To Avoid the Agency Problem, Managers Should Take Actions

question 39

Multiple Choice

To avoid the agency problem, managers should take actions:

• A) Which adds value to the firm.
• B) Only after the president has approved them.
• C) Only if they increase the market share of the firm.
• D) Which add to the size of the firm's workforce.
• E) Only if management jobs will not be jeopardized.

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Definitions:

Ph.D.

A PhD, or Doctor of Philosophy, is a postgraduate degree conferred by universities.

Physics

The natural science that studies matter, its motion and behavior through space and time, and the related entities of energy and force.

Structural Unemployment

The loss of jobs stemming from changes in industrial setups, usually driven by innovations in technology, instead of shifts in market demand or supply.

Bank Tellers

Employees of banks who deal directly with customers, handling transactions and other financial inquiries.