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Which of the following is NOT a way to overcome investment myopia?Group of answer choicesRemove financial measuresReduce pressure for meeting short-term profitExtend financial measurement horizon

Question

Which of the following is NOT a way to overcome investment myopia?Group of answer choicesRemove financial measuresReduce pressure for meeting short-term profitExtend financial measurement horizon

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Solution

The option that is NOT a way to overcome investment myopia is "Remove financial measures".

Here's why:

  1. Reducing pressure for meeting short-term profit: This is a way to overcome investment myopia because it allows for long-term planning and investment. When there's less pressure to meet short-term profit goals, companies can focus on investments that may take longer to pay off but will ultimately be more beneficial in the long run.

  2. Extending financial measurement horizon: This is also a way to overcome investment myopia. By looking further into the future when measuring financial success, companies can make better long-term investment decisions.

  3. Removing financial measures: This is NOT a way to overcome investment myopia. Financial measures are crucial for assessing the health and success of a company. Without them, it would be nearly impossible to make informed investment decisions. Therefore, removing financial measures would not help to overcome investment myopia, but rather, it could exacerbate the problem.

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