which of the following is NOT an attempt to overcome a principal-agent problem A

Question

which of the following is NOT an attempt to overcome a principal-agent problem A. Giving managers long-term contracts B. Paying employees a bonus from the firm’s profit C. Granting managers partial ownership of the company D. Granting owners of corporations limited liability which of the following is NOT an attempt to overcome a principal-agent problem A. Giving managers long-term contracts B. Paying employees a bonus from the firm’s profit C. Granting managers partial ownership of the company D. Granting owners of corporations limited liability which of the following is NOT an attempt to overcome a principal-agent problem A. Giving managers long-term contracts B. Paying employees a bonus from the firm’s profit C. Granting managers partial ownership of the company D. Granting owners of corporations limited liability

Explanation / Answer

The principal agent problem refers to the occurrence of moral hazard in principal agent behaviours. The correct answer thus should be D.

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