What are three major ways that corporations can cope with the ...

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What are three major ways that corporations can cope with the principal-agent problem?
 
  What will be an ideal response?

Question 2

In Zealand, banks' desired reserve ratio is 20 percent and there is no currency drain. The money multiplier equals ________.
 
  A) 0.50
  B) 0.20
  C) 20.0
  D) 5.0

[fromAlphatoOmega22]

Answer to Question 1

First, employees can be made part-owners of the corporation. Second, employees can be given incentive pay linked to achieving targets that serve the interests of the owners. Third, managers can be given long-term contracts that encourage them to pursue long-term strategies that can yield higher profit over time.

Answer to Question 2

D

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Gracias!

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