Which of the Following Is Not Viewed as a Cost

question 5

Multiple Choice

Which of the following is not viewed as a cost to the principal in an agency relationship?

• A) Monitoring expenditures by the principal
• B) Monitoring expenditures by the agent
• C) Bonding expenditures by the agent
• D) The residual loss

---

Definitions:

Zero Slope

A horizontal line on a graph, indicating that there is no change in the y-value (vertical) regardless of the change in the x-value (horizontal); it represents a constant function.

Positive Slope

Indicates an upward trend on a graph, demonstrating that as one variable increases, the other variable also increases, especially used in the context of supply and demand curves in economics.

Consumption

The use of goods and services by households or individuals for personal needs or wants.

Income

Earnings received by an individual or entity, typically in the form of wages, salaries, or various types of investments.