The primary reason that agency problems persist is:

Question

Quizplus · Accepted Answer

Information asymmetries occur when one party in a transaction has more information than the other party, which can lead to conflicts of interest and mistrust between the principal and agent. This information asymmetry can persist even if both parties act in their own self-interest and fulfill their contractual obligations, which can result in agency problems. Thus, the primary reason for agency problems is information asymmetries. Poor stewardship or delegation could be contributing factors, but they are not the primary reason for agency problems.

The Primary Reason That Agency Problems Persist Is