MANAGEMENT

Detailed explanation-1: -false, When management and ownership are separated, there is the potential for management to act in its own best interests. ‘ Maximizing the price of a share of the firm’s common stock is the equivalent of maximizing the wealth of the firm’s present owners.

Detailed explanation-2: -Which of the following is not a true statement about the goal of maximizing shareholder wealth? It is a short-run point of view.

Detailed explanation-3: -Shareholder wealth maximization is concerned with the maximization of a firm’s stock price.

Detailed explanation-4: -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-5: -Why is shareholders’ wealth maximization important? Shareholders’ wealth maximization is the only way to measure the value of a company. This is because shareholder value represents a company’s ability to make money for its shareholders in the future.