Which one of the following is least likely to be an agency problem?
A)increasing the size of a firm
B)concentrating on maximizing current profits
C)closing a division with net losses
D)increasing the market value of the firm's shares
E)obtaining a patent for a new product

Question

Quizplus · Accepted Answer

Agency problems typically arise when there's a conflict of interest between the management (agents) and the shareholders (principals). Increasing the market value of the firm's shares aligns with the interests of the shareholders, making it least likely to be considered an agency problem.

Which One of the Following Is Least Likely to Be