Two Common Agency Problems Include

question 69

Multiple Choice

Two common agency problems include

• A) managers investing some of a firm's capital in managerial perquisites that do not add economic value to a firm and managerial risk aversion.
• B) managers not investing enough of a firm's capital in managerial perquisites and managerial risk aversion.
• C) managers investing some of a firm's capital in managerial perquisites that do not add economic value to a firm and managerial risk seeking.
• D) managers not investing enough of a firm's capital in managerial perquisites and managerial risk seeking.

---

Definitions:

Gibbons V. Ogden

A landmark decision by the U.S. Supreme Court in 1824 that held that the power to regulate interstate commerce was granted to Congress by the Commerce Clause of the Constitution.

Supreme Court Case

A legal proceeding brought before the United States Supreme Court, the highest federal court, which often results in a decision of significant legal precedent.

Seminole War

A series of conflicts in the early 19th century in Florida between the United States and the Seminole Indians, primarily over land and the U.S.'s attempts to recapture runaway slaves.

1818

The year 1818 marks various historical events, such as the admission of Illinois as the 21st state of the United States.