"In Agency theory, the following are true except:"

		The agent has a legal and fiduciary duty to act in the best intrests of the principal.
		The agent always acts in the interest of the principal.
		Both parties are utility maximisers.
		The principal delegates decision-making authority to an agent.

The horizon problem in owner-manager agency relationships can be reduced by:

		linking management s bonus to profits.
		having financial statements audited.
		paying a bonus linked to the dividend pay-out ratio.
		paying a portion of managerial remuneration as shares.