Share Price Maximization Is Good for Society Because Consumers Benefit

question 28

Multiple Choice

Share price maximization is good for society because consumers benefit.Which of the following best describes this idea?

• A)Firms that maximize share price minimize costs and produce low-quality goods, which only benefits producers.
• B)Firms that maximize share price minimize costs and produce high quality goods that consumers demand.
• C)Firms that maximize share price maximize costs and produce low-quality goods, which benefits society.
• D)Most Canadian households do not own or participate, directly or indirectly, in the stock market and as such they do not benefit from the production of quality goods produced at low cost.

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Definitions:

Discontinuous Innovation

A breakthrough product or service that creates a completely new market or drastically changes both the existing market and consumer habits.

Market Modification

The process of changing a market’s dynamics, including product offerings, pricing strategies, and customer engagement to achieve better performance or competitive advantage.

Product Repositioning

The strategic process of changing a product's place in the market by altering its image, target audience, or distinct features.

Trialability

A characteristic of a product or service that allows potential consumers to experiment with it on a limited basis before making a purchase decision.