Principal-agent problems, Principal-agent problems:

Principal-agent problems

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Reference no: EM13815520

Principal-agent problems:

a. occur when firm managers have more incentive to maximize profit than shareholder do.

b. would be reduced if firm owners had better information about the actions of the firm's managers.

c. help explain why equity investments from outside owners are an important financing source for firms.

d. are increased as more information is shared between the parties

Reference no: EM13815520

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