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3 Cards in this Set
- Front
- Back
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above-average returns
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are returns in excess of what an investor expects to earn from other investments with a similar amount of risk.
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agency costs
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the sum of incentive costs, monitoring costs, enforcement costs, and individual financial losses incurred by principals, because governance mechanisms cannot guarantee total compliance by the agent
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agency relationship
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exists when one or more persons (the principal or principals) hire another person or persons (the agent or agents) as decision-making specialists to perform a service.
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