Of the two conflicts, __________ more severe as the firm becomes smaller.
A) the shareholder-lender conflict gets
B) the manager-shareholder conflict gets
C) both get
D) neither gets

Question

Quizplus · Accepted Answer

As the firm becomes smaller, the shareholder-lender conflict tends to become more severe due to increased risk and limited resources, which can heighten tensions between shareholders seeking returns and lenders concerned about loan repayment.

Of the Two Conflicts, __________ More Severe as the Firm