Which of the Following Should Be the Primary Goal Pursued

question 27

Multiple Choice

Which of the following should be the primary goal pursued by the financial manager of a firm?

• A)Maximize net income (profits).
• B)Maximize the firm's net worth, or book value.
• C)Maximize dividends paid to common stockholders.
• D)Minimize variable operating expenses.
• E)Maximize the market value of the firm's stock.

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Definitions:

Capitalist Economic System

An economic system where the means of production and distribution are privately or corporately owned and the operation is fueled by profit motive.

Structural Explanation

An approach in social science that explains phenomena in terms of the underlying social structures, such as economic, political, or legal systems.

Boom And Bust

An economic cycle characterized by periods of rapid expansion and prosperity followed by sudden decline and recession.

Shortage Of Workers

A situation where the demand for labor exceeds the supply of available workers in certain industries or geographic areas.