The Informational Advantage That Agents Possess Over Principals Is Often

question 87

Multiple Choice

The informational advantage that agents possess over principals is often based on the fact that

• A) the information is extremely secure and protected from exposure to anyone outside the company.
• B) public stock companies are characterized by information symmetry.
• C) insiders are the first to learn about important developments before the information is released to the public.
• D) agents are legally permitted to freely trade the information in exchange for benefits, unlike principals.

---

Definitions:

Tenacity

The quality of being determined and persistent in achieving goals, despite facing difficulties or setbacks.

New Program

Initiative or set of organized activities introduced to meet certain objectives or address specific needs.

Era of Downsizing

A period characterized by a significant reduction in the workforce of organizations to cut costs and improve efficiency.

Limited Power

A condition where an entity's authority or capacity to act and influence is restricted by external factors or internal regulations.