The Agency Problem May Result from a Manager's Concerns About

question 122

Multiple Choice

The agency problem may result from a manager's concerns about ________.

• A) job security
• B) maximizing shareholder value
• C) corporate goals
• D) increasing credit worthiness

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Definitions:

Unlimited Personal Liability

A legal obligation where an individual's personal assets can be used to satisfy the debts and liabilities of the business.

New Capital

Funds raised by a company through issuing new shares or debt to finance its business activities.

Hedge Funds

Investment funds that employ various strategies to earn active return, or alpha, for their investors, often requiring a large initial minimum investment and offering less regulation.

Market-Neutral

Market-neutral is an investment strategy or portfolio designed to neutralize certain market risks by taking offsetting positions, aiming to achieve returns largely independent of the overall market movement.