The presence of a powerful owner removes all forms of agency problems.

Question

Quizplus · Accepted Answer

The presence of a powerful owner does not necessarily remove all forms of agency problems. The owner may have conflicting interests with other stakeholders, or may not have sufficient knowledge or abilities to manage the company effectively. Additionally, even if the owner has good intentions, they may not always be able to prevent opportunistic behavior by managers or employees.

The Presence of a Powerful Owner Removes All Forms of Agency