You are the CEO of a company and you are considering entering into an agreement to have your company buy another company. You think the price might be too$$ high, but you will be the CEO of the$$ combined, much larger company. You know that when the company gets$$ bigger, your pay and prestige will increase. What is the nature of the agency conflict here and how is it related to ethical$$ considerations?

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Part $1$

$($Select all the choices that$$ apply.$)$

A$.$

There is an ethical dilemma when the CEO of a firm has incentives that are opposite to those of the shareholders.

B$.$

There is a legal issue when the CEO of a firm has incentives that are opposite to those of the shareholders.

C$.$

In this$$ case, you$($as the$$ CEO$)$ have an incentive to potentially overpay for another company$($which would be damaging to your$$ shareholders$)$ because the value of the combined company will improve.

D$.$

In this$$ case, you$($as the$$ CEO$)$ have an incentive to potentially overpay for another company$($which would be damaging to your$$ shareholders$)$ because your pay and prestige will improve.