Question

QUESTION 30

1. Which one of the following statements is TRUE?

   	a.	Personal use of the corporate jet is an example of a nonpecuniary benefit.
   	b.	An agency conflict between inside owners/managers and outside owners occurs when the outside owners sell their shares to someone else.
   	c.	An agency problem occurs when an owner/manager sells stock to an outside investor and the owner/manager fears the outside investor will consume too many perquisites.
   	d.	A supplier substituting a lower-quality raw material without approval is an example of asset switching.
   	e.	A quarter-end bonus is an example of a nonpecuniary benefit.

Answer 1

insy page:01 The given informaton explains about us to Select the consent option from the following: "option a" is correct a) personal use of the corporate jet is an example of a nonpecuniary benefit Explanation: Managers might use corporate resowires of activities that benefits themself rather than share holder. Examples: membership of clubs or using of corporate jet since this benefits are non monetary, these are examples of non pecuniary benefits