Before continuing, first answer the following 3 questions to diagnose and solve the problem. Then, please elaborate in your answer to the question above.
1) Who is making the bad decision?
2) Do the actuaries have enough information to make a good decision?
3) Do the actuaries have the incentive to make a good decision?
This material may consist of step-by-step explanations on how to solve a problem or examples of proper writing, including the use of citations, references, bibliographies, and formatting. This material is made available for the sole purpose of studying and learning - misuse is strictly forbidden.1) Who is making the bad decision?
The managers, especially those responsible for designing the compensation structure in the company, are the ones making the bad decision. They include top management such as the chief executive officer, directors and human resource managers. This is...