A person acting as a supervisor as well as a residual claimant:
A)attempts to make value-maximizing investment decisions.
B)aims to maximize a firm's sales.
C)facilitates maximum investment in capital goods.
D)reduces risk of opportunism.

Question

Quizplus · Accepted Answer

A person who acts as both a supervisor and a residual claimant would aim to make value-maximizing investment decisions because they have a direct financial stake in the success of the firm. They would be motivated to make decisions that maximize the value of the firm, which would benefit them as a residual claimant.

A Person Acting as a Supervisor as Well as a Residual