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Questions and Answers
According to agency theory, what is the type-1 agency problem?
According to agency theory, what is the type-1 agency problem?
- The separation of ownership and management
- The conflict between majority and minority shareholders
- The misalignment of shareholders goals
- The conflict between owner and manager (correct)
What does the type-2 agency problem represent?
What does the type-2 agency problem represent?
- The separation of ownership and management
- The misalignment of shareholders goals
- The conflict between majority and minority shareholders (correct)
- The conflict between owner and manager
Which category of agency problem involves the conflict between owner and manager?
Which category of agency problem involves the conflict between owner and manager?
- Type-1 agency problem (correct)
- Type-2 agency problem
- Both type-1 and type-2 agency problems
- None of the above
What is the main issue at the heart of agency theory?
What is the main issue at the heart of agency theory?
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Which type of agency problem can manifest itself in the misalignment of shareholders goals?
Which type of agency problem can manifest itself in the misalignment of shareholders goals?
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