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

question 17

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:

Balance Sheet Approach

A method focusing on a company's balance sheet to assess its financial condition by analyzing assets, liabilities, and equity at a specific point in time.

Allowance Account

A contra-asset account used to estimate future uncollectible debts from customers, reducing the total amount of outstanding receivables.

Gross Accounts Receivable

The total amount of money owed to a company by its customers before deducting any allowance for doubtful accounts.

Date Violence

Refers to physical, sexual, psychological, or emotional violence within a dating relationship, including stalking.