Which one of the following is the best example of an agency problem? Assume the company is paying the employees' travel expenses.

Question $16$Answer

a$.$

Luisa, the marketing director, travels to California to attend a sales convention. While there she visits Disneyland.

b$.$

Ann, the controller, travels to Orlando, Florida to visit Disney World with friends. While there, she talks with her friends about employment opportunities at the firm.

c$.$

Mike, the president, travels to China to attend an international convention related to the company's line of business. While there, he tours the Great Wall of China.

d$.$

Juan, the chief financial officer, travels to France to meet with the bank that is loaning the firm money to build a factory in France. While in France, he tours Paris.