Managers and stockholders of large corporation

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Agency Problem is a conflict of interest inherent in any relationship where one party is expected to act in another's best interests. The problem is that the agent who is supposed to make the decisions that would best serve the principal is naturally motivated by self-interest, and the agent's own best interests may differ from the principal's best interests.

List at least 3 agency problems between the managers and stockholders of a large corporation like IBM. For example, managers may commit accounting fraud to inflate profit, and earn higher bonuses.

Reference no: EM131704512

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