The Specific Agency Problems Created by the Assumption That Managers

question 4

Multiple Choice

The specific agency problems created by the assumption that managers are wealth maximisers include which of the following?

• A)the differences between managers' and shareholders' attitudes to risk
• B)the potential for company managers to maximise their wealth at the expense of company shareholders
• C)the tendency for management to focus on short- term performance at the expense of long- term growth
• D)all of the above

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Definitions:

Prohibition

An order not to proceed with a hearing or other administrative process.

Decision Maker

An individual or group responsible for making judgments and deciding on matters within an organization, project, or situation.

Mandamus

A judicial remedy in the form of an order from a court to any government, subordinate court, corporation, or public authority to do some specific act that it is obligated under law to do.

Decision Maker

An individual or group responsible for making choices or judgments, especially in a professional or business context.