Auto Industry

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Business Finance

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United States Auto Industry Back on Top of CEO Pay

Answer the following questions:

  1. Do you think CEOs and other executives are worth the compensation packages they receive? Why or why not?
  2. Do you agree with Peter Drucker that corporate executives should receive compensation packages no larger than a certain percentage of the pay of hourly workers? Explain.
  3. Will the Dodd–Frank Wall Street Reform and Consumer Protection Act giving shareholders the right to vote on executive pay influence the size of these packages in the future?

The following requirements must be met:

  • Write between 1,000 – 1,500 words using Microsoft Word in APA 6th edition style.
  • Use an appropriate number of references to support your position, and defend your arguments. The following are examples of primary and secondary sources that may be used, and non-credible and opinion based sources that may not be used.
    1. Primary sources such as government websites (United States Department of Labor - Bureau of Labor Statistics, United States Census Bureau, The World Bank), peer reviewed and scholarly journals in EBSCOhost (Grantham University Online Library) and Google Scholar.
    2. Secondary and credible sources such as CNN Money, The Wall Street Journal, trade journals, and publications in EBSCOhost (Grantham University Online Library).
    3. Non-credible and opinion based sources such as, Wikis, Yahoo Answers, eHow, blogs, etc. should not be used.
  • Cite all reference material (data, dates, graphs, quotes, paraphrased statements, information, etc.) in the paper and list each source on a reference page using APA style. An overview of APA 6th edition in-text citations, formatting, reference list, and style is provided here.

Download an APA sample paper from the Purdue OWL here.

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Explanation & Answer

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Running Head: UNITED STATES AUTO INDUSTRY BACK ON TOP OF CEO PAY

United States Auto Industry Back On Top Of Ceo Pay

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Institutional Affiliation:

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UNITED STATES AUTO INDUSTRY BACK ON TOP OF CEO PAY

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United States Auto Industry Back On Top Of Ceo Pay

Introduction

The term executive compensation can broadly be used to describe the financial
compensation given to the top executives in a firm. Cases of executive compensation have on
several occasion hit the media and stayed in the public debate with the question extending to the
Congress on how the top executive in a company should be compensated. The majority of the
executive officer heading big companies such as the automotive companies in the United States
continues receiving huge sums of compensation even in times of economic downturns such as
the one experienced in 2001 and 2008. The irony is while the three top automotive that is
General Motors, Chrysler and Fords were experiencing possible bankruptcy and insurmountable
debt the companies’ top executive were receiving the highest compensation ever recorded in the
automotive industry.

So should the Chief Executive Officer and other executive get the kind of compensation
packages they receive? The answer to this question would be it depends on several factors. First,
if a company is not doing well to meet its performance measure, then this is a clear indication
that the top executive should not receive the large compensation packages (Reilly & New York
University., & New York University Annua...


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