Which of the Following Is a Cause of 'Agency Problem

question 44

Multiple Choice

Which of the following is a cause of 'agency problem'? 

• A) Conflict of interest between buyer and seller due to conflicting goals. 
• B) Sub-contractors fail to meet project milestones. 
• C) Detailed project engineering and planning problems. 
• D) Sub-contractors failure to perform due to poor quality performance.

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Definitions:

Informal Communication Channel

Messages outside formally authorized channels within an organization’s hierarchy.

Stock Options Plan

A benefit plan that gives employees the option to buy company shares at a future date at a predetermined price.

Company Stock

Shares of ownership in a corporation, representing a claim on the company's assets and earnings.

Upward Communication Channel

The flow of information from lower levels of a hierarchy to higher levels, including feedback, reports, and suggestions.