In the principal-agent framework, the ultimate principals are
A)managers and a board of directors only.
B)governments only.
C)shareholders only.
D)managers, a board of directors, and shareholders.

Question

Quizplus · Accepted Answer

In the principal-agent framework, shareholders are considered the ultimate principals as they own the company and delegate authority to managers and the board of directors to act on their behalf.

In the Principal-Agent Framework, the Ultimate Principals Are