The Most Correct Reason of Why Residual Loss Is Incurred

question 21

Multiple Choice

The most correct reason of why residual loss is incurred is:

• A) principals do not take any actions to control agents' behaviours.
• B) agents do not always act in the best interest of principals.
• C) it is too costly for principals to completely monitor agents' behaviours.
• D) agents are rational wealth maximisers.

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