(Solved): Does an agency conflict exist between CSI's CFO and the company's shareholders? Yes; the shares shou ...

Does an agency conflict exist between CSI's CFO and the company's shareholders? Yes; the shares should not have been sold at a

discount, which is price discrimination. No; professionals, such as doctors and professional money managers, would not participate in unethical activities. No; in general, shareholders are satisfied with company officers engaging in any type of legal or illegal activity to ensure the chances of them receiving greater dividend payments. Yes; CSI's CFO engaged in unethical conduct to manipulate the firm's short-term earnings and improve the likelihood of receiving his annual bonus. For the past 40 years, companies have attempted to attract, retain, and encourage managers by developing attractive compensation packages. These compensation packages have also been intended to reduce potential agency conflicts between these managers and the firm's shareholders. In the best interest of shareholders, compensation packages should be structured in a way such that managers have an incentive to maximize the

_ value of the company's common stock price. Amalgamated Metals Corporation's stockholders are mostly individual investors, and there is relatively little institutional ownership. If several pension and mutual funds were to take large positions in Amalgamated Metals Corporation's stock, direct shareholder intervention would be .

likely to motivate the firm's management.