Identify and explain the components of management compensation and the tradeoffs that compensation designers make.

Incorrect/Incomplete question: Complete question read;

Which of the following statements correctly describes management compensation options?

A) Managers do not receive fixed salaries; instead their compensation is based on bonuses and incentives.

B) Perks (perquisites) were eliminated as part of the Sarbanes-Oxley Act.

C) Bonuses are typically awarded for meeting or achieving specific goals.

D) Stock options and awards are part of fixed salary compensation.

C) Bonuses are typically awarded for meeting or achieving specific goals.

Explanation:

All the options above with the exception of option C rightly describes management compensation plans. Remember, the term compensation includes both cash and non-cash payments an employee may receive for performing their duties well.

Hence, managers may award certain bonuses (eg 5% salary bonuses, etc)  to their employees for working diligently to meet specific goals (like meeting a sales target, new customer acquisition targets, etc).

answercontrol is returned to method c;

answera public company has access to more capital;