k Ch 21 Solution3 Managers generally have shorter time horiz

Solution

3. Managers generally have shorter time horizon than owners, thus managers do not fully take into account the future long term profitability.

As principal and agent or owners and managers do not have complete information about each other, managers often work to increase their own being than the firm\'s.

4. False

The schools are rated good when they have intelligent students who can increase test scores, etc. In this case schools are likely to consider those students than poor students who need to learn more than intelligent students. Low performing students are served less.