A fiNancial Manager of a Corporation Is Considering Different Operating

question 165

Multiple Choice

A financial manager of a corporation is considering different operating strategies for the coming year. From a financial management standpoint, which of the following would be her optimal
Strategy?

• A) Undertake the plan that would reduce the overall riskiness of the firm.
• B) Undertake the plan that would maximize the current stock price.
• C) Undertake the plan that would result in the largest profits for the year.
• D) Undertake the plan that would maximize her personal wealth.
• E) Undertake the plan that would lead to the most stable stock price for the year.

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Definitions:

Zinc

A metallic element used primarily for galvanizing steel and iron products to prevent rust; also important in biology and nutrition.

Production Function

An analytical expression that shows how the amounts of different inputs determine the maximum quantity of output that can be produced.

Labor

The human effort, including both physical and mental exertion, used in the production of goods and services.

Machines

Mechanical or electronic devices that perform tasks or assist in carrying out tasks, ranging from simple tools to complex systems.