When executives unrealistically assess acquisition targets' outlooks in order to increase the probability of increasing organizational size through their acquisition,this is an example of

Question

Quizplus · Accepted Answer

This scenario describes a moral hazard problem, where executives might take riskier decisions (like overvaluing an acquisition target) because they are not personally bearing the full consequences of those risks, instead aiming to increase organizational size which might benefit them personally or professionally.

When Executives Unrealistically Assess Acquisition Targets' Outlooks in Order to Increase