While CEO of General Electric, Jack Welch was a very successful corporate manager. He also loaded up his retirement program with numerous unusual benefits such as rented apartments, free airplanes, and numerous club memberships. The owners (stockholders) were generally unaware of these benefits. This conflict between owners and managers involved:
A) choice of effort of Mr. Welch while he was CEO.
B) perquisite taking on the part of Mr. Welch.
C) differential risk exposure between Mr. Welch and the typical stockholder.
D) overinvestment in company offices by Mr. Welch.
Correct Answer:
Verified
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