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Principal-agent problem: Quiz


Question 1: The problem also occurs in the relationship between lenders and borrowers, and in the complex system of derivatives, ________, and other varieties of financial speculation.
Credit default swapFutures contractDerivative (finance)Swap (finance)

Question 2: Ongoing periodic catastrophic organizational failure is directly incentivized by tournament and other ________/Winner take all compensation systems.
Warhol SuperstarChelsea GirlsSuperstarAndy Warhol

Question 3: The principal–agent problem in energy efficiency is the topic of an ________ report: [1] "Mind the Gap—Quantifying Principal–Agent Problems in Energy Efficiency" (2007).
International Energy AgencyDenmarkBelgiumItaly

Question 4: In terms of ________, it involves changing the rules of the game so that the self-interested rational choices of the agent coincide with what the principal desires.
Prisoner's dilemmaNash equilibriumEvolutionarily stable strategyGame theory

Question 5: See the ________ article for more information on the tournament theory.
Chelsea GirlsAndy WarholSuperstarWarhol Superstar

Question 6: Nikkinen and Sahlström (2004) find empirical evidence that agency theory can be used, at least to some extent, to explain ________ fees internationally.
AccountantCertified Public AccountantFinancial accountancyFinancial audit

Question 7: [citation needed] Similar issues occur when a publicly held asset or non-profit organization undergoes ________.
PrivatizationDeregulationCapitalismPrivate finance initiative

Question 8: (One can interpret this as a destruction of organizational ________ – workers identifying with, and actively working for the benefit of, the firm – in favour of the creation of personal social capital – the individual-level social relations which enable workers to get ahead (“networking”).)
SociologyPierre BourdieuSocial networkSocial capital

Question 9: When the company gets bought out (or taken private)—at a dramatically lower price—the ________ artist gains a windfall from the former top executive's actions to surreptitiously reduce share price.
Leveraged buyoutTakeoverCorporate financeStock

Question 10: One example, may be in the area of takeovers and top executive compensation:[citation needed] It is fairly easy for a top executive to reduce the price of his/her company's stock—due to ________.
Information economicsContract theoryInformation asymmetryEconomics


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