Executive Pay.

Some evidence suggests that there is a direct and positive relationship between a firm's size and its top-level managers' compensation. Explain what inducement you think that relationship provides to upper-level executives.

I believe that top-level managers generally are compensated based on the size of the firm because of the risk, education, stress, hard work, and expected level of achievement that their job duties require. The top-level managers are expected to take a risk at making decisions that could lead to the firm's success or failure. Often top-level managers have obtained four to six years of the appropriate hard university work that makes them better qualified to perform their job duties. Most levels of management are accompanied by a certain level of stress,...