Agency Theory Seeks to Explain

question 38

Multiple Choice

Agency theory seeks to explain:

• A) how owners and managers may vary in their approach to risk taking.
• B) how owners are more effective than managers in using pay and other forms of compensation to effectively run the organization.
• C) differences in time horizons between managers and lower-level employees.
• D) how owners and managers are similar while making decisions during a high stress situation.

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Definitions:

Employee Right

Legal, moral, or ethical entitlements pertaining to employment conditions, such as safety, privacy, and freedom from discrimination.

Restraining Order

A legal order issued by a court to protect an individual from being harmed or harassed by another person.

Walkaround

An informal inspection or tour of a workplace or facility for evaluation or informational purposes.

OSHA Inspector

A professional responsible for enforcing safety and health standards in workplaces, employed by the Occupational Safety and Health Administration (OSHA).