All things equal, managerial risk aversion will have the following effect:

Question options:

a$)$

CEOs will pass on NPV $<0$ projects, which is an indirect agency cost

b$)$

Less diversified executives will place a lower value on riskier forms of compensation

c$)$

CEOs will prefer debt over equity financing for new projects

d$)$

CEOs will be less willing to accept underpricing at an initial public offering