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neonofarm [45]
3 years ago
14

Which one of the following actions by a financial manager is most apt to create an agency problem? Refusing to lower selling pri

ces if doing so will reduce the net profits. Refusing to expand the company if doing so will lower the value of the equity. Refusing to borrow money when doing so will create losses for the firm. Increasing current profits when doing so lowers the value of the firm's equity. Agreeing to pay bonuses based on the market value of the company stock rather than on the firm's level of sales.
Business
1 answer:
Nuetrik [128]3 years ago
5 0

Answer:

Increasing current profits when doing so lowers the value of the firm's equity.

Explanation:

Agency problem is the likelihood that managers may place personal goals ahead of corporate goals. A characteristic feature of corporate enterprises is the separation between ownership and management. Thus, with the objective of survival, management would aim at satisfying instead of maximizing shareholder´s wealth.

Three generic agency problems arise in business firms:

-The conflict between the firm´s owners and its hired managers.

-The conflict between controlling and minority shareholders.

-The conflict between shareholders and non shareholders constituencies.

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A number of activities that are a part of a company's quality control system are listed below.
Karolina [17]

Answer:

Following is the classification of  the costs associated with each of these activities that is prevention cost, appraisal cost, internal failure cost, or external failure cost.

(a) Product testing  - Appraisal Cost

(b) Product recall  - External Failures

(c) Product design  - Prevention cost

(d) Quality circle  - Prevention cost

(e) Inspection of goods - Appraisal Cost

Explantion cost:

Appraisal costs are costs incurred to detect defects in the poduct produce. Prevention cost are cost incurred to prevent detects in the product produce.

Internal failure costs are costs incurred to remove defects found before the customer receives the product or service. External failure costs are costs incurred to remove defects found after the customer receives the product or service.

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3 years ago
Driving skills are a basic qualification of
Semmy [17]

Answer: The answer is B mail carriers

Explanation:

5 0
3 years ago
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The range of S is 74 while that of P is 37 across the two states. What is the hedge ratio of the put
lorasvet [3.4K]

This question is incomplete, the complete question is;

We will derive a two-state put option value in this problem.

Data: S₀ = 106; X = 112; 1 + r = 1.12. The two possibilities for ST are 149 and 75.

The range of S is 74 while that of P is 37 across the two states. What is the hedge ratio of the put

Answer: the hedge ratio of the put H = - 1/2 ≈ - 0.5

Explanation:

Given that;

S₀ = 106, X = 112, 1 + r = 1.12

Us₀ = 149 ⇒ Pu = 0

ds₀ = 75 ⇒ Pd = 37

To find the Hedge ratio using the expression

H = Pu - Pd /Us₀ - ds₀

so we substitute

H = 0 - 37 / 149 - 75

H = - 37/ 74

H = - 1/2 ≈ - 0.5

3 0
3 years ago
What type of audit occurs at your home or business
Vikentia [17]

The type of audit that occurs at your home or in the business is called the field. It is because the field is the place like home or business in which the IRS goes to in means of conducting the investigation in regards with them and their tax payer.

8 0
3 years ago
Lighting design personnel must: A. Understand environmental, cost, and associated benefits of energy-efficient lighting B. Recog
Setler79 [48]

Answer: All of the above

Explanation:

The Lighting Design Personnel is in charge of the designing, the installation, and the operation of lighting and every other special electrical effects.

Such person must understand environmental, cost, and associated benefits of energy-efficient lighting. Also, he or she must be bake to recognize when specialized knowledge is necessary and also estimate energy cost savings

Therefore, the correct option is all of the above.

6 0
3 years ago
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