Which of the Following Is One of the Two Conditions

question 56

Multiple Choice

Which of the following is one of the two conditions that lead to a moral hazard problem?

• A) the principal possesses more information than the agent
• B) the agent has an incentive to pursue goals and objectives that are different from the principal's
• C) the principal acts in his own best interest, as opposed to the interests of the other stakeholders
• D) the agent is given the authority to allocate scarce organizational resources

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