The problem that arises when an agent does not complete a task in the way intended by the principal is:

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The principal-agent problem is the issue that arises when an agent, such as an employee or contractor, does not act in the best interest of the principal, such as a company or client. This can happen when the goals, incentives, or information of the agent differ from those of the principal, leading to a misalignment of interests and potential conflicts. It can result in suboptimal outcomes, such as lower productivity, quality, or profitability, and can be mitigated through various mechanisms, such as monitoring, contracts, training, or performance-based rewards. The other choices are not directly related to this issue. Immoral hazard is a variation of moral hazard that involves unethical or illegal behaviors, whereas diminishing returns refers to the diminishing marginal productivity of resources. Adverse selection is a situation in which one party has more information than the other and uses it to gain an advantage, whereas market failure refers to the inefficient allocation of resources due to market imperfections, such as externalities or monopolies.

The Problem That Arises When an Agent Does Not Complete