The primary operating goal of a publicly-owned firm trying to best serve its stockholders should be to O a. Minimize the firm's risks because most stockholders dislike risk. In turn, this will maximize the firm's stock price. O b. Maximize managers' own interests, which are by definition consistent with maximizing shareholders' wealth. O c. Since it is impossible to measure a stock's intrinsic value, the text states that it is better for managers to attempt to maximize the current stock price than its intrinsic value. O d. Use a well-structured managerial compensation package to reduce conflicts that may exist between stockholders and managers. O e. Maximize the firm's expected EPS, which must also maximize the firm's price per share.

The primary operating goal of a publicly-owned firm trying to best serve its stockholders should be to O a. Minimize the firm's risks because most stockholders dislike risk. In turn, this will maximize the firm's stock price. O b. Maximize managers' own interests, which are by definition consistent with maximizing shareholders' wealth. O c. Since it is impossible to measure a stock's intrinsic value, the text states that it is better for managers to attempt to maximize the current stock price than its intrinsic value. O d. Use a well-structured managerial compensation package to reduce conflicts that may exist between stockholders and managers. O e. Maximize the firm's expected EPS, which must also maximize the firm's price per share.

Fundamentals of Financial Management (MindTap Course List)

14th Edition

ISBN:9781285867977

Author:Eugene F. Brigham, Joel F. Houston

Publisher:Eugene F. Brigham, Joel F. Houston

Chapter8: Risk And Rates Of Return

Section: Chapter Questions

Problem 8TCL

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