If a firm's owner is better able than the sales staff to bear the risk of a recession, weak incentives:
A) are worse than strong incentives.
B) may be better than strong incentives.
C) should not be used.
D) would not be profitable.

Question

Quizplus · Accepted Answer

If the owner is better able to bear the risk of a recession, it may be more cost-effective to provide weak incentives to the sales staff. Strong incentives incur higher costs to the firm and may not be necessary if the owner can absorb the risk without significant impact on the firm's financial wellbeing. However, no incentives should not be used at all as it may lead to lackluster performance from the sales staff.

If a Firm's Owner Is Better Able Than the Sales