Homework SourseWhich of the following statements best represents the Agency
Which of the following statements best represents the “Agency Problem “
A the agency problem results from the separation of management and the ownership of the company
B the agency problem may interfere with the implementation of maximizing shareholder wealth
C managers might attempt to benefit themselves in terms of salary and perquisites at the expense of the shareholders
D all of the above
Which of the following statements best represents the “Agency Problem “
A the agency problem results from the separation of management and the ownership of the company
B the agency problem may interfere with the implementation of maximizing shareholder wealth
C managers might attempt to benefit themselves in terms of salary and perquisites at the expense of the shareholders
D all of the above
Solution
Answer:D all of the above
One of the potential problems of using this method is that it complicates making decisions and forces them to take longer than they should. Separating the ownership and control of the company can be beneficial in cases, but it can also lead to a disconnect between the two parties.
