An argument that opposes the idea of high executive pay is

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BlackTom AI · Accepted Answer

The question asks for an argument that opposes the idea of high executive pay. We will examine each option to see how well it represents a critique of very large pay packages.

Option 1: 'high salaries divert resources that could be used to invest in the business.' This statement directly presents a resource-allocation concern: when executives are paid a lot, those funds could instead be invested in growth, R&D, or other productive activities. It captures the economic intuition behind the opposition to high pay: opportunity cost and potentially reduced reinvestment in the firm. The logic is that excessive pay for executives could hinder other value-creating uses of corporate resources.

Option 2: 'high salaries provide an incentive for innovation and risk taking.' This asserts a pro-pay effect, not an anti-pay argument. It contends that high pay motivates executives to innovate and take risks. Since the question seeks an opposition to high executive pay, this option actually supports rather than opposes the idea, making it inconsistent with the prompt’s goal.

Option 3: 'not many individuals are capable of running today's large, complex organizations.' This is a statement about the difficulty of leadership, possibly used to justify high pay as a market-based incentive to attract scarce talent. While it can be used in support of high pay, it does not itself oppose high pay; rather, it rationalizes it. Therefore, as an opposition argument, it is misaligned because it shifts focus to scarcity rather than criticizing the pay level itself.

Option 4: 'top athletes and entertainers make a lot of money, so top executives should, too.' This is an analogy that suggests equivalence in pay with unrelated professions. It does not argue against high executive pay; it attempts to justify it by comparison, which makes it an argument in favor of high pay or at least a justification rather than an objection. Consequently, it does not express the opposing viewpoint.

In summary, Option 1 uniquely articulates a direct opposed-position by highlighting the potential cost to the business through diverted resources, whereas the other options either advocate for high pay, justify it on different grounds, or rely on a comparison that does not constitute an opposition to high pay.

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MGS*3520*01.2025FA EXAM III- Requires Respondus LockDown Browser

An argument that opposes the idea of high executive pay is

View Explanation

Log in for full answers

Similar Questions

An argument in support of high executive compensation is

Which element of executive pay is most likely to include some metric based on ESG performance?

Which executive remuneration concern is most likely expressed by board members?

Studies show that in most companies, executive pay is significantly aligned with Blank ______.

In addition to salary, what is a major component of a typical CEO compensation package?

In a software company that caters to the federal government it would be most appropriate for which of the following positions to be paid at the highest percentile?

Which of the following is a common reward in variable executive compensation agreements?

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More Practical Tools for Students Powered by AI Study Helper

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MGS352001.2025FA EXAM III- Requires Respondus LockDown Browser