An Agency Problem Can Be Alleviated By

question 20

Multiple Choice

An agency problem can be alleviated by:

• A)requiring all firms to be sole proprietorships.
• B)compensating managers in such a way that acting in the best interest of shareholders is also in the best interest of managers.
• C)asking managers to take on more risk than they are comfortable taking.
• D)A and B.

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Definitions:

Customer Satisfaction

The degree to which a product or service meets or exceeds the customer's expectations, often considered crucial for business success.

Employee Job Satisfaction

The degree to which employees feel fulfilled, content, and happy with their positions and workplace.

Performance

The act of carrying out a task with a particular level of efficiency or success.

Satisfaction

The fulfillment or gratification of a desire, need, or appetite; a feeling of pleasure or contentment.