A Principal-Agent Problem Arises When

Multiple Choice

A principal-agent problem arises when

A) only less-qualified workers apply for a job
B) a firm must find a proxy for unobservable qualities needed in employees
C) potential employees have more information about their own productivity than do prospective employers
D) a customer knows little about the service provided by a business
E) a customer knows little about the service provided by a business and is, therefore, given poor service