A payday loan company has decided to open several new locations in a cityand hires consultants to decide where to open these locations. The consultantsare paid per store that is opened, and at the end of the quarter, the companynotices a many of the new stores' sales volume fail to meet expectations. Toincentivize the consultants to instead focus on opening profitable stores, thecompany decided to alter the compensation to a percentage of the profitearned per new store. This puts the consultants_and the payday loan company should expect tocompensate for this change.toGroup of answer choices1. In a less risky position; pay the consultants more than they would in the per-store scheme2. A more risky position; pay the consultants less than they would in the per-store scheme3. In a less risky position; pay the consultants less than they would in the per-store scheme4. A more risky position; pay the consultants more than they would in the per-store scheme

Since the compensation is based on profit, it is riskier and the payment overall would be more to…

Answered: A payday loan company has decided to…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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