Agency Cost
Subject: Finance | Topics:

Agency Cost is a type of internal cost that comes from, or must be paid to, an agent acting with respect to a principal. Agency cost arise on account of core problems including conflicts of attention between shareholders and also management. Shareholders wish for management to run the company in a way that increases shareholder worth. But management wish to grow the company in manners that maximize their particular personal power and also wealth that may not be in the desires of shareholders.

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