. List and briefly explain two out of the three ways to prevent agency problems
Agency problem arises due to conflict of interest between
promoters of company or stockholders and the management.
The conflict arises due to interest of stockholder to maximize
their own wealth whereas interest of manager will be to increase
their own wealth.
Two ways to prevent agency problems:
1. Performance linked pay and ESOPS: By
compensating for better share performance the manager can be
motivated to work towards shareholder wealth maximisation .
ESOP(Employee Stock options) are provided to employee so that they
can also benefit from increasing share value. Since management
donot want takeover bids by competitors due to job security issues
but higher pay and ESOPS can align their interests with the
shareholders.
2. This principal and agent conflict can be minimised by using
contracts and laws. The covenants help to legally
bind the mangers to performs according to wishes of the
shareholders. Any breach of contract can have monetary losses for
the manager which can deter managers to work against the
shareholders.
. List and briefly explain two out of the three ways to prevent agency problems
List three ways that a company can price discriminate, and briefly explain how each behavior could increase profits for the company. (6 pts) HTML Editora B I VA - A - I E321 X X, SE V JDT 12pt Paragra Films On Demand (2.0)
Briefly explain two ways to limit overfitting in constructing a decision tree. Briefly explain the advantages and the weaknesses of decision trees.
List ten problems and solutions (algorithms) of computer networking! explain them briefly!
list and briefly explain at least 3 possible ways that auditor independence could be further enhanced/improved beyond what is currently in place in practice or through auditing standards
List, and briefly discuss, (1-2 sentences max for each) the THREE different ways bacterial cells can exchange genetic information.
Briefly explain at least three ways in which a business may expect to benefit from preparing a formal budget.
J. List two methods for overcoming starting problems in an Induction Motor. Briefly describe them
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We have learned that there are two types of agency problems: agency problems between shareholders and management, and agency problems between shareholders and creditors. A special phenomenon in China’s corporate governance practice is the existence of a third type of agency problem, namely, the agency problem between major shareholders and minority in order to maximize their own interests. Question Is the major shareholder an angel or a devil?
List and briefly explain the three major categories of False Claim Act cases.