Which one of the following is an agency cost? » MCQ Academy English

Corporate Finance

Which one of the following is an agency cost?

accepting an investment opportunity that will add value to the firm
increasing the quarterly dividend
hiring outside accountants to audit the company's financial statements
closing a division of the firm that is operating at a loss

Note

The hiring outside accountants to audit the company's financial statements is an agency cost.

Tags: Introduction to Corporate Finance

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