The primary goal of a financial manager should be to __________. a. minimize operating costs b....

The primary goal of a financial manager should be to __________.

a.	minimize operating costs
b.	minimize interest payments
c.	minimize tax payments
d.	maximize operating income each year
e.	maximize the value of the firm's stock

Solutions

Expert Solution

Answer: Option [e] maximize the value of the firm's stock

Explanation:

Maximizing shareholders' wealth is the most appropriate goal of a financial manger.

As shareholders' wealth is the market value of equity, it follows that maximizing share prices would maximize shareholders' wealth.

All the other options together constitute measures to increase shareholders' wealth and the price of the shares.

jeff jeffy answered 1 year ago

Next > < Previous

Related Solutions

1. The overall goal of the financial manager is to: a. minimize total costs. b. maximize...

1. The overall goal of the financial manager is to: a. minimize total costs. b. maximize net income. c. maximize earnings per share. d. maximize shareholder wealth. 2. Sustainable Growth Rate You have located the following information on Rock Company: debt ratio = 49.5%, capital intensity ratio = 2.63 times, profit margin = 27%, and dividend payout ratio = 44%. What is the sustainable growth rate for Rock? (Do not round intermediate steps.) 1. 3.92% 2. 12.85% 3. 15.12% 4....

The primary goal of the financial manager of a firm is to: A) maximize operating income...

The primary goal of the financial manager of a firm is to: A) maximize operating income B) Generate growing sales C) Maximize the book value of the company D) maximize the market value of the shareholders' investment in the company E) Increase profit margins

The primary goal of a financial manager of a corporation is:

The primary goal of a financial manager of a corporation is: maximizing shareholder value growing earnings increasing market share increasing dividends

The primary goal of a publicly-owned firm interested in serving its stockholders should be to Minimize...

The primary goal of a publicly-owned firm interested in serving its stockholders should be to Minimize the debt used by a firm. Maximize expected EPS. Minimize the chances of losses. Maximize the stock price per share. Maximize expected net income.

Which of the following should be the goal of the financial manager?

Which of the following should be the goal of the financial manager? to maximize market share to maximize current stock value to maximize profit to maximize earnings

What should be the goal of the financial manager of a corporation?

7. What should be the goal of the financial manager of a corporation? Does it mean that financial managers have to do anything and everything to achieve that goal? Explain your answer. 8. Briefly explain the assumptions associated with the constant dividend growth formula. What are the components of the required rate of return on a share of stock? Briefly explain each

You are a financial manager that always follows the primary goal of management.

You are a financial manager that always follows the primary goal of management. Which of the following is the optimal Dividend Policy for your firm?Capital Budget=$5.3 Million, EPS = $3.24, Debt ratio = 40%, Dividends = $1.00, Firm Value=$45 MillionCapital Budget=$17 Million, EPS = $3.39, Debt ratio = 60%, Dividends = $0.00, Firm Value=$38 MillionCapital Budget=$2.9 Million, EPS = $2.95, Debt ratio = 30%, Dividends = $2.00, Firm Value=$43 MillionCapital Budget=$8.5 Million, EPS = $3.54, Debt ratio = 50%, Dividends...

Which of the following is not an appropriate primary goal for a corporation's financial manager?

Which of the following is not an appropriate primary goal for a corporation's financial manager?A. 0 Maximize shareholder wealthB. 0 Maximize stock priceC. 0 Maximize the number of shares of stockD. 0 Maximize the value of an all-equity firm

Early in the class, we identified the primary goal of a financial manager as maximizing shareholder...

Early in the class, we identified the primary goal of a financial manager as maximizing shareholder wealth. Having now completed the class, explain whether or not you feel this is the appropriate goal for a company. Provide a minimum of 2 reasons to support your answer.

1. In serving its stockholders, the primary operating goal of a publicly-owned firm should be to:...

1. In serving its stockholders, the primary operating goal of a publicly-owned firm should be to: Select one: a. Maximize its expected total corporate income. b. Maximize its expected EPS. c. Minimize the chances of losses. d. Maximize the stock price per share over the long run, which is the stock's intrinsic value. e. Maximize the stock price on a specific target date. 2. Which of the following has the highest Present Value? Select one: a. $800/yr. for 9 years...

Subjects