The separation of ownership and control is often asubject of concern for financi

The separation of ownership and control is often asubject of concern for financial managers. Management decisions aresometimes not acceptable to shareholders. This in turn raisesconflicts. These conflicts are called agencyproblems.For example a chief executive officer (CEO) mayspend a considerable amount of the organizations capital onartwork to decorate the office premises. The shareholders may raisethe concern that their investment has been inappropriately investedas decorating the office premises will not yield any financialbenefits.Provide at least two more examples of agencyproblems. Why does such a conflict develop? Are such conflicts morelikely to occur in smaller or larger organizations? Why? What canbe done to decrease the likelihood of theseconflicts?