strategies with greater diversification for the firm.
B) riskier strategies with more focused diversification for the firm.
C) safer strategies with more focused diversification for the firm.
D) riskier strategies with greater diversification for the firm.

Question

Quizplus · Accepted Answer

Shareholders often prefer riskier strategies with more focused diversification because they are interested in maximizing their returns, and focused diversification can lead to higher potential profits.

Compared to Managers, Shareholders Prefer