Question: Jensen criticizes kinked relationships between pay and performance (see Fig. 13.6). How well do the following compensation schemes fit a linear relationship? (a) Stock option

Jensen criticizes "kinked" relationships between pay and performance (see Fig. 13.6). How well do the following compensation schemes fit a linear relationship?
(a) Stock option growth
(b) Stock growth
(c) Fixed salary plus variable bonus based on exceeding expectations?

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