Question
Larry is the owner-manager of a retail store which went public on January 1, 2020. After the IPO, Larry the fun-loving manager owns 40% of
Larry is the owner-manager of a retail store which went public on January 1, 2020. After the IPO, Larry the fun-loving manager owns 40% of the understanding common shares and has retained the position of CEO.
1. Is Larry likely to engage in shirking now that the company is public? Support you position.
2. How would the share price be impacted by Larry remaining as the CEO?
3. What could Larry due to convince the other shareholders that he will not shirk.
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Auditing Principles And Practice
Authors: Kumar And Sharma
3rd Edition
8120350987, 9788120350984
