As It Relates to Corporations, the Principal-Agent Problem Is That

question 72

Multiple Choice

As it relates to corporations, the principal-agent problem is that

• A)the goals of the corporate managers (the principals)may not match the goals of the corporate owners (the agents).
• B)the goals of the corporate managers (the agents)may not match the goals of the corporate owners (the principals).
• C)the federal government (the agent)taxes both corporate profits and the dividends paid to stockholders (the principals).
• D)it is costly for the corporate owners (the principals)to obtain a corporate charter from government (the agent).