In the principal-agent problem,the agent is:
A)a person who entrusts someone with a task.
B)a person who carries out a task on someone else's behalf.
C)a person who is in charge of a top-secret mission.
D)a person who is the source of the problem.

Question

Quizplus · Accepted Answer

In the principal-agent problem, the agent is the person who is hired or entrusted to carry out a task on behalf of another person or organization. The problem arises when the agent's interests do not align with the principal's interests, leading to a potential conflict of interest. Therefore, the best choice is B.

In the Principal-Agent Problem,the Agent Is