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The principal-agent problem in administration refers to:
Aundertraining
Bshortage of administrators
Cunconstitutional acts
Ddivergent interests of principals and agents
Answer & Solution
Correct answer: D. divergent interests of principals and agents
1. Principal (elected officials, citizens) hires agent (bureaucracy).
2. Agent may pursue own goals due to information asymmetry.
3. Solutions: monitoring, incentives, transparency.
__Source: NCERT Class 11 Political Theory — administrative theory__