One Way to Overcome the Principal-Agent Problem Is To

question 33

Multiple Choice

One way to overcome the principal-agent problem is to:

• A) Flatten the organization.
• B) Micromanage the management team.
• C) Make managers owners through stock options.
• D) Increase the scope of management's responsibilities.

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Definitions:

Racing Heart

An increase in heart rate that is often perceived as heartbeats that are faster than normal.

Posttraumatic Stress Disorder

A psychiatric disorder that may occur in people who have experienced or witnessed a traumatic event such as a natural disaster, a serious accident, a terrorist act, war/combat, rape, or other violent personal assault.

Natural Disaster

An event such as a flood, earthquake, or hurricane that causes significant damage or loss of life, resulting from natural processes of the Earth.

Jumpy Anxiety

A state of heightened nervousness and fear that results in sudden, quick reactions to stimuli, often without logical basis.