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Human Resource Management QUESTION #6461
Question 1

The statement that 'stock market often looks favorably on layoffs' suggests:

  • Financial markets prioritize short-term cost reduction over long-term human capital✔️
  • Layoffs always improve organizational performance
  • Investors understand HR strategy better than managers
  • Job cuts are the only way to increase profitability
Correct Answer Explanation

This reveals that financial markets often prioritize short-term cost reduction (immediate expense savings from layoffs) over long-term human capital development, even though chronic job insecurity causes stress and can lower performance and productivity.