Incentives tied to current stock prices increase the likelihood that executives will make necessary capital investments.

Question

Quizplus · Accepted Answer

Incentives tied to current stock prices may create a short-term focus on boosting the stock price, potentially at the expense of long-term investments. This can result in executives being less likely to make necessary capital investments that may not immediately impact the stock price.

Incentives Tied to Current Stock Prices Increase the Likelihood That