Remember, an agency relationship can degenerate into an agency confict when an agent acts in a manner that is not in the best interest of his or ber prindpal. In large corporations, these conflicts most frequently involve the enrichment of the firm's executives or managers fin the form of money and perquisites or power and prestige) at the expense of the compary's shareholders. This usurping and reallocation of shareholder wealth is most 'kely to occur when shareholders do not have sufficient information about the decisions and actions being made by the firm's management. Consider the following scenario and determine whether an agency conflict exists: Michsel owns Michaei's Tontalizing Tees, a T-shirt shop in a small college town in New Hampshire: With a staff of three part-time employees; Michael operates the buIiness in accordance with his personal goats; dreams; and capabitities. Does Micheel have an agency conflict to deal with? Noj as both the owner and Geerator of Michaein Tanaizing Tees, Micheni has not creacd the necessary agency relatianahip through which an agency conflict can exist. Nof by faving part-time, as oppoted to full-time, employees, Michaet is prevented from experiencing an agency connikt. Ves; there is always an inherent conflict of interest between owners and operators (managers). Yeb; as both the owner and operator of Michael' Tantelining Tees, Michaet has created the necessary agency relationthip through which in agency connict can esist