The few examples of agency problems. Introduction: The way wherein the stakeholders of a company control the affairs of the firm to guarantee their return on investment is termed as corporate governance . The managers of the firm are appointed to work in the best interest of the investors. In a corporation, the control of an organizational structure and separation of ownership will give rise to conflicting interest. Every managers face ethical dilemma of whose interest to serve their own or the investors to whom he/she is responsible. This agency conflict takes place when there are different stakeholders in an organization because everyone will have their own interests.

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Chapter 29, Problem 2P

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To discuss: The few examples of agency problems.

Introduction:

The way wherein the stakeholders of a company control the affairs of the firm to guarantee their return on investment is termed as corporate governance.

The managers of the firm are appointed to work in the best interest of the investors. In a corporation, the control of an organizational structure and separation of ownership will give rise to conflicting interest. Every managers face ethical dilemma of whose interest to serve their own or the investors to whom he/she is responsible. This agency conflict takes place when there are different stakeholders in an organization because everyone will have their own interests.

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