Which one of the following statements about the theory of property rights is true?

Question

Quizplus · Accepted Answer

According to the theory of property rights, employees should be given ownership of the firm if their investments in their human capital are highly specific to the firm. This is known as the "residual claimant" principle, which states that those who bear the risks and make the investments should receive the rewards. Therefore, choice A is true. Choice B is incorrect because partnerships can be a suitable form for many types of firms, not just those in the financial sector. Choice C is also incorrect because property rights can be structured in various ways, depending on the specific circumstances and objectives of the parties involved. Therefore, D is also incorrect.

Which One of the Following Statements About the Theory of Property