In Corporations, a Principal-Agent Problem Can Arise When

question 376

Multiple Choice

In corporations, a principal-agent problem can arise when

• A)the shareholders are the principal and the managers are the agent.
• B)the board of directors is the principal and the managers are the agent.
• C)the shareholders are the principal and the board of directors is the agent.
• D)All of the above are correct.

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Definitions:

Serious Problems

Major issues or difficulties that significantly impact an individual's life or situation, requiring urgent attention or resolution.

Community Psychology

A branch of psychology focused on understanding individuals within their social, cultural, economic, geographic, and political contexts and addressing societal issues.

Emphasis on Prevention

The focus on preventing health problems or societal issues before they start, rather than treating them after they occur.

Free Association

A psychoanalytic technique where the patient verbalizes thoughts as they come, without censorship or filtering, to uncover unconscious desires and conflicts.