Anonymous asked in Business & FinanceOther - Business & Finance · 1 decade ago

Cost Accounting?

Which of the following forms of executive compensation is most likely to reduce agency costs?

1. Annual bonus based on company profitability

2. Base salary with annual merit increases

3. Stock options with long vesting periods

4. Annual grants of company shares

1 Answer

  • 1 decade ago
    Favorite Answer

    #3. Your deferring any actual costs until the vesting period starts.

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