Question
a)In 2017, after developing a commercially viable product, pedal sales were $400,000 and revenues are expected to reach $5 million by 2020. In 2018, Tom
a)In 2017, after developing a commercially viable product, pedal sales were $400,000 and revenues are expected to reach $5 million by 2020. In 2018, Tom hires John to be the President and CEO of Pedal Pushers. Prior to that time, John worked in sales and marketing in the toy industry for more than 15 years.
(i)What type of agency problems or conflicts should Tom, as the founder of Pedal Pushers, have anticipated?
(ii)What, if anything should the founding entrepreneur have done in anticipation of agency problems or conflicts?
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Modern Portfolio Theory and Investment Analysis
Authors: Edwin Elton, Martin Gruber, Stephen Brown, William Goetzmann
9th edition
9781118805800, 1118469941, 1118805801, 978-1118469941
