What are three major ways that corporations can cope with the principal-agent problem?
What will be an ideal response?
First, employees can be made part-owners of the corporation. Second, employees can be given incentive pay linked to achieving targets that serve the interests of the owners. Third, managers can be given long-term contracts that encourage them to pursue long-term strategies that can yield higher profit over time.
Economics
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The objective of creating value is the same as
A) maximizing shareholder value. B) maximizing profit. C) maximizing added value. D) all of these choices.
Economics
In an attempt to reduce poaching of elephant ivory tusks, officials in Kenya burned illegally gathered ivory. Using your understanding of shifts in supply and demand, will this turn out to be a helpful or hurtful move on the Kenyan government's part?
Economics