Which of the Following Is True When the Managers Have

Which of the following is true when the managers have flexibility in investment decisions?

A) Uncertainty in management effectiveness increases as the level of flexibility in investment decisions increases.
B) When there is very little uncertainty,the outside shareholders must not limit the managers' flexibility.
C) The costs of discretion are greater when the interests of managers and shareholders do not coincide.
D) Flexible investment designs cannot add value to a firm,since flexibility decreases a firm's operating options.