Which of the Following Is an Example of an Agency

question 45

Multiple Choice

Which of the following is an example of an agency problem?

• A)Managers not working as diligently if they are not the sole owner of the business.
• B)The board of directors firing an incompetent manager.
• C)The manager owning a great deal of stock in the company.
• D)A corporate raider attempting to purchase the company.

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Definitions:

Income

Monetary returns that come on a recurring basis, either from being employed or from putting money into investments.

Nash Equilibrium

A concept in game theory where each player's strategy is optimal, given the strategies of all other players in the game.

Payoff

An outcome of a decision or action, usually quantified in terms of profit, loss, or other benefits.

Strategy

A planned series of actions or tactics aimed at achieving specific goals or outcomes, often used in the context of business, military, or games.