Please help me with this problem. I only have one attempt left! Thank you for yo

Question

Please help me with this problem. I only have one attempt left!

Thank you for your help.

Select as choices all of the following that you believe depict the 'agency'relationship inside the corporation Note: A correct answer requires that you check ALL that apply. The goals of the managers may not always align themselves with the goals of the shareholders. In the context of the agency relationship managers are the principals. The compensation plan has many advantages but using it to reduce agency costs is NOT one of these One type of agency costs are lost opportunities caused by conflicts too difficult to resolve The goal of shareholder wealth maximization often leads to agency costs. One of the goals of the study of modern corporate finance is to maximize agency costs. In the context of the agency relationship shareholders are the principals.

Explanation / Answer

The correct statements are:

The goals of managers may not always align themselves with goals of shareholders.

One type of agency costs are lost opportunities caused by conflicts too difficult to resolve.

The goal of shareholder wealth maximization leads to agency cost.

In the context of agency relationship, shareholders are principals

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