Which of the Following Statements Is True of the Agency

question 25

Multiple Choice

Which of the following statements is true of the agency problem facing the modern public corporation?

• A)It arises when a corporation hires a private agency to conduct audits of its business practices.
• B)It arises when a government agency is assigned with the task of identifying corrupt practices by a corporation.
• C)It arises as a consequence of the separation of ownership and control in the corporation.
• D)It arises as a consequence of the managers of the corporation focusing on enhancing shareholder value.

---

Definitions:

Competence

The ability or skill to perform a task effectively or to a satisfactory standard.

Distress

The effect of unpleasant and undesirable stressors.

Frustration

The feeling of being upset or annoyed, especially because of inability to change or achieve something.

Relatedness

The feeling of being connected or related to others, often considered a fundamental human need.