An agency problem is the acquisition of a firm by another firm or group that is not supported by management.

Question

Quizplus · Accepted Answer

An agency problem is typically when there is a conflict of interest between the actions or motivations of a company's management and the interests of its shareholders or owners. The acquisition of a firm by another firm or group may or may not be supported by management, but it is not necessarily an example of an agency problem.

An Agency Problem Is the Acquisition of a Firm by Another