Which of these projects is likely to have the higher asset beta, other things equal? Why? a. The sales force for project A is paid a fixed annual salary. Project B’s sales force is paid by commissions only. b. Project C is a first-class-only airline. Project D is a well-established line of breakfast cereals.

A and B

Explanation: The above projects is likely to have higher asset beta other things being equal because people or workers are motivated by Money which would aid them to perform and give hundred percent on any project.

Abraham Maslow gives us a good explanation around Motivation-Starting from the premise that each human being is motivated by needs that are inborn, presumably as a result of tens of thousands of years of evolution, the Maslow theory of motivation suggests a hierarchy of needs:  

Physiological needs  

These are the very basic needs such as air, water, food, sleep, sex, etc. When these are not satisfied we may feel sickness, irritation, pain, discomfort, etc. These feelings motivate us to alleviate them as soon as possible to establish homeostasis. Once they are alleviated, we may think about other things.  

Safety needs  

These have to do with establishing stability and consistency in a chaotic world. These needs are mostly psychological in nature. We need the security of a home and family. However, if a family is dysfunction, i.e., an abused child - cannot move to the next level as she is continuously fearful for her safety. Love and a sense of belonging are postponed until she feel safe.  

Love and needs of belonging  

Humans have [in varying degrees of intensity] a strong desire to affiliate by joining groups such as societies, clubs, professional associations, churches and religious groups etc. There is a universal need to feel love and acceptance by others.  

Self-Esteem needs  

There are essentially two types of esteem needs:self-esteem resulting from competence or mastery of a task; and the esteem and good opinion of other people.  

The need for self-actualisation  

Maslow theory of motivation proposes that people who have all their "lower order" needs met progress towards the fulfilment their potential. Typically this can include the pursuit of knowledge, peace, esthetic experiences, self-fulfillment, oneness with God, nirvana, enlightenment etc. So ultimately this is all to do with the desire for self transcendence.

this conflict is person vs. society

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