In general, there are four categories of real or opportunity costs incurred by shareholders designed to prevent, mitigate, or correct managementstareholder agency connicts. They are: 1. Expenditures to minimize management's desire to act contrary to the best interests of sharehalders 2. Expenditures to monitor management's activities 3. Expenditures to provide a bond against management dishonesty 4. The opportunity cost of lost profits Consider the following situation and identify both the category of the expenditure and the best device that might be used to prevent, reduce, or correct the agency confict: A firm's vice president uses the company's private jet to take unauthorized personal trips on the weekends Expenature category: Most appropriate form of control device: Identify a competitor to take over the company. Conduct internal audits of the aireraft log books to determine who is using the plane, when, and for what purpose. Purchase an insurance policy that protects Against unauthorized use of the company's assets