One problem with compensation systems is that
A) sometimes a manager is rewarded for an objective other than maximizing profits.
B) managers are often paid too much.
C) owners sometimes want to pursue social objectives.
D) the Dodd-Frank Act of 2010 requires shareholder votes on compensation that are non-binding.
Question 2
If Ben values good X more than good Y and Catherine values good Y more than good X a firm can increase its profits by
A) charging the same price for both goods.
B) bundling the goods.
C) selling the goods in a competitive market.
D) charging one price per good.
