Managerial Economics 13th Edition by James McGuigan,Charles Moyer,Frederick Harris

Exercise 12

Explain several dimensions of the shareholder-principal conflict with manageragents known as the principal-agent problem. To mitigate agency problems between senior executives and shareholders, should the compensation committee of the board devote more to executive salary and bonus (cash compensation) or more to long-term incentives Why What role does each type of pay play in motivating managers