Within the principal/agent perspective of PAT,the price-protection approach is:
A) The principal pays the agent a lower salary on the basis that the agent is expected to undertake opportunistic behaviour.
B) The contract between the principal and agent includes a clause that stipulates the basis for pricing of goods so that the agent does not price the product too highly in an effort to increase the agent's short-term rewards.
C) The contract between the principal and the agent specifies a period within which the price paid for the services of the agent cannot be changed.
D) The contract between the principal and the agent includes an agreement whereby the agent guarantees the price of the shares in the company will be protected by the agent's actions.
E) None of the given Answers.
Correct Answer:
Verified
Q33: Various researchers have indicated that when managers
Q34: The rational economic person assumption as it
Q35: Positive Accounting Theory (PAT)assumes that principals are
Q36: Market-based bonus schemes may be considered more
Q37: Creative Accounting:
A) Is a term used by
Q39: Problems associated with rewarding managers based on
Q40: The efficiency perspective in PAT research considers:
A)
Q41: The general aim of the current-cost accounting
Q42: The development of exit-price accounting (or CoCoa)was
Q43: As part of the company's compensation plan,a
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents