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Basic Question 1 of 9

In the principal-agent framework, the ultimate principals are ______.

A. managers
B. the board of directors
C. shareholders
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User Contributed Comments 1

User Comment
Antoinepo Shareholders are the principal of the board of directors which are the principal of managers which are the principal of typical agent.
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I passed! I did not get a chance to tell you before the exam - but your site was excellent. I will definitely take it next year for Level II.
Tamara Schultz

Tamara Schultz

Learning Outcome Statements

describe the principal-agent relationship and conflicts that may arise between stakeholder groups

CFA® 2026 Level I Curriculum, Volume 2, Module 3.