The Primary Operating Goal of a Publicly-Owned Firm Interested in Serving

question 16

Multiple Choice

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

• A) Maximize the stock price per share over the long run, which is the stock's intrinsic value.
• B) Maximize the firm's expected EPS.
• C) Minimize the chances of losses.
• D) Maximize the firm's expected total income.
• E) Maximize the stock price on a specific target date.

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Definitions:

Apparent Authority

A principle in law where a person appears to have authority to act on behalf of another party, such as a company, due to their conduct or statements.

Disclosed Principal

A principal whose identity is known by the third party at the time of entering into a contract with an agent.

Terminates

The act of bringing something to an end or conclusion, often referring to the cessation of agreements, employment, or processes.

Express Authority

Authority granted to an agent in clear, definite terms, verbally or in writing, by the principal in an agency relationship.