Answer to Question #191258 in Finance for Animesh Gautam

Question #191258

explain in two ways how a company can limit the agency cost through the payment of dividends.


1
Expert's answer
2021-05-10T16:01:55-0400

The agency issue occurs when a company's executives behave in their own best interests rather than concentrating on the company's goals. There is a connection between dividend policies and organizational agency issues.


The agency problem occurs when a company's management behave in their own best interests rather than concentrating on the company's goals. There is a connection between dividend policies and organizational agency issues.


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