Identify a way in which principals usually salvage their businesses from agency problems that destroy value.

Question

Quizplus · Accepted Answer

Principals usually salvage their businesses from agency problems that destroy value by monitoring their manager-agents through the board of directors. This helps in ensuring that the manager-agents are acting in the best interest of the principals and the business, as well as providing oversight to prevent unethical behavior or decisions that could harm the business. Therefore, option C is the best choice. The other options may also help in certain circumstances but do not specifically address agency problems that destroy value.

Identify a Way in Which Principals Usually Salvage Their Businesses