BUSINESS ADMINISTRATION
FINANCIAL MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Stockholder wealth maximization, Maximize sale
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Social responsibility, Avoid financial distress
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Social responsibility, Stockholder wealth maximization
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Stockholder wealth maximization, Minimize cost
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Detailed explanation-1: -The shareholder wealth maximization goal states that management should seek to maximize the present value of the expected future returns to the owners (that is, shareholders) of the firm. These returns can take the form of periodic dividend payments or proceeds from the sale of the common stock.
Detailed explanation-2: -Shareholder wealth maximization means that a company’s primary goal is raising its stock price. Shareholder wealth maximization can be a good thing because it gives a firm’s managers a clear objective that builds value.
Detailed explanation-3: -Wealth maximization’s ultimate goal is to keep the stockholders invested in a business by increasing overall value.
Detailed explanation-4: -The firm is thought to have profit maximization as its primary goal. The firm’s owner manager is assumed to be working to maximize the firm’s short-run profits. Profits are the primary measure of the success of any business.
Detailed explanation-5: -Abstract. Organizations should be more concerned with corporate social responsibility rather than focusing on wealth maximization only. The objectives of an organization are the leading justifications for its existence. Commercial objectives exist to make the maximum possible profits for the shareholders.