The Principal-Agent Problem Is a Problem

question 89

Multiple Choice

The principal-agent problem is a problem

• A)caused by a person (principal)who hires an agent to act on his behalf but is unwilling to delegate authority to the agent to carry out the task in the best possible way.
• B)caused by agents pursuing their own interests rather than the interests of the principals who hired them.
• C)of the power system of boss and subordinate where the boss (principal)exerts influence over his subordinates (agents)using punishment or threat.
• D)that exists when a person (principal)has more information about the task than the agent he hires to perform the task.

---

Definitions:

Abnormal Behaviour

Actions or behaviors that deviate significantly from what is considered typical or usual for a given culture or society.

Projective Test

A type of psychological test that reveals information the person being tested cannot or will not report directly. Used to help clinicians form hypotheses about an individual’s personality. See also Rorschach inkblot test.

Psychological Assessment

A process by which professionals use a variety of tools and techniques to understand a person's behavior, personality, and capabilities.

Reliability

The extent to which a measurement instrument yields reliable and steady outcomes across different periods.