Firm strategies for coping with the principal-agent problem are
A)ownership, incentive pay, and long-term contracts.
B)sole proprietorship, partnership, and the corporation.
C)economies of scale, scope, and team production.
D)technology, information, and the market.
E)ownership, scope, and the market.

Question

Quizplus · Accepted Answer

Ownership can align the interests of the principal and the agent, incentive pay can motivate the agent to work towards the principal's objectives, and long-term contracts can provide security and alignment of interests over an extended period of time. These strategies can help mitigate the principal-agent problem.

Firm Strategies for Coping with the Principal-Agent Problem Are