Traders working for banks are subject to the ________.

Question

BlackTom AI · Accepted Answer

The question asks about a specific risk or issue that arises with workers (traders) who operate on behalf of banks. 
Option 1: 'free-rider problem' typically refers to a situation in public goods where individuals benefit from a resource without contributing to its provision. This doesn’t capture the dynamic between bank owners and their traders. 
Option 2: 'double-jeopardy problem' is not a standard or recognized term in economics or corporate governance related to banking/trading relationships. It misframes the issue. 
Option 3: 'exchange-risk problem' would imply risk arising from differences in exchange rates or currency-related issues, which is not the core governance/incentive concern described when traders work for banks. 
Option 4: 'principal-agent problem' correctly identifies the core dynamic: the principal (bank shareholders or owners) hires an agent (traders/managers) to act on their behalf, but the agent may pursue incentives that diverge from the principal’s interests due to information asymmetry, risk tolerance, compensation structures, and moral hazard. This misalignment can lead to excessive risk-taking or other behavior not aligned with the principals’ goals. 
In summary, only the principal-agent framework appropriately describes the relationship and potential conflicts between banks (principals) and their traders (agents). The other options describe phenomena that do not fit this particular employer–employee/governance context.

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Traders working for banks are subject to the ________.

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ECON 206-PTS2-Online Final- Requires Respondus LockDown Browser

Traders working for banks are subject to the ________.

查看解析

登录即可查看完整答案

类似问题

Part 1Asymmetric information in equity contracts is known as the​ ______________ problem because the manager of the firm has fewer incentives to maximize profits than the stockholders might ideally prefer. Part 2 A. debt deflation B. ​principal-agent C. ​free-rider D. adverse selection

If an owner of a store puts a bell on a cash register so that he/she can be informed as to when a sale has been made thereby reducing the chance of the cashier stealing is an example of:

In a consumer society, many adults channel creativity into buying things

Economic stress and unpredictable times have resulted in a booming industry for self-help products

People born without creativity never can develop it

A product has a selling price of $20, a contribution margin ratio of 40% and fixed cost of $120,000. To make a profit of $30,000. The number of units that must be sold is: Type the number without $ and a comma. Eg: 20000

Which of the following statement regarding cost is correct:

Under the assumptions used in cost-volume-profit analysis, as the activity increases:

更多留学生实用工具

希望你的学习变得更简单

Part 1Asymmetric information in equity contracts is known as the ______________ problem because the manager of the firm has fewer incentives to maximize profits than the stockholders might ideally prefer. Part 2 A. debt deflation B. principal-agent C. free-rider D. adverse selection