The Principal-Agent Problem Occurs

question 97

Multiple Choice

The principal-agent problem occurs:

• A)when the principal has more information than the agent.
• B)commonly in school settings, when the agent puts in more effort than the principal would like.
• C)commonly in the employer-employee relationship.
• D)when the principal and agent have the same objectives.

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Definitions:

Arbitration Cases

Legal disputes resolved outside of court by a neutral third party (arbitrator), whose decision is binding on the involved parties, often used in labor disputes.

Management

The coordination of an organization's resources to achieve its goals through effective planning, leading, organizing, and controlling.

Unfair Labour Practice

Actions by employers or unions that violate the rights of employees or the labor union's regulations, such as discrimination or interference with union activities.

Employees Fairly

Treating workers with impartiality, justice, and equality in the workplace regarding opportunities, rewards, and conditions.