​Monitoring

question 39

Multiple Choice

​Monitoring

• A)​Gives the principle a better performance evaluation metric
• B)Allows the principle to better align the incentives of the agent with the goals of the principle
• C)Can be costly for the principal
• D)​All of the above

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Definitions:

Future Value

The value of a current asset at a specific date in the future based on an assumed rate of growth.

Interest Rate

The proportion of a total amount of money that is charged for borrowing it, usually represented as an annual rate.

Risk Averse

A description of individuals or entities that prefer to avoid risk and seek safer, more predictable outcomes.

Fundamental Analysis

A method of evaluating a security to measure its intrinsic value by examining economic, financial, and other qualitative and quantitative factors.