All of the following statements about agency problems are true EXCEPT
A) Agency problems result from the separation of management and the ownership of a firm.
B) Agency problems interfere with the goal of maximizing shareholder value.
C) Agency costs are paid by the managers who do not act in the shareholders' best interest.
D) The root cause of agency problems is conflicts of interest.
C
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Which of the following initial contact statements should be avoided?
A) May I have some of your valuable time? B) We highly value your opinion and would like to ask you a few questions. C) Would you like to answer a few questions? D) Both A and C should be avoided.
Rob's income was $20,000 in 2005 and $22,000 in 2006. If inflation was 6% in 2006, then we can say that Rob's 2006 income
A) simply matched the inflation rate. B) fell behind the inflation rate. C) exceeded the inflation rate by 4%. D) lagged the inflation rate by 2%.