According to agency theory, under what circumstances could companies eliminate agency costs?
A) If their shares are not traded on the stock exchange
B) If bonuses are based on financial performance
C) If they publish audited financial statements
D) Organisations cannot eliminate agency costs

Question

Quizplus · Accepted Answer

Agency costs arise from the inherent conflicts of interest between principals (owners) and agents (managers), and while they can be minimized, they cannot be completely eliminated.

According to Agency Theory, Under What Circumstances Could Companies Eliminate